Attached files
| file | filename |
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| 8-K - 8-K - AMERICAN MEDICAL ALERT CORP | v207474_8k.htm |
| EX-10.1 - EX-10.1 - AMERICAN MEDICAL ALERT CORP | v207474_ex10-1.htm |
Exhibit
10.2
EMPLOYMENT
AGREEMENT
EMPLOYMENT AGREEMENT dated as
of December 30, 2010 between AMERICAN MEDICAL ALERT CORP., a New York
corporation (the "Company"), with offices located at 3265 Lawson Boulevard,
Oceanside, New York 11572 and FREDERIC SIEGEL, an individual having an address
at ___________________________________ ("Employee").
WITNESSETH:
WHEREAS, the Company desires
to retain the services of Employee upon the terms and conditions stated herein;
and
WHEREAS, Employee desires to
continue to be employed by the Company upon the terms and conditions stated
herein.
NOW, THEREFORE, in
consideration of the mutual covenants, conditions and promises contained herein,
the parties hereby agree as follows:
1. Employment. The
Company hereby employs Employee for the period beginning as of January 1, 2011
and ending December 31, 2013 (the "Expiration Date"), unless earlier terminated
pursuant hereto (the "Employment Period").
2. Duties. Subject
to the authority of the Board of Directors and the Chief Executive Officer of
the Company, Employee shall be employed as the Company's Executive Vice
President. Employee will perform such duties and services of an executive
nature, commensurate with his position as the Executive Vice President, as may
from time to time be assigned to him by the Chief Executive Officer of the
Company. Specifically, the Employee shall have overall responsibility for
the operating results of the Company's Health and Safety Monitoring Systems
("HSMS") division, including delivery of top line and pre-tax profit.
Employee shall also have such duties and responsibilities on a Company wide
basis as shall be directed by the Board of Directors or the CEO from time to
time. The Employee shall report to the Company's Chief Executive
Officer.
3. Full Time.
Employee agrees that he will devote his full time and attention during regular
business hours to the business and affairs of the Company. The foregoing
shall not prevent the purchase, ownership or sale by Employee of investments or
securities of publicly held companies and any other business that is not
competitive with the Company or any subsidiary of the Company so long as such
investment does not require active participation of Employee in the management
of the business of such publicly held companies, does not interfere or conflict
with the performance of Employee's duties hereunder and does not otherwise
violate any of the provisions of this Agreement, or Employee's participation in
philanthropic organizations to the extent that such participation does not
interfere or conflict with the performance of Employee's duties hereunder and
does not otherwise violate any provision of this Agreement.
4. Compensation.
In consideration of the duties and services to be performed by Employee
hereunder, the Company agrees to pay, and Employee agrees to accept the amounts
set forth below:
(a) A
base salary, to be paid on a bi-weekly basis, at the rate of:
(i) $225,000
per annum, for the period beginning January 1, 2011 and ending December 31,
2011;
(ii) $232,500
per annum, for the period beginning January 1, 2012 and ending December 31,
2012;
(iii) $240,000
per annum, for the period beginning January 1, 2013 and ending December 31,
2013;
(b)
Employee will also be entitled to receive restricted stock units ("RSU") for
16,500 shares of common stock, to vest, subject to the condition that Employee
is employed by the Company at the applicable date, as follows: 5,500 shares on
December 31, 2011, 5,500 shares on December 31, 2012, and 5,500
shares on December 31, 2013; provided, however, that in the
event of a Change in Control (as hereinafter defined), if the Company or its
successor pursuant to such Change in Control, as applicable, and the Employee
either agree to continue this Agreement or to enter into a new employment
agreement mutually acceptable to the Company or its successor and the Employee
in lieu of this Agreement, then any such RSU which remain unvested, shall vest
immediately upon the mutual agreement of the Company or its successor and the
Employee to continue this Agreement or to enter into a new agreement. All
RSUs to be issued pursuant to this Agreement shall be issued out of, and subject
to, the Company's 2010 Equity Incentive Plan, and the effectiveness of such RSU
grants is conditioned upon entry into an Award Agreement, as defined in and
required by such Plan.
(c) In
addition to the base salary payable pursuant to Section 4(a) above, Employee
shall be entitled to participation in the executive bonus pool, which the
Company shall establish by June 30, 2011, on such terms and conditions as may be
determined by the Company’s
independent Compensation Committee in its
sole discretion.
