Employment Agreement - GT Equipment Technologies Inc. and Jeffrey J. Ford
THIS EMPLOYMENT AGREEMENT (this "Agreement"), effective the 1st day of June 2006 ("Effective Date"), is entered into by and between Jeffrey J. Ford ("Executive") and GT Equipment Technologies, Inc., a Delaware corporation (the "Company").
WHEREAS, the Company wishes to employ the Executive, and the Executive wishes to enter into such employment, upon and subject to the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the mutual representations, warranties, covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:
1. Term. The term of the Executive's employment under this Agreement (the "Term") shall commence on the Effective Date and shall continue, subject to earlier termination in accordance with Section 4 below, until the second anniversary of the Effective Date, provided that on the second anniversary of the Effective Date and on each subsequent anniversary of the Effective Date (each, an "Extension Date") the Term, unless earlier terminated in accordance with Section 4 below, shall automatically extend for one additional year unless either party gives the other written notice of non-extension at least ninety (90) days prior to the applicable Extension Date. The date on which the Executive's employment under this Agreement terminates for any reason shall be the "Termination Date."
2. Employment. During the Term, the Executive shall serve the Company, and the Company shall employ the Executive, as General Manager, China or in such other executive capacity or capacities as may be determined from time to time by the Company's Chief Executive Officer or Board of Directors (the "Board"). The Executive shall use the Executive's best and most diligent efforts to promote the interests of the Company; shall discharge the Executive's duties in a highly competent manner; shall provide reasonable advisory or similar services to GT Solar Holdings, LLC, as and when requested by the managing member thereof, without additional compensation or benefits; and shall devote the Executive's full business time and best business judgment, skill and knowledge to the performance of the Executive's duties and responsibilities hereunder. The Executive's responsibilities will include, but not be limited to, managing the Company's China operations and, as requested by the Company, management assistance in Asia generally, including spending substantial amounts of time in the Peoples' Republic of China, in Taiwan, and elsewhere in Asia as requested by GT.
3. Compensation and Benefits.
(a) Salary. During the Term, the Executive shall be paid a salary at the rate of ONE HUNDRED SEVENTY-FIVE THOUSAND Dollars ($175,000) per year ("Base Salary"). The Base Salary shall be reviewed annually by the Company's Board which may increase Base Salary based upon the Executive's and/or Company's performance. The Board may not reduce the Executive's Base Salary.
(b) Bonuses. The Executive shall be paid a one time signing bonus of $50,000 within thirty (30) days of starting employment and moving to the Merrimack, New Hampshire area. The Executive shall also be eligible to participate in any long-term incentive compensation plan, program or arrangement, applicable to certain senior management from time to time. The terms of such participation including the size and type of awards thereunder ("Awards") shall be within the sole discretion of the Board. Currently, such program provides for the Award of twenty-five percent (25%) of the Executive's Base Salary upon achievement by the Company of its target EBITDA, with such Award to be adjusted higher or lower for performance ranging from 75% to 125% of target EBITDA. At 75% of target EBITDA, the Award is reduced to 0% of Base Salary and, at 125% of target EBITDA, the Award is increased to 150% of target or 37.5% of Base Salary (e.g. 25% of Base Salary at target EBITDA X 150% at 125% of EBITDA = Award of 37.5% of Base Salary.
(c) Long-Term Incentive. The Executive shall be considered for the award of stock options or warrants in the Company, subject to approval of GT's Board of Directors. Additionally, Executive will be paid a "stay" bonus of $25,000 within thirty (30) days following both of the first and second anniversaries of the Executive's employment with the Company.
(d) Reimbursement of Expenses. The Company shall reimburse the Executive, in accordance with its normal policies and practices, for all reasonable travel and other expenses incurred by the Executive in performing the Executive's obligations under this Agreement, including the rental of an apartment in China at a cost not to exceed $3000 per month and a car and driver as reasonably required for business travel within China. The Company also agrees to pay the reasonable travel expenses of the Executive's spouse to and from China
(e) Other Benefits. During the Term, the Executive shall be eligible to participate in health, medical, dental, long-term disability insurance, and "401(k)" benefits and in any other employee benefit plans or programs on terms generally applicable to senior management employees. The Executive shall be entitled to three (3) weeks of paid vacation per year or any greater amount due under the terms of the Company's vacation policy in effect from time to time.
4. Termination of Employment.
(a) Either party may terminate the Executive's employment hereunder at any time, and for any reason, provided that the Executive shall provide thirty (30) days written notice of a voluntary termination as described in Section 4(e) below. The terms and condition of any such termination shall be as set forth in this Section 4.
