EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of
March 1, 1996, between and among SCOTT F. LOCHRIDGE, a resident of the State
of Tennessee ("Employee"), and AMERIDYNE CORPORATION, a Tennessee corporation
("Company").
W I T N E S S E T H:
WHEREAS, execution of this Agreement is a condition of closing under that
certain Agreement and Plan of Merger dated as of March 1, 1996 (the "Merger
Agreement"), whereby Contour Merger Sub, Inc., a wholly-owned subsidiary of
Contour Medical, Inc. ("Contour"), will be merged with and into the Company
(the "Merger");
WHEREAS, Contour intends to continue to carry on the business of the
Company and its subsidiaries after the Merger;
WHEREAS, the covenants and agreements of Employee herein are made as an
inducement to the Merger; and
WHEREAS, the Company and Employee each desire to enter into this
Agreement, pursuant to which the Company will employ the Employee on the terms
and conditions hereinafter set forth, and to make certain other agreements;
NOW, THEREFORE, in consideration of the premises and of the promises and
agreements hereinafter set forth, the parties hereto, intending to be legally
bound, do hereby agree as follows:
SECTION 1.EMPLOYMENT.
1.1 GENERAL EMPLOYMENT. Subject to the terms hereof, the Company hereby
employs Employee, and Employee hereby accepts such employment. Employee will
devote his full business time and best efforts to rendering services on behalf
of the Company.
SECTION 2.POSITION. Employee will serve as an officer of the Company.
SECTION 3.TERM.
3.1 INITIAL TERM. The employment of Employee hereunder will commence on
the date hereof (the "Effective Date") and will continue until the earlier of:
(a) the second anniversary of the Effective Date (the "Anniversary
Date"); or
(b) the occurrence of any of the following events:
(i) the death or total disability of Employee (total disability
meaning the failure of Employee to perform his normal required services
hereunder at his office for a period of three (3) consecutive months, by
reason of Employee's mental or physical disability as so determined by a
licensed physician selected by the Company reasonably satisfactory to
Employee);
(ii) the mutual written agreement of the parties hereto to
terminate Employee's employment hereunder;
(iii) the Company's termination of Employee's employment
hereunder, upon thirty (30) days' prior written notice to Employee, for "good
cause"; or
(iv) the Employee's termination of employment hereunder upon
sixty (60) days' prior written notice.
(c) For the purposes of this Section, "good cause" for termination
of Employee's employment will exist:
(i) if Employee is convicted of (from which no appeal may be
taken), or pleads guilty to, any act of fraud, misappropriation or
embezzlement, or any felony;
(ii) if, in the sole determination of the Board of Directors of
the Company ("Board"), Employee has engaged in conduct or activities
materially damaging to the business of the Company (it being understood,
however, that neither conduct nor activities pursuant to Employee's exercise
of his good faith business judgment nor unintentional physical damage to any
property of the Company by Employee will be a ground for such a determination
by the Board); or
(iii) if Employee has failed without reasonable cause to devote
his full business time and best efforts to the business of the Company and,
after notice from the Company of such failure, Employee at any time thereafter
again so fails.
SECTION 4.COMPENSATION AND BENEFITS.
4.1 SALARY. For his employment hereunder, the Company will pay Employee
a salary at the annual rate of (i) One Hundred Fifty Thousand Dollars
($150,000) during the first twelve (12) months of the term hereof and (ii) One
Hundred Sixty-Five Thousand Dollars ($165,000) during second twelve (12)
months of the term hereof, payable bi-weekly in accordance with the payroll
payment practices from time to time adopted by the Company.
4.2 PARTICIPATION IN BONUS PLAN. During the term of this Agreement,
Employee shall be eligible to participate in an annual performance-based bonus
plan to be agreed upon between the Company and the Employee each year of the
term hereof, but whose criteria is generally based upon the achievement of
certain operating profit, net revenue and receivables management goals, among
others, that may be mutually determined by the Company and the Employee, with
such plan providing the opportunity for the Employee to earn up to thirty
percent (30%) of his annual salary as additional compensation.
4.3 PARTICIPATION IN STOCK OPTION PLAN. During the term of this
Agreement, the Employee shall be eligible to participate in the 1996
Non-Qualified Stock Option Plan of Contour on the terms and subject to the
conditions under which participation in such plan is made available to
eligible employees of Contour and its subsidiaries.
4.4 INSURANCE.
(a) LIFE AND OTHER INSURANCE. The Company will, at its expense,
provide or arrange for and keep in effect, during the term of Employee's
employment hereunder, so long as he is insurable, (i) a term life insurance
policy in the amount of $500,000, the beneficiary of which shall be named by
Employee, and (ii) such group term life insurance, accidental death and
dismemberment insurance and long term disability insurance, or their
equivalents, as is provided from time to time for executives of the Company
holding positions and responsibilities comparable to those of Employee.
