Document:

EXHIBIT 10.10.BQ

 

8%
CONVERTIBLE TERM NOTE

 

	
  $100,000

  	
   

  	
  July 1, 2004

  

 

ELECTROPURE,
INC., a California corporation, (the “Company”),
for the value received, hereby unconditionally and absolutely promises to pay
to the order of ANTHONY M. FRANK, or holder (collectively, the “Holder”),
upon presentation and surrender of this Note at its office at 23456 South
Pointe Drive, Laguna Hills, California 92653, or such other place as the
Company may, from time to time, designate, the sum of One Hundred Thousand ($100,000) Dollars,
in lawful money of the United States, on the “Maturity Date” which date shall
be the first to occur of the following events:

 

A)           January 1,
2005, or

 

B)            From
the proceeds of any sale of the Company’s Electropure EDI subsidiary.

 

1.             CONVERSION.

 

The Holder of this Note shall have the right, at its option, at any
time up until 5:00 P.M. Los Angeles time on the fifth (5th) day immediately
before the Maturity Date (except that, with respect to any portion of this Note
which shall be called for prepayment, such right shall as to such portion
terminate at 5:00 P.M. Los Angeles time on the fifth (5th) day immediately
prior to the Prepayment Date (as defined in Section 2 hereof)), to convert
all or any portion of the principal amount of this Note, including interest
accrued thereon, subject to the terms and provisions of this Section 1,
into common stock of Electropure, Inc. at the then fair market value (closing
bid price) on the date of such conversion.

 

2.             PAYMENTS AND PREPAYMENTS.

 

(a)           All
payments and prepayments of principal and interest shall be made in immediately
available funds on or before the Maturity Date to the Holder at 1 Maritime
Plaza, Suite 825, San Francisco, California 
94111.

 

(b)           The
unpaid principal amount of the Note from time to time outstanding shall bear
interest from the date of this Note at the rate of Eight Percent (8%) per annum
until paid.  Interest shall be computed
for the actual number of days elapsed on the basis of a year consisting of 360
days.

 

(c)           The
Company may prepay at any time in advance of the Maturity Date all or any part
of this Note, plus accrued interest on the portion of the principal being
prepaid.  Interest on the portion of the
Note prepaid shall cease to accrue on and after the date of such prepayment.

 

3.             NOTICES TO NOTEHOLDER.

 

So long as this Note shall be outstanding, if the Company (i) shall pay
any dividend or make any distribution upon the Company Stock or (ii) shall
effect a capital reorganization, reclassification of capital stock,
consolidation or merger with or into another corporation, sale, lease

 

 

or transfer of all or substantially all of the property and assets of
the Company to another corporation, or voluntary or involuntary dissolution,
liquidation or winding up of  the
Company, then in any such case, the Company shall cause to be mailed by
certified mail to the Holder, at least fifteen days prior to the date specified
in (x) or (y) below, as the case may be, a notice containing a brief
description of the proposed action and stating the date on which (x) a record
is to be taken for the purpose of such dividend or distribution, or (y) such
reclassification, reorganization, consolidation, merger, conveyance, lease,
dissolution, liquidation or winding up is to take place and the date, if any is
to be fixed, as of which the holders of Common Stock or other securities shall
receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.

 

4.             EVENTS OF DEFAULT.  If one or more of the following
described events shall occur (each an “Event of Default”):

 

(a)           The
Company shall fail to pay the principal of, or interest on, this Note within
five (5) days after the Holder has given written notice to the Company that the
same has become due; or

 

(b)           The
Company shall fail to perform or observe any of the provisions contained in any
Section of this Note and such failure shall continue for more than thirty
(30) days after the Holder has given written notice to the Company; or

 

(c)           Any
material representation or warranty made in writing by or on behalf of the
Company in this Note shall prove to have been false or incorrect in any
material respect, or omits to state a material fact required to be stated
therein in order to make the statements contained therein, in the light of the
circumstances under which made, not misleading, on the date as of which made,
and the Company shall have failed to cure such false or incorrect statement
within thirty (30) days after the Holder has given written notice to Borrower;
or

 