(d) The
compensation provided for herein shall be in addition to any retirement, profit
sharing, insurance or similar benefit which may at any time be payable to
Employee pursuant to any plan or policy of the Company relating to such
benefits, which additional benefits shall be made available to Employee on the
same basis as they are generally made available to other executive officers of
the Company.
(e) The
Company shall reimburse Employee in accordance with the Company's normal
policies for all reasonable travel, hotel, meal and other expenses properly
incurred by him in the performance of his duties hereunder.
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(f) The
Company shall provide Employee with a monthly automobile stipend in the amount
of $950.
5. Vacation.
Employee shall be entitled to three (3) weeks vacation each fiscal year, to be
taken at such time as is mutually convenient to the Company and
Employee.
6. Death. In the
event of the death of Employee during the Employment Period, this Agreement and
the employment of Employee hereunder shall terminate on the date of the death of
Employee. The estate of Employee (or such person(s) as Employee shall
designate in writing) shall be entitled to receive, and the Company agrees to
continue to pay, in accordance with the normal pay practice of the Company, the
base salary of Employee provided by paragraph 4(a) and the additional benefits,
if any, provided by paragraph 4(e), in each instance for a period of one (1)
year following the date of death of Employee.
7. Disability. In
the event that Employee shall be unable to perform because of illness or
incapacity, physical or mental, the duties and services to be performed by him
hereunder for a period of one hundred and eighty (180) consecutive days or an
aggregate period of more than one hundred and eighty (180) days in any 12-Month
period, the Company may terminate this Agreement after the expiration of such
period. Upon such termination, Employee shall be entitled to receive the
base salary provided by paragraph 4(a) and the additional benefits, if any,
provided by paragraph 4(e), in each instance through the date of such
termination.
8. Non-Competition,
Non-Solicitation and Non-Disclosure. (a) Employee covenants and
agrees that throughout the Employment Period and for a period of twelve (12)
months thereafter, he will not, directly or indirectly, own, manage, operate or
control, or participate in the ownership, management, operation or control of,
any business competing directly in the United States of America with the
business conducted by the Company or any subsidiary of the Company during the
Employment Period; provided, however, that
Employee may own not more than 5% of the outstanding securities of any class of
any corporation engaged in any such business, if such securities are listed on a
national securities exchange, the NASDAQ Stock Market or regularly traded in the
Over the Counter market by a member of a national securities
association.
(b)
Employee covenants and agrees that, (i) throughout the Employment Period, he
will not directly or indirectly solicit, entice or induce any person
(collectively, “Solicit”) who during the Employment Period is associated with,
employed by or is a customer of the Company or any subsidiary, and (ii) for a
period of twenty four (24 ) months following the Employment Period, he will not
Solicit any person who is, or within the last three months of Employee's
employment by the Company was, associated with, employed by, or was a customer
of the Company or any subsidiary of the Company, in each case, to leave the
employ of, terminate his association or its relationship with the Company, or
any subsidiary of the Company, or solicit the employment or business of any such
person on his own behalf or on behalf of any other business
enterprise.
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(c)
Employee covenants and agrees that, throughout the Employment Period and at all
times thereafter, he will not use, or disclose to any third party, trade secrets
or confidential information of the Company, including, but not limited to,
confidential information or trade secrets belonging or relating to the Company,
its subsidiaries, affiliates, customers and clients or proprietary processes or
procedures of the Company, its subsidiaries, affiliates, customers and clients,
or the Company’s or its subsidiaries’ business, business plans, investments,
customers, strategies, operations, records, financial information, assets,
technology, data and information that reveals the processes, methodologies,
technology or know-how of the Company or its subsidiaries. Trade secrets
and confidential information shall include, but shall not be limited to, all
information which is known or intended to be known only by employees of the
Company, its respective subsidiaries and affiliates or others in a confidential
relationship with the Company or its respective subsidiaries and affiliates
which relates to business matters.
(d) If
any term of this paragraph 8 is found by any court having jurisdiction to be too
broad, then and in that case, such term shall nevertheless remain effective, but
shall be considered amended (as to the time or area or otherwise, as the case
may be) to a point considered by said court as reasonable, and as so amended
shall be fully enforceable.
