Document:

inzy-ex101_22.htm

 

Exhibit 10.1

AMENDED AND RESTATED CONSULTING AGREEMENT

This Amended and Restated Consulting Agreement (the “Agreement”) is made effective as of May 4, 2021 (the “Effective Date”), by and between Inozyme Pharma, Inc., a Delaware corporation, with its principal place of business being 321 Summer Street, Suite 400, Boston, MA 02210(the “Company”) and Danforth Advisors, LLC, a Massachusetts limited liability corporation, with its principal place of business being 91 Middle Road, Southborough, MA 01772 (“Danforth”), which amends and restates that certain Consulting Agreement, dated January 21, 2016, by and among the Company and Danforth, as amended from time to time (the “Original Agreement”).  The Company and Danforth are herein sometimes referred to individually as a “Party” and collectively as the “Parties.”

WHEREAS, the Company is a publicly traded company developing novel therapeutics for the treatment of diseases of abnormal mineralization impacting the vasculature, soft tissue and skeleton; and

WHEREAS, Danforth has expertise in financial and corporate operations and strategy; and

WHEREAS, Danforth desires to serve as an independent consultant for the purpose of providing the Company with certain strategic and financial advice and support services, as more fully described in Exhibit A attached hereto, (the “Services”); and

WHEREAS, the Company and the Danforth desire to amend and restate the Original Agreement  in order to engage Danforth on the terms and conditions set forth herein.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which are hereby acknowledged, the Parties agree that the Original Agreement is hereby amended and restated as follows.

	
1.
	
Services of Consultant.  Danforth will assist the Company with matters relating to the Services as the Company requests from time to time.  The scope of the Services that Danforth is available to provide is more fully described in Exhibit A attached hereto.  Danforth and the Company will confer on a monthly basis to determine the particular tasks from those listed on Exhibit A that the Company requires and to prioritize and implement Danforth’s performance of the designated tasks.

	
2.
	
Compensation for Services.  In full consideration of Danforth’s full, prompt and faithful performance of the Services, the Company shall compensate Danforth by paying a consulting fee more fully described in Exhibit A (the “Consulting Fee”).  Danforth shall, from time to time, but not more frequently than twice per calendar month, invoice the Company for Services rendered, and such invoice will be paid upon fifteen (15) days of receipt.  Each month the Parties shall evaluate jointly the current fee structure and scope of Services.  Danforth reserves the right to an annual increase in consultant rates of up to 4%, effective January 1 of each year.  Upon termination of this Agreement pursuant to Section 3, no compensation or benefits of any kind as described in this Section 2 shall be 

 

 

		
payable or issuable to Danforth after the effective date of such termination.  In addition, the Company will reimburse Danforth for reasonable out-of-pocket business expenses, including but not limited to travel and parking, incurred by Danforth in performing the Services hereunder, upon submission by Danforth of supporting documentation reasonably acceptable to the Company.  Any such accrued expenses in any given three (3) month period that exceed one thousand dollars ($1,000) shall be submitted to the Company for its prior written approval. 

	
3.
	
Term and Termination.  The term of this Agreement will commence on the Effective Date and will continue through  January 21, 2023 (the “Term”).  This Agreement may be extended for an additional period by mutual written agreement.  This Agreement may be terminated by either Party hereto: (a) with Cause (as defined below), upon thirty (30) days prior written notice to the other Party; or (b) without cause upon sixty (60) days prior written notice to the other Party.  For purposes of this Section 3, “Cause” shall include: (i) a breach of the terms of this Agreement which is not cured within thirty (30) days of written notice of such default or (ii) the commission of any act of fraud, embezzlement or deliberate disregard of a rule or policy of the Company.

	
4.
	
Time Commitment.  Danforth will devote such time to perform the Services under this Agreement as may reasonably be required.

	
5.
	
Place of Performance.  Danforth will perform the Services at such locations upon which the Company and Danforth may mutually agree.  Danforth will not, without the prior written consent of the Company, perform any of the Services at any facility or in any manner that might give anyone other than the Company any rights to or allow for disclosure of any Confidential Information (as defined below).

	
6.
	
Compliance with Policies and Guidelines.  Danforth will perform the Services in accordance with all rules or policies adopted by the Company that the Company discloses in writing to Danforth.

	
7.
	