(d)           The
Company shall be adjudicated a bankrupt or insolvent, or admit in writing its
inability to pay its debts as they mature, or make an assignment for the
benefit of creditors; or the Company shall apply for or consent to the
appointment of a receiver, trustee, or similar officer for it or for all or any
substantial part of its property; or such receiver, trustee or similar officer
shall be appointed without the application or consent of the Company and such
appointment shall continue undischarged for a period of thirty (30) days; or
the Company shall institute (by petition, application, answer, consent or
otherwise) any bankruptcy, insolvency, reorganization, arrangement,
readjustment of debt, dissolution, liquidation or similar proceeding relating
to it under the laws of any jurisdiction; or any such proceeding shall be
instituted (by petition, application or otherwise) against the Company and
shall remain undismissed for a period of ninety (90) days; or any judgment,
writ, warrant of attachment or execution or similar process shall be issued or
levied against a substantial part of the property of the Company and such
judgment, writ, or similar process shall not be released, vacated or fully
bonded within ninety (90) days after its issue or levy; or

 

 

(e)           The
Company shall be enjoined, restrained or in any way prevented by a court order
from continuing to conduct all or any material part of its business affairs;

 

(f)            Any
suit, action or other proceeding (judicial or administrative) commenced against
the Company, or with respect to any assets of the Company, shall threaten to
have a material adverse effect on their future operations, including, without
limitation a final judgment or settlement in excess of $25,000 in excess of
insurance shall be entered in, or agreed to in respect of any such suit, action
or proceeding.

 

THEN, or at any time thereafter, and in each and every case:

 

(1)           Where
the Company is in default under the provisions of Section 3(d) hereof, the
entire unpaid principal amount of the Note, all interest accrued and unpaid
thereon, and all other amounts payable to the Holder hereunder shall
automatically become and be forthwith due and payable without offset or
counterclaim of any kind and without presentment, demand, protest or notice of
any kind, and without regard to the running of the statute of limitations, all
of which are hereby expressly waived by the Company; and

 

(2)           In
any other case referred to in this Section 3, the Holder may, by written
notice to the Company, as the case may be, declare the entire unpaid principal
amount of this Note, all interest accrued and unpaid hereon, and all other
amounts payable hereunder to be forthwith due and payable, whereupon the same
shall become immediately due and payable, without offset or counterclaim of any
kind and without presentment, demand, or protest, and without regard to the
running of any statutes of limitation, all of which are hereby expressly waived
by the Company.

 

Any declaration made pursuant to Section 3(2) hereof is subject to
the condition that, if at any time after the principal of this Note shall have
become due and payable, and before any judgment or decree for the payment of
the moneys so due, or any thereof, shall have been entered, all arrears of
principal and interest upon this Note (except that principal of this Note which
by such declaration shall have become payable) shall have been duly paid, and
every Event of Default shall have been made good, waived or cured, then and in
every such case the Holder shall be deemed to have rescinded and annulled such
declaration and its consequences; but no such rescission or annulment shall
extend to or affect any subsequent Event of Default or impair any right
consequent thereon.

 

5.             CORPORATE OBLIGATION.         It is expressly
understood that this Note is solely a corporate obligation of the Company and
that any and all personal liability, either at common law or in equity, or by
constitution or statute, of, and any and all rights and claims against, every
stockholder, officer, or director, as such, past, present or future, are
expressly waived and released by the Holder as a part of the consideration for
the issuance hereof.

 

6.             AUTHORIZATION; NO CONFLICT.             The borrowings
hereunder, the execution and delivery of the Note and the performance by the
Company of its obligations under this Agreement and the Note are within the
corporate powers of the Company, have been authorized

 

 

by all necessary corporate action, have received all necessary
governmental approval (if any shall be required) and do not and will not
contravene or conflict with any provision of law or of the charter or by-laws
of the Company or of any agreement binding upon the Company.

