EXHIBIT 10.5
EXECUTIVE EMPLOYMENT
AGREEMENT
This EXECUTIVE EMPLOYMENT AGREEMENT (this
“Agreement”) is made effective this January 1, 2009, by
and between CAPITAL GOLD CORPORATION, a Delaware corporation
(“Employer”), and JEFFREY W. PRITCHARD, a
Pennsylvania resident (“Executive”).
WHEREAS, Executive agrees to be employed by
Employer for the period and upon and subject to the terms herein
provided; and
WHEREAS, Employer agrees to employ Executive for
the period and upon and subject to the terms herein
provided;
THEREFORE, in consideration of the foregoing and
of the mutual promises, covenants and agreements contained herein,
the legal sufficiency of which is hereby acknowledged, and
intending to be legally bound, Employer and Executive
agree:
1.
Employment . Upon and subject to the terms
provided herein, Employer agrees to employ Executive, and Executive
hereby agrees to be employed by Employer, as Employer’s
Executive Vice President and Secretary, or other substantially
similar positions.
2.
Term of Employment . Subject to the terms set
forth in this Agreement, Employer agrees to employ Executive and
Executive hereby agrees to be employed by Employer for a period
(the “Employment Period”) commencing from the date
hereof and ending on December 31, 2011. The Employment
Period shall automatically renew for successive one-year periods
unless either party provides the other party with written notice of
its intent not to renew at least thirty (30) days prior to the
expiration of the then current Employment Period.
(a)
Base Salary . As compensation for the services
rendered pursuant to this Agreement, Employer agrees to pay
Executive a base salary at an annual rate of not less than
$224,250, payable in installments in accordance with
Employer’s standard payroll practices, subject to such
payroll and withholding deductions as are required by law or
authorized by Executive. The amount of the base salary
shall be reviewed periodically and may be increased at the sole
discretion of Employer.
(b)
Bonus . Executive shall be eligible for any
annual incentive bonus opportunity offered by Employer to employees
at Executive’s level. In the event of any conflict
between this Agreement and any incentive bonus plan adopted by
Employer for its officers and employees, this Agreement shall
control. The amount of this bonus, as well as the
criteria necessary to earn a bonus, may be changed at any time by
Employer and shall be within the sole discretion of
Employer. All bonuses paid pursuant to this Agreement
will be subject to applicable withholdings and deductions and will
be paid no earlier than fifteen (15) days and no later than ninety
(90) days after Employer’s fiscal year end for which the
bonus is earned (but in no event later than the March 15 of the
calendar year after the calendar year in which the bonus is
earned).
If Executive’s employment terminates,
voluntarily or involuntarily, prior to the last day of the fiscal
year for which the bonus applies, Executive acknowledges that he is
not entitled to any bonus not yet paid at the time of the
termination because any such unpaid bonus will not be earned,
vested, due, or owing. Executive hereby expressly
forfeits and waives any such unpaid bonus. In the event that
Executive’s engagement terminates without cause pursuant to
Section 4(e) or by Executive for breach pursuant to Section 4(f)
prior to the last day of the fiscal year for which the bonus
applies, Executive will be entitled to a bonus pro rated for the
period from the beginning of that fiscal year to the date of
termination and payable no later than 60 days following
Executive’s termination.
(c)
Vacation. For each full twelve (12) months of
employment, Executive shall be entitled to receive four (4) weeks
paid vacation. One (1) week of paid vacation may be
carried forward from one calendar year to the next calendar year
only (the “Carried Forward Vacation”). If
applicable, Executive’s first week of vacation each calendar
year shall be deemed the Carried Forward Vacation.
(d)
Benefits . Executive shall be entitled to
participate in the employee benefits plans offered to all employees
of Employer. Employer shall not be required to establish
or continue any benefit plans or take any action to cause Executive
to be eligible for any such benefits on a basis more favorable than
that applicable to all its employees generally.