Confidential Information.  Danforth acknowledges and agrees that during the course of performing the Services, the Company may furnish, disclose or make available to Danforth information, including, but not limited to, material, compilations, data, formulae, models, patent disclosures, procedures, processes, business plans, projections, protocols, results of experimentation and testing, specifications, strategies and techniques, and all tangible and intangible embodiments thereof of any kind whatsoever (including, but not limited to, any apparatus, biological or chemical materials, animals, cells, compositions, documents, drawings, machinery, patent applications, records and reports), which is owned or controlled by the Company and is of a type that is customarily considered to be confidential information (collectively the “Confidential Information”).  Danforth acknowledges that the Confidential Information or any part thereof is the exclusive property of the Company and shall not be disclosed to any third party without first obtaining the written consent of the Company or used by Danforth or its affiliates, agents, employees or subcontractors for any reason other than performance of the Services.  Danforth further agrees to take all practical steps to ensure that the Confidential Information, and any part thereof, shall not be disclosed or issued to its 

 

 

		
affiliates, agents, employees or subcontractors, except on like terms of confidentiality.  The above provisions of confidentiality shall apply for a period of five (5) years from the Effective Date.  The Company may require individuals who carry out Danforth’s performance of the Services to sign the Company’s confidentiality and proprietary information agreement that it generally uses with its employees and consultants.

	
8.
	
Intellectual Property.  Danforth agrees that all ideas, inventions, discoveries, creations, manuscripts, properties, innovations, improvements, know-how, inventions, designs, developments, apparatus, techniques, methods, and formulae that Danforth conceives, makes, develops or improves as a result of performing the Services, whether or not reduced to practice and whether or not patentable, alone or in conjunction with any other party and whether or not at the request or upon the suggestion of the Company (all of the foregoing being hereinafter collectively referred to as the “Inventions”), shall be the sole and exclusive property of the Company.  Danforth hereby agrees in consideration of the Company’s agreement to engage Danforth and pay compensation for the Services rendered to the Company and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged that Danforth shall not, without the prior written consent of the Company, directly or indirectly, consult for, or become an employee of, any company which conducts business in the Field of Interest anywhere in the world.  As used herein, the term “Field of Interest” shall mean the research, development, manufacture and/or sale of the products resulting from the Company’s technology.  The limitations on competition contained in this Section 8 shall continue during the time that Danforth performs any Services for the Company, and for a period of two (2) years following the termination of any such Services that Danforth performs for the Company.  If any part of this section should be determined by a court of competent jurisdiction to be unreasonable in duration, geographic area, or scope, then this Section 8 is intended to and shall extend only for such period of time, in such area and with respect to such activity as is determined to be reasonable.  Except as expressly provided herein, nothing in this Agreement shall preclude Danforth from consulting for or being employed by any other person or entity.

	
9.
	
Non Solicitation.  All personnel representing Danforth are employees or contracted agents of Danforth.  As such, they are obligated to provide the Services to the Company and are obligated to Danforth under confidentiality, non-compete, and non-solicitation agreements.  Accordingly, they are not retainable as employees or contractors by the Company and the Company hereby agrees not to solicit, hire or retain their services for so long as they are employees or contracted agents of Danforth and for one (1) year thereafter.  Should the Company violate this restriction, it agrees to pay Danforth liquidated damages equal to thirty percent (30%) of the employee’s starting annual base salary and target annual bonus for each Danforth contracted agent hired by the Company in violation of this Agreement, plus Danforth’s reasonable attorneys’ fees and costs incurred in enforcing this agreement should the Company fail or refuse to pay the liquidated damages amount in full within thirty (30) days following its violation.

	
10.
	
Placement Services.  In the event that Danforth refers a potential employee to the Company and that individual is hired, Danforth shall receive a fee equal to twenty percent (20%) of the employee’s starting annual base salary and target annual bonus.  

 

 

		
This fee is due and owing whether an individual is hired, directly or indirectly on a permanent basis or on a contract or consulting basis by the Company, as a result of Danforth’s efforts within one (1) year of the date applicants) are submitted to the Company.  Such payment is due within thirty (30) days of the employee’s start date.

	
11.
	