(b) Termination for Cause. If it has "Cause," as defined below, the Company shall have the right, exercisable by written notice to the Executive, to terminate the Executive's employment effective upon the giving of such notice (or such later date as shall be specified in such notice), in which case (i) the Company shall have no further obligation hereunder to the Executive, except for payment of Base Salary and provision of benefits through the Termination Date, and (ii) any Awards shall expire immediately. For purposes of this Agreement, "Cause" means the Executive's: (i) conviction of, or plea of guilty or nolo contendere to, any felony or other crime punishable by imprisonment; (ii) gross misconduct, misconduct that is repeated after written notice to the Executive, gross negligence, or negligence that is repeated after written notice to the Executive; (iii) fraud or embezzlement; or (iv) willful failure or refusal to perform his obligations under this Agreement, unless such failure or refusal is corrected within thirty (30) days after notice to the Executive. If the Executive's employment is terminated for any reason other than for Cause and it is thereafter determined that the Company could have terminated such employment for Cause, such termination shall be deemed to have been for Cause and the Executive's rights and obligations shall be adjusted accordingly.
(c) Termination as a Result of the Executive's Death or Disability. The Executive's employment under this Agreement shall terminate upon (i) the Executive's death or (ii) the Executive's Disability (as defined below) after thirty (30) days written notice by the Company, whereupon the Executive or the Executive's estate, as the case may be, will be entitled to receive: (A) accrued Base Salary and benefits through the Termination Date, (B) any accrued and unpaid Bonus for the year prior to the year in which the Termination Date occurs, and (C) a Bonus for the year in which the Termination Date occurs equal to the target Bonus the Executive would have earned had the Executive remained in employment through the end of the Bonus year prorated to reflect the Executive's actual period of employment during the year in which the Termination Date occurs. Additionally, the Executive's rights to any Awards will be determined pursuant to any applicable plans or agreements and the Executive shall have no other rights except as may be specifically set forth in writing under a Company plan or program applicable to the Executive.
For purposes of this Agreement, "Disability" shall have the meaning set forth in any long-term disability plan in which the Executive participates, and in the absence thereof shall mean that, due to physical or mental illness, the Executive is unable to perform the Executive's duties on a full-time basis hereunder for (i) a period in excess of one hundred twenty (120) consecutive days or (ii) more than one hundred eighty (180) days in any consecutive twelve (12) month period.
(d) Termination Without Cause or for Good Reason.
If the Executive's employment is terminated by the Executive for "Good Reason" (as defined below) or by the Company for any reason other than (i) the Executive's death or Disability or (ii) for Cause, and provided that the Executive shall have entered into a release of claims in favor of the Company in a form acceptable to the Company (the "Release"), and also provided that the Executive has complied with the Release and the "Restrictive Covenant Agreement" (as defined below), the Executive shall be entitled to the following:
(i) accrued Base Salary and benefits through the Termination Date,
(ii) any accrued and unpaid Bonus for the year prior to the year in which the Termination Date occurs,
(iii) cash severance payments equal in the aggregate to the Executive's annual Base Salary at the time of termination, payable in twelve (12) equal monthly installments beginning at the end of the first full month following the Termination Date; and
(iv) continuation of the Executive's health, medical and dental insurance benefits for a period equal to the lesser of (i) twelve (12) months, or (ii) the period ending on the date the Executive first becomes entitled to similar benefits under any plan maintained by any person for whom the Executive provides services as an employee or otherwise.
The Executive's rights with respect to any Awards shall be determined pursuant to any applicable plans or agreements and the Executive shall have no other rights except as may be specifically set forth in writing under a Company plan or program applicable to the Executive.
For purposes of this Agreement, "Good Reason" shall mean (i) the Company's material breach of this Agreement; provided that the Executive has delivered written notice of the material breach and the Company has not cured such breach within fifteen (15) days following the date the Executive provides such notice; or (ii) change in Executive's title or position which is not generally commensurate with Executive's level of seniority with the Company, or the assignment to the Executive of duties and responsibilities which are not generally commensurate with the Executive's level of seniority with the Company, or a change to the Executive's duties and responsibilities which has the effect of substantially reducing the scope of the Executive's duties and responsibilities in the aggregate.
(e) Termination by the Executive other than for Good Reason. The Executive may terminate employment with the Company other than for Good Reason upon thirty (30) days written notice to the Company, in which case (i) the Company shall have no further obligation hereunder to the Executive, except for payment of Base Salary and provision of benefits through the Termination Date, and (ii) the Executive's rights with respect to any Awards shall be determined pursuant to any applicable plans or agreements.
5. Confidential Information, Non-Competition; Non-Solicitation. The Executive shall execute and will comply with the Confidentiality and Non-Competition Agreement to be dated as of the Effective Date (the "Restrictive Covenant Agreement"), between the Company and the Executive in substantially the form of Exhibit A, attached hereto.
