Exhibit 10.1

 

 

TRANSITION AGREEMENT

 

This Transition Agreement (“Agreement”) is entered into on January 7, 2020 (the
“Effective Date”), by and between Ikonics Corp. (the “Company”), and William
Ulland (“Executive”).

 

RECITALS

 

A.     Executive is employed by the Company as its Chief Executive Officer and
serves as the Chair of the Company’s Board of Directors (“Board”).

 

B.     Executive will retire from the Company. In connection with his
retirement, Executive and the Company have agreed to conclude their employment
relationship amicably and to continue Executive’s role as the Chairman of the
Company’s Board of Directors (the “Board”), but mutually recognize that the
termination of the employment relationship may give rise to potential claims or
liabilities.

 

C.     Executive and the Company desire to resolve all of Executive’s potential
claims on the terms set out in this Agreement.

 

NOW THEREFORE, in consideration of the mutual promises and provisions contained
in this Agreement and the Release referred to below, the parties, intending to
be legally bound, agree as follows:

 

AGREEMENT

 

For the consideration described below, the adequacy of which the parties
acknowledge, Executive and the Company, intending to be bound, agree as follows:

 

 

1.

Transition Period.

 

(a)     Anticipated Transition. Subject to the terms and conditions of this
Agreement, the Company hereby agrees to continue Executive’s employment, and
Executive hereby accepts continued employment by the Company, for the period
(the “Transition Period”) commencing on the Effective Date and continuing until
the earlier of (a) February 10, 2020 (the “Anticipated Separation Date”), (b)
the date on which Executive’s employment is earlier terminated under Section 6,
or (c) the date on which the Company and Executive mutually agreed Executive’s
employment shall end. The effective date of the termination of Executive’s
employment with the Company for any reason is referred to herein as the
“Separation Date.” As of the Separation Date, Executive agrees to resign as the
Company’s Chief Executive Officer.

 

(b)     Other Termination. Unless Executive’s employment is terminated before
the Anticipated Separation Date as a result of Executive’s resignation for any
reason or the Company terminating Executive’s employment for Cause (as defined
below), Executive’s termination of employment with the Company will be effective
as of the Anticipated Separation Date. For purposes of this Agreement, “Cause”
means (a) the willful refusal by Executive to perform Executive’s employment
duties, including failure to complete the transition duties described in Section
3 in a timely and professional manner, during the Transition Period; (b)
Executive’s material violation of this Agreement, the Confidentiality Agreement,
or any Company policy; (c) Executive willfully engaging in illegal conduct; or
(d) Executive’s engagement in acts of material dishonesty.

 

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2.     Compensation and Benefits During Transition Period. While Executive is
employed by the Company during the Transition Period, (a) the Company will
maintain Executive’s current base salary, payable according to the Company’s
regular payroll schedule and subject to all legally required and authorized
withholdings, and (b) Executive will be eligible to participate in all employee
benefit plans and programs generally available from time to time to employees of
the Company, to the extent that Executive meets the eligibility requirements for
each individual plan or program and subject to the provisions, rules, and
regulations of, or applicable to, the plan or program. Except as set forth in
this Section 2, Executive will not be eligible to receive any other form of
compensation of any kind during the Transition Period.

 

3.     Duties and Authority. During the Transition Period, Executive shall
properly and timely perform those duties requested by the Company from time to
time. Executive shall perform all such duties diligently and in good faith. The
Company may relieve Executive of any or all duties during the Transition Period.
During the Transition Period, Executive shall follow all applicable policies and
procedures adopted by the Company, including without limitation policies related
to business ethics, conflict of interest, confidentiality and protection of
trade secrets, and shall not engage in any activity during the Transition Period
that violates Executive’s obligations under the Confidentiality Agreement (as
defined below) or that is detrimental or is reasonably likely to be detrimental
to the Company’s best interests.

 

4.     Confidentiality Agreement. In consideration for the benefits provided to
Executive under this Agreement, Executive agrees to execute and return the
Agreement Regarding Non-Disclosure of Confidential Information and
Non-Competition attached to this agreement as Exhibit B (the “Confidentiality
Agreement”). Executive acknowledges entering into the Confidentiality Agreement
in exchange for valid consideration and hereby affirms all of Executive’s
obligations under the Confidentiality Agreement that remain in effect during the
Transition Period and that survive the Separation Date. Executive further
represents that Executive has not violated any of Executive’s obligations under
the Confidentiality Agreement. It shall not be a violation of the
Confidentiality Agreement for Executive to discuss Confidential Information (as
defined in the Confidentiality Agreement) with officers, directors, or other key
stakeholders of the Company that are similarly bound by agreements regarding the
non-disclosure of Company confidential information.