No Implied Warranty.  Except for any express warranties stated herein, the Services are provided on an “as is” basis, and the Company disclaims any and all other warranties, conditions, or representations (express, implied, oral or written), relating to the Services or any part thereof.  Further, in performing the Services Danforth is not engaged to disclose illegal acts, including fraud or defalcations, which may have taken place.  The foregoing notwithstanding, Danforth will promptly notify the Company if Danforth becomes aware of any such illegal acts during the performance of the Services.  Because the Services do not constitute an examination in accordance with standards established by the American Institute of Certified Public Accountants (the “AICPA”), Danforth is precluded from expressing an opinion as to whether financial statements provided by the Company are in conformity with generally accepted accounting principles or any other standards or guidelines promulgated by the AICPA, or whether the underlying financial and other data provide a reasonable basis for the statements.  Nonetheless, to the extent Danforth provides Services that constitute preparation of the Company’s quarterly or annual financial statements in the same or similar circumstances in which a chief financial officer or controller would do so, Danforth shall prepare such periodic financial statements in accordance with U.S. generally accepted accounting principles, but nonetheless subject to any review or audit by the Company’s independent certified public accountants.

	
12.
	
Indemnification.  Each Party hereto agrees to indemnify and hold the other Party hereto, its directors, officers, agents and employees harmless against any claim based upon circumstances alleged to be inconsistent with such representations and/or warranties or as contained in this Agreement.  Further, the Company shall indemnify and hold harmless Danforth and any of its subcontractors against any claims, losses, damages or liabilities (or actions in respect thereof) that arise out of or are based on the Services performed hereunder, except for any such claims, losses, damages or liabilities arising out of the gross negligence or willful misconduct of Danforth or any of its subcontractors.  

	
13.
	
Independent Contractor.  Danforth and its agents and subcontractors are not, nor shall Danforth or any of its agents or subcontractors be deemed to be at any time during the term of this Agreement, an employee of the Company, and therefore neither Danforth nor any of its agents or subcontractors shall be entitled to any benefits provided by the Company to its employees, if applicable.  Danforth’s status and relationship with the Company shall be that of an independent contractor and consultant.  Danforth shall not state or imply, directly or indirectly, that Danforth is empowered to bind the Company without the Company’s prior written consent.  Nothing herein shall create, expressly or by implication, a partnership, joint venture or other association between the parties.  Danforth will be solely responsible for payment of all charges and taxes arising from its and its agents and subcontractors’ relationship to the Company as a consultant.

 

 

	
14.
	
Records.  Upon termination of Danforth’s relationship with the Company, Danforth shall deliver to the Company any property or Confidential Information of the Company relating to the Services which may be in its possession including products, project plans, materials, memoranda, notes, records, reports, laboratory notebooks, or other documents or photocopies and any such information stored using electronic medium.

	
15.
	
Notices.  Any notice under this Agreement shall be in writing (except in the case of verbal communications, emails and teleconferences updating either Party as to the status of work hereunder) and shall be deemed delivered upon personal delivery, one day after being sent via a reputable nationwide overnight courier service or three days after deposit in the mail or on the next business day following transmittal via facsimile.  Notices under this Agreement shall be sent to the following representatives of the Parties:

		
	
If to the Company:

	
Name:
	
Axel Bolte

	
Title:
	
Chief Executive Officer

	
Address:
	
 

	
Phone:
	
321 Summer Street, Suite 400, Boston, MA 02210

	
E-mail:
	
axel.bolte@inozyme.com

	
If to Danforth:

	
Name:
	
Gregg Beloff

	
Title:
	
Managing Partner

	
Address:
	
91 Middle Road

	
Phone:
	
Southborough, MA 01772 (617) 686-7679

	
E-mail:
	
ebeloff@danforthadvisors.com

	
16.
	
Assignment and Successors.  This Agreement may not be assigned by a Party without the consent of the other, which consent shall not be unreasonably withheld, except that each Party may assign this Agreement and the rights, obligations and interests of such Party, in whole or in part, to any of its Affiliates, to any purchaser of all or substantially all of its assets or to any successor company resulting from any merger or consolidation of such Party with or into such company.

	
17.
	
Force Majeure.  Neither Party shall be liable for failure of or delay in performing obligations set forth in this Agreement, and neither shall be deemed in breach of its obligations, if such failure or delay is due to natural disasters or any causes beyond the reasonable control of either Party.  In the event of such force majeure, the Party affected thereby shall use reasonable efforts to cure or overcome the same and resume performance of its obligations hereunder.

	
18.
	
Headings.  The Section headings are intended for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

 

 

	
19.
	
Integration; Severability.  This Agreement is the sole agreement with respect to the subject matter hereof and shall supersede all other agreements and understandings between the Parties with respect to the same.  If any provision of this Agreement is or becomes invalid or is ruled invalid by any court of competent jurisdiction or is deemed unenforceable, it is the intention of the Parties that the remainder of the Agreement shall not be affected.