6. No Conflict. The Executive represents and warrants that the Executive is not subject to any agreement, instrument, order, judgment or decree of any kind, or any other restrictive agreement of
any character, which would prevent the Executive from entering into this Agreement or would conflict with the performance of the Executive's duties pursuant to this Agreement. The Executive represents and warrants that the Executive will not engage in any activity which would conflict with the performance of the Executive's duties pursuant to this Agreement.
7. Notices. All notices and other communications under this Agreement shall be in writing and shall be given by courier service or first-class mail, certified or registered with return receipt requested, and shall be deemed to have been duly given on the date receipt is recorded by the appropriate delivery service, or may be delivered personally by hand to the respective persons named below:
If to the Company:
GT Equipment Technologies, Inc.
243 Daniel Webster Highway
Merrimack, NH 03054
Attention: Chief Executive Officer
cc: General Counsel
If to the Executive:
Jeffrey J. Ford
20 Woodbriar Lane
Rochester, New York 14624
Either party may change such party's address for notices by notice duly given pursuant hereto.
8. Dispute Resolution. Any dispute or controversy between the Company and the Executive relating to this Agreement shall be settled by binding arbitration in the City of Manchester, State of New Hampshire, pursuant to the governing rules of the American Arbitration Association and shall be subject to the provisions of New Hampshire Revised Statutes Annotated Chapter 542. Judgment upon the award may be entered in any court of competent jurisdiction.
9. Assignment; Successors. This Agreement is personal in its nature and neither of the parties hereto shall, without the consent of the other, assign or transfer this Agreement or any rights or obligations hereunder; provided that, in the event of the merger, consolidation, transfer, or sale of all or substantially all of the assets of the Company with or to any other individual or entity, this Agreement shall, subject to the provisions hereof, be binding upon and inure to the benefit of such successor and such successor shall discharge and perform all the promises, covenants, duties, and obligations of the Company hereunder.
10. Governing Law. This Agreement and the legal relations thus created between the parties hereto shall be governed by and construed under and in accordance with the laws of the State of New Hampshire.
11. Withholding. The Company shall make such deductions and withhold such amounts from each payment made to the Executive hereunder as may be required from time to time by law, governmental regulation or order or by assent of the Executive.
12. Headings. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose.
13. Waiver; Modification. Failure to insist upon strict compliance with any of the terms, covenants, or conditions hereof shall not be deemed a waiver of such term, covenant, or condition, nor shall any waiver or relinquishment of, or failure to insist upon strict compliance with, any right or power hereunder at any one or more times be deemed a waiver or relinquishment of such right or power at any other time or times. This Agreement shall not be modified in any respect except by a writing executed by each party hereto.
14. Severability. If for any reason any term or provision containing a restriction set forth herein is held to be for a length of time which is unreasonable or in other way is construed to be too broad or to any extent invalid, such term or provision shall not be determined to be null, void and of no effect, but to the extent the same is or would be valid or enforceable under applicable law, any court shall construe and reform this Agreement to provide for a restriction having the maximum time period and other provisions as shall be valid and enforceable under applicable law. If, notwithstanding the previous sentence, any term or provision of this Agreement is held to be invalid or unenforceable, all other valid terms and provisions hereof shall remain in full force and effect, and all of the terms and provisions of this Agreement shall be deemed to be severable in nature.
15. Entire Agreement; Effect on Certain Prior Agreements. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes any prior agreements between them with respect to the subject matter hereof, including all prior employment, retention, severance or related agreements between the Executive and the Company or any successor, predecessor or affiliate; provided, however, that nothing in this Agreement shall affect the Executive's obligations under the Restrictive Covenant Agreement.
16. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly authorized officer, and the Executive has hereunto signed this Agreement, as of the date first above written.
|GT EQUIPMENT TECHNOLOGIES, INC.|
/s/ KEDAR P. GUPTA
/s/ JEFFREY J. FORD 5/21/06
Jeffrey J. Ford
GT EQUIPMENT TECHNOLOGIES, INC. EMPLOYEE, NON-COMPETITION, NON-DISCLOSURE,
PROPRIETARY INFORMATION AND PATENT AND INVENTION ASSIGNMENT AGREEMENT
In consideration of my employment or continued employment, as the case may be, with GT Equipment Technologies, Inc. (the "Company"), and the compensation received by me from the Company, from time to time, I hereby agree with the Company as follows:
Company and after its termination, I will keep in strictest confidence and trust all Proprietary Information and I will not use or disclose any Proprietary Information without the written consent of the Company, except as may be necessary in the ordinary course of performing my duties as an employee of the Company.
executed by me and I hereby ratify, affirm and approve all such lawfully permitted acts accordingly.
construed as prohibiting the Company from pursuing any other remedies available for any such breach or threatened breach.
I HAVE READ AND AGREE TO THE FOREGOING.
/s/ JEFFREY J. FORD
|Jeffrey J. Ford, Employee||Date:|