(e)
Stock Options. Executive will be eligible to
participate in any stock option or other equity compensation plan
adopted by Employer during the term of this Agreement and
applicable to other employees at Executive’s level (the
“Equity Plan”). The number of options,
vesting schedule, exercise price, and all other terms and
conditions of the stock options shall be set forth in an option
agreement pursuant to the applicable plan and shall be commensurate
with Executive’s position, as determined by the Committee of
Employer’s Board of Directors charged with administering the
Equity Plan, in its sole discretion. Employer may,
consistent with its obligations under such a plan or plans, amend
or discontinue any or all stock option plans at any
time.
(f)
Expense Reimbursement . Employer shall reimburse
Executive for all reasonable and documented travel, entertainment
and other business expenses actually and properly incurred by him
in relation to Employer’s business, as they are
incurred. No such expense reimbursement shall be allowed
with regard to such expenses that exceed $5,000 unless such
expenses have been pre-approved by Employer in writing.
(g)
Office and Duties . Executive shall report to the
President and Chief Executive Officer or such other supervisor as
designated by the President and Chief Executive Officer of
Employer. Executive shall perform such tasks
commensurate with this position as may from time to time be
assigned by Employer. Executive shall devote all
business time, labor, skill, undivided attention and best ability
to the performance of Executive’s duties hereunder in a
manner which will faithfully and diligently further the business
and interests of Employer. During the term of
employment, Executive shall not directly or indirectly pursue any
other business activity without the prior written consent of
Executive’s supervisor, with the exception of passive
personal investments not in breach of any other term or provision
hereof. Executive
agrees to
travel to whatever extent is reasonably necessary in the conduct of
Employer’s business, at Employer’s expense and pursuant
to Employer’s standard policies and procedures.
4.
Termination of Employment . Notwithstanding any
other provision of this Agreement, Executive’s employment may
be terminated as follows:
(a)
Expiration. This Agreement may be terminated
upon expiration of the term hereof. Following
termination pursuant to this Section 4(a), Employer’s only
obligation to Executive shall be to pay to Executive all accrued
base salary, all accrued vacation time and any reasonable and
necessary business expenses incurred by Executive in connection
with his duties, all to the date of termination and payable in a
lump sum, less applicable deductions and withholdings, as soon as
administratively practicable following Executive’s
termination.
(b)
Termination for Cause. This Agreement may be
terminated by Employer for Cause. For purposes of this
Agreement, “Cause” justifying the termination of this
Agreement by Employer is defined as: (1) failure or refusal to
perform the services required hereunder; (2) a material breach by
Executive of any of the terms of this Agreement; or (3)
Executive’s conviction of a crime that either results in
imprisonment or involves embezzlement, dishonesty, or activities
injurious to Employer or its reputation. Whether Cause
exists under this Agreement shall be determined by the Employer in
its reasonable discretion. Following termination
pursuant to this Section 4(b), Employer’s only obligation to
Executive shall be to pay to Executive all accrued base salary, all
accrued vacation time and any reasonable and necessary business
expenses incurred by Executive in connection with his duties, all
to the date of termination and payable in a lump sum, less
applicable deductions and withholdings, as soon as administratively
practicable following Executive’s termination.
(c)
Disability. This Agreement may be terminated by
Employer upon at least thirty (30) days’ written notice if
Executive is prevented by illness, accident or other disability
(mental or physical) from performing the essential functions of the
position for one or more periods cumulatively totaling three (3)
months during any consecutive twelve (12) month
period. In the event this Agreement is terminated
pursuant to this Section 4(c), Employer shall pay to Executive
all accrued base salary, all accrued vacation time and any
reasonable and necessary business expenses incurred by Executive in
connection with his duties, all to the date of termination and
payable in a lump sum, less applicable deductions and
withholdings. In addition, Employer shall pay to
Executive severance payments in an amount equal to one (1) month of
Executive’s base salary, payable in a lump sum, less
applicable deductions and withholdings, as soon as administratively
practicable (but in no event later than 60 days) following
Executive’s termination (“Disability Severance
Payments”). Severance payments made by Employer to
Executive pursuant to this Section 4(c) are conditioned on the
Executive signing a Confidential Severance Agreement and Release
substantially in the form attached hereto as Exhibit A
.