 

7.             TRANSFER.          Subject to the appropriate provisions hereof,
this Note or any portion of the principal amount hereof (or any remaining
balance if any pre-payments have occurred pursuant to Section 1 hereof) is
transferable on the records of the Company upon presentation of this Note, properly
endorsed, at its principal office; upon such presentation and transfer a new
Note or Notes will be issued.  For the
purposes of payment and all other purposes, the Company shall deem and treat
the person in whose name this Note is registered as the absolute owner hereof
and the Company shall not be affected by any notice to the contrary.

 

8.             MISCELLANEOUS.

 

(a)           Notwithstanding
the foregoing, the Company promises to pay interest after maturity (whether by
acceleration or otherwise, and before as well as after judgment) at the same
rate as above provided prior to maturity on balances, if any, then outstanding.

 

(b)           Interest
under this Note shall be computed on the basis of a thirty (30) day month and a
year of 360 days for the actual number of days elapsed.

 

IN WITNESS WHEREOF, the Company has caused this Note to be executed in
Laguna Hills, California as of the day and year first above written.

 

	
  COMPANY:

  	
  HOLDER:

  
	
   

  	
   

  
	
  ELECTROPURE, INC.

  	
   

  
	
   

  	
   

  
	
  By

  	
    /S/ 
  CATHERINE PATTERSON

  	
   

  	
  By

  	
    /S/ 
  ANTHONY M. FRANK

  	
   

  
	
   

  	
  Catherine Patterson,
  CFO

  	
  Anthony M. Frank

  
	
   

  	
  23456 South Pointe Drive

  	
  1 Maritime Plaza, Suite 825

  
	
   

  	
  Laguna Hills, CA  92653

  	
  San Francisco, CA  94111Exhibit
10.a

 

	
   

  	
  Laura
  Owen

  
	
   

  	
  Vice President, Human
  Resources

  
	
   

  	
  Laura_owen@adc.com

  
	
   

  	
  Tel:  952.917.0706

  
	
   

  	
  Fax: 952.917.0708

  

 

March 24, 2004

 

Mr. Ron Lowy

 

Dear Mr. Lowy:

 

As you know, ADC
Telecommunications, Inc. (“Company”) is anticipating a stock purchase agreement
with Gentek, Inc. under which the Krone Communications business will be
purchased from Gentek (the “Transaction”). 
The Company is very excited about this opportunity, and values the role
that you can serve on our team.  This
employment letter agreement (“Letter Agreement”), sets forth our offer of
continued employment following the closing of the Transaction.

 

1.                                       Position and Duties.  Your initial position will be
Vice-President, Global Sales, and President, Infrastructure Business, reporting
to Robert Switz and your principal place of employment shall be Centennial,
Colorado.  While some change in your
duties and responsibilities will be inherent in the integration of the Company
and Krone, your job duties will be those normally and reasonably attendant to
such a position. Reasonable changes may be made from time to time in your
position and duties in the Company’s discretion.  The Company will consult with you in good faith prior to making
any such changes. You agree to devote your full time and attention to the
performance of your duties.  You also
agree to comply with applicable law and all Company policies, including the
Company’s Code of Business Conduct. 
Upon Closing of the Transaction, you will also be required to sign the
Company’s standard Confidentiality and Invention Agreement, and other routine
human resources documents as necessary from time-to-time.

 

2.                                       Term. 
Your employment will not be for a set term, but rather continue
indefinitely on an at-will basis subject to your potential right to severance
described below.

 

3.                                       Base Salary.  You will be paid a base salary (“Base Salary”) at an annual rate
of Three Hundred Sixty Thousand Dollars ($360,000.00), payable in accordance
with the Company’s normal payroll policies. 
Your Base Salary will be reviewed annually and may be increased in the
discretion of the Company, but will not be decreased.

 

4.                                       Benefits.  You will be eligible to participate in all employee benefit
programs established by the Company that are applicable to similarly situated
employees of the Company as in effect from time to time.  You will be given credit for your time of
service with GenTek for purposes of the Company’s benefit plans. You will also
be eligible for vacation and other paid time off in accordance with the
Company’s policies in effect for similarly situated employees. You will retain
any accrued unused vacation at the time of

 

Office
Address:  13625 Technology Drive, Eden
Prairie, Minnesota 55344

Mailing Address:
P.O. Box 1101, Minneapolis, Minnesota 55411-1101

World
Headquarters: Minneapolis, Minnesota USA +1.952.938.8080   www.adc.com

 

 

Closing.  The Company does not guarantee the adoption
or continuance of any particular employee benefit or benefit plan, and nothing
in this Letter Agreement is intended to, or shall in any way restrict the right
of the Company, to amend, modify or terminate any of its benefits or benefit
plans.  Your eligibility to participate
in any benefits plan is subject to the terms of the applicable plan, as may be
amended from time to time.

