EXHIBIT 10.20
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as of the 7th day of
August, 1996, by and between Tridex Corporation, a Connecticut corporation with
a mailing address of 00 Xxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxx 00000 (the
"Company"), and Xxxxxx X. Xxxxxx, Xx., an individual with a residence address of
000 Xxxxxxx Xxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, (the "Executive").
INTRODUCTION
1. The Company is in the business of designing, developing, manufacturing and
marketing Point of Sale printers and related products (the "Business").
2. The Company desires to employ Executive and Executive desires to accept
such employment on the terms and conditions set forth herein.
AGREEMENT
In consideration of the premises and mutual promises herein below set forth, the
parties hereby agree as follows:
1. Employment Period. The term of this Agreement (the "Employment Period")
shall commence on the date hereof and, subject to earlier termination as
hereinafter provided, shall terminate one (1) year from the date hereof
provided that the term of this Agreement shall automatically extend by
thirty (30) days for each thirty (30) day period which shall expire
without either the Company or Executive giving written notice of an intent
to terminate.
2. Employment Duties. Subject to the terms and conditions set forth herein,
the Company hereby employs Executive to act as Vice President of Human
Resources of the Company during the Employment Period, and Executive
hereby accepts such employment. The duties assigned and authority granted
to Executive shall be as set forth in the By-laws of the Company and as
determined by its Board of Directors from time to time. Executive agrees
to perform his duties for the Company diligently, competently, and in a
good faith manner. The Executive may also engage in civic and charitable
activities to the extent they are not inconsistent with Executive's duties
hereunder.
3. Salary and Bonus.
(a) Base Salary. The Company agrees to pay Executive $89,000 per year,
payable bi-monthly in arrears. Executive's base salary shall not be
decreased. In addition, no later than March 31, 1997 the Board of
Directors of the Company (or any appropriate committee thereof)
shall review and may increase the Executive's annual base salary in
its discretion, based upon the Company's performance and the
Executive's particular contributions.
(b) Bonus. Executive shall have an opportunity to earn an annual cash
bonus under the Company's Executive Incentive Compensation Plan,
subject to the discretion of the Company's Board of Directors (or
any appropriate committee thereof).
4. Other Benefits.
(a) Insurance and Other Benefits. The Executive shall be entitled to
participate in, and shall receive the maximum benefits available
under the Company's insurance programs (including health, disability
and life insurance) and any ERISA benefit plans, as the same may be
adopted and/or amended from time to time, and shall receive all
other fringe benefits that are provided by the Company to other
senior executives. The Company shall contribute the maximum amount
permitted under current law to the Executive's 401(k) Plan, and any
other Company pension or retirement plan during the Employment
Period.
(b) Vacation. Executive shall be entitled to an annual vacation of such
duration as may be determined by the Board of Directors, but not
less than that generally established for other executives of Company
and in no event less than three (3) weeks, without interruption of
salary.
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(c) Automobile Allowance. Subject to approval by the Compensation
Committee of the Tridex Board of Directors, the Company shall
provide Executive with an automobile allowance.
(d) Reimbursement of Expenses. The Company shall reimburse Executive for
all reasonable travel, entertainment and other expenses incurred or
paid by the Executive in connection with, or related to, the
performance of his duties or responsibilities under this Agreement,
provided that Executive submits to the Company substantiation of
such expenses sufficient to satisfy the record keeping guidelines
promulgated from time to time by the Internal Revenue Service.
5. Termination by the Company With Cause. The Company may terminate this
Agreement if any of the following events shall occur:
(a) the death or disability of the Executive (For purposes of this
Agreement, "disability" shall mean the Executive's incapacity due to
physical or mental illness which has caused the Executive to be
absent from the full-time performance of his duties with the Company
for a period of six (6) consecutive months.).
(b) any action or inaction by the Executive that constitutes larceny,
fraud, gross negligence, a willful or negligent misrepresentation to
the directors or officers of the Company, its successors or assigns,
a crime involving moral turpitude; or
(c) the refusal of the Executive to follow the reasonable and lawful
written instructions of the Board of Directors of the Company with
respect to the services to be rendered and the manner of rendering
such services by Executive, provided such refusal is material and
repetitive and is not justified or excused either by the terms of
this Agreement or by actions taken by the Company in violation of
this Agreement, and with respect to the first two refusals Executive
has been given reasonable written notice and explanation thereof and
reasonable opportunity to cure and no cure has been effected within
a reasonable time after such notice.