(d)
Death. This Agreement shall be automatically
terminated in the event of Executive’s death during the term
of employment. In the event this Agreement terminates
upon Executive’s death, Employer shall pay Executive’s
estate or beneficiary, as applicable, all accrued base salary, all
accrued vacation time and any reasonable and necessary
business
expenses
incurred by Executive in connection with his duties, all to the
date of termination and all payable in a lump sum, less applicable
deductions and withholdings, as soon as administratively
practicable (but in no event later than 60 days) following
Executive’s termination.
(e)
Without Cause. This Agreement may be terminated
by Employer without Cause by giving notice at least thirty (30)
days prior to the effective termination date; provided
that Employer pays Executive each of the
following:
(i) Provided
at least one year has elapsed since the date of Executive’s
original employment with Employer regardless of the date of this
agreement, Employer shall pay Executive severance payments (the
“Cash Severance Payments”) in an amount equal to the
greater of Executive’s base annual salary in effect upon the
date of termination or the balance of base salary remaining in the
then current term of the Agreement. Subject to Section
4(i)(i) of the Agreement, such Cash Severance Payments shall be
paid in equal monthly installments to Executive beginning in the
month following Executive’s termination. In
addition, Employer shall pay to Executive all accrued base salary,
all accrued vacation time and any reasonable and necessary business
expenses incurred by Executive in connection with his duties, all
to the date of termination and payable in a lump sum, less
applicable deductions and withholdings, as soon as administratively
practicable (but in no event later than 60 days) following
Executive’s termination.
(ii) If
and when the Company adopts a health insurance plan for its
employees and Executive is covered under such plan, provided that
Executive timely elects continuation coverage under the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“COBRA”), Employer shall pay, on Executive’s
behalf, the portion of premiums of Executive’s group health
insurance, including coverage for Executive’s eligible
dependents, that Employer paid immediately prior to
Executive’s separation of employment with Employer
(“COBRA Payments”) for a period of twelve (12) months
(“COBRA Period”). Employer will pay such
COBRA Payments for Executive’s eligible dependents only for
coverage for which those dependents were enrolled immediately prior
to the date of Executive’s separation of
employment. Executive will continue to be required to
pay that portion of the premium of Executive’s health
coverage, including coverage for Executive’s eligible
dependents, that Executive was required to pay as an active
employee immediately prior to the date of Executive’s
separation of employment. For the balance of the period
that Executive is entitled to coverage under COBRA after the COBRA
Period, if any, Executive shall be entitled to maintain coverage
for Executive and Executive’s eligible dependents at
Executive’s sole expense.
(iii) The
Cash Severance Payments and the COBRA Payments (if any) shall be
paid so long as Executive is not in breach of any term of this
Agreement, including, without limitation, Sections 5, 6, and 7
hereof. The Cash Severance Payments and COBRA Payments
(if any) made by Employer to, or on behalf of, Executive pursuant
to this Section 4(e) are conditioned on the Executive signing
a Severance Agreement and Release substantially in the form
attached hereto as Exhibit A .
(f)
Material Breach. This Agreement may be
terminated by Executive for a material breach by Employer of any of
the terms of this Agreement, upon thirty (30) days’ written
notice specifying the breach, and failure of Employer to either (i)
cure or diligently commence to cure the breach within the 30-day
notice period, or (ii) dispute in good faith the existence of the
material breach. Following termination pursuant to this
Section 4(f), Employer shall pay to Executive Cash Severance
Payments (as defined and calculated in section
4(e)(i)). Subject to Section 4(i)(i) of the Agreement,
such severance payments shall be paid in equal monthly installments
to Executive beginning in the month following Executive’s
termination. Such severance payments shall be paid so
long as Executive is not in breach of any term of this Agreement,
including, without limitation, Sections 5, 6, and 7
hereof. In addition, Employer shall pay to Executive all
accrued base salary, all accrued vacation time and any reasonable
and necessary business expenses incurred by Executive in connection
with his duties, all to the date of termination and payable in a
lump sum, less applicable deductions and withholdings, as soon as
administratively practicable (but in no event later than 60 days)
following Executive’s termination. Severance
payments made by Employer to Executive pursuant to this
Section 4(f) are conditioned on the Executive signing a
Confidential Severance Agreement and Release substantially in the
form attached hereto as Exhibit A .