(b) MEDICAL INSURANCE. During the term of Employee's employment
hereunder, the Company will, at its expense, provide or arrange for and keep
in effect, hospitalization, major medical and similar medical and health
insurance for Employee and his family, to the same extent as is provided from
time to time for executives of the Company holding positions and
responsibilities comparable to those of Employee.
4.5 VACATION. Employee will be entitled to the same number of days of
paid vacation during each year of his employment hereunder as is allowed to
other executives of the Company holding positions and responsibilities
comparable to those of Employee.
4.6 CAR ALLOWANCE. During the term of the Employee's employment
hereunder, the Company will pay Employee a monthly car allowance of $500 to be
applied to those expenses related to the Employee's primary automobile during
business hours.
4.7 OUT-OF-POCKET EXPENSES. The Company will reimburse Employee for all
reasonable out-of-pocket expenses incurred by Employee in connection with the
performance of his duties hereunder upon presentation of appropriate vouchers
therefor.
SECTION 5.MISCELLANEOUS.
5.1 BINDING EFFECT. This Agreement will inure to the benefit of and
will be binding upon Employee, his executor, administrator, heirs, personal
representatives and assigns, and upon the Company and its successors and
assigns; provided, however, that the obligations and duties of Employee may
not be assigned or delegated.
5.2 GOVERNING LAW. This Agreement will be deemed to be made in, and in
all respects will be interpreted, construed and governed by and in accordance
with, the laws of the State of Tennessee without giving effect to principles
of conflicts of laws.
5.3 INVALID PROVISIONS. The parties herein hereby agree that the
agreements, provisions and covenants contained in this Agreement are severable
and divisible, that none of such agreements, provisions or covenants depends
upon any other provision, agreement or covenant for its enforceability, and
that each such agreement, provision and covenant constitutes an enforceable
obligation between the Company and Employee. Consequently, the parties hereto
agree that neither the invalidity nor the unenforceability of any agreement,
provision or covenant of this Agreement will affect the other agreements,
provisions or covenants hereof, and this Agreement will remain in full force
and effect and be construed in all respects as if such invalid or
unenforceable agreement, provision or covenant were omitted.
5.4 HEADINGS. The section and paragraph headings contained in this
Agreement are for reference purposes only and will not affect in any way the
meaning or interpretation of this Agreement.
5.5 NOTICES. All communications provided for hereunder will be in
writing and will be deemed to be given when delivered in person or deposited
in the United States mail, first class, registered mail, return receipt
requested, with proper postage prepaid, and
If to Employee, addressed to:
Scott F. Lochridge
39 Garden Drive
Jackson, Tennessee 38305
If to the Company, addressed to:
AmeriDyne Corporation
6000 Lake Forrest Drive
Suite 200
Atlanta, Georgia 30328
Attn: Chairman of the Board
or at such other place or places or to such other person or persons as will be
designated in writing by the parties hereto in the manner provided above for
notices.
5.6 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original but all of which
together will constitute one and the same instrument.
5.7 WAIVER OF BREACH. The waiver by the Company of a breach of any
provision, agreement or covenant of this Agreement by Employee will not
operate or be construed as a waiver of any prior or subsequent breach of the
same or any other provision, agreement or covenant by Employee.
5.8 ENTIRE AGREEMENT. This Agreement is intended by the parties hereto
to be the final expression of their agreement with respect to the subject
matter hereof and is the complete and exclusive statement thereof
notwithstanding any representation or statements to the contrary heretofore
made. This Agreement may be modified only by written instrument signed by
each of the parties hereto.
5.9 RIGHT TO SET OFF. The Company will have the right to set off
against or to deduct from any payments to be made to Employee hereunder any
amounts claimed by the Company to be owed to it by Employee, or to withhold
the making of any such payment based upon any such claimed indebtedness,
whether such claim or indebtedness arises hereunder or otherwise; provided,
however, that this Section 5.9 does not constitute a waiver or limitation of
any right of garnishment or any other legal remedy (other than a right of set
off or self help) available to the Company against Employee pursuant to court
order.
IN WITNESS WHEREOF, Employee has set his hand and seal, and the Company
has caused this Agreement to be duly executed by its duly authorized officers,
and the parties have caused this Agreement to be delivered, all on the day and
year first written above.
________________________(SEAL)
SCOTT F. LOCHRIDGE
AMERIDYNE CORPORATION
By:______________________________
Its:___________________________