 

You will also participate
in perquisite programs established by the Company that are in effect from time
to time for similarly-situated executives in your country.  Currently, this includes an enhancement to
the long-term disability coverage, eligibility for a supplement to the 401(k)
plan, which we call the ADC 401(k) Excess Plan, and a monthly allowance in lieu
of other perquisites that has an annualized value of Sixteen Thousand
Dollars$16,000.

 

5.                                       Incentive Compensation.  For the period of January 1, 2004
through the time of Closing of the Transaction, you will be paid under the
terms of the 2004 GenTek Operations Management Incentive Plan.  From that point forward, while you are
employed and while the Company’s Management Incentive Plan (“MIP”) remains in
effect, you will be eligible to participate in the MIP subject to and in
accordance with the terms and conditions thereof.  Under the current MIP, your target incentive will be 75% of your
salary paid during the 2004 Company fiscal year.  Under the current Plan design, the actual MIP award can range
from zero to 300% of your target award. The Company reserves the right to
modify the design and terms of the MIP for subsequent fiscal years.

 

6.                                       Stock Options.  The Company will grant you an option to
purchase 375,000 shares of the Company’s common stock in accordance with the
terms of the Company’s Global Stock Incentive Plan (the “Global Plan”), as the
same may be amended from time-to-time, and a non-qualified stock option
agreement to be entered into between you and the Company.  The exercise price for this option shall be
the average of the high and low trading prices of the Company’s common stock on
the effective date of grant, as determined in accordance with the terms of the
Global Plan.  These options will vest
over a four (4) year period, with 25% of the grant vesting after the lapse of
each full year from the date of grant and shall terminate ten (10) years from
the date of grant if not earlier in the event of termination of employment.  Vesting is conditional on your continued
employment during the vesting period, provided however, that the options
granted hereby shall become fully vested and exercisable if your employment
terminates after November 12, 2004 by the Company without “cause” or by
you for “good reason”, in each case as defined in the KERP (as described in
Section 8 hereof).  The effective
date of the grant will be the last business day of the month in which you
become an employee of ADC (the month of the Transaction Closing).  The grant will be conditional on your signed
acceptance of ADC’s standard form of option agreement, which includes your
promise not to solicit ADC employees in the case of your departure from ADC.

 

7.                                       Restricted Stock Units.  The Company will grant to you 125,000 shares
of the restricted stock units (RSU’s”) in the Company’s common stock in
accordance with the terms of the Global Plan, as the same may be amended from
time-to-time, and ADC’s standard form of RSU agreement to be entered into
between you and the Company.  These
RSU’s will vest over a four (4) year period, with 25% of the grant vesting
after the lapse of each full year from the date of grant.  The effective date of the grant will be the
last business day of the month in which you become an employee of ADC.  As with your stock options, vesting is
conditional on your continued employment with ADC during the vesting period,
provided however, that the RSU’s granted hereby shall become fully vested if
your

 

2

 

employment terminates
after November 12, 2004 by the Company without “cause” or by you for “good
reason,” in each case as defined in the KERP.

 

8.                                       KERP Severance Provisions.  The Company and Gentek are in discussions
about the GenTek Inc. Key Employee Retention Plan (“KERP”).  Regardless of the result of those
discussions, the severance benefits currently available to you and the
conditions under which you may be entitled to such severance will be maintained,
either directly under the KERP or under a comparable severance plan to be
established by the Company.  Any such
plan established by the Company will be in effect until November 13,
2008.  In either case, any potential
right to “enhanced severance” as set forth in the KERP expires on November 13,
2004.  Please understand that we do not
intend any duplication of severance pay benefits across the GenTek KERP, any
comparable plan adopted by the Company or any other severance pay maintained by
the Company.  Accordingly, under no
circumstances would you be entitled to severance payments under more than one
such plan.