(g)
Resignation . This Agreement may be terminated by
Executive for any reason or no reason at all by giving notice to
Employer of Executive’s resignation at least sixty (60) days
prior to the effective resignation date. Following
termination pursuant to this Section 4(g), Employer’s only
obligation to Executive shall be to pay to Executive all accrued
base salary, all accrued vacation time and any reasonable and
necessary business expenses incurred by Executive in connection
with his duties, all to the date of termination and payable in a
lump sum, less applicable deductions and withholdings.
(h)
Termination Upon a Change of Control . In the
event of a Termination Upon a Change of Control as defined in the
Agreement Regarding Change In Control (“Change In Control
Agreement”) attached hereto as Exhibit B ,
Employer’s obligation to Executive shall be as set forth in
the Change In Control Agreement.
(i) Anything
in this Agreement to the contrary notwithstanding, if on the date
of termination of Executive’s employment with
Employer,
(A) Executive
would not have a separation from service within the meaning of
Section 409A(a)(2)(A)(i) (“Separation From Service”) of
the Internal Revenue Code of 1986, as amended (the
“Code”), and as a result of such termination of
employment would receive any payment that, absent the application
of this Section 4(i)(i)(A), would be subject to additional tax
imposed pursuant to Section 409A(a) of the Code, then such payment
shall instead be payable on the date that is the earliest of (1)
Executive’s Separation From Service, (2) the date the
Executive becomes disabled (within the meaning of Section
409A(a)(2)(C) of the Code), (3) the Executive’s death,
or (4) such other date as will not result in such payment
being subject to such additional tax; and if
(B) Executive
is a specified employee within the meaning of Section
409A(a)(2)(B)(i) of the Code and would receive any payment sooner
than six months after Executive’s Separation From Service
that, absent the application of this Section 4(i)(i)(B), would be
subject to additional tax imposed pursuant to Section 409A(a) of
the Code as a result of such status as a specified employee, then
such payment shall instead be payable on the date that is the
earliest of (1) six months after Executive’s Separation
From Service, (2) the Executive’s death, or
(3) such other date as will not result in such payment being
subject to such additional tax.
(ii) It
is the intention of the parties that payments or benefits payable
under this Agreement not be subject to the additional tax imposed
pursuant to Section 409A of the Code. To the extent such
potential payments or benefits could become subject to such
Section, the parties shall cooperate to amend this Agreement with
the goal of giving Executive the economic benefits described herein
in a manner that does not result in such tax being
imposed.
(iii) In
the event that a payment or benefit payable under this Agreement is
subject to the additional tax imposed by Section 409A of the Code,
and Executive has not been uncooperative in any attempts of the
Employer to amend this Agreement to avoid such additional tax,
Employer shall (at Executive’s option) pay directly, or
reimburse Executive for such additional tax and any interest and
penalty related thereto (the “409A Amounts”) within 10
days of Executive’s submission to Employer of the taxing
authority’s determination of amounts due (which determination
must be submitted by Executive to Employer within 30 days of
receipt by Executive), and in the case of Executive’s
payment, evidence of such payment. At the same time as
Employer’s payment or reimbursement, Employer shall pay
Executive a gross-up amount to cover income, excise, and other
applicable taxes on the 409A Amounts and on the gross-up amount
(before this further gross-up). For purposes of
calculating the gross-up amounts for taxes, the Executive shall be
deemed to be taxed at the highest marginal rate under all
applicable local, state, federal, and foreign tax laws for which
the payment is made.
5.
Proprietary Information .
(a) Executive
represents and warrants to Employer that (i) Executive is not
subject to any limitation or agreement restricting employment by
Employer or performance of Executive’s duties hereunder, and
(ii) neither Executive nor any third party has any right or claim
to Executive’s work produced on behalf of Employer or using
the property, personnel, or facilities of
Employer. Executive shall not misappropriate proprietary
rights of Employer or any third party.