	
20.
	
Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, excluding choice of law principles.  The Parties agree that any action or proceeding arising out of or related in any way to this Agreement shall be brought solely in a Federal or State court of competent jurisdiction sitting in the Commonwealth of Massachusetts.

	
21.
	
Counterparts.  This Agreement may be executed in counterparts, each of which will be deemed an original, but all of which together will constitute one agreement.

If you are in agreement with the foregoing, please sign where indicated below, whereupon this Agreement shall become effective as of the Effective Date.

		
	
DANFORTH ADVISORS, LLC

By: /s/ Chris Connors

Print Name: Chris Connors

Title: CEO

Date: 5/6/2021
	
INOZYME PHARMA, INC.

By: /s/ Axel Bolte

Print Name: Axel Bolte

Title: President and Chief Executive Officer

Date: 5/6/2021

 

 

 

 

EXHIBIT A

Description of Services and Schedule of Fees

Danforth will perform mutually agreed to finance and accounting functions which are necessary to support the management and operations of the Company including, but not limited to, the functions set forth below:

RoleNameHourly Rate

 

Interim CFO*Steve DiPalma$500/hour

*including interim principal financial officer and principal accounting officer 

Equity Compensation:

In further consideration of Danforth’s service to the Company, and subject to approval by the Company’s Board of Directors, the Company will grant to Mr. DiPalma an option under the Company’s 2020 Stock Incentive Plan to purchase 15,000 shares of the Company’s common stock (the “Option”). The Option shall have an exercise price equal to the closing price of the Common Stock on the Nasdaq Global Select Market on the effective date of grant of such Option, and shall vest as to 50% on the date that is 180 days from the Effective Date and as to the remaining 50% on the first anniversary of the Effective Date, provided Mr. DiPalma is providing the Services to the Company on each such vesting date. The Company and Mr. DiPalma will enter into a separate option agreement evidencing the Option within 30 days of the date of approval by the Company’s Board of Directors, such option agreement to be in substantially the form previously approved and adopted by the Company’s Board of Directors. 

CFO Services:

	
 
	
•
	
Support strategic business planning

	
 
	
•
	
Support fundraising activities

	
 
	
•
	
Provide finance support for operational planning

	
 
	
•
	
Participate in supplier contract negotiation and cost reduction planning

	
 
	
•
	
Assist with corporate and business development/licensing initiatives

	
 
	
•
	
Perform financial modeling, planning and analysis

	
 
	
•
	
Strategic opportunity assessment

	
 
	
•
	
Stock option plan management

	
 
	
•
	
Capitalization table management

Accounting Services:

 

 

	
 
	
•
	
Establish and maintain an appropriate accounting system and general ledger, likely on QuickBooks

	
 
	
•
	
Regular bookkeeping and accounting activities— monthly close, monthly reporting, and general financial administration

	
 
	
•
	
Establish and perform procedures for setting up new vendors (contracts, W-9s) and paying monthly invoices; manage payables and cash disbursements

	
 
	
•
	
Reconcile cash accounts, track cash usage and prepare cash flow projections

	
 
	
•
	
Establish reporting template and perform monthly reporting (internal and external)

	
 
	
•
	
Establish/maintain internal controls

	
 
	
•
	
Input of budget in QuickBooks for variance analysis

	
 
	
•
	
Manage insurance and banking

	
 
	
•
	
Establish and manage payroll and employee benefits

	
 
	
•
	
Monthly payroll/benefits administration

	
 
	
•
	
Update and manage the Company’s cap table

	
 
	
•
	
Financing, audit, budget, payroll/workers comp set up or other special project(s), as required and requested

	
 
	
•
	
Provide support for fundraising initiatives

	
 
	
•
	
Assist with tax returns, as appropriate

Financial Planning & Analysis Services:

	
 
	
•
	
Prepare annual budget and long-term forecasts in consultation with management

	
 
	
•
	
Prepare analyses to support fundraising activities and/or communications with investors

	
 
	
•
	
Perform deal analyses, and/or develop financial projections related to strategic alternatives

	
 
	
•
	
Complete other tasks consistent with financial planning and analysis activitieskop-ex101_18.htm

Exhibit 10.1

CHANGE IN CONTROL AGREEMENT

 

 

This Agreement made this 1st day of March, 2021  by and between [                ] (“Executive”) and Koppers Holdings Inc. (the “Company”).  

