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EXHIBIT 1
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AMENDED AND RESTATED EMPLOYMENT AGREEMENT
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This Amended and Restated Employment Agreement (the
"Employment Agreement") is made and entered into as of the 14th day of June,
1999 (the "Execution Date"), by and between N-Viro International Corporation, a
Delaware corporation (the "Company"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇, an individual
("Employee").
W I T N E S S E T H:
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WHEREAS, the Company owns and licenses the N-Viro Process, a
patented technology to treat and recycle wastewater sludge and other bio-organic
wastes, utilizing certain alkaline and mineral by-products produced by cement,
lime, electric utilities and other industries (such activities, together with
all other activities of the Company and/or its subsidiaries or affiliates, as
conducted at or prior to the termination of this Employment Agreement, and any
future activities reasonably related thereto that are contemplated by the
Company and/or its subsidiaries or affiliates at the termination of this
Employment Agreement identified in writing by the Company to Employee at the
date of such termination, are hereinafter collectively referred to as the
"Business Activities");
WHEREAS, the Company and Employee entered into an Employment
Agreement as of September 16, 1998 (the "First Employment Agreement"); and,
WHEREAS, the Company and Employee desires to amend and restate
the First Employment Agreement upon the terms and subject to the terms and
conditions set forth in this Employment Agreement.
NOW, THEREFORE, in consideration of the premises, the mutual
promises, covenants and conditions herein contained and in the First Employment
Agreement and for other good and valuable considerations, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto intending to be
legally bound hereby agree as follows:
Section 1. FIRST EMPLOYMENT AGREEMENT. Effective as of the
Execution Date, the First Employment Agreement shall be canceled and terminated
and of no further legal force or effect and this Employment Agreement shall be
in full legal force and effect until otherwise amended, modified, supplemented
or terminated in accordance with the terms of this Employment Agreement.
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Section 2. EMPLOYMENT. During the Employment Period (as
hereinafter defined), the Company shall employ Employee, and Employee shall
accept employment with the Company, all upon the terms and subject to the
conditions set forth in this Employment Agreement.
Section 3. CAPACITY AND DUTIES. Employee shall be employed in
the capacity of President and Chief Operating Officer of the Company and its
subsidiaries and affiliates and shall have such other duties, responsibilities
and authorities as are assigned to him by the Board of Directors of the Company
(the "Board") so long as such additional duties, responsibilities and
authorities are consistent with Employee's position and level of authority as
President and Chief Operating Officer of the Company. Employee shall report
directly to the Chairman of the Board and Chief Executive Officer of the
Company. Subject to the control and general directions of the Chairman of the
Board and Chief Executive Officer of the Company and the general policies and
guidelines established by the Board and except as otherwise herein provided,
Employee shall devote all of his business time, best efforts and attention to
promote and advance the business of the Company and its subsidiaries and
affiliates and to perform diligently and faithfully all the duties,
responsibilities and obligations of Employee to be performed by him under this
Employment Agreement. Employee's duties shall include the on-going management
and oversight of the general business affairs and operations of the Company and
its subsidiaries and affiliates and shall include, but not be limited to,
matters relating to research and development, technical direction, international
sales, national policy and governmental regulations and relations including
those relating to water and the environment. So long as Employee is employed by
the Company, the Company shall use its best efforts to cause the Nominating
Committee of the Board or the Board, if there is no Nominating Committee of the
Board, to nominate Employee for reelection as a director of the Company for a
three year term upon expiration of his current term as a director of the Company
and, if so nominated, Employee shall consent to serve as a director if elected.
During the Employment Period, Employee shall not be employed in any other
business activity, whether or not such activity is pursued for gain, profit or
other pecuniary advantage; PROVIDED, HOWEVER, that this restriction shall not be
construed as preventing Employee from (i) investing his personal assets in a
business that is not engaged in any Business Activities, where the form or
manner of such investment will not require services of any significance on the
part of Employee in the operation of the affairs of the business in which such
investment is made and in which his participation is solely that of a passive
investor or advisor or (ii) being engaged in those activities listed on Exhibit
2 attached hereto; PROVIDED FURTHER, HOWEVER, that the activities described in
clause (ii) of this sentence shall not unreasonably interfere with Employee's
performance of his obligations under this Employment Agreement.
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Section 4. TERM OF EMPLOYMENT. The term of employment of
Employee by the Company pursuant to this Employment Agreement shall be for the
period (the "Employment Period") commencing on July 1, 1999 (the "Commencement
Date") and ending on June 30, 2004 or such earlier date that Employee's
employment is terminated or later date that Employee's employment is extended in
accordance with the provisions of this Employment Agreement (the "Termination
Date"). So long as Employee is in full compliance with all of the terms and
conditions of this Employment Agreement, Employee is not in default under or in
breach of any of the covenants, agreements, representations or warranties set
forth in this Employment Agreement and neither Employee nor the Company has
delivered a Notice of Termination (as hereinafter defined) to the other that the
Employment Period shall not be extended, then this Employment Agreement and the
Employment Period shall be extended for an additional period of one (1) year
beginning July 1, 2000 and on July 1, of each succeeding year thereafter.
Section 5. PLACE OF EMPLOYMENT. Employee's principal place of
work shall be located at the principal offices of the Company in the Toledo,
Ohio area. The Company and Employee acknowledge that Employee's principal place
of work is consistent with the extensive national and international business
travel which may be required of Employee in connection with the performance of
his duties, responsibilities and authorities under this Agreement.
Section 6. COMPENSATION. During the Employment Period, subject
to all the terms and conditions of this Employment Agreement and, except as
otherwise provided in Sections 10 or 11, as the case may be, as compensation for
all services to be rendered by Employee under this Employment Agreement, the
Company shall pay to or provide Employee with the following:
6.01 BASE SALARY. The Company shall pay to Employee a
base annual salary (the "Base Salary") at the rate of at least One
Hundred Forty-Four Thousand Dollars ($144,000) per year from the
Commencement Date through December 31, 2000, payable at such intervals
(at least monthly) as salaries are paid generally to other executive
officers of the Company. On or before January 1, 2001 and on or before
each January 1 thereafter during the Employment Period, Employee's Base
Salary shall be reviewed by the Board and increased to an amount
determined in good faith by the Board based upon a complete review of
Employee's performance under this Employment Agreement during the prior
year and the growth and profitability of the Company and Employee's
contributions thereto, which review shall be communicated in writing to
Employee.
6.02 CASH BONUS. At the sole and exclusive discretion of
the Board, the Company shall pay to Employee an annual cash bonus (the
"Cash Bonus") in an amount determined in good faith by the Board based
upon a complete review of Employee's performance under this Employment
Agreement during the prior year and the growth and profitability of the
Company and
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Employee's contribution thereto. Any Cash Bonus payable to Employee
pursuant to this Section 6.02 shall be payable, if at all, on or before
March 31, of each year during the Employment Period based upon
Employees performance for the prior calendar year.
6.03 OTHER BENEFITS. The Company shall provide Employee
with the other benefits specified on Exhibit 6.03 attached hereto.