(b) Executive
further agrees not to make, use, disclose to any third party, or
permit to be made, used, or disclosed, any records, plans, papers,
articles, notes, memoranda, reports, lists, records, drawings,
sketches, specifications, software programs, data, or other
materials of any nature relating to any matter within the scope of
the business of Employer or concerning any of its dealings or
affairs (“Materials”), whether or not developed, in
whole or in part, by Executive and whether or not embodying
Confidential Information (defined below), otherwise than for the
benefit of Employer. Executive shall not, after the
termination of employment, use, disclose, or permit to be used or
disclosed, any such Materials, it being agreed that all such
Materials shall be
and remain the
sole and exclusive property of Employer. Immediately
upon the termination of employment, Executive shall deliver all
such Materials, and all copies thereof, to Employer, at its
designated office.
6.
Non-Competition; Non-Solicitation; Anti-Raiding;
Non-Disparagement . Without the prior written
approval of the President or Chief Executive Officer of Employer,
Executive shall not, directly or indirectly, during his employment
and until the end of one (1) year after termination of employment
(however such termination occurs, including, without limitation,
termination pursuant to Section 4(a), 4(b), 4(c), 4(e), 4(f), or
4(g)):
(a) Engage
in a “Competing Business’’ in the
“Territory”, as those terms are defined below, whether
as a sole proprietor, partner, corporate officer, employee,
director, shareholder, consultant, agent, independent contractor,
trustee, or in any other manner by which Executive holds any
beneficial interest in a Competing Business, derives any income
from any interest in a Competing Business, or provides any service
or assistance to a Competing Business. “Competing
Business” shall mean any business that mines or produces
minerals which is competitive with the business of Employer or any
of its Affiliates (defined below), as conducted or under
development at any time during the term of
employment. “Affiliates” shall mean any
entity controlled by or under common control with Employer or any
joint venture, partnership or other similar entity to which
Employer is a party. “Territory” shall mean
anywhere within a 50 mile radius of Caborca in the state of Sonora,
Mexico. The provisions of this Section 6 will not
restrict Executive from owning less than five percent of the
outstanding stock of a publicly-traded corporation engaged in a
Competing Business;
(b) Acquire,
lease or otherwise obtain or control any beneficial, direct or
indirect interest in mineral rights, or other rights or lands
necessary to develop, any mineral property in which Employer or any
of its Affiliates at the time of termination as a beneficial
interest or is actively seeking to acquire, or that is within a
distance of five (5) kilometers from any point on the outer
perimeter of any such property in which Employer or any of its
affiliates has a beneficial interest or that it is seeking to
acquire;
(c) Conduct
any exploration or production activities or otherwise work on or in
respect of any mineral property within a distance of five (5)
kilometers from any point on the outer perimeter of any mineral
property in which Employer or any of its affiliates then has a
beneficial interest or is actively seeking to acquire;
(d) (i) Contact
or solicit, or direct or assist others to contact or solicit, for
the purpose of promoting any person’s or entity’s
attempt to compete with Employer or any of its Affiliates, in any
business carried on by Employer or any of its Affiliates during the
period in which Executive was an employee of Employer, any
suppliers, independent contractors, vendors, or other business
associates of Employer or any of its Affiliates that were existing
or identified prospective suppliers, independent contractors,
vendors, or business associates during such period, or
(ii) otherwise interfere in any way in the relationships
between Employer or any of its Affiliates and their suppliers,
independent contractors, vendors, and business
associates;
(e) (i) Solicit,
offer employment to, otherwise attempt to hire, or assist in the
hiring of any employee or officer of Employer or any of its
Affiliates; (ii) encourage, induce, assist or assist others in
inducing any such person to terminate his or her employment with
Employer or any of its Affiliates; or (iii) in any way
interfere with the relationship between Employer or any of its
Affiliates and their employees; or
(f) Make
any public statement or perform or do any other act prejudicial or
injurious to the reputation or goodwill of Employer or any of its
Affiliates or otherwise interfere with the business of Employer or
any of its Affiliates.