 

5.     Early Termination. The Company will not terminate Executive’s employment
before the Anticipated Separation Date, or such other date agreed between the
Company and Executive, for any reason other than Cause (as defined in Section
1). Upon the termination of Executive’s employment for any reason, the Company
will pay to Executive such compensation that has been earned under this
Agreement but not paid to Executive as of the Separation Date, payable in
accordance with the Company’s normal payroll policies and procedures. If, prior
to the Anticipated Separation Date, the Company terminates Executive’s
employment for Cause, or Executive terminates Executive’s employment for any
reason before the Anticipated Separation Date, then Executive’s sole entitlement
will be compensation that has been earned but not paid to Executive as of the
Separation Date and Executive will not be eligible to receive the Severance
Payment (as defined below).

 

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6.     Severance Payment.

 

(a)     Payment. In consideration of the commitments under this Agreement, and
subject to the conditions below, the Company will pay Executive severance pay of
$225,000, less all legally required and authorized withholdings (the “Severance
Payment”), payable in a single lump sum on the Company’s first normal payroll
date following the expiration of the rescission period applicable to the Release
(as defined below).

 

(b)     Additional Commitments. In exchange for the benefits provided under this
Agreement, Executive agrees that on or within 21 days after the Separation Date
Executive will sign a release in the form substantially as attached hereto as
Exhibit A (the “Release”). This Agreement will not be interpreted or construed
to limit the Release in any manner. The existence of any dispute respecting the
interpretation of this Agreement or the alleged breach of this Agreement will
not nullify or otherwise affect the validity or enforceability of the Release.

 

(c)     Conditions. The Company shall not be obligated to provide the Severance
Payments unless and until Executive (i) signs this Agreement, and signs and does
not rescind the Release within the time periods set forth in the Release, (ii)
remains employed until the Anticipated Separation Date (or such other date as
mutually agreed between Executive and the Company), (iii) signs and returns the
Confidentiality Agreement, and (iv) is in compliance with Executive’s
obligations under this Agreement, the Release and the Confidentiality Agreement.

 

7.     Board Service.

 

(a)     Role. Unless Executive’s employment with the Company is terminated for
Cause, Executive shall continue to serve as the Chairman of the Company’s Board
of Directors (the “Board”) immediately following the Separation Date.
Executive’s subsequent service on the Board shall be subject to annual election
by the Company’s shareholders.

 

(b)     Compensation. During his service as Chairman, Executive shall receive a
retainer fee of $4,000 per quarter and an additional $4,000 fee per Board
meeting in which Executive serves as Chairman. These fees may be adjusted by the
Board in accordance with its normal review processes, provided however, each of
the quarterly retainer fee and per meeting fees for Executive in connection with
his service as Chairman of the Board will be the greater of (i) $4,000, or (ii)
twice the fees of other directors (excluding any director who is designated as a
financial expert).

 

(c)     Additional Entitlements. During his service as Chairman of the Board,
the Company shall provide Executive (i) an office at the Ikonics West location
for use in connection with his responsibilities as Chairman for the 2020
calendar year, and (ii) Executive’s annual dues for the Kitchi Gammi Club. If
Executive’s service as Chairman terminates, the Company may discontinue these
entitlements.

 

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8.     Return Of Property. Upon termination of Executive’s employment with the
Company, or at any earlier time upon request from the Company, Executive shall
deliver promptly to the Company all Company materials and property that may be
in Executive’s possession or under Executive’s control, including without
limitation all confidential or proprietary information and any computers, credit
cards, keys, records, files, documents, data, photographs, video tapes, audio
tapes, computer disks and other computer storage media, except to the extent any
Company property is anticipated to be used in connection with Executive’s
continued service on the Board. The Company will allow Executive to keep his
Company iPad and cellphone, provided the Company receives satisfactory
confirmation that all Company property has been removed (except that required
for him to perform his services to the Board). The Company will also cooperate
with Executive to transfer his Company telephone number to a personal cellular
phone plan.

 

8.     Agreement Regarding Confidentiality. To the fullest extent permitted by
law, Executive agrees that the terms of this Agreement and the Release are
confidential and that Executive may not disclose those terms to any person
except: (a) as required by law; (b) as permitted under the terms of the Release;
or (c) to Executive‘s attorneys, spouse and tax advisors, provided they agree to
keep the terms of this Agreement and the Release confidential.

