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EXHIBIT 10.13
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made as of this 22nd day of
January, 1997, by and between Plasma-Therm, Inc., a Florida corporation
(hereinafter referred to as the "Company"), and Ronald Scott Deferrari
(hereinafter referred to as "Employee").
WHEREAS, Company desires to employ Employee and Employee desires to accept
such employment and both parties are entering into this Agreement to set forth
their entire understanding with respect to such employment;
NOW, THEREFORE, the parties hereto intending to be legally bound hereby,
and in consideration of the mutual covenants herein contained, agree as follows:
1. EMPLOYMENT
Company hereby employs Employee and Employee hereby accepts such employment
upon the terms and subject to the conditions set forth herein.
2. TERM
The term of this Agreement shall be for a period of three (3) years
commencing on the 22nd day of January, 1997, and terminating on the 21st day of
January, 2000 (the "Term"). Upon expiration of the initial Term and any
subsequent terms, this Agreement shall automatically renew for additional
subsequent three (3) year Terms unless at least ninety (90) days prior to the
end of the then current Term, either Company or Employee has given written
notice to the other of its or his election to terminate the employment at or
prior to the end of such Term.
3. DUTIES
The Employee shall be employed by Company as President and Chief Operating
Officer. Employee's particular duties and power in such capacity shall be such
as may be determined from time to time by the Board of Directors of Company. Any
material diminution of Employee's duties or responsibilities pursuant to this
Agreement will be considered a breach of this Agreement.
4. COMPENSATION
Company agrees to pay and Employee agrees to accept as compensation for all
services rendered hereunder:
4.1 A base annual salary of $160,000.00 payable in accordance with the
Company's usual payroll procedures as they may exist from time to time;
4.2 An annual bonus based on five percent (5%) of fiscal year Net
Earnings, as defined by Company policy, to be paid on a quarterly basis and
reconciled at year end, not to exceed $250,000.00 annually; and
4.3 Reimbursement for two (2) automobiles, and other reasonable
car-related expenses including fuel, oil, maintenance and repair items.
5. EXPENSES
The parties recognize that in the course of performing his duties
hereunder, Employee may incur expenses. Company agrees to reimburse Employee
upon presentation of vouchers for reasonable expenses incurred by Employee in
the performance of his duties hereunder according to the Company Travel and
Expense policy. Additionally, Employee will be entitled to reimbursement for
such reasonable expenses granted to other executive level employees which may or
may not be included in the Company Travel and Expense policy.
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6. FRINGE BENEFITS
Employee shall be entitled to such fringe benefits paid for or supplied by
Company and shall be further entitled to the following:
6.1 Participation in retirement and Employee benefit plans such as
401k, tuition reimbursement, health, dental, accident, disability, life, or
other group insurance plans, and other plans as the Company determines from
time to time to make available generally to the other executive employees
of Company.
6.2 Company may elect to pay for the Employee's entire health
insurance premium payments to the extent that this is offered to the other
executive employees of Company. Otherwise, Employee bears the cost of such
benefits, as determined by then existing Company policy.
6.3 If the insurance policy permits, the Employee may at any time
direct Company, in writing to assign the insurance policy or policies to
the Employee. In the event of Employee's termination for any reason
whatsoever, whether or not with cause, payments on the policy or policies,
and Company's obligations, if any, under the policy or policies shall
cease.
6.4 Nothing herein shall be construed to alter, amend or modify the
terms of any stock option plan or policy that may be made available to
Employee by Company. Upon termination of this Agreement for any reason, any
and all such benefits granted under any such plan or policy shall be
governed by the terms and conditions of that plan or policy as it may exist
from time to time.
6.5 Company presently maintains, and shall continue to maintain
Directors and Officers Liability Insurance coverage for the benefit of
Employee for so long as Employee remains an officer of Company.
7. DEATH OR DISABILITY
In the event the Employee becomes permanently disabled so that he is unable
to perform his essential employment duties hereunder, and no requested
reasonable accommodation of Employee's disability is possible, this Agreement
shall terminate. Notwithstanding the foregoing, the compensation then payable by
Company to Employee pursuant to Section 4 hereof shall continue to be paid as if
Employee were not disabled in any way, until the end of the current Term of
employment pursuant to Section 2 hereof. For the purposes of this Agreement, the
term "permanent disability" shall mean any disability lasting ninety (90)
calendar days or more.
