EXHIBIT 10.4
HARVARD BIOSCIENCE,
INC.
AMENDED AND RESTATED EMPLOYMENT
AGREEMENT
This EXECUTIVE EMPLOYMENT AGREEMENT
(“Agreement”) is made as of the 18th day of December,
2008, between Harvard Bioscience, Inc., a Delaware corporation (the
“Company”), and Chane Graziano
(“Executive”). For purposes of this Agreement the
“Company” shall refer to the Company and any of its
predecessors.
WHEREAS , the Company desires to employ Executive and
Executive desires to be employed by the Company on the terms
contained herein.
NOW, THEREFORE,
in consideration of the mutual
covenants and agreements herein contained and other good and
valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties agree as follows:
1. Employment. The term of this
Agreement shall extend from December 5 , 2008 (the
“Commencement Date”) until the second anniversary of
the Commencement Date; provided, however, that the term of this
Agreement shall automatically be extended for two additional years
on each second anniversary of the Commencement Date unless, not
less than 90 days prior to each such date, either party shall have
given notice to the other that it does not wish to extend this
Agreement; provided, further, that if a Change in Control occurs
during the original or extended term of this Agreement, the term of
this Agreement shall, notwithstanding anything in this sentence to
the contrary, continue in effect for a period of not less than
eighteen (18) months beyond the month in which the Change in
Control occurred. The term of this Agreement shall be subject
to termination as provided in Paragraph 6 and may be referred to
herein as the “Period of Employment.”
2. Position and Duties. During
the Period of Employment, Executive shall serve as the Chief
Executive Officer of the Company and member of the Board of
Directors of the Company, and shall have supervision and control
over and responsibility for the day-to-day business and affairs of
those functions and operations of the Company and shall have such
powers and duties as may from time to time be prescribed by the
Board of Directors (the “Board”) of the Company,
provided that such duties are consistent with Executive’s
position or other positions that he may hold from time to
time. Executive shall devote his full working time and efforts
to the business and affairs of the Company. Notwithstanding
the foregoing, Executive may serve on other boards of directors,
with the approval of the Board as long as such service does not
materially interfere with Executive’s performance of his
duties to the Company as provided in this Agreement.
3. Compensation and
Related Matters.
(a)
Base Salary and
Incentive Compensation. Executive’s initial annual
base salary shall be $535,500 ($ Five hundred thirty five thousand
five hundred) Dollars. Executive’s base salary shall be
redetermined annually by the Board or a Committee thereof. The base
salary in effect at any given time is referred to herein as
“Base Salary.” The Base Salary shall be payable in
substantially equal installments on a bi-weekly or more frequent
basis. In addition to Base Salary, Executive shall be eligible to
receive cash incentive compensation as determined by the Board or a
Committee thereof from time to time, and shall also be eligible to
participate in such incentive compensation plans as the Board or a
Committee thereof shall determine from time to time for employees
of the same status within the hierarchy of the Company.
(b) Expenses. Executive shall be entitled to receive prompt
reimbursement for all reasonable expenses incurred by him in
performing services hereunder during the Period of Employment, in
accordance with the policies and procedures then in effect and
established by the Company for its senior executive
officers.
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(c) Other
Benefits . During the Period of Employment, Executive shall
be entitled to continue to participate in or receive benefits under
all of the Company’s Employee Benefit Plans in effect on the
date hereof, or under plans or arrangements that provide no less
favorable treatment to the Executive then the Employee Benefit
Plans provided to other members of the Company’s senior
management. As used herein, the term “Employee Benefit
Plans” includes, without limitation, each pension and
retirement plan; supplemental pension, retirement and deferred
compensation plan; savings and profit-sharing plan; stock ownership
plan; stock purchase plan; stock option plan; life insurance plan;
medical insurance plan; disability plan; and health and accident
plan or arrangement established and maintained by the Company on
the date hereof for employees of the same status within the
hierarchy of the Company. During the Period of Employment,
Executive shall be entitled to an automobile or to lease for an
automobile (the “Company Car”) for up to $1,500.00 per
month and the cost of automobile insurance for such Company Car. To
the extent that the scope or nature of benefits described in this
section is determined under the policies of the Company based in
whole or in part on the seniority or tenure of an employee’s
service, Executive shall be deemed to have a tenure with the
Company equal to the actual time of Executive’s service with
the Company. During the Period of Employment, Executive shall
be entitled to participate in or receive benefits under any
employee benefit plan or arrangement which may, in the future, be
made available by the Company to its executives and key management
employees, subject to and on a basis consistent with the terms,
conditions and overall administration of such plan or
arrangement. Any payments or benefits payable to Executive
under a plan or arrangement referred to in this Subparagraph 3(c)
in respect of any calendar year during which Executive is employed
by the Company for less than the whole of 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]/[she] is so employed. Should any such
payments or benefits accrue on a fiscal (rather than calendar)
year, then the proration in the preceding sentence shall be on the
basis of a fiscal year rather than calendar year.
