Exhibit 10.3
EMPLOYMENT AGREEMENT
This Employment Agreement and its Exhibits (this Agreement), entered into the 23rd day of April, 2008, effective as of January 1, 2008 is by and between Dynamic Materials Corporation, a Delaware corporation (the Company), and Yvon Cariou, a resident of the State of Colorado (Executive) (together, the parties).
Recitals
A. Executive has significant experience in the management of companies and is willing to serve the Company on the terms and subject to the conditions hereinafter set forth.
B. The Company desires to secure the continued services of Executive subject to the terms and conditions hereinafter set forth.
C. This agreement replaces, in its entirety, that certain Employment Agreement between the Company and Executive dated March 3, 2005.
Agreement
In consideration of the foregoing and the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Employment. The Company hereby employs Executive as President and Chief Executive Officer of the Company reporting to the board of directors of the Company, and Executive hereby accepts such employment and agrees to perform such duties and responsibilities as are assigned to him from time-to-time by the board of directors of the Company.
2. Full-time Best Efforts. Executive shall devote his full and exclusive professional time and attention to the performance of his obligations under this Agreement, and will at all times faithfully, industriously and to the best of his ability, experience and talent, perform all of this obligations hereunder. Executive shall not, without the express written consent of the Company, directly or indirectly, engage, alone or with others, in any other enterprises or business concerns, nor render professional services to, own, control, manage, consult with, be employed by, or otherwise have an interest in, any such enterprises or concerns, during the term of his continued employment with the Company. Without limiting the generality of any other provision herein, transactions in securities of publicly traded companies and other passive investment activities shall not be considered prohibited by the foregoing sentence, except as such transactions and activities may violate the Companys conflict of interest policy, if any, in place from time to time.
3. Term of Agreement. This agreement shall be effective on January 1, 2008 (the Effective Date) and shall continue until December 31, 2008 (the Term), unless otherwise terminated by either party pursuant to Section 5 below.
4. Compensation Reimbursement.
(a) Salary. During the term of this Agreement, the Company shall pay Executive an annual salary (Salary) of $440,000 payable in accordance with the Companys standard payroll practices for similarly situated employees. The compensation committee of the Companys board of directors (the Compensation Committee) will review Executives Salary at least annually and may increase (but not reduce) Executives Salary in its sole discretion. All compensation paid to Executive hereunder is subject to all deductions required by law.
(b) Bonus. Executive shall be eligible to receive a non-discretionary annual bonus equal to 2.5% of the Companys 2008 net income. Executive shall also be eligible to receive a discretionary annual bonus in an amount up to 25% of Executives Salary. The discretionary bonus will be determined based on performance goals
and rules established by the Compensation Committee. The bonus and discretionary bonus, if any, will be payable before March 15, 2009. Executive is not guaranteed any bonus payment.
(c) Stock Incentives. Executive shall be eligible to receive restricted shares of the common stock of the Company under the Companys 2006 Stock Incentive Plan (the Incentive Plan) subject to the terms and conditions of such plan and as granted by the Compensation Committee. If the Company terminates Executives employment for any reason other than Cause pursuant to Section 5(b), all restricted stock held by Executive shall immediately vest, subject to the terms and conditions of the Incentive Plan.
(d) Benefits. Executive shall receive the following Company benefits:
(e) Expense Reimbursement. The Company shall reimburse Executive for all travel expenses and other disbursements incurred by Executive for or on behalf of the Company in the performance of his duties hereunder, subject to and in accordance with the Companys expense reimbursement policies and procedures, as in effect from time-to-time.
5. Termination.
For purposes of this subparagraph (e), disability shall mean that Executive is unable, by reason of physical or mental sickness or illness, injury, or incapacity, to perform any of the essential functions of his regular employment by the Company. Executive shall be considered to be suffering from a disability if he is determined to be disabled by any disability insurer insuring Executive on the date the condition of disability commenced. In the event there is no disability determination made by a relevant insurer, Executive shall be considered to be suffering from a disability if, in the opinion of a qualified physician selected by mutual agreement of Executive and the Company, Executive is determined to be unable to perform any of the essential functions of his regular employment by the Company by reason of any physical or mental sickness, injury, or incapacity. In the event Executive and the Company cannot agree upon the selection of a qualified physician, each party shall appoint a qualified physician of his or its choice and the two physicians so appointed shall mutually select a qualified physician to render the subject opinion as to whether or not Executive is suffering from a disability as defined above. A qualified physician shall mean a person who is licensed to practice medicine and prescribe and administer prescription drugs and/or to perform surgery in the state of Executives residence at the time of the commencement of the believed disability (or is so licensed in such other state as the parties shall reasonably agree is a convenient place in which to examine Executive and/or review his medical records) and who is acting within the scope of his/her medical license and qualified by his/her licensure, certification, training or experience to render the subject opinion.