 

WHEREAS, the Company considers it essential to the best interests of its stockholders to foster the continuous employment of certain key management personnel of the Company and its affiliates; and 

 

WHEREAS, the Board of Directors of the Company (the “Board”) recognizes that the possibility of a change in control of the Company exists and that such possibility, and the uncertainty and questions which it may raise among management, may result in the departure or distraction of management personnel to the detriment of the Company and its stockholders; and

 

WHEREAS, the Board has determined that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of certain members of the management of the Company and its affiliates to their assigned duties without distraction in the face of potentially disturbing circumstances arising from the possibility of a change in control of the Company.

 

NOW THEREFORE, in consideration of the mutual covenants contained herein, and intending to be legally bound hereby, the parties agree as follows:

 

	
 
	
1.
	
Term of Agreement.  The term of this Agreement (the “Term”) shall commence as of March 1, 2021 and shall continue in effect until March 1, 2023; provided, however, that as of March 1, 2023 and each March 1 thereafter, the Term shall automatically be extended for one additional year unless, at least ninety (90) days prior to such renewal date either the Company or Executive shall have given notice to the other that such party does not wish to extend the Term; and provided further, however, that if a Change in Control (as hereinafter defined) shall have occurred during the original or any extended Term, the Term shall continue for a period of not less than twenty-four (24) months following the month in which such Change in Control occurred.  

 

	
 
	
2.
	
Change in Control.

 

	
 
	
a.
	
Definition.  For purposes of this Agreement, a “Change in Control” shall have the definition ascribed to such term in the Company’s 2018 Long Term Incentive Plan, as amended from time to time.  

 

	
 
	
b.
	
Termination Following Change in Control.  Executive shall be entitled to the benefits provided in subsection (c) below if any of the events, described in Section 2(a) constituting a Change in Control shall have occurred, and:

 

	
 
	
i.
	
Executive terminates Executive’s employment upon 30 days’ written notice after being required to relocate Executive’s primary office to a location greater than 50 miles from the then current location of Executive’s office or Executive terminates Executive’s employment upon 30 days’ written notice after a material reduction in Executive’s duties, responsibilities or compensation (unless the Company either revokes such relocation requirement or revokes such material 

DB1/ 111278283.2

 
 

 

 

	
 
		
reduction in Executive’s duties, responsibilities or compensation, as the case may be, during the period beginning on the date of Executive’s written notice of termination and ending 30 days thereafter); or 

 

	
 
	
ii.
	
The Company or its affiliates, as the case may be, terminates Executive’s employment for any reason other than for Cause (as defined below) or by reason of Executive’s Disability (as defined below);

 

Provided, however, that such termination, whether pursuant to Section  2(b)(i) or 2(b)(ii) above, shall have occurred (x) during the two-year period following such Change in Control; or (y) prior to the date on which a Change in Control of the Company occurs, if it can be reasonably demonstrated by Executive that such termination of employment was at the request of a third party who has taken steps reasonably calculated to effect a Change in Control or otherwise arose in connection with or anticipation of a Change in Control.

 

	
 
	
c.
	
Compensation Upon Termination - In the event that a termination of employment of Executive occurs under the circumstances set forth in Section 2(b) above:

 

	
 
	
i.
	
No later than the fifth day following the date of termination, the Company shall pay to Executive his or her full base salary through the date of termination at the rate in effect at the time notice of termination is given; 

 

	
 
	
ii.
	
In lieu of any further salary payments to Executive for periods subsequent to the date of termination, the Company shall pay as severance pay to Executive, at the time specified in subsection (d) below, a lump sum severance payment (the “Severance Payment”) equal to two times Executive’s annual Base Salary as in effect as of the date of termination or immediately prior to the Change in Control, whichever is greater;

 

	
 
	
iii.
	
In lieu of any payments under the executive incentive plan or other bonus plan in effect for the year in which Executive’s date of termination occurs, the Company shall pay Executive, at the time specified in subsection (d) below, a pro rata portion of all contingent awards granted under such plans for all uncompleted periods, assuming for this purpose that the amount of each award that would have been paid upon completion of such period would equal the average of the payments from the executive incentive plan for the previous two (2) years, and basing such pro rata portion upon the portion of the award period that has elapsed as of the date of termination;

 

	
 
	
iv.
	