(d) Vacations.
Executive shall be entitled to
twenty (20) paid vacation days in each calendar year, which
shall be accrued ratably during the calendar year. Executive
shall also be entitled to all paid holidays given by the Company to
its executives. To the extent that the scope or nature of
benefits described in this section are determined under the
policies of the Company based in whole or in part on the seniority
or tenure of an employee’s service, Executive shall be deemed
to have a tenure with the Company equal to the actual time of
Executive’s service with Company.
4. Unauthorized
Disclosure.
(a) Confidential
Information. Executive acknowledges that in the course of his
employment with the Company (and, if applicable, its predecessors),
he has been allowed to become, and will continue to be allowed to
become, acquainted with the Company’s business affairs,
information, trade secrets, and other matters which are of a
proprietary or confidential nature, including but not limited to
the Company’s and its affiliates’ and
predecessors’ operations, business opportunities, price and
cost information, finance, customer information, business plans,
various sales techniques, manuals, letters, notebooks, procedures,
reports, products, processes, services, and other confidential
information and knowledge (collectively the “Confidential
Information”) concerning the Company’s and its
affiliates’ and predecessors’ business. The
Company agrees to provide on an ongoing basis such Confidential
Information as the Company deems necessary or desirable to aid
Executive in the performance of his duties. Executive
understands and acknowledges that such Confidential Information is
confidential, and he agrees not to disclose such Confidential
Information to anyone outside the Company except to the extent that
(i) Executive deems such disclosure or use reasonably
necessary or appropriate in connection with performing his duties
on behalf of the Company; (ii) Executive is required by order
of a court of competent jurisdiction (by subpoena or similar
process) to disclose or discuss any Confidential Information,
provided that in such case, Executive shall promptly inform the
Company of such event, shall cooperate with the Company in
attempting to obtain a protective order or to otherwise restrict
such disclosure, and shall only disclose Confidential Information
to the minimum extent necessary to comply with any such court
order; (iii) such Confidential Information becomes generally
known to and available for use in the Company’s industry (the
“laboratory analytical instruments industry”), other
than as a result of any action or inaction by Executive; or
(iv) such information has been rightfully received by a member
of the laboratory analytical instruments industry or has been
published in a form generally available to the laboratory
analytical instruments industry prior to the date Executive
proposes to disclose or use such information. Executive
further agrees that he will not during employment and/or at any
time thereafter use such Confidential Information in competing,
directly or indirectly, with the Company. At such time as
Executive shall cease to be employed by the Company, he will
immediately turn over to the Company all Confidential Information,
including papers, documents, writings, electronically stored
information, other property, and all copies of them provided to or
created by [him]/[her] during the course of his employment with the
Company.
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(b) Heirs, successors,
and legal representatives. The foregoing provisions of this
Paragraph 4 shall be binding upon Executive’s heirs,
successors, and legal representatives. The provisions of this
Paragraph 4 shall survive the termination of this Agreement
for any reason.