6. Proprietary Information and Non-Competition Agreements. Executive shall be bound by the terms of the Companys standard form of the Key Employee Proprietary Information and Inventions Agreement, attached hereto as Exhibit A, and the Non-Competition and Non-Solicitation Agreement, attached hereto as Exhibit B, from and after the date hereof.
7. Miscellaneous.
(a) Judicial Limitation. In the event that any provision of this Agreement is more restrictive than permitted by the law of the jurisdiction in which the Company seeks enforcement thereof, the provisions of this Agreement shall be limited only to that extent that a judicial determination finds the same to be unreasonable or otherwise enforceable. Such invalidity or unenforceability shall not affect any other terms herein, but such term shall be deemed deleted, and such deletion shall not affect the validity of the other terms thereof. In addition, if any one or more of the terms contained in this Agreement shall for any reason be held to be excessively broad or of an overly long duration, that term shall be construed in a manner to enable it to be enforced to the extent compatible with applicable law. Moreover, notwithstanding any judicial determination that any provision of this Agreement is not specifically enforceable the parties intend that the Company shall nonetheless be entitled to recover monetary damages as a result of any breach hereof.
(b) Injunctive Relief. In view of the nature of the rights in goodwill, business reputation and prospects of the Company to be protected under this Agreement, Executive understands and agrees that the Company could not be reasonably or adequately compensated in damages in an action at law for Executives breach of his obligations hereunder. Accordingly, Executive specifically agrees that the Company shall be entitled to temporary and permanent injunctive relief to enforce the provisions of this Agreement and that such relief may be granted without the necessity of proving actual damages. This provision with respect to injunctive relief shall not, however, diminish the right of the Company to claim and recover damages in addition to injunctive relief.
(c) Waiver. The failure of the Company to enforce at any time of the provisions of this Agreement or to require any performance by Executive of the provisions hereof shall in no way be construed to be a waiver of such provisions or to affect either the validity of this Agreement, or any part hereof, or the right of the Company thereafter to enforce each and every provision in accordance with the terms of this Agreement.
(d) Severability. The invalidity or unenforceability of any particular provision of this Agreement shall not affect the other provisions hereof, and this Agreement shall be construed in all respects as if such invalid or unenforceable provisions were omitted.
(e) Binding Effect. This Agreement shall be binding upon the parties, their successors, executors and heirs.
(f) Assignability. This Agreement shall be freely assignable by the Company and shall inure to the benefit of its successors and assigns.
(g) Entire Agreement. This Agreement, including the Key Employee Proprietary Information and Inventions Agreement and the Non Competition Agreement referred to herein, and which are incorporated herein and made a part hereof by reference, embody the entire agreement and understanding of the parties hereto and supersede all prior agreements or understanding (whether written or oral) with respect to the subject matter hereof.
(h) Governing Law and Venue. The validity of this Agreement and any of its terms and provisions, as well as the rights and duties of the parties hereunder, shall be governed by the laws of the State of Colorado (without regard to its conflicts of law doctrines) and the venue for any action to enforce or to interpret this Agreement shall be in a court of competent jurisdiction located in the State of Colorado and each of the parties consent to the jurisdiction of such court in any such action or proceeding and waives any objection to venue laid therein.
(i) Amendments. This agreement may not be amended, altered or modified other than by a written agreement between the parties hereto.
(j) Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which shall together constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof shall bear the signatures of all the parties indicated as the signatories hereto.
(k) Notices. All notices, requests, demands and other communications under the Agreement shall be given in writing and shall be served either personally, by facsimile or delivered by first class mail, registered or certified, return receipt requested, postage prepaid and properly addressed to the parties as noticed herein. Notice shall be deemed received upon the earliest of actual receipt, confirmed facsimile or three (3) days following mailing pursuant to this section.