6.04 STOCK OPTION. The Company shall grant to Employee
the sole and exclusive right and option to purchase Fifty Thousand
(50,000) shares of the Common Stock, par value $.01 per share, of the
Company (the "Company Common Stock") at a price per share equal to the
closing sale price of the Company Common Stock on August 14, 1998 as
reported on the NASDAQ Small Caps Market and upon the terms and subject
to the conditions set forth in the form of Stock Option Agreement
attached hereto as Exhibit 6.04 (the "Stock Option Agreement"), which
the Company and Employee shall each execute and deliver to the other as
of the Execution Date.
Section 7. ADHERENCE TO STANDARDS. Employee shall comply with
the written policies, standards, rules and regulations of the Company from time
to time established for all executive officers of the Company.
Section 8. REVIEW OF PERFORMANCE. The Board and/or the Chief
Executive Officer of the Company shall periodically review and evaluate the
performance of Employee under this Employment Agreement with Employee.
Section 9. EXPENSES. The Company shall reimburse Employee for
all reasonable, ordinary and necessary expenses (including, but not limited to,
automobile and other business travel and customer entertainment expenses)
incurred by him in connection with his employment hereunder; PROVIDED, HOWEVER,
Employee shall render to the Company a complete and accurate accounting of all
such expenses in accordance with the substantiation requirements of Section 274
of the Internal Revenue Code of 1986, as amended (the "Code"), as a condition
precedent to such reimbursement.
Section 10. TERMINATION WITH CAUSE BY THE COMPANY. This
Employment Agreement may be terminated with Cause (as hereinafter defined) by
the Company provided that the Company shall (i) give Employee the Notice of
Termination and (ii) pay Employee his annual base salary through the Termination
Date at the rate in effect at the time the Notice of Termination is given plus
any bonus or incentive compensation which have been earned or have become
payable pursuant to the terms of any compensation or benefit plan as of the
Termination Date, but which have not yet been paid.
Section 11. TERMINATION WITHOUT CAUSE BY THE COMPANY OR FOR
GOOD REASON BY EMPLOYEE. This Employment Agreement may be terminated by (i) the
Company by reason of
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the death or Disability (as hereinafter defined) of Employee, (ii) the Company
by giving Employee the Notice of Termination, (iii) Employee for Good Reason (as
hereinafter defined) after giving the Company the Notice of Termination within
fifteen (15) days prior to such termination and (iv) Employee not for Good
Reason after giving the Company the Notice of Termination within sixty (60) days
prior to such termination. In the event of termination of this Employment
Agreement under this Section 11, the Company shall pay Employee his Base Salary
through the Termination Date at the rate in effect at the time of the
Termination Date plus any bonus or incentive compensation which have been earned
or have become payable pursuant to the terms of any compensation or benefit plan
as of the Termination Date, but which have not yet been paid. In the event of
termination of this Employment Agreement under this Section 11 by the Company
(other than by reason of the death or Disability of Employee) or by Employee for
Good Reason and such termination is on or prior to the Termination Date that
would be in effect if such employment had not been terminated under this Section
11, the Company shall pay to Employee, in addition to the other benefits
specifically provided for in this Section, his Base Salary for the one (1) year
period beginning on the Termination Date; PROVIDED, HOWEVER, that if such
Termination under this Section 11 is by the Company (other than by reason of the
death or Disability of Employee) prior to the Termination Date that would be in
effect if such employment had not been terminated under this Section 11, the
Company shall pay to Employee his Base Salary for the two (2) year period
beginning on the Termination Date. This Section 11 shall not be interpreted so
as to limit any benefits to which Employee, as a terminated employee of the
Company, or his family may be entitled under the Company's life insurance,
medical, hospitalization or disability plans following the Termination Date or
under applicable law.
Section 12. CONSULTING AGREEMENT. If Employee is still acting
as an executive officer of the Company on June 30, 2004 under this Employment
Agreement or such later date as this Employment Agreement is extended by the
mutual agreement of Employee and the Company (the "Extension Date"), then
Employee and the Company shall enter into a Consulting Agreement in the form of
Exhibit 12 attached hereto (the "Consulting Agreement"), which Consulting
Agreement shall be effective as of the Extension Date and shall terminate on
June 30, 2014, subject to earlier termination as provided therein.
Section 13. COVENANT NOT TO COMPETE. On the Execution Date,
Employee and the Company shall enter into a Covenant Not to Compete Agreement in
the form of Exhibit 13 attached hereto (the "Covenant Not to Compete").
Section 14. DEFINITIONS. In addition to the words and terms
elsewhere defined in this Employment
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Agreement, certain capitalized words and terms used in this Employment Agreement
shall have the meanings given to them by the definitions and descriptions in
this Section 14 unless the context or use indicates another or different meaning
or intent, and such definition shall be equally applicable to both the singular
and plural forms of any of the capitalized words and terms herein defined. The
following words and terms are defined terms under this Employment Agreement:
14.01 "Disability" shall mean a physical or mental illness
which, in the judgment of the Company after consultation with the
licensed physician attending Employee, impairs Employee's ability to
substantially perform his duties under this Employment Agreement as an
employee and as a result of which he shall have been absent from his
duties with the Company on a full-time basis for three (3) consecutive
months.
14.02 A termination with "Cause" shall mean a termination
of this Employment Agreement by reason of (a) a good faith
determination by the Board that Employee (i) failed to substantially
perform his duties with the Company (other than a failure resulting
from his incapacity due to physical or mental illness) after a written
demand for substantial performance has been delivered to him by the
Board, which demand specifically identifies the manner in which the
Board believes he has not substantially performed his duties and
Employee has failed to substantially perform as requested within a
reasonable time, (ii) has engaged in conduct the consequences of which
are materially adverse to the Company, monetarily or otherwise, (iii)
is found guilty of fraud, dishonesty or other acts of gross misconduct
or misfeasance in the performance of his duties under this Employment
Agreement by a court of competent jurisdiction whose decision is final
and non-appealable, (iv) is found to be an alcoholic or under the
influence of illegal drugs or other similar substance while performing
his duties under this Employment Agreement or (v) is convicted of a
felony, or (b) the Company makes an assignment for the benefit of
creditors, files a voluntary petition in bankruptcy, is involuntarily
adjudicated to bankrupt, is liquidated or dissolved or sells
substantially all of its assets. No act, or failure to act, on
Employee's part shall be grounds for termination with Cause unless he
has acted or failed to act with an absence of good faith or without a
reasonable belief that his action or failure to act was in or at least
not opposed to the best interests of the Company. Notwithstanding the
foregoing, Employee shall not be deemed to have been terminated with
Cause unless there shall have been delivered to him a copy of a
resolution duly adopted by the affirmative vote of not less than a
majority of the entire membership of the Board (exclusive of Employee)
at a meeting of the Board called and held for the purpose of
terminating Employee (after reasonable notice to Employee and
opportunity for him, together with his counsel, to be heard before the
Board), finding that in the good faith opinion of the Board, Employee
failed to perform his duties or engaged in conduct in the manner or of
the type set forth above in the first sentence of this Section 14.02
and specifying the particulars thereof in detail.