For a twenty-four (24) month period or for the term of this Agreement, whichever is later, the Company shall arrange to provide Executive with 

 

 

 

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life, disability, accident and group health insurance benefits substantially similar to those which Executive was receiving immediately prior to the notice of termination (or, in the Company’s discretion, the monetary equivalent of such benefits, payable on a monthly basis).  Benefits otherwise receivable by Executive pursuant to this paragraph (iv) shall be reduced to the extent comparable benefits are actually received by Executive during the twenty-four (24) month period following Executive’s termination, and any such benefits actually received by Executive shall be reported to the Company; and

 

	
 
	
v.
	
The Company’s obligations to indemnify and defend Executive with respect to matters arising out of Executive’s performance during the Term shall continue after Executive’s termination to the same extent that they existed prior to such termination.   The Company will, at all times, maintain in force and effect Directors and Officers Liability Insurance.

 

	
 
	
d.
	
Except as provided in subsection (f) hereof, the payments provided for in subsections (c) (ii) and (iii), above, shall be made no later than the fifth day following the date of termination; provided, however, that if the amounts of such payments cannot be finally determined on or before such day, the Company shall pay to Executive on such day an estimate, as determined in good faith by the Company, of the minimum amount of such payments and shall pay the remainder of such payments (together with interest at the rate provided in section 1274(b)(2)(B) of the Internal Revenue Code as amended (the “Code”)) as soon as the amount thereof can be determined, but in no event later than the thirtieth day after the date of termination.  In the event that the amount of the estimated payments exceeds the amount subsequently determined to have been due, such excess shall constitute a loan by the Company to Executive, payable on the fifth day after demand by the Company (together with interest at the rate provided in section 1274 (b)(2)(B) of the Code).

 

	
 
	
e.
	
Except as provided in subsection (c)(v) hereof, Executive shall not be required to mitigate the amount of any payment provided for in this Section by seeking other employment or otherwise, nor shall the amount of any payment or benefit provided for in this Section 2 be reduced by any compensation earned by Executive as the result of employment by another employer, by retirement benefits, by offset against any amount claimed to be owed by Executive to the Company, or otherwise.

 

	
 
	
f.
	
Notwithstanding the provisions of this Section 2, in no event shall the aggregate present value of “parachute payments” as defined in Section 280G of the Code, exceed three times Executive’s “base amount”, as defined in Section 280G(b)(3) of the Code.  If the preceding limitation is exceeded, then Executive’s payments and benefits in this Section 2 shall be reduced to the extent necessary to cause the total payments and “parachute payments” to comply with the limitation.

 

 

 

 

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DB1/ 111278283.2

 
 

 

 

 

	
 
	
g.
	
Executive’s entitlement to the benefits set forth in Sections 2(c)(ii), (iii), (iv) and (v) shall be conditioned upon Executive executing and delivering a release satisfactory to the Company releasing the Company and its affiliates and persons employed by such entities from any and all claims, demands, damages, actions and/or causes of action whatsoever, which Executive may have had on account of the termination of Executive’s employment, including, but not limited to claims of discrimination, including on the basis of sex, race, age, national origin, religion, or handicapped status (with all applicable periods during which Executive may revoke the release or any provision thereof having expired), and any and all claims, demands and causes of action under any retirement or welfare benefit plan of the Company (as defined in the Employee Retirement Income Security Act of 1974, as amended), other than under the Company’s 401(k) plan and the Qualified Plan, severance or other termination pay.  Such release shall not, however, apply to the ongoing obligations of the Company arising under this Agreement, or any rights of indemnification Executive may have under the Company’s policies or by contract or by statute.

 

Notwithstanding anything to the contrary herein, including in subsection (d), in the case of payments or benefits under this Agreement that are or may be deferred compensation subject to Internal Revenue Code Section 409A and are subject to an effective release as set forth above, where the period for execution and non-revocation of the release spans more than one calendar year, no such payment or benefit shall be made or provided any earlier than the beginning of the second calendar year.  In no event may Executive, directly or indirectly, designate the calendar year of payment.  

 

	
 
	
3.
	
Successors; Binding Agreement.

 

	
 
	
a.
	
The Company will require any successor (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 assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.  As used in this Agreement, “Company” shall mean the Company as herein before defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

 

	
 
	
b.
	
This Agreement shall inure to the benefit of and be enforceable by Executive and Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.  If Executive should die while any amount would still be payable to Executive hereunder had Executive continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to Executive’s devisee, legatee or other designee or, if there is no such designee, to Executive’s estate.