 

9.     Non-Admission. Nothing in this Agreement or the Release is intended to
be, nor will be deemed to be, an admission by the Company that it has violated
any law or that it has engaged in any wrongdoing.

 

10.     Entire Agreement. This Agreement and its Exhibits constitute the entire
agreement between the parties with respect to the subject matter of this
Agreement (including the Confidentiality Agreement), including the termination
of Executive’s employment with the Company, and the Company and Executive agree
that there were no inducements or representations leading to the execution of
this Agreement except as stated in this Agreement.

 

11.     Amendment. This Agreement may be amended only by a writing that is
signed by me and an authorized representative of the Company.

 

12.     Assignment. The rights and obligations of the Company under this
Agreement shall inure to the benefit of and shall be binding upon its agents,
employees, successors, assigns, heirs, attorneys, trustees, estates and
representatives. The rights and obligations of Executive under this Agreement
shall not be subject to transfer or assignment by Executive without the written
consent of the Company.

 

13.     Governing Law and Jurisdiction. This Agreement and the Release shall be
interpreted and construed in accordance with the laws of Minnesota, without
regard to conflict of laws principles. Minnesota state or federal courts will
have personal and subject-matter jurisdiction over any litigation arising out of
or relating to this Agreement or the Release. Any action involving claims for
interpretation, breach or enforcement of this Agreement or the Release shall be
brought in such courts. Executive and the Company consent to personal
jurisdiction over them in the state and/or federal courts of Minnesota and each
hereby waives any defense of lack of personal jurisdiction or inconvenient
forum.

 

[signature page follows]

 

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 Dated: January 7, 2020

/s/ William Ulland

 

 

William Ulland

 

 

 

 

 

 

 Dated January 7, 2020

IKONICS CORPORATION 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Marianne Bohren 

 

 

Name: Marianne Bohren

 

 

Its: Director 

 

 

 

Signature page to Ulland Transition Agreement

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EXHIBIT A

 

RELEASE BY

WILLIAM ULLAND

 

Definitions. I intend all words used in this Release by William Ulland
(“Release”) to have their plain meanings in ordinary English. Specific terms
that I use in this Release have the following meanings:

 

 

A.

I, me, and my includes me (William Ulland) and anyone who has or obtains any
legal rights or claims through me.

 

 

B.

Ikonics means Ikonics Corporation and any entity related to Ikonics Corporation
in the present or past, including without limitation, its predecessors, parents,
subsidiaries, members, affiliates, and divisions, and any successors of Ikonics
Corporation.

 

 

C.

Company means Ikonics; the present and past officers, directors, committees,
shareholders and employees of the Company; any company providing employment or
employee benefit services to the Company in the past or present, and the present
and past fiduciaries of such plans (other than multiemployer plans); the
attorneys for the Company; and anyone who acted on behalf of the Company or on
instructions from the Company.

 

 

D.

Severance Payment has the meaning given to such term in the Transition
Agreement.

 

 

E.

Confidentiality Agreement has the meaning given to such term in the Transition
Agreement.

 

 

F.

Separation Date has the meaning given to such term in the Transition Agreement.

 

 

G.

Transition Agreement means the Transition and Separation Agreement by and
between Ikonics and me that I signed on January 7, 2020.

 

 

H.

My Claims means all of my rights that I now have to any relief of any kind from
the Company, including without limitation:

 

 

1.

all claims arising out of or relating to my employment with Ikonics or the
termination of that employment;

 

 

2.

all claims arising out of or relating to the statements, actions, or omissions
of the Company;

 

 

3.

all claims arising out of or relating to any agreements (whether express or
implied) to which I and the Company are parties;

 

 

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4.

all claims for any alleged unlawful discrimination, harassment, retaliation or
reprisal, or other alleged unlawful practices arising under any federal, state,
or local statute, ordinance, or regulation, including without limitation, claims
under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities
Act and the ADA Amendments Act (“ADA”), the Age Discrimination in Employment Act
(“ADEA”), 42 U.S.C. § 1981, the Family Medical Leave Act (“FMLA”), the Executive
Retirement Income Security Act (“ERISA”), the Worker Adjustment and Retraining
Notification Act (“WARN”), the Lilly Ledbetter Fair Pay Act of 2009, the Genetic
Information Nondiscrimination Act, the Fair Credit Reporting Act, the National
Labor Relations Act (“NLRA”), the Minnesota Human Rights Act (Minnesota Statutes
Chapter 363A), Minnesota Statutes Chapter 181, and workers’ compensation
non-interference or non-retaliation statutes (such as Minn. Stat. § 176.82);