5. Covenant Not to
Compete or Solicit or Hire. In consideration for Executive’s
employment by the Company under the terms provided in this
Agreement and as a means to aid in the performance and enforcement
of the terms
(a)
during the term of Executive’s
employment with the Company and for a period of twelve
(12) months thereafter, regardless of the reason for
termination of employment, Executive will not, directly or
indirectly, as an owner, director, principal, agent, officer,
employee, partner, consultant, servant, or otherwise, carry on,
operate, manage, control, or become involved in any manner with any
business, operation, corporation, partnership, association, agency,
or other person or entity which is engaged in a business that
produces products that compete directly with any of the
Company’s products which are produced by the Company or any
affiliate of the Company or which the Company or any affiliate of
the Company has active plans to produce as of the date of
Executive’s termination of employment with the Company, in
any area or territory in which the Company or any affiliate of the
Company conducts or has active plans to conduct operations as of
the date of the Executive’s termination of employment with
the Company; provided, however, that the foregoing shall not
prohibit Executive from owning up to one percent (1%) of the
outstanding stock of a publicly held company engaged in the
laboratory analytical instruments industry; and
(b)
during the term of Executive’s
employment with the Company and for a period of twelve
(12) months thereafter, regardless of the reason for
termination of employment, Executive will not directly or
indirectly solicit or induce any present or future employee of the
Company or any affiliate of the Company to accept employment with
Executive or with any business, operation, corporation,
partnership, association, agency, or other person or entity with
which Executive may be associated, and Executive will not hire or
employ or cause any business, operation, corporation, partnership,
association, agency, or other person or entity with which Executive
may be associated to hire or employ any present or future employee
of the Company.
Should Executive violate any of the
provisions of this Paragraph, then in addition to all other rights
and remedies available to the Company at law or in equity, the
duration of this covenant shall automatically be extended for the
period of time from which Executive began such violation until he
permanently ceases such violation.
6. Termination
. Executive’s employment hereunder may
be terminated without any breach of this Agreement under the
following circumstances:
(a) Death.
Executive’s employment
hereunder shall terminate upon his death.
(b) Disability. If, as a result of Executive’s incapacity
due to physical or mental illness, Executive shall have been absent
from his duties hereunder on a full-time basis for one hundred
eighty (180) calendar days in the aggregate in any twelve
(12) month period, the Company may terminate Executive’s
employment hereunder.
(c) Termination by
Company For Cause. At
any time during the Period of Employment, the Company may terminate
Executive’s employment hereunder for Cause if such
termination is approved by not less than a majority of the Board at
a meeting of the Board called and held for such purpose. For
purposes of this Agreement, “Cause” shall
mean: (A) conduct by Executive constituting a material
act of willful misconduct in connection with the performance of his
duties, including, without limitation, misappropriation of funds or
property of the Company or any of its affiliates other than the
occasional, customary and de minimis use of Company property for
personal purposes; (B) criminal or civil conviction of
Executive, a plea of nolo contendere by Executive or conduct by
Executive that would reasonably be expected to result in material
injury to the reputation of the Company if he were retained in his
position with the Company, including, without limitation,
conviction of a felony
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involving moral turpitude;
(C) continued, willful and deliberate non-performance by
Executive of his duties hereunder (other than by reason of
Executive’s physical or mental illness, incapacity or
disability) which has continued for more than thirty (30) days
following written notice of such non-performance from the Board;
(D) a breach by Executive of any of the provisions contained
in Paragraphs 4 and 5 of this Agreement; or (E) a violation by
Executive of the Company’s employment policies which has
continued following written notice of such violation from the
Board.
(d) Termination Without
Cause. At any time
during the Period of Employment, the Company may terminate
Executive’s employment hereunder without Cause if such
termination is approved by a majority of the Board at a meeting of
the Board called and held for such purpose. Any termination by
the Company of Executive’s employment under this Agreement
which does not constitute a termination for Cause under
Subparagraph 6(c) or result from the death or disability of the
Executive under Subparagraph 6(a) or (b) shall be deemed a
termination without Cause. If the Company provides notice to
Executive under Paragraph 1 that it does not wish to extend the
Period of Employment, such action shall be deemed a termination
without Cause.