The Company may terminate this Agreement pursuant to this Section 5 upon
written notice to the Executive, except for termination due to the death of
the Executive, which shall require no notice.
6. Termination and Severance.
6.1 Notice/Events/Defined Terms.
(a) Termination of the Executive. Executive may terminate this Agreement
at any time by providing written notice to the Company.
(b) Termination by the Company Without Cause. The Company may terminate
this Agreement at any time, without cause by providing written
notice to Executive. As used in this Agreement, the term "without
cause" shall mean termination for any reason not specified in
Section 5 hereof, except for retirement.
(c) Change in Control. A "Change in Control" will be deemed to have
occurred if: (1) the Company effectuates a Takeover Transaction; or
(2) any election of directors of the Company (whether by the
directors then in office or by the stockholders at a meeting or by
written consent) where a majority of the directors in office
following such election are individuals who were not nominated by a
vote of two-thirds of the members of the Board of Directors
immediately preceding such election; or (3) the Company effectuates
a complete liquidation of the Company or a sale or disposition of
all or substantially all of its assets. A "Change in Control" shall
not be deemed to include, however, a merger or sale of stock, assets
or business of the Company if the Executive immediately after such
event owns, or in connection with such event immediately acquires
(other than in the Executive's capacity as an equity holder of the
Employer or as a beneficiary of its employee stock ownership plan or
profit sharing plan), any stock of the buyer or any affiliate
thereof.
(d) Takeover Transaction. A "Takeover Transaction" shall mean (i) a
merger or consolidation of the Company with, or an acquisition of
the Company or all or substantially all of its assets by, any other
corporation, other than a merger, consolidation or acquisition in
which the individuals who were members of the Board of Directors of
the Company immediately prior to such transaction continue to
constitute a majority of the Board of Directors of the surviving
corporation (or, in the case of an acquisition involving a holding
company, constitute a majority of the Board of Directors of the
holding company) for a period
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of not less than twelve (12) months following the closing of such
transaction, or (ii) when any person or entity or group of persons
or entities (other than any trustee or other fiduciary holding
securities under an employee benefit plan of the Company either
related or acting in concert becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Securities Exchange Act of 1934, as
amended) of securities of the Company representing more than fifty
percent (50%) of the total number of votes that may be cast for the
election of directors of the Company.
(e) Terminating Event. A "Terminating Event" shall mean: (i) termination
by the Company of the employment of the Executive without Cause
occurring within twelve (12) months of a Change of Control; or (ii)
resignation of the Executive from the employ of the Company, while
the Executive is not receiving payments or benefits from the Company
by reason of the Executive's disability, subsequent to any of the
following events occurring within twelve (12) months of a Change of
Control: (A) a significant reduction in the nature or scope of the
Executive's responsibilities, authorities, powers, functions or
duties from the responsibilities, authorities, power functions or
duties exercised by the Executive immediately prior to the Change in
Control; (B) a decrease in the salary payable by the Company to the
Executive from the salary payable to the Executive immediately prior
to the Change in Control except for across-the-board salary
reductions similarly affecting all management personnel of the
Company; or (C) the relocation of the Company's executive offices
(or, if the Executive is primarily located at the Company's
manufacturing facilities, such facilities) by more than 50 miles
from their current location in Westport, Connecticut (unless such
new location is closer than Westport, Connecticut to the Executive's
then residence) provided, however, that a Terminating Event shall
not be deemed to have occurred solely as a result of the Executive
being an employee of any direct or indirect successor to the
business or assets of the Company, rather than continuing as an
employee of the Company, following a Change in Control; or (D)
elimination or reduction of the Executive's participation in the
Company's Executive Incentive Compensation Plan.