 

 

5.

all claims for alleged wrongful discharge; breach of contract; breach of implied
contract; failure to keep any promise; breach of a covenant of good faith and
fair dealing; breach of fiduciary duty; estoppel; defamation; infliction of
emotional distress; fraud; misrepresentation; negligence; harassment;
retaliation or reprisal; constructive discharge; assault; battery; false
imprisonment; invasion of privacy; interference with contractual or business
relationships; any other wrongful employment practices; and violation of any
other principle of common law;

 

 

6.

all claims for compensation of any kind and employee benefits of any kind
relating to my employment, including without limitation, bonuses, commissions,
deferred compensation, stock options, equity awards or equity-based compensation
in any form, vacation pay, perquisites, relocation expenses and expense
reimbursements;

 

 

7.

all claims for back pay, front pay, reinstatement, other equitable relief,
compensatory damages, damages for alleged personal injury, liquidated damages,
and punitive damages;

 

 

8.

all claims that a past unlawful decision has or has had a continuing effect on
my compensation; and

 

 

9.

all claims for attorneys’ fees, costs, and interest.

 

However, My Claims do not include (i) any claims for unemployment benefits, (ii)
any claims that the law does not allow to be waived, (iii) any claims related to
my compensation for my service on the Ikonics Board of Directors, or (iv) any
claims that may arise after the date on which I sign this Release.

 

 

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Agreement to Release My Claims. I acknowledge and agree that Ikonics has agreed
to provide me the Severance Payment in connection with the Transition Agreement,
and that if I do not sign, or I rescind this Release as provided below, Ikonics
shall be relieved of its obligations to provide the Severance Payment. I
understand and acknowledge that the Severance Payment is in addition to anything
of value that I would be entitled to receive from Ikonics if I did not sign this
Release or if I rescinded this Release. In exchange for the commitments of
Ikonics under the Transition Agreement I give up and release all of My Claims. I
will not make any demands or claims against the Company for compensation or
damages relating to My Claims. The Severance Payment that I am receiving is a
fair compromise for the release of My Claims. Furthermore, I understand and
agree that, with the exception of money provided to me by a governmental agency
as an award for providing information, I am not entitled to receive any money or
other relief in connection with My Claims, regardless of who initiated or filed
the charge or other proceeding. Furthermore, My Claims include my right to
recover any damages or other relief in any administrative charge before the
Equal Employment Opportunity Commission or any similar state or local agency or
any court action based on any such charge.

 

No Other Rights To Compensation. I understand and acknowledge that, except as
provided in this Release, and subject to the terms and conditions of this
Release, the Company is not obligated to make any payments to me of any kind and
does not have any other outstanding obligations to me under any agreement or
arrangement between me and the Company or under any Company plan or policy.

 

Additional Agreements and Understandings. Even though Ikonics will provide the
Severance Payment in exchange for me to settle and release My Claims, the
Company does not admit that it is responsible or legally obligated to me. In
fact, the Company denies that it is responsible or legally obligated to me for
My Claims, denies that it engaged in any unlawful or improper conduct toward me,
and denies that it treated me unfairly.

 

Confirmation of Obligations Under The Confidentiality Agreement. I acknowledge
entering into the Confidentiality Agreement, represent that I have not violated
any terms included in the Confidentiality Agreement, and hereby reaffirm my
agreement to remain bound by, and to abide by, all terms of the Confidentiality
Agreement that survive my Separation Date.

 

Confidentiality. To the fullest extent permitted by law, I agree that the terms
of this Release are confidential and that I may not disclose those terms to any
person except: (a) as required by law; or (b) to my attorneys, spouse and tax
advisors, provided they agree to keep the terms of this Release confidential.
Notwithstanding any other language in this Release or the Confidentiality
Agreement to the contrary, I understand that I may not be held criminally or
civilly liable under any federal or state trade secret law for the disclosure of
a trade secret that is made (i) in confidence to a federal, state or local
government official, either directly or indirectly, or to an attorney if such
disclosure is made solely for the purpose of reporting or investigating a
suspected violation of law or for pursuing an anti-retaliation lawsuit; or (ii)
in a complaint or other document filed in a lawsuit or other proceeding, if such
filing is made under seal and you do not disclose the trade secret except
pursuant to a court order.

