Attached files
EMPLOYMENT AGREEMENT
Employment Agreement dated September 13, 2011 as of July 1, 2011,
between SCIENTIFIC INDUSTRIES, INC., a Delaware corporation 70 Orville
Drive, Bohemia, New York 11716 (the "Company") and HELENA R. SANTOS, an
individual residing at 16 Gerta Court, Selden, New York 11784,
("Employee").
WITNESSETH:
WHEREAS, Employee has been employed as a senior executive officer
of the Company since 1997 with the period commencing January 1, 2007 and
ending June 30, 2011 covered by Employment Agreements dated, respectively,
December 29, 2006, December 31, 2009, July 31, 2009, and February 2010,
the Company and Employee desire that she continue to be employed
through June 30, 2013 as a senior executive officer of the Company with
the employment for the two-year period ended June 30, 2013 be on the
terms and conditions hereinafter contained;
NOW, THEREFORE, it is hereby agreed as follows:
1. Employment. The Company hereby employs and Employee agrees to be
employed as a senior executive officer of the Company for the Term as
defined in Section 2 to perform the duties described in Section 3 hereof.
2. Term. The employment of Employee by the Company pursuant hereto
shall be for the period from July 1, 2011 through June 30, 2013 unless
terminated earlier pursuant to the provisions of Section 7 hereof; such
period is herein referred to as the "Term".
3. Duties. Employee has devoted and shall devote her full time to
the affairs and business of the Company in such senior executive
positions or offices as the Board of Directors (the "Board") shall
designate. For the purposes of this Agreement, senior executive offices
means any one or more of the following: President, Chief Executive
Officer, Chief Operating Officer, Chief Financial Officer, Executive
Vice President and Treasurer, it being agreed that Employee may hold
more than one executive office, provided that her duties will not require
her to devote more time to the performance of her duties on behalf
of the Company than is reasonable. As a senior executive officer
Employee shall report directly to the Board through the Chairman of
the Board of the Company. Employee shall use her best efforts to
promote the interests and welfare of the Company. The duties
shall be principally performed at the principal executive offices
of the Company.
4. Salary. As her compensation hereunder, Employee shall be paid
by the Company a base salary for the 12-month periods ended June 30,
2011 and June 30, 2012 at the rates of $138,000 per annum and
$141,000 per annum, respectively. The base salary shall be payable
in equal weekly installments. The Company at the sole and absolute
discretion of the Board of Directors may pay to Employee a bonus
for her service for each of the years ending June 30, 2012 and
June 30, 2013. Each bonus, if any, shall be paid within a date
which is no later than four months following the end of the year.
The Board in determining the amount of a bonus, if any, shall
consider the achievement and surpassing of goals or projections
set forth or referred to in the operation plan for the relevant
period approved by the Board, including but not limited to, cash
flow and earnings; the Employee's performance of her executive
responsibilities, and such other criteria as the Board deems
relevant.
5. Expenses.
a. Subject to the authorization of the Board, Employee will be
authorized to incur reasonable and necessary expenses in connection
with the discharge of Employee's duties and in promoting the business
of the Company. The Company will, according to its practices,
reimburse Employee for all such expenses upon presentation of a
properly itemized account of such expenditures, setting forth the
business reasons for such expenditures on a timely basis.
b. Employee agrees to cooperate with the Company in the
Company's efforts to obtain and maintain a term insurance policy
on the life of Employee with the Company as sole beneficiary in
such principal amount as may be determined by the Board, which
currently is $500,000.
6. Other Benefits; Vacation.
a. Employee shall be entitled to receive from the Company
such medical, hospital and disability benefits, life insurance
coverage, holiday and sick pay consistent with those made
available to the officers of the Company and to participate in the
Company's Plan under Section 401(k) of the Internal Revenue Code in
accordance with its terms.
b. Employee shall be entitled to an annual vacation during the
Term of employment hereunder in accordance with the Company's
employee policy.
7. Termination.
a. In the event of Employee's death during the Term, this
Agreement shall terminate automatically as of the date of death,
except with respect to any accrued but unsatisfied obligations to
the date of death. In the event of Employee's disability (as
hereinafter defined) for sixty (60) consecutive calendar days or
ninety (90) calendar days in the aggregate during any twelve (12)
consecutive month period within the Term, the Company shall have
the right, by written notice to Employee, to terminate this
Agreement as of the date of such notice, except with respect to
any accrued but unsatisfied obligation to the date of such
termination. "Disability" for the purposes of this Agreement
shall mean Employee's physical or mental disability so as to render
Employee incapable of carrying out Employee's essential duties
under this Agreement. In the event of a termination by the
Company pursuant to this Section 7(a), the Company shall not be
under any further obligation to Employee hereunder except to pay
Employee the base salary and benefits accrued and payable up to
the date of such termination, and reimburse her for expenses
accrued and payable under Section 5 hereof through the date
of termination.