6.2 Severance
(a) Without Cause. If the Company terminates this Agreement without
Cause, other than as a result of a Terminating Event and for a
period equal to one (1) year thereafter, the Company shall provide
Executive with a severance package which shall consist of the
following: (i) payment on the first business day of each month of an
amount equal to one-twelfth of the Executive's then current annual
base salary under Section 3(a) hereof; (ii) payment on the first
business day of each month of an amount equal to one-twelfth of the
Executive's annual target bonus amount under the Company's Executive
Incentive Compensation Plan for the year of termination, pro rated
for the portion of the fiscal year occurring prior to termination;
and (iii) continuation of all benefits under Section 4(a), (b) and
(d).
(b) With A Terminating Event. If the Company terminates this Agreement
as a result of a Terminating Event, then commencing on the date of
such termination and for a period equal to two (2) years thereafter,
the Company shall provide Executive with a severance package which
shall consist of the following: (i) payment on the first business
day of each month an amount equal to one-twelfth of the Executive's
then current annual base salary under Section 3(a) hereof; (ii)
payment on the first business day of each month of an amount equal
to one-twelfth of the Executive's annual target bonus amount under
the Company's Executive Incentive Compensation Plan; and (iii)
continuation of all benefits under Section 4(a), (b), and (d). In
addition, if the Company terminates this Agreement as a result of a
Terminating Event, then the Company shall cause the immediate
vesting of all options granted to the Executive under the Company's
stock plans. At any time when the Company is obligated to make
monthly payments under Section 6.2(b), the Company shall, ten (10)
days after receipt of a written request from the Executive, pay the
Executive an amount equal to the balance of the amounts payable
under Section 6.2(b)(i)-(ii), provided that the obligation of the
Company to continue to provide benefits pursuant to Section 6.2(b)
(iii) or to make monthly payments under 6.2(b) (i)-(ii) shall cease
upon the payment of such amount.
(c) General Release. As a condition precedent to receiving any severance
payment, the Executive shall execute a general release of any and
all claims which Executive or his heirs, executors, agents or
assigns might have against the Company, its subsidiaries,
affiliates, successors, assigns and its past, present and future
employees, officers, directors, agents and attorneys.
7. Non-Competition. During the term of this Agreement and (a) in the case of
termination other than as a result of a Terminating Event, for one (1)
year following the termination of this Agreement or (b) in the case of
termination as a result of a Terminating Event, for two (2) years
following the termination of this Agreement,
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Executive will not directly or indirectly whether as a partner,
consultant, agent, employee, co-venturer, greater than two percent owner
or otherwise or through any other person (as hereafter defined): (a) be
engaged in any business or activity which is competitive with the business
of the Company in any part of the world in which the Company is at the
time of the Executive's termination engaged in selling its products
directly or indirectly; or (b) attempt to recruit any employee of the
Company, assist in their hiring by any other person, or encourage any
employee to terminate his or her employment with the Company; or (c)
encourage any customer of the Company to conduct with any other person any
business or activity which such customer conducts or could conduct with
the Company. For purpose of this Section 7, the term "Company" shall
include any person controlling under common control with or controlled by,
the Company, provided, however, that with respect to Tridex Corporation or
any subsidiary of Tridex Corporation, the provisions of this Section 7
shall cease and be of no force and effect one (1) year after the Company
is no longer a subsidiary of Tridex.
For purpose of this Section 7, the term "Person" shall mean an individual
or corporation, association or partnership in estate or trust or any other
entity or organization.
The Executive recognizes and agrees that because a violation by him of
this Section 7 will cause irreparable harm to the Company that would be
difficult to quantify and for which money damages would be inadequate, the
Company shall have the right to injunctive relief to prevent or restrain
any such violation, without the necessity of posting a bond.
Executive expressly agrees that the character, duration and scope of this
covenant not to compete are reasonable in light of the circumstances as
they exist at the date upon which this Agreement has been executed.
However, should a determination nonetheless be made by a court of
competent jurisdiction at a later date that the character, duration or
geographical scope of this covenant not to compete is unreasonable in
light of the circumstances as they then exist, then it is the intention of
both Executive and the Company that this covenant not to compete shall be
construed by the court in such a manner as to impose only those
restrictions on the conduct of Executive which are reasonable in light of
the circumstances as they then exist and necessary to provide the Company
the intended benefit of this covenant to compete.