 

Non-Disparagement. To the fullest extent permitted by law, I agree that I will
not make any false, disparaging or derogatory statements to anyone, including
but not limited to any media outlet, industry group, financial institution,
current or former employee, consultant, client or customer of Ikonics regarding
the Company or about the Company’s business affairs and financial condition,
capability or any other aspect of the Company’s business, and I will not engage
in any conduct which is intended to, or does, harm professionally or personally
the reputation of the Company.

 

 

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Cooperation. In partial consideration for the Severance Payment being paid to me
under the Transition Agreement, to the fullest extent permitted by law, I agree
to cooperate with the Company’s reasonable requests, subject to my own
availability, in: (a) providing information; (b) resolving questions; or (c)
transitioning any responsibilities of information, pertaining to any matters
which arose during my employment by Ikonics about which I have or may have
knowledge of the underlying facts or for which I had responsibility during my
employment with Ikonics.

 

Return Of Property. I represent that I have delivered to Ikonics all Company
property that was previously in my possession or under my control, including
without limitation any computers, credit cards, keys, records, files, documents,
data, computer disks and other computer storage media, except for that property
required for my continued service on the Ikonics Board of Directors and that
property I am specifically entitled to maintain under the Transition Agreement.

 

No Unlawful Restriction. I understand and agree that nothing in this Release,
including the Confidentiality, Non-Disparagement and Cooperation provisions
above, is intended to or will: (a) impose any condition, penalty, or other
limitation on my rights to challenge this Release; (b) constitute an unlawful
release of my rights; or (c) prevent or interfere with my ability or right to
provide truthful testimony if under subpoena to do so, to file any charge with
or participate in any investigation or proceeding before the U.S. Equal
Employment Opportunity Commission or any other federal, state or local
governmental agency, or to respond to a subpoena, court order or as otherwise
provided by law.

 

Advice to Consult with an Attorney. I understand and acknowledge that I am
hereby being advised by the Company to consult with an attorney prior to signing
this Release. My decision whether to sign this Release is my own voluntary
decision made with full knowledge that the Company has advised me to consult
with an attorney.

 

Period to Consider the Release. I understand that I have 21 calendar days from
the Separation Date or the date on which I receive this Release, whichever is
later and not counting the Separation Date or the date on which I receive this
Release (as applicable), to consider whether I wish to sign this Release. If I
sign this Release before the end of the 21-day period, it will be my voluntary
decision to do so because I have decided that I do not need any additional time
to decide whether to sign this Release. I also agree that any changes made to
this Release before I sign it, whether material or immaterial, will not restart
the 21-day period.

 

My Right to Rescind this Release. I understand that I may rescind this Release
at any time within 15 calendar days after I sign it, not counting the day upon
which I sign it. This Release will not become effective or enforceable unless
and until the 15-day rescission period has expired without my rescinding it.

 

Procedure for Accepting or Rescinding the Release. To accept the terms of this
Release, I must deliver this Release, after I have signed and dated it, to
Ikonics by hand or by mail within the 21-day period that I have to consider this
Release. To rescind my acceptance, I must deliver a written, signed statement
that I rescind my acceptance to Ikonics by hand or by mail within the 15-day
rescission period. All deliveries must be made to Ikonics at the following
address:

 

Ernest Harper

Ikonics Corporation

4832 Grand Avenue

Duluth, MN 55807

 

If I choose to deliver my acceptance or the rescission of my acceptance by mail,
it must be (1) postmarked within the period stated above; and (2) properly
addressed to Ikonics at the address stated above.

 

 

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Entire Agreement. This Release, the Transition Agreement, and the
Confidentiality Agreement constitute the entire agreement between me and the
Company with respect to the subject matter of this Release, the Transition
Agreement, and the Confidentiality Agreement, including the termination of my
employment with the Company, and I agree that there were no inducements or
representations leading to the execution of this Release except as stated in
this Release, the Transition Agreement, and the Confidentiality Agreement.

 

Amendment. This Release may be amended only by a writing that is signed by me
and an authorized representative of the Company.

 

Waiver. No term or condition of this Release shall be deemed to have been waived
except by a statement in writing signed by the party against whom the
enforcement of the waiver is sought. The waiver by the Company of the breach or
nonperformance of any provision of this Release by me will not operate or be
construed as a waiver of any future breach or nonperformance under any such
provision of this Release.

 

Governing Law and Jurisdiction. This Release shall be governed by and
interpreted in accordance with the laws of the State of Minnesota, without
regard to conflicts of law provisions. Minnesota state or federal courts will
have personal and subject-matter jurisdiction over any litigation arising out of
or relating to this Release. Any action involving claims for interpretation,
breach or enforcement of this Release shall be brought in such courts. I consent
to personal jurisdiction over me in the state and/or federal courts of Minnesota
and hereby waive any defense of lack of personal jurisdiction or inconvenient
forum.