(e) In
the event that Employee shall breach or threaten to breach any provision of this
Agreement (including but not limited to the provisions of this paragraph 8),
then Employee hereby consents to the granting of a temporary or permanent
injunction against him by a court of competent jurisdiction prohibiting him from
violating any provision of this Agreement. In any proceeding for an
injunction and upon any motion for a temporary or permanent injunction, Employee
agrees that his ability to answer in damages shall not be a bar or interposed as
a defense to the granting of such temporary or permanent injunction against
Employee. Employee further agrees that the Company will not have an
adequate remedy at law in the event of any breach or threatened breach by
Employee hereunder and that the Company will suffer irreparable damage and
injury if Employee breaches any of the provisions of this
Agreement.
9. Termination;
Non-Renewal.
(a) The
Company may terminate this Agreement without liability (other than for the base
salary and any other compensation provided in paragraph 4 accrued to the date of
termination) in the event of (i) a material breach by Employee of the provisions
of this Agreement, which breach shall not have been cured by Employee within
thirty (30) days following notice thereof by the Company to Employee, (ii) the
commission of gross negligence or bad faith (i.e., an act involving actual or
constructive fraud, or a design to mislead or deceive another, or the conscious
doing of a wrong because of dishonest purpose or motivated by ill will) by
Employee in the course of his employment hereunder, which commission has a
material adverse effect on the Company, (iii) the commission by Employee of a
criminal act of fraud, theft or dishonesty causing material damages to the
Company or any of its subsidiaries, (iv) the conviction of Employee of (or plead
nolo contendere to) any
felony, or misdemeanor involving moral turpitude if such misdemeanor results in
material financial harm to or materially adversely affects the goodwill of the
Company, or (v) any violation by Employee of the Company’s Code of Business
Conduct and Ethics or the Company’s sexual harassment and other forms of
harassment policy or drug and alcohol abuse policy, as set forth in the
Company’s employee handbook. The circumstances specified in (i) through
(v) above shall be defined as “Cause.”
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(b)
Unless the Employee is terminated for Cause pursuant to Section 9(a) above on or
prior to the Expiration Date, and other than in the circumstances described in
Section 9(d), in the event that the Company does not offer Employee to enter
into a written employment agreement with terms and conditions no less favorable
than substantially the same terms and conditions as this Agreement to begin
immediately following the Expiration Date, Employee shall receive, in
consideration of his continuing obligations under Section 8 hereof, payment of
base salary, based on the then applicable salary level, for a period of twelve
(12) months, commencing seven months following the date of expiration of the
Employment Period. Employee’s right to any payments pursuant to this
Section 9(b) shall be in addition to, and not in lieu of, any damages for the
termination by the Company of this Agreement prior to the Expiration Date for
any reason other than those set forth in Section 9(a) above.
(c) After
a Change in Control (as hereinafter defined) has occurred, Employee may
terminate his employment upon thirty (30) days' written notice to the Company
within one hundred and eighty (180) days following such a Change in Control and
after he has obtained actual knowledge of the occurrence of any of the following
events:
(i) Failure to elect or appoint, or
re-elect or re-appoint, Employee to, or removal of Employee from, his office
and/or position with the Company as constituted prior to the Change in
Control, except in connection with the termination of Employee's employment
pursuant to Section 9(a) hereof;
(ii) A reduction in Employee's overall
compensation (including any reduction in pension or other benefit programs or
perquisites) or a material adverse change in the nature or scope of the
authorities, powers, functions or duties normally attached to Employee's
position with the Company as referred to in Section 2 hereof;
(iii) A determination by Employee made in
good faith that, as a result of a Change in Control, he is unable effectively to
carry out the authorities, powers, functions or duties attached to his position
with the Company as referred to in Section 2 hereof, and the situation is not
remedied within thirty (30) days after receipt by the Company of written
notice from Employee of such determination;
(iv) A
breach by the Company of any provision of this Agreement not covered by clauses
(i), (ii) or (iii) of this Section 9(c), which is not remedied within thirty
(30) days after receipt by the Company of written notice from Employee of such
breach;
(v) A change in the location at which
substantially all of Employee's duties with the Company are to be performed to a
location which is not within a 50-mile radius of the address of the place where
Employee is performing services prior to the date of the Change in
Control; or
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(vi) failure
by the Company or its successor pursuant to such Change in Control, as
applicable, and the Employee to either agree to continue this Agreement or to
enter into a new employment agreement mutually acceptable to the Company or its
successor and the Employee in lieu of this Agreement.