14.03 "Good Reason" shall mean the occurrence of any of
the following events without Employee's prior express written consent:
(i) any material change in Employee's status, title, authorities or
responsibilities (including reporting responsibilities) under this
Employment Agreement which represents a
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demotion from such status, title, position or responsibilities
(including reporting responsibilities); the assignment to him of any
duties or work responsibilities which are materially inconsistent with
his status, title, position or work responsibilities set forth in this
Employment Agreement or which are materially inconsistent with the
status, title, position or work responsibilities of a President or
Chief Operating Officer of a publicly traded corporation; or any
removal of Employee from, or failure to appoint, elect, reappoint or
reelect Employee to, any of such positions, except in connection with
the termination of his employment with Cause, or as a result of his
death or Disability; PROVIDED, HOWEVER, that no change in title,
authorities or responsibilities customarily attributable solely to the
Company ceasing to be a publicly traded corporation shall constitute
Good Reason hereunder; (ii) the relocation of the principal office of
the Company or the reassignment of Employee to a location more than
thirty (30) miles from Toledo, Ohio; (iii) the failure by the Company
to continue in effect any incentive, bonus or other compensation plan
in which Employee participates, unless an equitable arrangement
(embodied in an ongoing substitute or alternative plan) has been made
with respect to the failure to continue such plan, or the failure by
the Company to continue Employee's participation therein, or any action
by the Company which would directly or indirectly materially reduce his
participation therein or reward opportunities thereunder; PROVIDED,
HOWEVER, that Employee continues to meet all eligibility requirements
thereof; (iv) the failure by the Company to continue in effect any
employee benefit plan (including any medical, hospitalization, life
insurance or disability benefit plan in which Employee participates),
or any material fringe benefit or prerequisite enjoyed by him unless an
equitable arrangement (embodied in an ongoing substitute or alternative
plan) has been made with respect to the failure to continue such plan,
or the failure by the Company to continue Employee's participation
therein, or any action by the Company which would directly or
indirectly materially reduce his participation therein or reward
opportunities thereunder, or the failure by the Company to provide him
with the benefits to which he is entitled under this Employment
Agreement; PROVIDED, HOWEVER, that Employee continues to meet all
eligibility requirements thereof; (v) any other material breach by the
Company of any provision of this Employment Agreement; (vi) the failure
of the Company to obtain a satisfactory agreement from any successor or
assign of the Company to assume and agree to perform this Employment
Agreement, as contemplated in Section 25 hereof; (vii) any purported
termination of Employee's employment which is not effected pursuant to
a Notice of Termination satisfying the requirements of this Employment
Agreement; and for purposes of this Employment Agreement, no such
purported termination shall be effective; or (viii) any Change of
Control (as hereinafter defined) of the Company.
14.04 CHANGE OF CONTROL. "Change of Control" shall be
deemed to have occurred when: (i) securities of the Company
representing 50% or more of the combined voting power of the Company's
then outstanding voting securities are acquired pursuant to a tender
offer or an exchange offer by a person or entity which is not a
wholly-owned subsidiary of the Company or any of its affiliates; (ii) a
merger or consolidation is consummated in which the Company is a
constituent corporation and which results in less than 50% of the
outstanding voting securities of the surviving or resulting entity
being owned by the then existing stockholders of the Company; (iii) a
sale is consummated by the Company
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of substantially all of the Company's assets to a person or entity
which is not a wholly-owned subsidiary of the Company or any of its
affiliates; or (iv) during any period of two consecutive years,
individuals who, at the beginning of such period, constituted the Board
cease, for any reason, to constitute at least a majority thereof,
unless the election or nomination for election for each new director
was approved by the vote of at least two-thirds of the directors then
still in office who were directors at the beginning of the period.
14.05 NOTICE OF TERMINATION. "Notice of Termination" shall
mean a written notice which shall indicate the specific termination
provision in this Employment Agreement relied upon and shall set forth
in reasonable detail the facts and circumstances claimed to provide a
basis for termination of Employee's employment under the provision so
indicated; PROVIDED, HOWEVER, no such purported termination shall be
effective without such Notice of Termination; PROVIDED FURTHER,
HOWEVER, any purported termination by the Company or by Employee shall
be communicated by a Notice of Termination to the other party hereto in
accordance with Section 4 of this Employment Agreement.
Section 15. FEES AND EXPENSES. The Company shall pay all legal
fees and related expenses (including the costs of experts, evidence and counsel)
incurred by Employee as a result of a contest or dispute over Employee's
termination of employment if such contest or dispute is resolved in Employee's
favor.
Section 16. NOTICES. For the purposes of this Employment
Agreement, notices and all other communications provided for in the Employment
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or sent by certified mail, return receipt requested,
postage prepaid, or by expedited (overnight) courier with established national
reputation, shipping prepaid or billed to sender, in either case addressed to
the respective addresses last given by each party to the other (provided that
all notices to the Company shall be directed to the attention of the Board with
a copy to the Secretary of the Company) or to such other address as either party
may have furnished to the other in writing in accordance herewith. All notices
and communication shall be deemed to have been received on the date of delivery
thereof, on the third business day after the mailing thereof, or on the second
day after deposit thereof with an expedited courier service, except that notice
of change of address shall be effective only upon receipt.
Section 17. LIFE INSURANCE. The Company may, at any time after
the execution of this Employment Agreement, apply for and procure as owner and
for its own benefit, life insurance on Employee, in such amounts and in such
form or forms as the Company may determine. Employee shall, at the request of
the Company, submit to such medical examinations, supply such information, and
execute such documents as may be required by the insurance company or companies
to whom the Company has applied for such insurance. Employee hereby
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represents that to his knowledge he is in excellent physical and mental
condition and is not under the influence of alcohol, drugs or similar substance.
Section 18. PROPRIETARY INFORMATION AND INVENTIONS. Employee
understands and acknowledges that:
18.01 TRUST. Employee's employment creates a relationship of
confidence and trust between Employee and the Company with respect to
certain information applicable to the business of the Company and its
subsidiaries and affiliates (collectively, the "Group") or applicable
to the business of any licensee, vendor or customer of any of the
Group, which may be made known to Employee by the Group or by any
licensee, vendor or customer of any of the Group or learned by Employee
during the Employment Period.
18.02 PROPRIETARY INFORMATION. The Group possesses and will
continue to possess information that has been created, discovered, or
developed by, or otherwise become known to, the Group (including,
without limitation, information created, discovered, developed or made
known to by Employee during the period of or arising out of his
employment by the Company) or in which property rights have been or may
be assigned or otherwise conveyed to the Group, which information has
commercial value in the business in which the Group is engaged and is
treated by the Group as confidential. Except as otherwise herein
provided, all such information is hereinafter called "Proprietary
Information", which term, as used herein, shall also include, but shall
not be limited to, data, functional specifications, computer programs,
know-how, research, patents, inventions, discoveries, processes,
procedures, formulae, technology, improvements, developments, designs,
marketing plans, strategies, forecasts, new products, unpublished
financial statements, budgets, projections, licenses, prices, costs,
and customer, supplier and potential acquisition candidates lists.