In the event Employee becomes temporarily disabled so that he is unable to
perform his essential employment duties hereunder, and no requested reasonable
accommodation of Employee's disability is possible, then Company has the right
to terminate this Agreement without cause consistent with the obligations set
forth in Section 8.3.1, except as otherwise provided by law. For the purpose of
this Agreement, the term "temporary disability" shall mean any disability
lasting less than ninety (90) calendar days.
In the event Employee becomes either permanently or temporarily disabled,
Company shall be entitled to credit against its obligations under Section 7 of
this Agreement the amount of any and all other disability benefits provided by
or paid for by the Company that inure to Employee's benefit. In the event this
Agreement is terminated pursuant to this Section, should an Employee's
disability cease prior to the expiration of the Term of employment during which
the Agreement was terminated, then Employee remains obligated to return to his
employment duties with the Company for the balance of the then current Term, at
the Company's option.
The terms "disability" and "disabled" as used in this Agreement connote the
inability of Employee, for a period of time greater than seven (7) consecutive
business days, to perform his regular employment duties hereunder as a result of
death, mental or physical illness, or injury or accident.
8. TERMINATION
8.1 Notwithstanding anything herein contained to the contrary, subject to
Section 7 hereof, Company shall have the right to terminate this Agreement "with
cause." A termination "with cause" may occur as
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provided by law or as a result of any criminal activity, or may occur as a
result of reckless misconduct, or gross negligence arising out of this Agreement
or Employee's duties and responsibilities as an officer or employee of Company.
In the event of a termination by Company with cause, Company agrees to provide
Employee with one (1) day's notice and pay. Company may elect to waive the one
(1) day notice requirement by providing one (1) day's pay in lieu of notice.
Notwithstanding that Company terminates this Agreement for cause, Employee shall
be entitled to the severance package set forth in Section 8.7 below.
8.2 During the Term of this Agreement, Employee will not have, either
directly or indirectly, any more than ten percent (10%) equity interest in any
entity, including any person, partnership, trust or incorporated or
unincorporated association or entity, that is manufacturing, distributing or
marketing products or services directly competitive to those manufactured,
distributed or marketed by Company. It is expressly understood that such
ownership or interest may represent a conflict of interest which may be grounds
for Company to terminate this Agreement with cause.
8.3 Notwithstanding anything herein contained to the contrary, subject to
Sections 7 and 8 hereof, Company and Employee shall have the right to terminate
the Agreement hereunder without cause.
8.3.1 In the event Company terminates the Agreement without cause, pursuant
to Section 8.3 herein, Employee shall receive the full compensation hereunder
for the then remaining Term of this Agreement pursuant to Section 2, as well as
payment of the severance package set forth in Section 8.7 below. Company
reserves the right to exercise its option to pay the comparable value of any
benefit set forth in Section 6, above, to which employee is entitled, rather
than continuing the benefit for the balance of the Term; except that, Employee
will not have any continuing rights under the 401(k) plan or other defined
benefit plan, unless provided by law.
8.3.2 In the event Employee terminates the Agreement without cause,
Employee must provide Company with at least ninety (90) days' advance written
notice. Upon the expiration of the ninety (90) day notice period, Employee shall
be entitled to the severance package set forth in Section 8.7 below; all other
obligations by the Company to the Employee, except those provided by law, shall
cease. Failure to provide Company with at least ninety (90) days' advance
written notice constitutes grounds for Company to terminate the Agreement with
cause as provided in Section 8.1 above, and voids any other right that Employee
may have to compensation, benefits or plans pursuant to Company programs or
policies, except those specified in Section 8.1 above and those required to be
provided by law.