 

	
 
	
4.
	
Notice.  For the purpose of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have 

 

 

 

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DB1/ 111278283.2

 
 

 

 

	
 
		
been duly given when delivered or mailed by United States certified or registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the signature page of this Agreement, 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, except that notice of change of address shall be effective only upon receipt.

 

	
 
	
5.
	
Miscellaneous.  No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by Executive and such officer of the Company 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 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.  No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement.  The validity interpretation, construction and performance of this Agreement shall be governed by the laws of the Commonwealth of Pennsylvania without regard to its conflicts of law principles.  Any payments provided for hereunder shall be paid net of any applicable withholding required under federal, state or local law.  The obligations of the Company under Section 2 shall survive the expiration of the term of this Agreement.

 

	
 
	
6.
	
Counterparts.  This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

 

	
 
	
7.
	
Definitions.

 

	
 
	
a.
	
Cause.  Termination by the Company of Executive’s employment for “Cause” shall mean termination (a) upon the willful and continued failure by Executive to substantially perform Executive’s duties with the Company or its affiliates, as the case may be, (other than any such failure resulting from Executive’s incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to Executive by the Chief Executive Officer, which demand specifically identifies the manner in which the Chief Executive Officer believes that Executive has not substantially performed Executive’s duties, and Executive is given a reasonable opportunity to remedy such identified failure to perform, or (b) the willful engaging by Executive in conduct which is demonstrably and materially injurious to the Company or its affiliates, as the case may be, monetarily or otherwise.  For purposes of this subsection, no act, or failure to act, on Executive’s part shall be deemed “willful” unless done, or omitted to be done, by Executive not in good faith and without reasonable belief that Executive’s action or omission was in the best interest of the Company or its affiliates, as the case may be.

  

 

 

 

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b.
	
Disability.  If, as a result of Executive’s incapacity due to physical or mental illness, Executive shall have been absent from the full-time performance of Executive’s duties with the Company for at least six (6) consecutive months out of the previous twelve (12) months, and within thirty (30) days after written notice of termination is given to Executive by the Company or its affiliates shall not have returned to the full-time performance of Executive’s duties, Executive’s employment shall be deemed terminated for “Disability.”

 

	
 
	
8.
	
Dispute Resolution.

 

	
 
	
a.
	
Negotiation.  If a dispute or controversy arises under or in connection with this Agreement, the parties agree first to try in good faith to settle the dispute or controversy.  Any party may initiate the negotiation process by written notice to the others, identifying the dispute or controversy and the desire for negotiation.

 

	
 
	
b.
	
Arbitration.  If the parties have not resolved the dispute or controversy by direct negotiations within thirty (30) days of such notice, any party may initiate arbitration as herein provided.  All disputes or controversies arising under or in connection with this Agreement which are not resolved by negotiation shall be decided by arbitration in accordance with the Employment Dispute Resolution Rules of the American Arbitration Association, provided, however, that any such arbitration shall be before a single arbitrator selected by agreement of the parties.  Judgment upon the award or decision of the arbitrator may be entered and enforced in any court of competent jurisdiction.  In the event that the parties cannot agree upon the selection of an arbitrator, the parties agree that the American Arbitration Association in Pittsburgh, Pennsylvania will select the arbitrator. Notwithstanding the foregoing to the contrary, a party shall not be prohibited or precluded from seeking equitable relief in a court of competent jurisdiction without first resorting to the dispute resolution provisions of this Section 9 in circumstances in which a party’s interests or property will otherwise be compromised.  It is specifically intended by the parties that if any equitable relief is granted by an arbitrator, said relief may be enforced in any court of competent jurisdiction.  The forum of such arbitration shall be in Pittsburgh, Pennsylvania to the exclusion of all other jurisdictions.  

 

	
 
	
c.
	
Notice of Decision.  The arbitrator shall promptly notify the parties in writing of the decision, together with the amount of any dispute resolution costs arising with respect thereto (the “Notice of Decision”).  The Notice of Decision need not contain an explanation of the decision or grounds thereof.

 

	
 
	
d.
	
Costs and Fees.  All dispute resolution costs, which shall include any fee for the arbitrator for services rendered shall be borne by the Company.  Each party is to pay its own counsel fees and expenses.

 

	
 
	
9.
	