(e) Termination by
Executive. At any
time during the Period of Employment, Executive may terminate his
employment hereunder for any reason, including but not limited to
Good Reason. If Executive provides notice to the Company under
Paragraph 1 that he does not wish to extend the Period of
Employment, such action shall be deemed a voluntary termination by
Executive and one without Good Reason. For purposes of this
Agreement, “Good Reason” shall mean that Executive has
complied with the “Good Reason Process” (hereinafter
defined) following the occurrence of any of the following
events: (A) a substantial diminution or other substantive
adverse change, not consented to by Executive, in the nature or
scope of Executive’s responsibilities, authorities, powers,
functions or duties; (B) any removal, during the Period of
Employment, from Executive of his title of Chief Executive Officer;
(C) an involuntary reduction in Executive’s Base Salary
except for across-the-board reductions similarly affecting all or
substantially all management employees; (D) a breach by the
Company of any of its other material obligations under this
Agreement and the failure of the Company to cure such breach within
thirty (30) days after written notice thereof by Executive;
(E) the involuntary relocation of the Company’s offices
at which Executive is principally employed or the involuntary
relocation of the offices of Executive’s primary workgroup to
a location more than 30 miles from such offices, or the requirement
by the Company that Executive be based anywhere other than the
Company’s offices at such location on an extended basis,
except for required travel on the Company’s business to an
extent substantially consistent with Executive’s business
travel obligations; or (F) the failure of the Company to
obtain the agreement from any successor to the Company to assume
and agree to perform this Agreement as required by Paragraph 10
(each of which is hereinafter referred to as a “Good Reason
event”). “Good Reason Process” shall mean
that (i) Executive reasonably determines in good faith that a
“Good Reason” event has occurred; (ii) Executive
notifies the Company in writing of the occurrence of the Good
Reason event; (iii) Executive cooperates in good faith with
the Company’s efforts, for a period not less than ninety
(90) days following such notice, to modify Executive’s
employment situation in a manner acceptable to Executive and
Company; and (iv) notwithstanding such efforts, one or more of
the Good Reason events continues to exist and has not been modified
in a manner acceptable to Executive. If the Company cures the
Good Reason event in a manner acceptable to Executive during the
ninety (90) day period, Good Reason shall be deemed not to
have occurred.
(f) Notice of
Termination. Except
for termination as specified in Subparagraph 6(a), any termination
of Executive’s employment by the Company or any such
termination by Executive shall be communicated by written Notice of
Termination to the other party hereto and shall be effective on the
Date of Termination (as defined below). 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.
(g) Date of
Termination. “Date of Termination” shall
mean: (A) if Executive’s employment is terminated
by his death, the date of his death; (B) if Executive’s
employment is terminated on account of disability under
Subparagraph 6(b) or by the Company for Cause under Subparagraph
6(c), the date on which Notice of Termination is given or such
later date as the Company may specify in the Notice of Termination;
(C) if Executive’s employment is terminated by the
Company under Subparagraph 6(d), sixty (60) days after the
date on which a Notice of Termination is given or such later date
as the Company may specify in the Notice of Termination (or, if
such termination occurs as a result of the Company providing notice
to Executive under Paragraph 1 that it does not wish to extend
the Period of Employment, the date of the expiration of the current
term of this Agreement); and (D) if Executive’s
employment is terminated by Executive under Subparagraph 6(e),
thirty
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(30) days after the date on which a
Notice of Termination is given or, if such termination is without
Good Reason, such later date up to sixty (60) days after the
date on which such Notice of Termination is given as Executive may
specify in the Notice of Termination (or, if such termination
occurs as a result of the Company providing notice to Executive
under Paragraph 1 that it does not wish to extend the Period
of Employment, the date of the expiration of the current term of
this Agreement).
7. Compensation Upon
Termination or During Disability.
(a) Death.
If Executive’s employment
terminates by reason of his death, the Company shall, within ninety
(90) days of death, pay in a lump sum amount to such person as
Executive shall designate in a notice filed with the Company or, if
no such person is designated, to Executive’s estate,
Executive’s accrued and unpaid Base Salary to the date of his
death, plus his accrued and unpaid incentive compensation, if any,
under Subparagraph 3(a). Upon the death of Executive, all
unvested stock options shall immediately vest in Executive’s
estate or other legal representatives and become
exercisable. All other stock-based grants and awards held by
Executive shall vest or be canceled upon the death of Executive in
accordance with their terms. For a period of one (1) year
following the Date of Termination, the Company shall pay such
health insurance premiums as may be necessary to allow
Executive’s spouse and dependents to receive health insurance
coverage substantially similar to coverage they received prior to
the Date of Termination. In addition to the foregoing, any
payments to which Executive’s spouse, beneficiaries, or
estate may be entitled under any employee benefit plan shall also
be paid in accordance with the terms of such plan or
arrangement. Such payments, in the aggregate, shall fully
discharge the Company’s obligations hereunder.