8.4 In the event of a "Change in Control" of Company, as defined in
Sections 10 or 11 below, or in the event of a "Change in the Board" as defined
in Section 8.6 below, the following shall apply:
(a) Upon a Change in Control, or upon a Change in the Board, if the
Term of the Agreement has less than eighteen (18) months remaining, the
Term of this Agreement shall be extended so that an eighteen (18) month
Term remains from the time of the Change in Control or a Change in the
Board, to the end of the Term. The extended Term of the Agreement will be
on terms identical to those in effect at the time of the Change in Control
or the Change in the Board. In the event that more than eighteen (18)
months of the Term exists as of the time of a Change in Control or a Change
in the Board, there will be no change in the Term.
(b) Employee commits to continue to perform his duties under this
Agreement for a minimum of eighteen (18) months after a Change in Control
or a Change in the Board. At the end of eighteen (18) months after a Change
in Control or a Change in the Board, Employee has the option to voluntarily
terminate this Agreement without a loss of benefits, as if Company had
terminated this Agreement "without cause" pursuant to Section 8.3.1 above;
except that if
(i) Employee exercises his option to terminate this Agreement
pursuant to this subparagraph in the event of a Change in Control, the
minimum compensation to which Employee shall be entitled pursuant to
Section 8.3.1 above shall be no less than twelve (12) months of salary
and benefits; or
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(ii) Company terminates this Agreement pursuant to Section 8.3.1
above subsequent to a Change in Control, the minimum compensation to
which Employee shall be entitled pursuant to Section 8.3.1 shall be no
less than twelve (12) months of salary and benefits.
(c) In the event of a Change in Control, Section 4.2, providing for an
annual bonus will be modified to provide that Employee's current fiscal
year annual bonuses will in no event, be less than the annual bonus given
in the full year prior to the Change in Control.
8.5 With respect to any payments due and owing as a result of any
termination pursuant to this Section 8, Employee may, at his option, receive
payment for any such obligations in a one-time lump sum payment, or, may
continue to receive payments in accordance with Company's usual payroll
procedures, as they may exist from time to time.
8.6 In the event that 50% or more of the Directors comprising a sitting
Board of Directors is replaced, this change in the Board of Directors will
constitute, and is defined herein as, a "Change in the Board." However, this
Section is not applicable if any such change in a sitting Board of Directors
occurs as a result of a Change in Control of the Company, as set forth in
Section 10 or 11 below.
8.7 Except as set forth in Sections 8.4(b)(i) and (ii) above, upon
termination or cancellation of this Agreement for any other reason, Employee
shall be entitled to a severance package of six (6) months of salary and
benefits, as set forth above in Sections 4 and 6 respectively; except that,
Employee will not have any continuing rights under the 401(k) plan or other
defined benefit plan, unless provided by law.
9. COVENANTS BY EMPLOYEE
9.1 Employee hereby acknowledges that Company is one of only a small number
of companies worldwide that designs, manufactures and sells plasma process thin
film etching and deposition equipment. Employee also acknowledges that pursuant
to his prior relationship with Company, and under the terms of this Agreement,
he will gain access to valuable trade secrets of Company and other valuable
confidential business and proprietary information, and will become aware of and
a part of Company's substantial relationships with customers, potential
customers, suppliers, and sources. Accordingly, Employee hereby covenants that
he shall not, either directly or indirectly, as a principal, partner,
stockholder, officer, director, agent or employee, or in any other capacity,
enter into any employment agreement, or accept employment with or render
services for, any company, partnership, person or entity that competes or
attempts to compete, whether directly or indirectly, with Company, for the
balance of the then remaining Term of this Agreement or for a period of twelve
months (12) from the termination of this Agreement, whichever is greater,
regardless of the reason for said termination.
9.2 The Employee agrees that he shall not solicit or attempt to solicit,
sell to, lease to or offer to sell to, or offer to lease to, except on behalf of
Company or any Affiliate, any present or future customer of Company or
Affiliate, any goods or services competitive to the goods and services now or
hereafter offered for sale or lease by Company or any Affiliate for the periods
of time set forth in Section 9.1 herein.
9.3 The parties hereto recognize that the covenants of Employee herein
contained are unique and that in the event there is a breach or threatened
breach of such covenants, Company shall be entitled, in addition to any other
remedies available to it, to institute and prosecute proceedings in any court of
competent jurisdiction either in law or in equity, to obtain damages for any
breach of covenants or to enforce a specific performance thereof by Employee, or
to enjoin Employee from performing services or doing any act in breach of such
covenants.