(a) The
term “Confidential Information” shall include, but not
be limited to, the whole or any portion or phase of (i) any
confidential, or proprietary or trade secret, technical, business,
marketing or financial information, whether pertaining to (1)
Employer or its Affiliates, (2) its or their suppliers, or (3) any
third party which Employer or its Affiliates is under an obligation
to keep confidential including, but not limited to, methods,
know-how, techniques, systems, processes, software programs, works
of authorship, supplier lists, projects, plans, and proposals, and
(ii) any software programs and programming prepared for
Employer’s benefit whether or not developed, in whole or in
part by Executive. For purposes of this Agreement,
“Confidential Information” shall include, but shall not
be limited to, strategies, analysis, concepts, ideas, or plans;
operating techniques; demographic and trade area information;
prospective site locations know-how; improvements; discoveries,
developments; designs, techniques, procedures; methods; machinery,
devices; drawings; specifications; forecasts; new products;
research data, reports, or records; marketing or business
development plans, strategies, analysis, concepts or ideas;
contracts; general financial information about or proprietary to
Employer, including, but not limited to, unpublished financial
statements, budgets, projections, licenses, and costs; pricing;
personnel information; and any and all other trade secrets, trade
dress, or proprietary information, and all concepts or ideas in or
reasonably related to Employer’s business. All
such Confidential Information is extremely valuable and is intended
to be kept secret to Employer; is the sole and exclusive property
of Employer or its Affiliates; and, is subject to the restrictive
covenants set forth herein. The term Confidential
Information shall not include any information generally available
to the public or publicly disclosed by Employer (other than by the
act or omission of Executive), information disclosed to Executive
by a third party under no duty of confidentiality to Employer or
its Affiliates, or information required by law or court order to be
disclosed by Executive.
(b) Executive
shall not, without Employer’s prior written approval, use,
disclose, or reveal to any person or entity any of Employer’s
Confidential Information, except as required in the ordinary course
of performing duties hereunder. Executive shall not use
or attempt to use any Confidential Information in any manner which
has the possibility of injuring or causing loss, whether directly
or indirectly, to Employer or any of its Affiliates.
(c) In
the event that Executive’s employment with Employer is
terminated for any reason whatsoever, he shall return to Employer,
promptly upon Employer’s written request therefore, any
documents, photographs, tapes, discs, memory devices, and other
property
containing
Confidential Information which were received by him during his
employment, without retaining copies thereof.
8.
Acknowledgments . Executive acknowledges that the
covenants contained in Sections 5, 6, and 7, including those
related to duration, geographic scope, and the scope of prohibited
conduct, are reasonable and necessary to protect the legitimate
interests of Employer. He further acknowledges that the
covenants contained in Sections 5, 6, and 7 are designed, intended,
and necessary to protect, and are reasonably related to the
protection of, Employer’s trade secrets, to which he will be
exposed and with which he will be
entrusted. Specifically, without limitation, Executive
is entrusted with trade secrets regarding: the strategic planning
initiatives; business development plans; budgets; financial
information; management training; future business plans; and
operational strategies and procedures. Executive
understands that any breach of Sections 5 or 7 will also constitute
a misappropriation of Employer’s proprietary rights, and may
constitute a theft of Employer’s trade secrets under
applicable local, state, and federal statutes, and will result in a
claim for injunctive relief, damages, and/or criminal sanctions and
penalties against Executive by Employer, and possibly
others.
9.
Forfeiture of Severance Payments . If Executive
breaches Sections 5, 6, or 7 of this Agreement during the term that
severance payments are made pursuant to Section 4(c), 4(e), or 4(f)
of this Agreement, Executive shall pay back to Employer all
severance payments received through the date of such breach;
provided, however, that Executive shall be permitted to
retain $10,000 (or, if the severance payments received
up to the date of the breach are less than $10,000,
then the total severance payments received up to the date
of the breach), which shall be deemed consideration for
Executive's release and waiver of any claims, causes of action, and
demands of any kind arising under the Age Discrimination in
Employment Act, and the Older Workers Benefit Protection Act,
referenced in the Severance Agreement and Release substantially in
the form attached hereto as Exhibit B . Nothing
contained in this Section 9 shall be construed as prohibiting
Employer from pursuing any other remedies available to it in the
event of the breach of Sections 5, 6, or 7, including the equitable
remedies set forth in Section 12.