 

Severability. In case any one or more of the provisions of this Release is
determined invalid, illegal, or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained in this
Release will not in any way be affected or impaired thereby.

 

Heirs, Successors, and Assigns. This Release shall be binding upon me and my
heirs, administrators, representatives, or executors, and upon the Company’
successors or assigns. No assignment of this Release may be made by me, and any
such purported assignment shall be null and void. The Company may assign its
rights or obligations under this Release to any successor or assign of the
Company without further consent by me.

 

Interpretation of the Release. This Release should be interpreted as broadly as
possible to achieve my intention to resolve all of My Claims against the
Company. If this Release is held by a court to be inadequate to release a
particular claim encompassed within My Claims, this Release will remain in full
force and effect with respect to all the rest of My Claims.

 

My Representations. I am legally able and entitled to receive the Consideration
being provided to me in settlement of My Claims. I have not been involved in any
personal bankruptcy or other insolvency proceedings at any time since I began my
employment with the Company. No child support orders, garnishment orders, or
other orders requiring that money owed to me by Ikonics be paid to any other
person are now in effect.

 

 

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I represent and confirm that I have been fully paid for all wages, overtime,
commissions, bonuses, and other compensation that I have earned through the date
of this Release.

 

I have read this Release carefully. I understand all of its terms. In signing
this Release, I have not relied on any statements or explanations made by the
Company except as specifically set forth in this Release, the Transition
Agreement, and the Confidentiality Agreement. I am voluntarily releasing My
Claims against the Company. I intend this Release to be legally binding.

 

 

Dated:               William Ulland  

 

 

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Exhibit B

 

IKONICS CORPORATION

AGREEMENT REGARDING NON-DISCLOSURE

OF CONFIDENTIAL INFORMATION

AND NON-COMPETITION

 

 

1.

INTRODUCTION

 

Ikonics Corporation (“Ikonics”) and William Ulland (“Executive”) acknowledges
that Ikonics will disclose or has already disclosed to Executive certain
Confidential Information as defined in Section 2. Executive recognizes that the
Confidential Information is a business asset of Ikonics, the value of which can
only be protected by maintaining the secrecy of the Confidential Information.
Executive further acknowledges that in the course of his employment by Ikonics,
Executive will establish or has already established personal contacts and
relationships with Ikonics’ customers and that such personal contacts and
relationships are valuable business assets of Ikonics.

 

Executive, therefore, enters into this Agreement Regarding Non-Disclosure of
Confidential Information and Non-Competition (“Agreement”) in consideration of
Ikonics’ offer continuing employment and other transition arrangements, in
consideration of being given access to Confidential Information, and for other
good and valuable consideration. Executive and Ikonics, intending to be legally
bound, agree as follows:

 

 

2.

DEFINITIONS. For the purposes of this Agreement:

 

 

(a)

“Ikonics” means the IKONICS CORPORATION, its successors in interest, assigns,
and all of its parent, subsidiary or affiliate corporations and the operating
divisions thereof.

 

 

(b)

“Confidential Information” means any information that Executive learns or
develops during the course of employment with Ikonics that derives independent
economic value from not being generally known, or not being readily
ascertainable by proper means, by other persons who can obtain economic value
from the disclosure or use of such information. Such information includes, but
is not limited to, Ikonics’ sales and marketing information, information about
new or future products, lists of Ikonics’ customers and information about
customer purchases and preferences, business strategies, financial information,
personnel information, information regarding research and development,
manufacturing processes or management systems and any other information which
provides Ikonics with a competitive advantage or is otherwise confidential or
proprietary information of Ikonics.

 

 

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(c)

“Inventions” means any improvement, discovery, writing, formula or idea (whether
or not patentable or subject to copyright protection) relating to the existing
or reasonably foreseeable business interests of Ikonics or resulting from any
work performed by Executive for Ikonics. Inventions include, but are not limited
to, methods, techniques, manufacturing practices or processes, and improvements
thereof or know-how related thereto, as well as any copyrightable material and
any trademark or trade name whether or not subject to trademark protection.

 

 

(d)

“Ikonics Product” means any actual or projected product, product line or service
that has been designed, developed, manufactured, marketed or sold by Ikonics
during Executive’s employment with Ikonics or regarding which Ikonics has
conducted or acquired research and development during Executive’s employment
with Ikonics.