9.4 For the purposes of this Agreement, the term "Affiliate" shall mean any
person who or which, directly and/or indirectly, controls, is controlled by or
is under common control with another person. For the purpose of this definition,
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of management and policies, whether through the ownership
of voting securities, by contract or otherwise. For the purpose of this
definition, "person," refers to an individual, partnership, company,
corporation, or other entity.
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9.5 Employee agrees that during the Term hereof and after the termination
of Employee for any reason whatsoever, the Employee shall not disclose to any
person, firm, partnership, company, or other legal entity any information
concerning any of the methods of conducting business utilized by Company or any
Affiliate or any details relating thereto including, but not limited to, the
names of suppliers, customers and methods of operation of Company or any of its
Affiliates; Employee hereby acknowledges that this information is confidential
in nature. This provision shall not be construed to prevent Employee from using
any knowledge that he possessed at the time he commenced his employment with
Company or from using any information that is not confidential.
9.6 Employee has carefully read the provisions of Section 9 herein, and of
each subsection or subparagraph thereof, and having done so agrees that:
(a) the restrictions set forth therein are fair and reasonable and are
reasonably required for the protection of the interests of Company; and
(b) each subsection or subparagraph set forth therein is separate and
independent and all are to be construed as separate and independent of any
other so as to promote their enforcement to the maximum extent possible.
10. CHANGE IN CONTROL
"Change in Control" as used in this Agreement shall refer to any one or
more of the following:
(a) the acquisition in any manner of the beneficial ownership of
shares of Company having 20% or more of the total number of votes that may
be cast for the election of one or more directors of Company by any person,
or persons acting as a group within the meaning of Section 13(d) of the
Securities and Exchange Act of 1934, if the Board has made a determination
that such acquisition constitutes or will constitute control of Company;
(b) any liquidation, dissolution or sale of all or substantially all
of the assets of Company; or
(c) any action taken following, as a result of, or in connection with,
any tender or exchange offer, merger or other business combination of the
foregoing whereby the persons who were the Directors of Company immediately
prior to such action shall cease to constitute a majority of the Board of
Company or any successor to Company.
The term "person," as used in Sections 10 and 11 herein, refers to an
individual, partnership, company, corporation, or other entity. A Change in the
Board not pursuant to any of the events set forth in Section 10 or 11 herein
shall not constitute a Change in Control, but shall constitute a Change in the
Board as set forth in Section 8.6 above.
11. ASSIGNABILITY
Employee may not transfer or assign this Agreement to any other person.
Company may assign this Agreement to any other company or entity that acquires
all or substantially all of the assets of Company, without further permission of
the Employee. In the event Company assigns this Agreement, said assignment will
be deemed to constitute a "Change in Control" as referred to in Sections 8.4,
and 10 herein.
12. PAID TIME OFF
Employee shall be entitled to take Paid Time Off at such time as shall
reasonably be requested by Employee and approved by Company in accordance with
Company policy, not to exceed five (5) weeks per annum. Paid Time Off less than
five (5) weeks per annum not used, shall either be "cashed out" or forfeited
according to Company policy. In the event of termination without cause by
Company or by Employee or with cause by Employee, Employee will receive cash
equivalent of time not yet taken during the Term in accordance with Company
policy.
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13. MISCELLANEOUS PROVISIONS
13.1 NOTICES
Any notice required or permitted to be given under this Agreement shall be
in writing, and shall be deemed to have been given when delivered personally or
sent by registered or certified mail, postage prepaid, addressed as follows:
If to Company: Diana M. DeFerrari, Senior Vice President
Plasma-Therm, Inc.
10050 16th Street North
St. Petersburg, FL 33716
If to Employee: Ronald Scott DeFerrari
Plasma-Therm, Inc.
10050 16th Street North
St. Petersburg, FL 33716
The designation of the person to be so notified or the address of such
person for the purposes of such notice may be changed from time to time by a
similar notice to be effective ten (10) days after such changed designation is
supplied.