Notwithstanding anything contained in this Employment Agreement to the
contrary, the term "Proprietary Information" shall not include (i)
information which is in the public domain, (ii) information which is
published or otherwise becomes part of the public domain through no
fault of Employee, (iii) information which Employee can demonstrate was
in Employee's possession at the time of disclosure and was not acquired
by Employee directly or indirectly from any of the Group on a
confidential basis, (iv) information which becomes available to
Employee on a non-confidential basis from a source other than any of
the Group and which source, to the best of Employee's knowledge, did
not acquire the information on a confidential basis or (v) information
required to be disclosed by any federal or state law, rule or
regulation or by any applicable judgment, order or decree or any court
or governmental body or agency having jurisdiction in the premises.
All Proprietary Information shall be the sole property of the Group and their
respective assigns. Employee assigns to the Company any rights Employee may have
or acquire in such Proprietary Information. At all times, both during Employee's
employment by the Company and after its termination, Employee shall keep in
strictest confidence and trust all Proprietary Information, and Employee shall
not use or disclose any Proprietary Information without the written consent of
the
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Group, except as may be necessary in the ordinary course of performing
Employee's duties as an employee of the Company.
Section 19. INVENTIONS. Any and all inventions, conceptions,
processes, discoveries, improvements, patent rights, letter patents, programs,
copyrights, trademarks, trade names and applications therefor, in the United
States and other countries, whether patentable or not, and any and all rights
and interest in, to and under the same, that are conceived, made, acquired, or
possessed by Employee, alone or with other employees, during the term of this
Employment Agreement, or within two (2) years thereafter shall become the
exclusive property of the Company and shall at all times and for all purposes be
regarded as acquired and held by Employee in a fiduciary capacity for the sole
benefit of the Company, and the Employee hereby assigns and agrees to assign the
same to the Company without further compensation. Employee agrees that, upon
request, he will promptly make all disclosures, execute all applications,
assignments or other instruments and perform all acts whatsoever necessary or
desired by the Company to vest and confirm in it, its successors, assigns and
nominees, fully and completely, all rights and interests created or contemplated
by this Section.
Section 20. SURRENDER OF DOCUMENTS. Employee shall, at the
request of the Company, promptly surrender to the Company or its nominee any
Proprietary Information or document, memorandum, record, letter or other paper
in his possession or under his control relating to the operation, business or
affairs of the Group.
Section 21. PRIOR EMPLOYMENT AGREEMENTS. Employee represents
and warrants that Employee's performance of all the terms of this Employment
Agreement and as an employee of the Company does not, and will not, breach any
agreement to keep in confidence proprietary information acquired by Employee in
confidence or in trust prior to Employee's employment by the Company. Employee
has not entered into, and shall not enter into, any agreement, either written or
oral, which is in conflict with this Employment Agreement or which would be
violated by Employee entering into, or carrying out his obligations under, this
Employment Agreement.
Section 22. RESTRICTIVE COVENANT. Employee acknowledges and
recognizes Employee's possession of Proprietary Information and the highly
competitive nature of the business of the Group and, accordingly, agrees that in
consideration of the covenants and conditions contained herein Employee shall
not, during the Employment Period, (i) directly or indirectly engage in any
Business Activities in the world that relate to the treatment of biosolids,
whether such engagement shall be as an employer, officer, director, owner,
employee, consultant, stockholder, partner or other participant in any Business
Activities (other than as a director, officer or employee
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of the Company), (ii) assist others in engaging in any Business Activities in
the manner described in the foregoing clause (i), or (iii) induce employees of
the Company to terminate their employment with the Company or engage in any
Business Activities in the world; PROVIDED, HOWEVER, that the ownership of the
outstanding capital stock of a corporation whose shares are traded on a national
securities exchange or on the over-the-counter market shall not be deemed
engaging in any Business Activities.
Section 23. REMEDIES. Employee acknowledges and agrees that
the Company's remedy at law for a breach or a threatened breach of the
provisions herein would be inadequate, and in recognition of this fact, in the
event of a breach or threatened breach by Employee of any of the provisions of
this Employment Agreement, it is agreed that the Company shall be entitled to,
equitable relief in the form of specific performance, a temporary restraining
order, a temporary or permanent injunction or any other equitable remedy which
may then be available, without posting bond or other security. Employee
acknowledges that the granting of a temporary injunction, a temporary
restraining order or other permanent injunction merely prohibiting Employee from
engaging in any Business Activities would not be an adequate remedy upon breach
or threatened breach of this Employment Agreement, and consequently agrees upon
any such breach or threatened breach to the granting of injunctive relief
prohibiting Employee from engaging in any activities prohibited by this
Employment Agreement. No remedy herein conferred is intended to be exclusive of
any other remedy, and each and every such remedy shall be cumulative and shall
be in addition to any other remedy given hereunder now or hereinafter existing
at law or in equity or by statute or otherwise.
Section 24. SUCCESSIVE EMPLOYMENT NOTICE. Within five (5)
business days after the Termination Date, Employee shall provide notice to the
Company of Employee's next intended employment. If such employment is not known
by Employee at such date, Employee shall notify the Company immediately upon
determination of such information. Employee shall continue to provide the
Company with notice of Employee's place and nature of employment and any change
in place or nature of employment during the period ending two (2) years after
the Termination Date. Failure of Employee to provide the Company with such
information in an accurate and timely fashion shall be deemed to be a breach of
this Employment Agreement and shall entitle the Company to all remedies provided
for in this Employment Agreement as a result of such breach.
Section 25. SUCCESSORS. This Employment Agreement shall be
binding on the Company and any successor to any of its businesses or assets.
Without limiting the effect of the prior sentence, the Company shall use its
best efforts to require any successor or assign (whether
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direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Employment Agreement in the same manner and to
the same extent that the Company would be required to perform it if no such
succession or assignment had taken place. As used in this Employment Agreement,
"Company" shall mean the Company as hereinbefore defined and any successor or
assign to its business and/or assets as aforesaid which assumes and agrees to
perform this Employment Agreement or which is otherwise obligated under this
Agreement by the first sentence of this Section 25, by operation of law or
otherwise.
Section 26. BINDING EFFECT. This Employment Agreement shall
inure to the benefit of and be enforceable by Employee's personal and legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If Employee should die while any amounts would still be
payable to him hereunder if he had continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms of this
Employment Agreement to Employee's estate.
Section 27. MODIFICATION AND WAIVER. No provision of this
Employment Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and signed by Employee and
such officer as may be specifically designated by the Board. No waiver by either
party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Employment Agreement to be
performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.
Section 28. HEADINGS. Headings used in this Agreement are for
convenience only and shall not be used to interpret or construe its provisions.
Section 29. WAIVER OF BREACH. The waiver of either the Company
or Employee of a breach of any provision of this Employment Agreement shall not
operate or be construed as a waiver of any subsequent breach by either the
Company or Employee.
Section 30. AMENDMENTS. No amendments or variations of the
terms and conditions of this Employment Agreement shall be valid unless the same
is in writing and signed by all of the parties hereto.