 

 

(e)

“Competitive Product” means any actual or projected product, product line or
service that has been or is being designed, developed, manufactured, marketed or
sold by anyone other than Ikonics which performs similar functions or is used
for the same or similar general purposes as an Ikonics Product.

 

 

(f)

“Solicitation of Sales” means activities intended to acquire sales or influence
customers to establish, continue, or increase business, including without
limitation, providing information or conducting demonstrations in anticipation
of sales as well as other acts of service including, but not limited to,
delivery and maintenance.

 

 

(g)

“Ikonics Customer” means any person or entity with whom Executive had contact of
any sort for the purpose of selling, marketing, promoting or servicing any
Ikonics Product during the time Executive was employed by Ikonics.

 

 

3.

NON-COMPETITION

 

During the term of employment and for a period of two (2) years following
termination of employment, for whatever reason (the “Restricted Period”),
Executive will not directly or indirectly, participate in or support the sale
of, Solicitation of Sales of, or marketing of any Competitive Product, including
the participation in or supporting the sale of, Solicitation of Sales of, or
marketing of any Competitive Product to any Ikonics Customer.

 

 

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During the Restricted Period, Executive shall not, directly or indirectly,
solicit, encourage, or attempt to solicit any Ikonics Customer to reduce or
otherwise adversely change its relationships with Ikonics.

 

During the Restricted Period, Executive will not induce or attempt to induce any
Ikonics Executive or contractor for whom Executive had direct or indirect
managerial or supervisory responsibilities to leave his employment or engagement
with Ikonics, or otherwise induce or attempt to induce an adversely impact to
any Executive’s employment or relationship with Ikonics. Such prohibition
includes, without limitation, all acts of recruitment including offering
employment, seeking expressions of interest in employment or discussing
employment opportunities.

 

The restrictions contained in this Section 3 shall apply regardless of whether
Executive acts directly or indirectly; or whether Executive acts personally or
as an employee, agent, supervisor, manager, or otherwise for another.

 

 

4.

NON-DISCLOSURE OF CONFIDENTIAL INFORMATION

 

Executive agrees not to disclose, during the course of Executive’s employment by
Ikonics or thereafter, in any manner to any person not employed by Ikonics, any
Confidential Information, except to the extent that such disclosure or use is
directly related to and required by Executive’s performance in good faith of
duties assigned to Executive by Ikonics. Executive will take all appropriate
steps to safeguard Confidential Information in Executive’s possession and to
protect it against disclosure, misuse, espionage, loss and theft. Executive
understands that such obligation is not only contractual, but is specified in
Minnesota Statues § 325C. Within twenty-four (24) hours of termination of
Executive’s employment with Ikonics, for whatever reason, Executive agrees to
return to Ikonics all originals and copies of documents containing Confidential
Information as well as all documents generated by Executive on behalf of Ikonics
and all documents relating to the business of Ikonics from any source
whatsoever.

 

 

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Nothing in this Agreement will preclude, prohibit or restrict Executive from (i)
communicating with any federal, state or local administrative or regulatory
agency or authority, including but not limited to the Securities and Exchange
Commission (the “SEC”); (ii) participating or cooperating in any investigation
conducted by any governmental agency or authority; or (iii) filing a charge of
discrimination with the United States Equal Employment Opportunity Commission or
any other federal state or local administrative agency or regulatory authority.
Nothing in this Agreement, or any other agreement between the parties, prohibits
or is intended in any manner to prohibit, Executive from (1) reporting a
possible violation of federal or other applicable law or regulation to any
governmental agency or entity, including but not limited to the Department of
Justice, the SEC, the U.S. Congress, and any governmental agency Inspector
General, or (2) making other disclosures that are protected under whistleblower
provisions of federal law or regulation. This Agreement does not limit
Executive’s right to receive an award (including, without limitation, a monetary
reward) for information provided to the SEC. Executive does not need the prior
authorization of anyone at Ikonics to make any such reports or disclosures, and
Executive is not required to notify Ikonics that Executive has made such reports
or disclosures. Nothing in this Agreement or any other agreement or policy of
Ikonics is intended to interfere with or restrain the immunity provided under 18
U.S.C. §1833(b). Executive understands he cannot be held criminally or civilly
liable under any federal or state trade secret law for the disclosure of a trade
secret that is made (x) (A) in confidence to federal, state or local government
officials, directly or indirectly, or to an attorney, and (B) for the purpose of
reporting or investigating a suspected violation of law; (y) in a complaint or
other document filed in a lawsuit or other proceeding, if filed under seal; or
(z) in connection with a lawsuit alleging retaliation for reporting a suspected
violation of law, if filed under seal and does not disclose the trade secret,
except pursuant to a court order.