10.
Forfeiture of Profits Related to Option Exercises
. If Executive breaches Section 5, 6, or 7 of this
Agreement, Employer shall have the right to repurchase any or all
shares of common stock of Employer purchased by the Executive upon
the exercise of options within the twelve (12)-month period
immediately preceding the breach at the exercise price of the
option (the “Repurchase Amount”), or if the Executive
no longer holds such shares of common stock purchased on exercise
of options, the Executive shall pay to Employer an amount (the
“Profit Amount”) equal to the gross profits that
Executive received or to be received on the sale of such shares
calculated as the aggregate sale price of such shares of common
stock less the exercise price. Employer may exercise
this right within 90 days of its discovery of a breach, by a
written notice (“Forfeiture Notice”) to Executive and,
as the case may be: (i) if Executive has the shares, Executive
shall immediately deliver them to Employer and, thereafter,
Employer shall pay the Repurchase Amount to Executive within thirty
(30) days by certified or bank check or by wired funds; and (ii) If
Executive no longer has the shares, Executive shall pay the Profit
Amount to Employer within thirty (30) days of the date of the
Forfeiture Notice. If the Executive has transferred such
shares in a transaction which is not a sale (including, for
example, a gift to a
family member
or entity), the Profit Amount payable by Executive to Employer
shall be an amount equal to the difference between the value of
such shares on the date of the Forfeiture Notice and the exercise
price. Nothing contained in this Section 10 shall be
construed as prohibiting Employer from pursuing any other remedies
available to it in the event of the breach of Sections 5, 6, or 7,
including the equitable remedies set forth in Section
12.
11.
Non-exclusivity of Rights . Amounts that are
vested benefits or that Executive is otherwise entitled to receive
under any plan, policy or program of, or contract or agreement with
Employer at or subsequent to termination of employment (however
such termination occurs, including, without limitation, termination
pursuant to Section 4(a), 4(b), 4(c), 4(e), 4(f), 4(g), or 4(h))
shall be payable in accordance with such plan, policy or program
of, or any contract or agreement except as explicitly modified by
this Agreement.
12.
Equitable Remedies . The services to be rendered
by Executive and the Confidential Information entrusted to
Executive as a result of his employment by Employer are of a unique
and special character, and any breach of Sections 5, 6, or 7 will
cause Employer immediate and irreparable injury and damage, for
which monetary relief would be inadequate or difficult to
quantify. Employer will be entitled to, in addition to
all other remedies available to it, injunctive relief and specific
performance to prevent a breach and to secure the enforcement of
Sections 5, 6, or 7. Executive acknowledges that
injunctive relief may be granted immediately upon the commencement
of any such action without notice to Executive and in addition may
recover monetary damages. In the event a court requires
posting of a bond, the parties agree to a maximum $5,000
bond. Executive further acknowledges that his duties
under this Agreement shall survive termination of his employment,
whether the termination is voluntary or involuntary, rightful or
wrongful, and shall continue until Employer consents in writing to
the release of Executive’s obligations under this
Agreement. The parties further agree that the provisions
of Sections 5, 6, and 7 are separate from and independent of the
remainder of this Agreement and that these provisions are
specifically enforceable by Employer notwithstanding any claim made
by Executive against Employer.
13.
Attorney’s Fees . In the event Executive
breaches, or threatens to breach, any provision of this Agreement,
Executive acknowledges that he shall be solely and fully
responsible for all fees and costs, including without limitation,
all attorney’s fees and costs, incurred by Employer in
enforcing this Agreement if Employer is the prevailing party in any
litigation.
14.
Entire Agreement; Amendments . This Agreement
(including all exhibits) constitute the entire understanding
between the parties with respect to the subject matter herein and
therein, and they supersede any prior or
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