13.2 CHOICE OF LAW
This Agreement, and any dispute arising between the parties by virtue of
their relationship under this Agreement, shall be governed by and construed in
accordance with the applicable laws of the State of Florida. The parties further
agree that any lawsuit or action pertaining to, or arising from, this Agreement,
shall be brought in the state or federal courts within the State of Florida, and
the parties expressly waive the right to proceed in any other jurisdiction or
forum.
13.3 ENTIRE AGREEMENT
This Agreement constitutes the full and complete understanding and
agreement of the parties and supersedes all prior understandings and agreements,
and may not be modified or amended orally, but only by an agreement in writing,
signed by the party against whom enforcement of the Agreement, or of or any
waiver, change, modification, extension or discharge of the Agreement, is
sought.
13.4 SEVERABILITY
This Agreement shall be construed to be valid and enforceable to the full
extent allowed by law. It is understood and agreed by the parties that if any
part, term or provision of this Agreement is determined to be illegal or in
conflict with applicable law, the validity of the remaining portions or
provisions shall not be affected, and the rights and obligations of the parties
shall be construed and enforced as if the Agreement did not contain the part,
term or provision held to be invalid.
13.5 INDEMNIFICATION
(a) Third-Party Proceeding: Company shall indemnify Employee, his heirs,
or personal representative, made, or threatened to be made, a party to any
threatened, pending, or completed action or proceeding, whether civil, criminal,
administrative, or investigative, by reason of the fact that he was or is a
corporate agent, or serves or served any other corporation or other enterprise
in any capacity at the request of Company, to the full extent permitted by
Florida law, including, without limitation, indemnification against his expenses
and liabilities in connection with the third party proceeding if he acted in
good faith and in a manner reasonably believed by him to be in, or not opposed
to, the best interests of Company, and with respect to any criminal third party
proceeding, had no reasonable cause to believe his conduct was unlawful or in
violation of applicable rules. The termination of any third party proceeding by
judgment, order, settlement, consent, filing of a criminal complaint or
information, indictment, conviction or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that Employee did not act
in good faith and in a manner which he reasonably believed to be in, or not
opposed to, the best interests of Company or, with respect to any criminal third
party proceeding, had reasonable cause to believe that his conduct was unlawful.
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(b) Derivative Actions: Company shall indemnify any director or officer of
Company, who was or is a party or is threatened to be made a party to any
derivative action by reason of the fact that such director or officer was or is
a corporate agent, against his expenses in the action if he acted in good faith
and in a manner reasonably believed by him to be in, or not opposed to, the best
interest of Company; except, that no indemnification shall be made in respect of
any claim, issue or matter as to which he shall have been adjudged to be liable
for negligence or misconduct in the performance of his duty to Company unless
and only to the extent that the court in which such derivative action is or was
pending shall determine upon application that, despite the adjudication of
liability but in view of all circumstances of the case, he is fairly and
reasonably entitled to indemnity for such items as the court shall deem proper.
(c) Independent Legal Counsel: In the event of an actual or potential
conflict of interest, Employee shall be entitled to an independent legal counsel
and said counsel shall be chosen by Company, subject to the consent of Employee,
and all such reasonable expenses incurred in defense of Employee shall be paid
directly by Company, or reimbursed to Employee at Employee's sole option.
(d) Scope of Employment: Pursuant to this Section 13.5, Company shall only
indemnify Employee, his heirs, or personal representative, made, or threatened
to be made, a party to any threatened, pending, or completed action or
proceeding, for claims relating to or arising out of Employee's actions, or
omissions, within the scope of his employment by Company.
(e) The term and conditions of this Section 13.5 shall survive the
termination of this Agreement and shall apply to any claims made against
Employee, relating to, or arising from Employee's actions pursuant to this
Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and
year first written above.
Witnesses: PLASMA-THERM, INC.
/s/ SHARON SMITH /s/ RONALD H. DEFERRARI
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Ronald H. DeFerrari
Chief Executive Office
Witnesses: Employee
/s/ STACY WAGNER /s/ RONALD SCOTT DEFERRARI
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Ronald Scott DeFarrari
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