If to Executive:
Yvon Cariou
1995 East Coalton Road
# 7 302
Superior CO 80027
If to the Company:
Dynamic Materials Corporation
Attention: Chief Financial Officer
5405 Spine Road
Boulder, CO 80301
Facsimile: (303) 604-1897
(l) Interpretation. Each party has had the opportunity and has reviewed and revised this Agreement (and has had an opportunity to consult with counsel if desired) and, therefore, the rule of construction requiring that any ambiguity be resolved against the drafting party shall not be employed in the interpretation of this Agreement. The section headings contained in this Agreement are for convenience and reference purposes only and shall not affect in any way the meaning and interpretation of this Agreement.
(m) Attorneys Fees and Costs. If either party shall commence any action or proceeding against the other to enforce the provisions hereof, or to recover damages as a result of the alleged breach of any provisions hereof, the prevailing party therein shall be entitled to recover all reasonable costs incurred in connection therewith, including reasonable attorneys fees.
[Signature Page Follows]
Acknowledgment
Each partys signature below acknowledges that the party has read this document fully, that the party fully understands and agrees to its contents and effect, that the party understands that it is a legally binding document, that the party is mentally and physically competent and capable of reading, understanding and signing this Agreement, and that the party has signed this document voluntarily and of its own free will, and not as a result of any pressure or coercion. Each partys signature below further acknowledges that the party has had the opportunity to consult with an attorney about the meaning and effect of the terms of this Agreement and that each party has in fact consulted with an attorney of the partys own choosing about this Agreement.
This Agreement is executed as of the date first set above:
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DYNAMIC MATERIALS CORPORATION |
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By: |
/s/ Richard A. Santa |
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Richard A Santa |
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Senior Vice President and Chief Financial Officer |
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EXECUTIVE |
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/s/ Yvon Cariou |
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Yvon Cariou |
2009 AMENDMENT TO EMPLOYMENT AGREEMENT
This 2009 Amendment to Employment Agreement (this Amendment), entered into the 4th day of February, 2009, effective as of January 1, 2009, is by and between Dynamic Materials Corporation, a Delaware corporation (the Company), and Yvon Cariou, a resident of the State of Colorado (Executive). This Amendment amends the Employment Agreement dated April 23, 2008 to be effective as of January 1, 2008, between the Company and Executive (the Agreement).
In consideration of the foregoing and the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Term. Section 3 of the Agreement is hereby amended by replacing 2008 with 2009 in both occurrences.
2. Salary. Section 4(a) of the Agreement is hereby amended by replacing $440,000 with $455,400.
3. Non-discretionary Annual Bonus. Section 4(b) of the Agreement is hereby amended to read in its entirety as follows:
(b) Bonus. Executive shall be eligible to receive a non-discretionary annual bonus equal to an amount equal to 2.5% of the Companys 2009 net income up to an amount equal to 175% of such Executives Salary and thereafter 1.0% of the Companys 2009 net income. Executive shall also be eligible to receive a discretionary annual bonus in an amount up to 25% of Executives Salary. The discretionary bonus will be determined based on performance goals and rules established by the Compensation Committee. The bonus and discretionary bonus, if any, will be payable before March 15, 2010. Executive is not guaranteed any bonus payment.
4. Miscellaneous. All other provisions of the Agreement shall remain effective.
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DYNAMIC MATERIALS CORPORATION |
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By: |
/s/ Richard A. Santa |
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Richard A. Santa |
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Senior Vice President and Chief Financial Officer |
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EXECUTIVE |
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/s/ Yvon Cariou |
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Yvon Cariou |
2010 AMENDMENT TO EMPLOYMENT AGREEMENT
This 2010 Amendment to Employment Agreement (this Amendment), entered into the 5th day of March, 2010, effective as of January 1, 2010, is by and between Dynamic Materials Corporation, a Delaware corporation (the Company), and Yvon Cariou, a resident of the State of Colorado (Executive). This Amendment further amends the Employment Agreement dated April 23, 2008 to be effective as of January 1, 2008, between the Company and Executive, as amended by the 2009 Amendment (the Agreement).
In consideration of the foregoing and the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Term. Section 3 of the Agreement is hereby amended to read in its entirety as follows:
2. Termination. Section 5(b) of the Agreement is hereby amended to read in its entirety as follows:
3. Miscellaneous. All other provisions of the Agreement shall remain effective.