 

 

5.

INVENTIONS AND PROPRIETARY INFORMATION

 

(a)     Executive will grant and does hereby grant to Ikonics the sole and
exclusive ownership of, including the sole and exclusive right to reproduce, use
or disclose for any purpose, any and all reports, drawings, blueprints, software
code, computer programs, data, writings and technical information made or
prepared by Executive alone or with other during the term of Executive’s
employment, whether or not made or prepared in the course of Executive’s
employment, that relate to apparatus, compositions of matter or methods
pertaining to Ikonics’ business. Executive acknowledges that all such reports,
drawings, blueprints, software code, computer programs, data, writings and
technical information are property of Ikonics.

 

(b)     Executive will promptly disclose to Ikonics in writing all Inventions
and proprietary information that Executive alone or with others conceives,
generates, or reduces to practice, during or after working hours, while
Executive is an employee of Ikonics; and all such Inventions and proprietary
information shall be the exclusive property of Ikonics and are hereby assigned
to Ikonics, except as otherwise specifically agreed to by Ikonics in writing.

 

(c)     Executive will, at Ikonics’ expense, give Ikonics all assistance it
reasonably requires to perfect, protect and use its rights to Inventions and
proprietary information. In particular, but without limitation, Executive will
sign all documents, do all things, and supply all information that Ikonics may
deem necessary or desirable to (1) transfer or record the transfer of
Executive’s entire right, title and interest in Inventions and proprietary
information; and (2) enable Ikonics to obtain patent, copyright or trademark
protection for Inventions anywhere in the world.

 

 

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(d)     The obligations to transfer and assign intellectual property rights
shall not apply to (1) all patents issued in Executive’s name alone or with
others, prior to the date of signing this Agreement; (2) Inventions for which no
equipment, supplies, facility or trade secret information of Ikonics were used
and which are developed entirely on Executive’s own time, and (a) which do not
relate directly to the business of Ikonics or to Ikonics’ actual or demonstrably
anticipated research or development, or (b) which do not result from any work
performed by me for Ikonics.

 

 

6.

INJUNCTIVE RELIEF

 

Executive agrees that Ikonics remedy at law for breach of this Agreement is
inadequate. Ikonics, therefore, shall be entitled to injunctive relief to
enforce the terms of this Agreement, in addition to any other remedy Ikonics
might have.

 

 

7.

SEVERABILITY

 

The invalidity of any portion of this Agreement shall not impair or affect
enforceability of the remainder. If any of these restrictions is determined to
be unenforceable as to duration or extent, or for any reason whatsoever, such
restriction shall be effective for such period of time and for such extent as it
may be enforceable.

 

 

8.

PRIOR AGREEMENTS

 

This Agreement and any prior non-compete and non-disclosure agreements signed by
Executive in connection with his or her employment at Ikonics shall constitute a
single agreement. In case of conflict between any provision of this Agreement
and any provision of any other such agreement, the provisions of this Agreement
shall control. If the provisions of this Agreement so selected are determined to
be unenforceable as written, then they shall be interpreted in accordance with
Section 7 (Severability) to make them enforceable to the maximum extent provided
by law. If the provisions of this Agreement so selected are determined to be
unenforceable in their entirety and cannot be revised pursuant to Section 7
(Severability) to make them enforceable, then such provisions shall give way to
the most restrictive provision in any other such agreement which covers the same
issue and which is enforceable. There are no agreements, representations, or
warranties relating to the subject matter of this Agreement which are not set
forth in this Agreement and the prior non-compete and non-disclosure agreements
(if any) signed by Executive.

 

 

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9.

NON-EMPLOYMENT AGREEMENT

 

This Agreement is not an employment contract and does not give Executive any
right to continued employment. Executive acknowledges that his employment with
Ikonics is terminable at will at any time by either party.

 

 

10.

GOVERNING LAW/CONSENT TO PERSONAL JURISDICTION

 

This Agreement will be construed and enforced in accordance with the laws of the
State of Minnesota. Executive hereby consents to the exercise of personal
jurisdictions over him by the courts of the State of Minnesota.

 

 

    IKONICS CORPORATION    EXECUTIVE                       BY          
 (Signature)   (Signature)                    

 

  DATE               (Printed Name)                           DATE