(b) Disability. During any period that Executive fails to
perform his duties hereunder as a result of incapacity due to
physical or mental illness, Executive shall continue to receive his
accrued and unpaid Base Salary and accrued and unpaid incentive
compensation, if any, under Subparagraph 3(a), until
Executive’s employment is terminated due to disability in
accordance with Subparagraph 6(b) or until Executive terminates his
employment in accordance with Subparagraph 6(e), whichever first
occurs. Upon the Date of Termination by reason of
Executive’s disability, all unvested stock options shall
immediately vest and become exercisable. All other stock-based
grants and awards held by Executive shall vest or be canceled upon
the Date of Termination in accordance with their terms. For a
period of one (1) year following the Date of Termination, the
Company shall pay such health insurance premiums as may be
necessary to allow Executive and Executive’s spouse and
dependents to receive health insurance coverage substantially
similar to coverage they received prior to the Date of
Termination. Upon termination due to death prior to the
termination first to occur as specified in the preceding sentence,
Subparagraph 7(a) shall apply.
(c) Termination other
than for Good Reason. If Executive’s employment is terminated by
Executive other than for Good Reason as provided in Subparagraph
6(e), then the Company shall, through the Date of Termination, pay
Executive his accrued and unpaid Base Salary at the rate in effect
at the time Notice of Termination is given. Thereafter, the
Company shall have no further obligations to Executive except as
otherwise expressly provided under this Agreement, provided any
such termination shall not adversely affect or alter
Executive’s rights under any employee benefit plan of the
Company in which Executive, at the Date of Termination, has a
vested interest, unless otherwise provided in such employee benefit
plan or any agreement or other instrument attendant
thereto.
(d) Termination by
Executive for Good Reason or by the Company without
Cause. If Executive
terminates his employment for Good Reason as provided in
Subparagraph 6(e) or if Executive’s employment is terminated
by the Company without Cause as provided in Subparagraph 6(d), then
the Company shall, through the Date of Termination, pay Executive
his accrued and unpaid Base Salary at the rate in effect at the
time Notice of Termination is given and his accrued and unpaid
incentive compensation, if any, under Subparagraph 3(a). In
addition, subject to the Executive’s execution of a general
release of claims in the form attached hereto as Exhibit A
within 21 days after the Date of Termination and the expiration of
the seven-day revocation period applicable thereto,
(i) the Company shall pay
Executive an amount equal to two times the sum of Executive’s
Average Base Salary and Executive’s Average Incentive
Compensation (the “Severance Amount”). The Severance
Amount shall be paid in cash in a single lump sum payment 30 days
after the
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Date of Termination,. For
purposes of this Agreement, “Average Base Salary” shall
mean the average of the annual Base Salary received by Executive
for each of the three (3) immediately preceding fiscal years
or such fewer number of complete fiscal years as Executive may have
been employed by the Company or the amount of Base Salary for the
prior fiscal year, whichever is higher. For purposes of this
Agreement, “Average Incentive Compensation” shall mean
the average of the annual cash incentive compensation under
Subparagraph 3(a) received by Executive for the three
(3) immediately preceding fiscal years or such fewer number of
complete fiscal years as Executive may have been employed by the
Company or the amount of cash incentive compensation for the prior
fiscal year, whichever is higher. In no event shall
“Average Incentive Compensation” include any sign-on
bonus, retention bonus or any other special
bonus. Notwithstanding the foregoing, if the Executive
breaches any of the provisions contained in Paragraphs 4 and 5 of
this Agreement, all payments of the Severance Amount shall
immediately cease or become repayable to the Company to the extent
paid. Furthermore, in the event Executive terminates his
employment for Good Reason as provided in Subparagraph 6(e), he
shall be entitled to the Severance Amount only if he provides the
Notice of Termination provided for in Subparagraph 6(f) within
thirty (30) days after he has complied with the Good Reason
Process; and
(ii) upon the Date of
Termination, each unvested stock option that would otherwise vest
during the next twenty four (24) months shall accelerate and
immediately vest. All other stock-based grants and awards held
by Executive that would otherwise vest during the next twenty four
(24) months shall accelerate and immediately vest upon the
Date of Termination; and
(iii) in addition to any other
benefits to which Executive may be entitled in accordance with the
Company’s then existing severance policies, the Company
shall, for a period of one (1) year commencing on the Date of
Termination, pay such health insurance premiums as may be necessary
to allow Executive and Executive’s spouse and
dependents