 

9.                                       No “Good Reason” to Resign.  By accepting this Letter Agreement, you
expressly agree that the terms of employment, including your initial position,
offered in this Agreement are satisfactory to you and the changes in the terms
and conditions of your employment contemplated hereby shall not constitute
“Good Reason” for a voluntary resignation under the KERP and shall not give
rise to your right to receive any severance payment under the KERP or any
comparable plan adopted by the Company. 
You are not forfeiting your right to resign for Good Reason as set forth
in the KERP if there are future changes from your initial position with the
Company that constitute Good Reason as defined in KERP, which definition will
be expressly adopted into any comparable Company plan.

 

10.                                 Non-solicitation and Non-hire.  You agree that, for a period of one (1) year
after termination of your employment under any circumstances, you shall not
directly or indirectly:  (a) hire
or attempt to hire for employment any person who is employed by the Company or
its affiliates, or attempt to influence any such person to terminate employment
with the Company or its affiliates; (b) induce or attempt to induce any
employee of the Company or its affiliates to work for, render services to,
provide advice to, or supply confidential business information or trade secrets
of the Company or its affiliates to any third person, firm or corporation; or
(c) induce or attempt to induce any customer, supplier, licensee, licensor
or other business relation of the Company to cease or reduce doing business
with the Company or its affiliates, or in any way interfere with the
relationship between any such customer, supplier, licensee, licensor, or other
business relation of the Company or its affiliates.

 

You agree that your
breach of the non-solicitation, non-hire restrictions will cause the Company
irreparable harm which would not be adequately compensated by monetary damages
and that an injunction may be granted by any court or courts having
jurisdiction, restraining you from breaches of those terms.

 

11.                                 Conditions.  This letter shall be legally binding upon mutual execution
and delivery by the Company and you, subject to the following conditions:  (a) receipt of approval of the material
terms of this agreement by the Compensation Committee of ADC’s Board of
Directors, which approval shall be sought prior to the execution of the
Acquisition Agreement between ADC and GenTek; and (b) the effective date of
employment under the terms of this Agreement shall not commence until the date
of closing of the Transaction.  If the
Acquisition Agreement is terminated for any reason prior to the closing of the

 

3

 

Transaction, this Letter
Agreement shall be terminated and neither party shall have any obligation to
the other by reason of this Agreement.

 

12.                                 Required Disclosures.  As a publicly-held company, ADC may have
certain disclosure obligations with respect the terms of your compensation and
employment.  You acknowledge and agree
that ADC may make such disclosures regarding this information as it deems
appropriate under applicable laws, however the Company will provide you notice
prior to any such disclosure being made to any party outside of the Company.

 

13.                                 Entire Agreement.  This
Letter Agreement and the Service Agreement, except as modified herein,
constitute the entire agreement between you and the Company, its affiliates
and/or subsidiaries, with respect to the matters addressed herein, including
with respect to compensation and termination, and at closing will supercede all
prior agreements and understandings with respect to the matters addressed
herein.  You acknowledge that
there have been no other representations or agreements other than as stated in
this Letter Agreement related to the terms and conditions of your employment
and/or the termination thereof.  This
Letter Agreement may be changed only by an agreement in writing signed by both
you and the Chief Executive Officer of the Company.  If any court or competent authority deems any portion of this
agreement unenforceable, such unenforceable portion shall be severed or
modified to permit enforcement to the maximum extent allowable.  In the event that the Transaction does not
occur, this Letter Agreement is null and void.

 

By your signature below,
you acknowledge that you have read, understood, and agreed to the terms set
forth in this Letter Agreement.

 

	
  Dated:

  	
    3-24-04

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ADC Telecommunications,
  Inc.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Laura N. Owen

  	
   

  
	
   

  	
  Company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  I agree to the above
  terms.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Dated:

  	
  3-24-04

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Ron Lowy

  	
   

  
	
   

  	
  RON LOWY

  
									

 

4

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