An
election by Employee to terminate his employment under the provisions of this
paragraph 9(c) shall not be deemed a voluntary termination of employment by
Employee for the purpose of interpreting the provisions of any of the Company's
employee benefit plans, programs or policies. Employee's right to
terminate his employment pursuant to this paragraph 9(c) shall not be affected
by his illness or incapacity, whether physical or mental, unless the Company
shall at the time be entitled to terminate his employment under paragraph 7 of
this Agreement. Employee's continued employment with the Company for any
period of time less than one hundred and eighty (180) days after a Change in
Control shall not be considered a waiver of any right he may have to terminate
his employment pursuant to this paragraph 9(c). A termination by Employee
under this paragraph 9(c) shall be deemed a termination by the Company of this
Agreement without Cause.
(d) After
a Change in Control has occurred, in the event that this Agreement is terminated
by the Company or its successor without Cause or by the Employee pursuant to
Section 9(c), and if the Company or its successor and the Employee do not
agree to enter into a new employment agreement in lieu hereof, then
Employee shall be entitled to be paid in a lump sum, six months and one day
after such termination, an amount of cash (to be computed, at the expense of the
Company or its successor, by the independent certified public accountants
utilized by the Company immediately prior to the Change of Control (the
"Accountants"), whose computation shall be conclusive and binding upon Employee
and the Company or its successor) equal to 2.99 times Employee's "base amount"
as defined in Section 280G(b)(3) of the Internal Revenue Code of 1986, as
amended (the "Code"). Any such payment shall be in full satisfaction of
all of the Company’s or its successor’s obligations hereunder, and upon payment
made pursuant to this paragraph 9(d), all of the Company’s or its successor’s
obligations pursuant to this Agreement shall terminate in full and Employee
shall have no further rights hereunder or recourse against the Company or its
successor pursuant to this Agreement; provided, however, nothing in
this paragraph 9(d) shall be interpreted to preclude the Employee receiving his
accrued salary and other compensation payable pursuant to paragraph 4 through
the date of termination. Such lump sum payment is hereinafter referred to
as the "Termination Compensation."
It is
intended that the "present value" of the payments and benefits to Employee,
whether under this Agreement or otherwise, which are includable in the
computation of "parachute payments" shall not, in the aggregate, exceed 2.99
times the "base amount" (the terms "present value", "parachute payments" and
"base amount" being determined in accordance with Section 280G of the
Code). Accordingly, if Employee receives payments or benefits from
the Company prior to payment of the Termination Compensation which, when added
to the Termination Compensation, would, in the opinion of the Accountants,
subject any of the payments or benefits to Employee to the excise tax imposed by
Section 4999 of the Code, the Termination Compensation shall be reduced by the
smallest amount necessary, in the opinion of the Accountants, to avoid such
tax. In addition, the Company shall have no obligation to make any
payment or provide any benefit to Employee subsequent to payment of the
Termination Compensation which, in the opinion of the Accountants, would subject
any of the payments or benefits to Employee to the excise tax imposed by Section
4999 of the Code. No reduction in Termination Compensation or release of the
Company from any payment or benefit obligation in reliance upon any aforesaid
opinion of the Accountants shall be permitted unless the Company shall have
provided to Employee a copy of any such opinion that specifically entitles
Employee to rely thereon, no later than the date otherwise required for payment
of the Termination Compensation or any such later payment or
benefit.