Section 31. SEVERABILITY. The invalidity or unenforceability
of any provision of this Employment Agreement, whether in whole or in part,
shall not in any way affect the validity and/or enforceability of any other
provision herein contained. Any invalid or unenforceable provision shall be
deemed severable to the extent of any such invalidity or unenforceability. It is
expressly understood and agreed that while the Company and Employee consider the
restrictions
13
contained in this Employment Agreement reasonable for the purpose of preserving
for the Company the good will, other proprietary rights and intangible business
value of the Company if a final judicial determination is made by a court having
jurisdiction that the time or territory or any other restriction contained in
this Employment Agreement is an unreasonable or otherwise unenforceable
restriction against Employee, the provisions of such clause shall not be
rendered void but shall be deemed amended to apply as to maximum time and
territory and to such other extent as such court may judicially determine or
indicate to be reasonable.
Section 32. GOVERNING LAW. This Employment Agreement shall be
construed and enforced pursuant to the laws of the State of Ohio.
Section 33. ARBITRATION. Any controversy or claim arising out
of or relating to this Employment Agreement or any transactions provided for
herein, or the breach thereof, other than a claim for injunctive relief shall be
settled by arbitration in accordance with the Commercial Arbitration Rules of
the American Arbitration Association (the "Rules") in effect at the time demand
for arbitration is made by any party. The evidentiary and procedural rules in
such proceedings shall be kept to the minimum level of formality that is
consistent with the Rules. One arbitrator shall be named by the Company, a
second shall be named by Employee and the third arbitrator shall be named by the
two arbitrators so chosen. In the event that the third arbitrator is not agreed
upon, he or she shall be named by the American Arbitration Association.
Arbitration shall occur in Toledo, Ohio or such other location agreed to by the
Company and Employee. The award made by all or a majority of the panel of
arbitrators shall be final and binding, and judgment may be entered in any court
of law having competent jurisdiction. The award is subject to confirmation,
modification, correction, or vacation only as explicitly provided in Title 9 of
the United States Code. The prevailing party shall be entitled to an award of
pre- and post-award interest. All legal fees' incurred by any party to the
arbitration, in connection with the arbitration and any judicial proceedings
related thereto shall be paid by such party. The fees of the arbitrators shall
be split between Employee and the Company.
Section 34. COUNTERPARTS. This Employment Agreement may be
executed in more than one (1) counterpart and each counterpart shall be
considered an original.
Section 35. EXHIBITS. The Exhibits attached hereto are
incorporated herein by reference and are an integral part of this Employment
Agreement.
Section 36. SECTIONS. Unless the context requires a different
meaning, all references to "Sections" in this Agreement shall mean the Section
of this Agreement.
Section 37. PUBLICITY. Press releases and other publicity
materials relating to the transactions contemplated by this Employment Agreement
shall be released by the parties
14
hereto only after review and with the consent of the other party; PROVIDED,
HOWEVER, that if legal counsel for the Company advises the Company that
disclosure of this Employment Agreement is required under applicable federal or
state securities laws, then the Company shall be permitted to make such
disclosure in the form recommended by such legal counsel without the prior
consent of Employee.
IN WITNESS WHEREOF, this Employment Agreement has been duly
executed by the Company and Employee in four (4) counterparts as of the date
first above written.
N-VIRO INTERNATIONAL CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------
Its /s/ Chief Financial Officer
---------------------------
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
15
EXHIBIT 2 TO EMPLOYMENT AGREEMENT
---------------------------------
OTHER ACTIVITIES
Perform normal unpaid activities expected of a faculty emeritus of The Ohio
State University. This includes occasional guest lectures and service on
graduate student advisory committees.
Provide service as an unpaid advisor to federal and state regulatory agencies,
private organizations, and professional societies in which ▇▇. ▇▇▇▇▇ has
membership.
Serve as Editor, Associate Editor, or reviewer of scientific journals, books, or
special publications.
Present paid or unpaid invited lectures or technical papers at conferences or
symposia.
16
EXHIBIT 6.04 TO EMPLOYMENT AGREEMENT
------------------------------------
STOCK OPTION AGREEMENT
----------------------
Pursuant to the N-Viro International Amended and Restated Stock Option Plan, ▇▇.
▇▇▇▇▇ ▇. ▇▇▇▇▇ is hereby granted 50,000 options to purchase N-Viro International
Corporation Common Stock, at a price determined by the closing price of the
Company's stock as quoted on the Nasdaq exchange, at the end of the day August
14, 1998.
IN WITNESS WHEREOF the parties have set their hands as of the
date first above written.
N-VIRO INTERNATIONAL CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Its /s/ Chief Financial Officer
----------------------------
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
17
EXHIBIT 12 TO EMPLOYMENT AGREEMENT
----------------------------------
CONSULTING AGREEMENT
--------------------
This Consulting Agreement (the "Consulting Agreement") is made
and entered into as of the ____ day of ____________, 200_ (the "Execution
Date"), by and between N-Viro International Corporation, a Delaware corporation
(the "Company"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇, an individual ("Consultant").
W I T N E S S E T H:
--------------------
WHEREAS, this Consulting Agreement is being entered into
pursuant to Section 12 of the Amended and Restated Employment Agreement made and
entered into as of the 14th day of June, 1999, by and between the Company and
Consultant (the "Employment Agreement");
WHEREAS, the Company desires to engage employee as a
consultant to the Company upon the terms and subject to the conditions set forth
in this Consulting Agreement; and,
WHEREAS, Consultant desires to be hired as a consultant to the
Company upon the terms and subject to the conditions set forth in this
Consulting Agreement.
NOW, THEREFORE, in consideration of the premises, the mutual
promises, covenants and conditions herein contained and for other good and
valuable considerations, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto intending to be legally bound hereby agree as
follows:
Section 1. DEFINITIONS. Unless otherwise defined in this
Consulting Agreement, the capitalized terms and words used in this Consulting
Agreement shall have the meanings ascribed thereto in the Employment Agreement.
Section 2. ENGAGEMENT. The Company hereby engages Consultant,
and Consultant hereby accepts engagement with the Company, as a consultant, all
upon the terms and subject to the conditions set forth in this Consulting
Agreement.
Section 3. CONSULTING SERVICES. Consultant is and shall be
engaged as a consultant to the Board of Directors of the Company (the "Board")
on all matters relating to the general business and affairs of the Company.
Consultant shall report directly to the Chief Executive Officer of the Company.
Consultant shall devote such of his business time, best efforts and attention to
promote and advance the business of the Company and its subsidiaries as
18
reasonably requested, from time to time, by the Chief Executive Officer;
PROVIDED, HOWEVER, that such time, efforts and attention shall be done during
normal business hours and shall not unreasonably interfere with Consultant's
other business and/or personal activities; PROVIDED FURTHER, HOWEVER, Consultant
shall devote a minimum of 75 business days as a consultant to the Company during
each year of the Consulting Period.
Section 4. TERM OF ENGAGEMENT. The term of engagement of
Consultant by the Company pursuant to this Consulting Agreement shall be for the
period (the "Consulting Period") commencing on the Termination Date (the
"Consulting Commencement Date") and ending on June 30, 2014 or such earlier date
that Consultant's engagement is terminated in accordance with the provisions of
this Consulting Agreement or such later date that Consultant's engagement is
extended pursuant to this Consulting Agreement (the "Consulting Termination
Date"). The Consulting Period shall automatically be extended for the period of
one (1) year unless either Consultant or the Company gives ninety (90) days
prior written notice that the Consulting Period shall not be so extended.