8. Confidentiality Covenants. Executive understands that Company may impart
to him confidential business information including, without limitations,
designs, financial information, personnel information, strategic plans,
product development information and the like (collectively "Confidential
Information"). Executive hereby acknowledges Company's exclusive ownership
of such Confidential Information.
Executive agrees as follows: (1) only to use the Confidential Information
to provide services to the Company; (2) only to communicate Confidential
Information to fellow employees, agents and representatives of the Company
on a need-to-know basis; and (3) not to otherwise disclose or use any
Confidential Information. Upon demand by the Company or upon termination
of Executive's employment, Executive will deliver to the Company all
manuals, photographs, recordings, and any other instrument or device by
which, through which, or on which Confidential Information has been
recorded and/or preserved, which are in my Executive's possession, custody
or control. Executive acknowledges that for purposes of this Section 8
that term "Company" means any person or entity now or hereafter during the
term of this Agreement which controls, is under common control with, or is
controlled by, the Company.
The Executive recognizes and agrees that because a violation by him of
this Section 8 will cause irreparable harm to the Company that would be
difficult to quantify and for which money damages would inadequate, the
Company shall have the right to injunctive relief to prevent or restrain
any such violation, without the necessity of posting a bond.
9. Governing Law/Jurisdiction. This Agreement shall be governed by and
interpreted and governed in accordance with the laws of the State of
Connecticut. The parties agree that this Agreement was made and entered
into in Connecticut and each party hereby consents to the jurisdiction of
a competent court in Connecticut to hear any dispute arising out of this
Agreement.
10. Entire Agreement. This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof and thereof
and supersedes any and all previous agreements, written and oral,
regarding the subject matter hereof between the parties hereto. This
Agreement shall not be changed, altered, modified or amended, except by a
written agreement signed by both parties hereto.
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11. Notices. All notices, requests, demands and other communications required
or permitted to be given or made under this Agreement shall be in writing
and shall be deemed to have been given if delivered by hand, sent by
generally recognized overnight courier service, telex or telecopy, or
certified mail, return receipt requested.
(a) to the Company at:
00 Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: Chairman and CEO
(b) to the Executive at:
000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Any such notice or other communication will be considered to have been
given (i) on the date of delivery in person, (ii) on the third day after
mailing by certified mail, provided that receipt of delivery is confirmed
in writing, (iii) on the first business day following delivery to a
commercial overnight courier, or (iv) on the date of facsimile
transmission (telecopy) provided that the giver of the notice obtains
telephone confirmation of receipt.
Either party may, by notice given to the other party in accordance with
this Section, designate another address or person for receipt of notices
hereunder.
12. Severability. If any term or provision of this Agreement, or the
application thereof to any person or under any circumstance, shall to any
extent by invalid or unenforceable, the remainder of this Agreement, or
the application of such terms to the persons or under circumstances other
than those as to which it is invalid of unenforceable, shall be considered
severable and shall not be affected thereby, and each term of this
Agreement shall be valid and enforceable to the fullest extent permitted
by law. The invalid or unenforceable provisions shall, to the extent
permitted by law, be deemed amended and given such interpretation as to
achieve the economic intent of this Agreement.
13. Waiver. The failure of any party to insist in any one instance or more
upon strict performance of any of the terms and conditions hereof, or to
exercise any right of privilege herein conferred, shall not be construed
as a waiver of such terms, conditions, rights or privileges, but same
shall continue to remain in full force and effect. Any waiver by any party
of any violation of, breach of or default under any provision of this
Agreement by the other party shall not be construed as, or constitute, a
continuing waiver of such provision, or waiver of any other violation of,
breach of or default under any other provision of this Agreement.
14. Successors and Assigns. This Agreement shall be binding upon the Company
and any successors and assigns of the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
Tridex Corporation
by: /s/ Xxxx X. Xxxxxx
-----------------------------------
Title: Chairman and CEO
EXECUTIVE:
/s/ Xxxxxx X. Xxxxxx, Xx.
----------------------------------------
Xxxxxx X. Xxxxxx, Xx.
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