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(e)
"Change in Control" as used in this Agreement shall mean the occurrence of any
of the following:
(i) any
"person" or "group" (as such terms are used in Section 3(a)(9) and 13(d)(3)
of the Securities Exchange Act of 1934, as amended (the "Act")), except for an
employee stock ownership trust (or any of the trustees thereof), becomes a
"beneficial owner" (as such term in used in Rule 13d-3 promulgated under
the Act), after the date hereof, directly or indirectly, of securities of the
Company representing 35% or more of the combined voting power of the Company's
then outstanding securities;
(ii) during
any twelve (12) month period during the Employment Period, individuals who at
the beginning of such period constitute the entire Board of Directors cease for
any reason to constitute at least a majority thereof, unless the election, or
the nomination for election, by shareholders of the Company of each new director
was approved or ratified by a vote of at least a majority of the directors then
still in office who were directors at the beginning of the Employment Period or
who were new directors approved by such a vote;
(iii) the
consummation of the sale or disposition by the Company of all or substantially
all of the Company's assets; or
(iv) the
consummation of a merger or consolidation of the Company with any other company,
other than a merger or consolidation which would result in the combined voting
power of the Company's voting securities outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or the parent company of such
surviving entity) 50% or more of the combined voting power of the voting
securities of the Company or such surviving entity or the parent company of such
surviving entity outstanding immediately after such merger or
consolidation. Notwithstanding the foregoing, any transaction
involving a leveraged buyout or other acquisition of the Company which would
otherwise constitute a Change in Control, in which Employee owns
(post-transaction) more than 10% of the voting power of outstanding securities
in the surviving or successor entity or its parent company (not counting
securities Employee receives in exchange for his Company holdings), shall not
constitute a Change in Control.
10. No
Impediments. Employee warrants and represents that he is free
to enter into this Agreement and to perform the services contemplated thereby
and that such actions will not constitute a breach of, or default under, any
existing agreement.
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11. No
Waiver. The failure of any of the parties hereto to enforce
any provision hereof on any occasion shall not be deemed to be a waiver of any
preceding or succeeding breach of such provision or of any other
provision.
12. Entire
Agreement. This Agreement constitutes the entire agreement and
understanding of the parties hereto with respect to the subject matter hereof
and no amendment, modification or waiver of any provision herein shall be
effective unless in writing, executed by the party charged
therewith.
13. Governing
Law. This Agreement shall be construed, interpreted and
enforced in accordance with and shall be governed by the laws of the State of
New York applicable to agreements to be wholly performed therein, other than
those which would defer to the substantive laws of another
jurisdiction.
14. Binding
Effect. This Agreement shall bind and inure to the benefit of
the parties, their successors and assigns.
15. Assignment and Delegation of
Duties. This Agreement may not be assigned by the parties
hereto except that the Company shall have the right to assign this Agreement to
any successor in connection with a sale or transfer of all or substantially all
of its assets, a merger or consolidation. This Agreement is in the
nature of a personal services contract and the duties imposed hereby are
non-delegable.
16. Paragraph
Headings. The paragraph headings herein have been inserted for
convenience of reference only and shall in no way modify or restrict any of the
terms or provisions hereof.
17. Notices. Any
notice under the provisions of this Agreement shall be in writing, shall be sent
by one of the following means, directed to the address set forth on the first
page of this Agreement or to such other address as shall be designated hereunder
by notice to the other party, effective upon actual receipt and shall be deemed
conclusively to have been given: (i) on the first business day following the day
timely deposited for overnight delivery with Federal Express (or other
equivalent national overnight courier service) or United States Express Mail,
with the cost of delivery prepaid or for the account of the sender; (ii) on the
fifth business day following the day duly sent by certified or registered United
States mail, postage prepaid and return receipt requested; or (iii) when
otherwise actually received by the addressee on a business day (or on the next
business day if received after the close of normal business hours or on any
non-business day).
18. Unenforceability;
Severability. If any provision of this Agreement is found to
be void or unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall, nevertheless, be binding upon the parties
with the same force and effect as though the unenforceable part has been severed
and deleted.
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19. Code Section
409A. The Company and the Employee agree to work together in
good faith to consider amendments to this Agreement necessary or appropriate to
avoid imposition of any additional tax or income recognition prior to actual
payment to Employee under Internal Revenue Code Section 409A and any temporary
or final Treasury Regulations and Internal Revenue Service guidance thereunder.
In the event any provision of this Agreement is not in compliance with Code
Section 409A, the Company will revise the Agreement as necessary, without the
consent of the Employee, to comply with Code Section 409A with respect to such
provision to best preserve the economic arrangement contemplated by such
provision.
20. Counterparts;
Facsimile. This Agreement may be executed in one or more
counterparts and delivered by facsimile, each of which shall constitute an
original, and which when taken together, shall constitute one and the same
instrument.
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IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed as of the date first
above written.
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EMPLOYEE:
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/s/ Frederic Siegel
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Frederic
Siegel
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COMPANY:
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AMERICAN
MEDICAL ALERT CORP.
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By:
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/s/ Jack Rhian
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Name:
Jack Rhian
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Title:
Chief Executive
Officer
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