Section 5. FEE. During the Consulting Period, subject to all
the terms and conditions of this Consulting Agreement and as compensation for
all consulting services to be rendered by Consultant to the Company under this
Consulting Agreement, the Company shall pay to or provide Consultant with the
following:
5.01 BASE FEE. The Company shall pay to Consultant a base
fee (the "Base Fee") at the rate of One Thousand Dollars ($1,000.00)
for each business day that Consultant provides consulting services to
the Company, payable at such intervals (at least monthly) as salaries
are paid generally to executive officers of the Company.
5.02 OTHER BENEFITS. The Company shall provide Consultant
with the other benefits specified on Exhibit 5.02 attached hereto.
Section 6. EXPENSES. The Company shall reimburse Consultant
for all reasonable, ordinary and necessary expenses (including, but not limited
to, automobile and other business travel and customer entertainment expenses)
incurred by him in connection with his engagement hereunder; PROVIDED, HOWEVER,
Consultant shall render to the Company a complete and accurate accounting of all
such expenses in accordance with the substantiation requirements of Section 274
of the Internal Revenue Code of 1986, as amended (the "Code"), as a condition
precedent to such reimbursement.
Section 7. NOTICES. For the purposes of this Consulting
Agreement, notices and all other communications provided for in the Consulting
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or sent by certified mail, return
19
receipt requested, postage prepaid, or by expedited (overnight) courier with
established national reputation, shipping prepaid or billed to sender, in either
case addressed to the respective addresses last given by each party to the other
(provided that all notices to the Company shall be directed to the attention of
the Board with a copy to the Secretary of the Company) or to such other address
as either party may have furnished to the other in writing in accordance
herewith. All notices and communication shall be deemed to have been received on
the date of delivery thereof, on the third business day after the mailing
thereof, or on the second day after deposit thereof with an expedited courier
service, except that notice of change of address shall be effective only upon
receipt.
Section 8. LIFE INSURANCE. The Company may, at any time after
the execution of this Consulting Agreement, apply for and procure as owner and
for its own benefit, life insurance on Consultant, in such amounts and in such
form or forms as the Company may determine. Consultant shall, at the request of
the Company, submit to such medical examinations, supply such information, and
execute such documents as may be required by the insurance company or companies
to whom the Company has applied for such insurance. Consultant hereby represents
that to his knowledge he is in excellent physical and mental condition and is
not under the influence of alcohol, drugs or similar substance.
Section 9. PROPRIETARY INFORMATION AND INVENTIONS. Consultant
understands and acknowledges that:
9.01 TRUST. Consultant's engagement creates a relationship of
confidence and trust between Consultant and the Company with respect to
certain information applicable to the business of the Company and its
subsidiaries and affiliates (collectively, the "Group") or applicable
to the business of any licensee, vendor or customer of any of the
Group, which may be made known to Consultant by the Group or by any
licensee, vendor or customer of any of the Group or learned by
Consultant during the Consulting Period.
9.02 PROPRIETARY INFORMATION. The Group possesses and will
continue to possess information that has been created, discovered, or
developed by, or otherwise become known to, the Group (including,
without limitation, information created, discovered, developed or made
known to by Consultant during the period of or arising out of his
employment by the Company) or in which property rights have been or may
be assigned or otherwise conveyed to the Group, which information has
commercial value in the business in which the Group is engaged and is
treated by the Group as confidential. Except as otherwise herein
provided, all such information is hereinafter called "Proprietary
Information", which term, as used herein, shall also include, but shall
not be limited to, data, functional specifications, computer programs,
know-how, research, patents, inventions, discoveries, processes,
procedures, formulae, technology, improvements, developments, designs,
marketing plans, strategies, forecasts, new products, unpublished
financial statements, budgets, projections, licenses, prices, costs,
and customer, supplier and potential acquisition candidates lists.
Notwithstanding
20
anything contained in this Consulting Agreement to the contrary, the
term "Proprietary Information" shall not include (i) information which
is in the public domain, (ii) information which is published or
otherwise becomes part of the public domain through no fault of
Consultant, (iii) information which Consultant can demonstrate was in
Consultant's possession at the time of disclosure and was not acquired
by Consultant directly or indirectly from any of the Group on a
confidential basis, (iv) information which becomes available to
Consultant on a non-confidential basis from a source other than any of
the Group and which source, to the best of Consultant's knowledge, did
not acquire the information on a confidential basis or (v) information
required to be disclosed by any federal or state law, rule or
regulation or by any applicable judgment, order or decree or any court
or governmental body or agency having jurisdiction in the premises.
All Proprietary Information shall be the sole property of the Group and their
respective assigns. Consultant assigns to the Company any rights Consultant may
have or acquire in such Proprietary Information. At all times, both during
Consultant's engagement by the Company and after its termination, Consultant
shall keep in strictest confidence and trust all Proprietary Information, and
Consultant shall not use or disclose any Proprietary Information without the
written consent of the Group, except as may be necessary in the ordinary course
of performing Consultant's duties as a consultant to the Company.
Section 10. INVENTIONS. Any and all inventions, conceptions,
processes, discoveries, improvements, patent rights, letter patents, programs,
copyrights, trademarks, trade names and applications therefor, in the United
States and other countries, whether patentable or not, and any and all rights
and interest in, to and under the same, that are conceived, made, acquired, or
possessed by Consultant, alone or with employees of the Company, during the term
of this Consulting Agreement, or within two (2) years thereafter shall become
the exclusive property of the Company and shall at all times and for all
purposes be regarded as acquired and held by Consultant in a fiduciary capacity
for the sole benefit of the Company, and the Consultant hereby assigns and
agrees to assign the same to the Company without further compensation.
Consultant agrees that, upon request, he will promptly make all disclosures,
execute all applications, assignments or other instruments and perform all acts
whatsoever necessary or desired by the Company to vest and confirm in it, its
successors, assigns and nominees, fully and completely, all rights and interests
created or contemplated by this Section.
Section 11. SURRENDER OF DOCUMENTS. Consultant shall, at the
request of the Company, promptly surrender to the Company or its nominee any
Proprietary Information or document, memorandum, record, letter or other paper
in his possession or under his control relating to the operation, business or
affairs of the Group.
21
Section 12. PRIOR EMPLOYMENT AGREEMENTS. Consultant represents
and warrants that Consultant's performance of all the terms of this Consulting
Agreement and as a consultant to the Company does not, and will not, breach any
agreement to keep in confidence proprietary information acquired by Consultant
in confidence or in trust prior to Consultant's employment by the Company.
Consultant has not entered into, and shall not enter into, any agreement, either
written or oral, which is in conflict with this Consulting Agreement or which
would be violated by Consultant entering into, or carrying out his obligations
under, this Consulting Agreement.