b. This Agreement may be terminated by (i) either Employee or
the Company (other than as provided in Section 7(a)) upon thirty
(30) days' written notice if, during the Term, the other of them
shall be in breach of or in default under any provision of this
Agreement or (ii) by the Company for Cause. In the event of
termination of this Agreement for reason of breach or default by
the Company or by the Company without cause, Employee shall have
no obligation to mitigate damages. ?Cause? shall mean conviction
for a felony or the failure of Employee to cure any of the
following by the end of the 10 day period following delivery of
written notice of such termination to Employee setting forth: (i)
the gross negligence or gross misconduct (including conflict of
interest in carrying out Employee's duties under this Agreement),
or (ii) the repeated or substantial failure, refusal or neglect
to perform Employee's duties in accordance with Paragraph 3 hereof,
or (iii) the engaging by Employee in a material act or acts of
dishonesty affecting the Company or a subsidiary of the Company,
or (iv) alcohol abuse or illegal use of drugs by Employee in a
manner materially and repeatedly interfering with performance
of Employee's obligations under this Agreement.
c. If such termination by the Company is made, notice in
writing shall be given as set forth in Paragraph 12. If such
termination is other than pursuant to Paragraph 7(a) or for
Cause, the Company shall pay to Employee severance payments equal
to one year's salary at the rate of the compensation Employee
is receiving at the time of termination. All such severance
payments shall be payable bimonthly over the following 12
months and Employee shall receive the benefits set forth in
Paragraph 6(a) for a period of two years from termination.
d. In the event of termination of the Agreement by reason of
breach or default by Employee or for Cause, the Company shall
not be under further obligation to Employee except to pay
Employee her base salary and benefits accrued and payable up
to the date of such termination, and reimburse her for expenses
accrued and payable under Section 5 thought the date of
termination.
8. Non-Competition; Non-Interference; Non-Solicitation.
a. For purposes of this Section 8 and Sections 9, 10 and 11,
"Company" includes each of its subsidiaries.
b. From the date hereof through the end of the Term, Employee
will not, without the express written approval of the Board,
directly or indirectly, own, manage, operate, control, invest or
acquire an interest in, or otherwise engage or participate in, or
be associated with in any way, any business which competes
directly or indirectly with the business or proposed business
of the Company (a "Competitive Business"); provided, however,
that Employee may, directly or indirectly, own, invest or acquire
an interest in the aggregate of up to one percent (1%) of the
capital stock of a corporation whose capital stock is traded
publicly.
Additionally, from the date hereof through the date which is
18 months after the date of termination of employment (the
"Restricted Period"), Employee will not, without the express written
approval of the Board, directly or indirectly, become associated
with a Competitive Business, or otherwise engage in or assist in any
enterprise, which develops, markets, sells, manufactures or designs
products or accessories currently being sold, developed or
contemplated (including those acquired or about to be acquired) by
the Company or which hereinafter may be sold, developed or
contemplated, by the Company as of the date of termination, including,
but not limited to, mixers, including vortex mixers, rotating,
shaking or oscillating apparatus; thermoelectric apparatus, catalytic
research instruments or components thereof; and bioprocessing
systems or products, systems or methods developed, patents,
licenses or sublicenses as may be amended from time to time or
related accessories of the foregoing; or any industrial or laboratory
processes, apparatus or equipment (the ?Products?).
c. During the Restricted Period, Employee will not without the
express prior written approval of the Board of Directors (i) directly
or indirectly, in one or a series of transactions, recruit, solicit
or otherwise induce or influence any proprietor, partner, licensee,
stockholder, lender, director, officer, employee, sales agent, joint
venturer, investor, lessor, supplier, customer, consultant, agent,
representative or any other person which has a business relationship
with the Company to discontinue, reduce or modify during the
Restrictive Period such employment, agency or business relationship
with the Company, or (ii) employ or seek to employ or cause any
Competitive Business to employ or seek to employ any person or agent
who is then (or was at any time within one (1) year prior to the
date the Competitive Business employs or seeks to employ such person)
engaged or retained by the Company or a business acquired or sold by
the Company.
9. Confidential Information.
a. Employee agrees that during and after the Term Employee will
not, directly or indirectly, disclose to any person, or use or
otherwise exploit for the benefit of Employee or for the benefit of
anyone other than the Company, any Confidential Information (as
defined in Section 9(c)). Employee shall have no obligation
hereunder to keep confidential any Confidential Information if and
to the extent disclosure of any therefor is specifically required
by law; provided, however, that in the event disclosure is required
by applicable law, Employee shall provide the Company with prompt
notice of such requirement, prior to making any disclosure,
so that the Company may seek an appropriate protective order.
b. At the request of the Company, Employee agrees to deliver to
the Company, at any time during the Term, or thereafter, all
Confidential Information which Employee may possess or control.