Severability and Reformation.  The provisions of this Agreement shall be deemed to be divisible so that in the event that any of the provisions of this Agreement shall be held to be invalid or unenforceable in whole or in part, those provisions to the 

 

 

 

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extent enforceable and all other provisions shall nevertheless continue to be valid and enforceable as though the invalid or unenforceable parts had not been included in this Agreement.  In the event that any provision of this Agreement (including, but not limited to, any provision related to a time period, geographical area or scope of restriction) shall be declared by a court of competent jurisdiction to exceed the maximum limitations or restrictions such court deems reasonable and enforceable, then such provision shall be deemed modified and reformed so as to be valid and enforceable to the maximum extent lawfully permitted. 

 

	
 
	
10.
	
Entire Agreement.  This Agreement sets forth the entire agreement of the parties hereto in respect of the subject matter contained herein, and supersedes all prior agreements, promises, covenants, arrangements, communications, representations or warranties; whether oral or written, by any officer, employee or representative of any party hereto; and any prior agreement of the parties hereto in respect of the subject matter contained herein is hereby terminated and canceled.

 

	
 
	
11.
	
Compliance with Code Section 409A.  

 

	
 
	
a.
	
The terms of this Agreement are intended to, and shall be interpreted and applied so as to, comply in all respects with the provisions of Internal Revenue Code Section 409A and regulations and rulings thereunder.  The terms of this Agreement may be amended or modified at any time and in any respect by the Company if and to the extent recommended by counsel in order to conform to the requirements of Internal Revenue Code Section 409A and regulations and rulings thereunder.

 

	
 
	
b.
	
Notwithstanding any provision of this Agreement to the contrary, in the event that Executive is a "specified employee" within the meaning of Internal Revenue Code Section 409A(a)(2)(B)(i), no payment under this Agreement may be made, or may commence, before the date which is 6 months after the date of Executive's "separation from service" within the meaning of Internal Revenue Code Section 409A(a)(2)(B)(i) (or, if earlier, the date of the Executive's death) if and to the extent such payment is a payment of "deferred compensation" subject to Internal Revenue Code Section 409A.

 

	
 
	
12.
	
Confidential information.

 

	
 
	
a.
	
Executive agrees and understands that Executive has been and will be exposed to and receive certain confidential information of the Company and its affiliates, including, but not limited to: technical information; business and marketing plans; strategies; customer information; product information; pricing information and policies; promotions; developments; financing plans; business policies and practices; processes; techniques; methodologies; formulae; processes; compilations of information; research materials; software (source and object code); algorithms; computer processing systems; drawings; proposals; job notes; reports; records; specifications; inventions; discoveries; improvements; innovations; designs; ideas; trade secrets; proprietary 

 

 

 

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information; manufacturing, packaging, advertising, distribution, and sales methods; sales and profit figures; and client and client lists and other forms of information considered by the Company or its affiliates to be confidential and in the nature of a trade secret (hereinafter all referred to as “Confidential Information”).  Executive acknowledges that the Confidential Information is a valuable and unique asset of the Company and hereby covenants that both during and after Executive’s employment, Executive shall keep such Confidential Information confidential and shall not disclose such information, either directly or indirectly, to any third person or entity without the prior written consent of a duly authorized representative of the Company.  Further, Executive agrees that Executive will not use any Confidential Information for any purpose (including, but not limited to, use for Executive’s own benefit or for the benefit of a third party) other than for purposes authorized by the Company or its affiliates and for the benefit of the Company and/or its affiliates.  The parties agree that any Confidential Information that was disclosed or provided to Executive by the Company or its affiliates prior to the effective date of this Agreement was intended to be and shall be subject to the terms and conditions of this Agreement.  Executive agrees that this confidentiality covenant has no temporal or territorial restriction.  The obligation of confidentiality imposed herein shall not apply: (i) to information that is now or hereafter becomes publicly known or generally known in the Company’s industry other than as a result of Executive’s breach of Executive’s obligations hereunder and (ii) to information that is required to be disclosed by applicable laws, governmental regulations or judicial or regulatory process; provided, however, in such event, that Executive may disclose such information only to the extent required and shall give at least fifteen (15) days’ prior written notice to the Company of the requirement to disclose such information to the extent practicable under the circumstances.

 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the day and year first above written.

 

 

THE COMPANY:EXECUTIVE:

 

 

 

__________________________________________________________

Daniel R. Groves           

	
Vice President, Culture and Engagement
	
 

 

 

 

 

 

 

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