Section 13. REMEDIES. Consultant acknowledges and agrees that
the Company's remedy at law for a breach or a threatened breach of the
provisions herein would be inadequate, and in recognition of this fact, in the
event of a breach or threatened breach by Consultant of any of the provisions of
this Consulting Agreement, it is agreed that the Company shall be entitled to,
equitable relief in the form of specific performance, a temporary restraining
order, a temporary or permanent injunction or any other equitable remedy which
may then be available, without posting bond or other security. Consultant
acknowledges that the granting of a temporary injunction, a temporary
restraining order or other permanent injunction merely prohibiting Consultant
from engaging in any Business Activities would not be an adequate remedy upon
breach or threatened breach of this Consulting Agreement, and consequently
agrees upon any such breach or threatened breach to the granting of injunctive
relief prohibiting Consultant from engaging in any activities prohibited by this
Consulting Agreement. No remedy herein conferred is intended to be exclusive of
any other remedy, and each and every such remedy shall be cumulative and shall
be in addition to any other remedy given hereunder now or hereinafter existing
at law or in equity or by statute or otherwise.
Section 14. SUCCESSIVE EMPLOYMENT NOTICE. Within five (5)
business days after the Termination Date, Consultant shall provide notice to the
Company of Consultant's next intended employment. If such employment is not
known by Consultant at such date, Consultant shall notify the Company
immediately upon determination of such information. Consultant shall continue to
provide the Company with notice of Consultant's place and nature of employment
and any change in place or nature of employment during the period ending two (2)
years after the Consulting Termination Date. Failure of Consultant to provide
the Company with such information in an accurate and timely fashion shall be
deemed to be a breach of this Consulting Agreement and shall entitle the Company
to all remedies provided for in this Consulting Agreement as a result of such
breach.
22
Section 15. SUCCESSORS. This Consulting Agreement shall be
binding on the Company and any successor to any of its businesses or assets.
Without limiting the effect of the prior sentence, the Company shall use its
best efforts to require any successor or assign (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company to expressly assume and agree to perform
this Consulting Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession or assignment had
taken place. As used in this Consulting Agreement, "Company" shall mean the
Company as hereinbefore defined and any successor or assign to its business
and/or assets as aforesaid which assumes and agrees to perform this Consulting
Agreement or which is otherwise obligated under this Agreement by the first
sentence of this Section 15, by operation of law or otherwise.
Section 16. TERMINATION. This Consulting Agreement may be
terminated by (i) the Company with Cause (as said term is defined in the
Employment Agreement by substituting the words "Consulting Agreement" for
"Employment Agreement"), (ii) the Company by reason of the death or Disability
(as defined in the Employment Agreement) of Consultant or (iii) consultant by
giving sixty (60) days prior written notice to the Company before such
termination.
Section 17. BINDING EFFECT. This Consulting Agreement shall
inure to the benefit of and be enforceable by Consultant's personal and legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If Consultant should die while any amounts would still be
payable to him hereunder if he had continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms of this
Consulting Agreement to Consultant's estate.
Section 18. MODIFICATION AND WAIVER. No provision of this
Consulting Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and signed by Consultant and
such officer as may be specifically designated by the Board. No waiver by either
party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Consulting Agreement to be
performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.
Section 19. HEADINGS. Headings used in this Agreement are for
convenience only and shall not be used to interpret or construe its provisions.
Section 20. WAIVER OF BREACH. The waiver of either the Company
or Consultant of a breach of any provision of this Consulting Agreement shall
not operate or be construed as a waiver of any subsequent breach by either the
Company or Consultant.
23
Section 21. AMENDMENTS. No amendments or variations of the
terms and conditions of this Consulting Agreement shall be valid unless the same
is in writing and signed by all of the parties hereto.
Section 22. SEVERABILITY. The invalidity or unenforceability
of any provision of this Consulting Agreement, whether in whole or in part,
shall not in any way affect the validity and/or enforceability of any other
provision herein contained. Any invalid or unenforceable provision shall be
deemed severable to the extent of any such invalidity or unenforceability. It is
expressly understood and agreed that while the Company and Consultant consider
the restrictions contained in this Consulting Agreement reasonable for the
purpose of preserving for the Company the good will, other proprietary rights
and intangible business value of the Company if a final judicial determination
is made by a court having jurisdiction that the time or territory or any other
restriction contained in this Consulting Agreement is an unreasonable or
otherwise unenforceable restriction against Consultant, the provisions of such
clause shall not be rendered void but shall be deemed amended to apply as to
maximum time and territory and to such other extent as such court may judicially
determine or indicate to be reasonable.
Section 23. GOVERNING LAW. This Consulting Agreement shall be
construed and enforced pursuant to the laws of the State of Ohio.
Section 24. ARBITRATION. Any controversy or claim arising out
of or relating to this Consulting Agreement or any transactions provided for
herein, or the breach thereof, other than a claim for injunctive relief shall be
settled by arbitration in accordance with the Commercial Arbitration Rules of
the American Arbitration Association (the "Rules") in effect at the time demand
for arbitration is made by any party. The evidentiary and procedural rules in
such proceedings shall be kept to the minimum level of formality that is
consistent with the Rules. One arbitrator shall be named by the Company, a
second shall be named by Consultant and the third arbitrator shall be named by
the two arbitrators so chosen. In the event that the third arbitrator is not
agreed upon, he or she shall be named by the American Arbitration Association.
Arbitration shall occur in Toledo, Ohio or such other location agreed to by the
Company and Consultant. The award made by all or a majority of the panel of
arbitrators shall be final and binding, and judgment may be entered in any court
of law having competent jurisdiction. The award is subject to confirmation,
modification, correction, or vacation only as explicitly provided in Title 9 of
the United States Code. The prevailing party shall be entitled to an award of
pre- and post-award interest as well as reasonable attorneys' fees incurred in
connection with the arbitration and any judicial proceedings related thereto.
24
Section 25. COUNTERPARTS. This Consulting Agreement may be
executed in more than one (1) counterpart and each counterpart shall be
considered an original.
Section 26. EXHIBITS. The Exhibits attached hereto are
incorporated herein by reference and are an integral part of this Consulting
Agreement.
Section 27. SECTIONS. Unless the context requires a different
meaning, all references to "Sections" in this Agreement shall mean the Section
of this Agreement.
Section 28. PUBLICITY. Press releases and other publicity
materials relating to the transactions contemplated by this Consulting Agreement
shall be released by the parties hereto only after review and with the consent
of the other party; PROVIDED, HOWEVER, that if legal counsel for the Company
advises the Company that disclosure of this Consulting Agreement is required
under applicable federal or state securities laws, then the Company shall be
permitted to make such disclosure in the form recommended by such legal counsel
without the prior consent of Consultant.
Section 29. INDEPENDENT CONTRACTOR. Consultant shall be deemed
to be an independent contractor with respect to the Company and not an employee
and Consultant shall be responsible for all federal, state and local taxes as a
result of the receipt of the Base Fee paid to Consultant by the Company,
including, but not limited to, unemployment and withholding taxes.
IN WITNESS WHEREOF, this Consulting Agreement has been duly
executed by the Company and Consultant in four (4) counterparts as of the date
first above written.
N-VIRO INTERNATIONAL CORPORATION
By________________________________
Its:______________________________
----------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
25
EXHIBIT 13 TO EMPLOYMENT AGREEMENT
----------------------------------
COVENANT NOT TO COMPETE
-----------------------
This Covenant Not to Compete (the "Covenant Not to Compete")
is made and entered into as of the 14th day of June, 1999, by and between N-Viro
International Corporation, a Delaware corporation (the "Company"), and ▇▇▇▇▇ ▇.