Employee agrees that all Confidential Information of the Company
(whether now or hereafter existing) conceived, discovered or made
by Employee during the Term exclusively belongs to the Company
(and not to Employee). Employee will promptly disclose such
Confidential Information to the Company and perform all actions
reasonably requested by the Company to establish and confirm such
exclusive ownership.
c. "Confidential Information" means any information including,
without limitation, any patent, patent application, license,
sublicense, copyright, trademark, trade name, service mark, service
name, "know-how", trade secrets, customer lists, vendor lists,
customer pricing or terms, details of client or consultant contracts,
pricing policies, cost information, operational methods, marketing
plans or strategies, product development techniques or plans, business
acquisition plans or any portion or phase of any business, scientific
or technical information, ideas, discoveries, designs, computer
programs (including source or object codes), processes, procedures,
formulae, improvements, information relating to the products currently
being sold, developed or contemplated, by the Company, or which
hereinafter may be sold, developed or contemplated, by the Company
through the date of termination of the Term, including, but not limited
to, the Products or other proprietary or intellectual property of the
Company, whether or not in written or tangible form, and whether or
not registered, and including all memoranda, notes, summaries, plans,
reports, records, documents and other evidence thereof. The term
"Confidential Information" does not include, and there shall be no
obligation hereunder with respect to, information that becomes
generally available to the public other than as a result of a
disclosure by Employee not permissible hereunder.
10. Patents. Employee agrees that all inventions, copyrightable
material, secret processes, formulae, trademarks, trade secrets and
the like, discovered or developed by him while in the employ of
the Company, whether in the course of his employment, on company time
or property, or otherwise, shall be the exclusive property of the
Company and Employee agrees to execute such instruments of transfer,
assignment, conveyance or confirmation and such other documents as
may be requested by the Company to transfer, confirm and perfect
in the Company all legally protectable rights in any such inventions,
copyrightable materials, secret processes, formulae, trademarks,
trade secrets and the like at no expense to Employee.
11. Remedies.
a. Nothing herein contained is intended to waive or diminish any
rights the Company may have at law or in equity at any time to
protect and defend its legitimate property interests including its
business relationship with third parties, the foregoing provisions
being intended to be in addition to and not in derogation or
limitation of any other rights the Company may have at law or in
equity.
b. Since a breach of the provisions of Section 8, Section 9 or
Section 10 could not adequately be compensated by money damages, the
Company shall be entitled, in addition to any other right and remedy
available to it, to an appropriate order from a court of competent
jurisdiction restraining such breach or a threatened breach, and in
any such case no bond or other security shall be required to be
posted in connection therewith. Employee agrees that the provisions
of Section 8, Section 9 or Section 10 are necessary and reasonable to
protect the Company in the conduct of its business. If any
restriction or provision contained in Section 8, Section 9 or
Section 10 shall be deemed to be invalid, illegal, or unenforceable
by reason of the extent, duration, or geographical scope thereof, or
otherwise, then the court making such determination shall have the
right to reduce such extent, duration, geographical scope, or other
provisions hereof, and in its reduced form such restriction shall
then be enforceable in the manner contemplated hereby.
12. Insurance. The Company agrees to include Employee in the
coverage of any directors' and officers' liability it provides on
behalf of its directors or other senior executive officers and, if
Employee is a fiduciary under a Company plan, coverage under the
applicable fiduciary liability insurance policy.
13. Notices. Any notices pertaining to this Agreement if to the
Company shall be addressed to the Company at its address set forth
in the opening paragraph of this Agreement, with a copy of any
notice to the Company to be sent to Leo Silverstein, Esq., Reitler
Kailas & Rosenblatt LLC, 885 Third Avenue, New York, New York 10022
and if to Employee shall be addressed to her at her address stated
in the opening of paragraph of this Agreement. All notices shall
be in writing and shall be deemed duly given if personally delivered
or sent by registered or certified mail, overnight or express mail
or by telefax. If sent by registered or certified mail, notice
shall be deemed to have been received and effective three days
after mailing; if by overnight or express mail or by telefax,
notice shall be deemed received the next business day after being
sent. Any party may change its address for notice hereunder by
giving notice of such change in the manner provided herein.
14. Entire Agreement. This Agreement contains the entire
agreement of the parties respecting the subject matter contained
herein. No modification of any provision hereof shall be effective
except by a written agreement signed by the parties hereto.
15. Miscellaneous.
a. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to
contracts entirely made and performed therein.
b. This Agreement shall be binding upon and inure to the benefit
of the parties, their respective successors, heirs and assigns
(where permitted).
c. The waiver by one party hereto of any breach by the other
(the "Breaching Party") of any provision of this Agreement shall not
operate or be construed as a waiver of any other (prior or subsequent)
breach by the Breaching Party, and waiver of a breach of a provision
in one instance shall not be deemed a waiver of a breach of
such provision in any other circumstance.
IN WITNESS WHEREOF, the parties hereto have signed this
Agreement as of the year and date first above written.
SCIENTIFIC INDUSTRIES, INC.
By: /s/ Joseph G. Cremonese
____________________________
Joseph G. Cremonese, Chairman
of the Board
HELENA R. SANTOS
____________________________
/s/ Helena R. Santos