▇▇▇▇▇, an individual ("Employee").
W I T N E S S E T H:
--------------------
WHEREAS, the Company and Employee entered into an Amended and
Restated Employment Agreement as of the date hereof (the "Employment
Agreement");
WHEREAS, the execution of this Covenant Not to Compete by the
Company and Employee is required under Section 13 of the Employment Agreement;
WHEREAS, the Company desires to enter into this Covenant Not
to Compete with Employee; and,
WHEREAS, Employee desires to enter into this Covenant Not to
Compete with the Company.
NOW, THEREFORE, in consideration of, and as an inducement to,
the Company entering into the Employment Agreement, of the covenants,
agreements, representations and warranties contained herein, in the Employment
Agreement and in the Consulting Agreement and for other good and valuable
considerations, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto, intending to be legally bound, hereby agree as follows:
1. CERTAIN DEFINITIONS. Unless otherwise defined herein, the
capitalized words and terms used herein shall have the meanings given to them by
the definitions and descriptions in the Employment Agreement. Unless the context
otherwise requires or indicates a different meaning, words of masculine gender
shall be deemed and construed to include correlative words of the feminine and
neuter genders, words importing the singular number shall include the plural
number and vice versa, and the terms "hereof," "hereby," "hereto," "hereunder,"
"herein" and similar terms mean this Covenant Not to Compete. Additionally, the
capitalized words and terms set forth below and used herein shall be defined as
follows:
"Consulting Agreement" means the Consulting Agreement referred
to in Section 12 of the Employment Agreement.
"Equitable Relief" means a preliminary restraining order, an
injunction, or any other available equitable remedy.
26
"Person" means any individual, corporation, limited liability
company, partnership, limited partnership, limited liability partnership,
partnership with limited liability, unincorporated association, or other
business, entity, organization or firm.
"Prohibited Activities" means any business or activities
operated by the Company and/or any of the Company's subsidiaries or affiliates
including, but not limited to, those related, directly or indirectly, to the
Business Activities.
"Territory" means the United States of America and all other
countries in which the Company is or reasonably contemplates engaging in
Business Activities.
2. RESTRICTIONS. During the period beginning on the
Commencement Date and ending five (5) years after the expiration of the later of
the Employment Agreement and the Consulting Agreement (the "Restriction
Period"), except as required in carrying out his duties and responsibilities
under the Employment Agreement or Consulting Agreement, and within the
Territory, Employee shall not individually or through any person who is an
affiliate of Employee:
(a) directly or indirectly canvass, solicit or accept any
business from or for any Person engaged in any Prohibited Activities;
(b) directly or indirectly induce or attempt to induce any
Person to canvass, solicit or accept any business for or from any Person engaged
in any Prohibited Activities;
(c) directly or indirectly request or advise any customer of
the Company to withdraw, curtail or cancel its business with the Company;
(d) directly or indirectly disclose to any Person the names of
past, present or future (if known) customers of the Company;
(e) directly or indirectly induce or attempt to influence any
employee or agent of any member of the Company and/or its subsidiaries or
affiliates to terminate his employment or agency, as the case may be, with such
member;
(f) directly or indirectly engage in any Prohibited Activities
as a director, officer, employee, consultant, agent, adviser, proprietor,
partner, member, Employee, lender or otherwise of any Person; PROVIDED, HOWEVER,
that investments in public traded entities in an amount not to exceed 5% of the
outstanding capital stock thereof shall be permitted; or
(g) directly or indirectly disclose to any person any of the
Proprietary Information.
27
3. REMEDIES. The parties hereto acknowledge that a breach of any
of the covenants in Section 2 by Employee will result in substantial injury and
damage to the Company and its subsidiaries and affiliates for which there is no
adequate remedy at law. Therefore, in addition to any other remedies available
to the Company and its subsidiaries and affiliates at law or in equity, in the
event of an actual or threatened breach of the covenants or any one of them by
Employee, each and every member of the Company and its subsidiaries and
affiliates shall be entitled to Equitable Relief to prohibit and restrain the
violation or attempted violation of this Covenant Not to Compete by Employee or
by any other Person acting for or on behalf of Employee as employee, agent,
representative or otherwise. Such Equitable Relief shall be provided to the
Company and its subsidiaries and affiliates without being required to post any
bond or other security whatsoever.
4. ENFORCEMENT. In the event there is any action to enforce the
terms of Section 2, the prevailing party, in addition to any other remedy, shall
be entitled to recover reasonable attorneys' fees and paralegal fees and all
other costs associated with any such action both at the trial and appellate
levels. Employee agrees and acknowledges that the restrictions contained in
Section 2 were reasonable in scope and duration, and are necessary to protect
the Business Activities of the Company and its subsidiaries and affiliates.
5. UNENFORCEABILITY. Should any of the provisions contained in
this Covenant Not to Compete be held invalid or unenforceable, such portion
shall be severed and the remaining portions of this Covenant Not to Compete
shall remain valid and enforceable.
6. MODIFICATION. In the event that a court of competent
jurisdiction determines by final non-appealable judgment that the scope, time
period, or Territory covered by the covenants contained in Section 2 are too
broad to be capable of enforcement, said court is authorized, and all parties
hereto agree and stipulate, to modify said covenants and enforce such provisions
as to scope, time, and Territory as such court deems appropriate considering the
intent of the parties hereto and the substantial injury that will result to the
Company and its subsidiaries and affiliates in the event of a modification of
the terms of Section 2 and the substantial sums of money received by Employee
pursuant to the Employment Agreement and Consulting Agreement.
7. NOTICES. Any notices or other communications required or
permitted hereunder shall be sufficiently given if sent in such manner and to
such addresses for the Company and Employee as are set forth in the Employment
Agreement unless otherwise changed in accordance with the Employment Agreement.
8. WAIVER. The waiver by the Company of a breach of any
provision of this Covenant Not to Compete by Employee shall not operate or be
construed to be a waiver of any subsequent breach by Employee. Any such waiver
must be in writing and signed by an authorized representative of the Company.
9. CHOICE OF LAW. This Covenant Not to Compete shall be
interpreted, construed and governed by and in accordance with the internal laws
of the State of Ohio.
10. AMENDMENTS. This Covenant Not to Compete may not be altered,
amended or changed except by written instrument signed by the party against whom
enforcement of any waiver, change, modification, extension or discharge is
sought.
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11. CONSTRUCTION. The normal rules of construction which require
the terms of an agreement to be construed most strictly against the drafter of
such agreement are hereby waived since each party has been represented by
counsel in the preparation, negotiation and execution of this Covenant Not to
Compete.
12. BINDING EFFECT. This Covenant Not to Compete shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
heirs, personal representatives, successors and permitted assigns.
13. COUNTERPARTS. This Covenant Not to Compete may be executed in
two or more counterparts, each of which shall be deemed an original but which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF the parties have set their hands as of the
date first above written.
N-VIRO INTERNATIONAL CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Its /s/ Chief Financial Officer
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/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