Employment Agreement
Exhibit 10.22
This Employment Agreement (“Agreement”) is entered into effective June 30, 2008, by and
between Zareba Systems, Inc., a Minnesota corporation (the “Company”), and Xxxx Xxxxxxxxx, a
resident of Minnesota (“Executive”).
Background
A. Executive desires to be employed by the Company, and the Company wishes to hire Executive
upon the terms and conditions set forth in this Agreement. The Company has extended a formal offer
of employment to Executive, subject to the terms of this Agreement, in a letter dated May 28, 2008
(the “Offer Letter”).
B. During employment with the Company Executive will have access to confidential, proprietary
and trade secret information of the Company. It is desirable and in the best interests of the
Company and its shareholders to protect confidential, proprietary and trade secret information of
the Company, to prevent unfair competition by former executives of the Company following separation
of their employment with the Company and to secure cooperation from former executives with respect
to matters related to their employment with the Company.
C. Executive understands that Executive’s receipt of the benefits provided for in this
Agreement depends on, among other things, Executive’s willingness to agree to and abide by the
non-disclosure, non-competition, non-solicitation, and other covenants contained in this Agreement.
Executive and the Company acknowledge that Executive was provided a copy of this Agreement before
Executive accepted employment with the Company.
In consideration of Executive’s employment with the Company, the compensation and benefits
payable in connection with such employment, and the foregoing premises and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, Executive and the Company
agree as follows:
Agreement
1. Employment. Commencing on June 30, 2008, or such other date mutually
agreed upon by the parties (the “Effective Date”), the Company will employ Executive, and Executive
will accept such employment and perform services for the Company, upon the terms and conditions set
forth in this Agreement.
2.
Position and Duties. While Executive is employed by the Company during
the Term, Executive will have the following position, duties and responsibilities:
(a) Position with the Company. Executive will serve as President and Chief Executive
Officer of the Company and will perform such duties and responsibilities as the Board may assign to
Executive from time to time.
(b) Performance of Duties and Responsibilities. Executive will serve the Company
faithfully and to the best of Executive’s ability, devoting full working time, attention, and
efforts to the business of the Company. Executive will report to the Board. Executive will follow
applicable policies and procedures adopted by the Company from time to time, including without
limitation policies relating to business ethics, conflict of interest, non-discrimination,
confidentiality and protection of trade secrets, and xxxxxxx xxxxxxx. Executive will not engage in
other employment or other material business activity, except as approved in writing by the Board.
It shall not be a violation of this Agreement for Executive to (i) serve on civic or charitable
boards or committees or (ii) manage personal investments, so long as such activities do not
materially interfere with the performance of Executive’s responsibilities to the Company.
Executive hereby represents and confirms that Executive is under no contractual or legal
commitments that would prevent Executive from fulfilling the duties and responsibilities as set
forth in or contemplated by this Agreement.
3. Compensation. While Executive is employed by the Company during the Term,
Executive will be provided with the following compensation and benefits:
(a) Annual Base Salary. The Company will pay to Executive for services provided
hereunder an Annual Base Salary at a rate determined from time to time by the Board, which Annual
Base Salary will be paid in accordance with the Company’s normal payroll policies and procedures.
Upon commencement of his employment hereunder, Executive’s Annual Base Salary will be $190,000.00.
(b) Incentive Compensation. Executive will be eligible to participate in any Company
executive management incentive programs approved by the Board from time to time, in accordance with
the terms and conditions of such programs as may be in effect from time to time. Executive’s
maximum yearly payout for any such incentive program will be 50% of Executive’s Annual Base Salary
for the fiscal year. For the Company’s fiscal year ending June 30, 2009, the Company guarantees
Executive a minimum incentive compensation award of $20,000.00, provided Executive remains
continuously employed by the Company through June 30, 2009.
(c) Vacation. Executive will be entitled to four weeks of paid vacation each year, to
be accrued and used in accordance with the Company’s policies as in effect from time to time.
(d) Employee Benefits. Executive will be entitled to participate in all employee
benefit plans and programs generally available to executive employees of the Company to the extent
that Executive meets the eligibility requirements for each individual plan or program. Executive’s
participation in any plan or program will be subject to the provisions, rules, and regulations of,
or applicable to, the plan or program. The Company provides no assurance as to the adoption or
continuation of any particular employee benefit plan or program.
(e) Expenses. The Company will reimburse Executive for all reasonable and necessary
out-of-pocket business, travel, and entertainment expenses incurred by Executive in the performance
of duties and responsibilities to the Company during Executive’s employment.
Such reimbursement shall be subject to the Company’s normal policies and procedures for
expense verification, documentation, and reimbursement. In no event shall any such reimbursement
be paid later than 2 1/2 months after the end of the calendar year in which the expense was
incurred.
(f) Equity. From time to time the Board in its sole discretion may grant to Executive
stock options, restricted stock or other equity-based awards, on such terms and conditions as the
Board may provide, subject to applicable plans and agreements to be entered into relating to such
equity-based awards. As of June 2, 2008, the Company will grant Executive an initial non-qualified
option to purchase 40,000 shares of common stock of the Company, with such shares vesting in four
equal increments on each of the first four annual anniversaries following the date of the grant.
The grant will be pursuant to the Company’s equity compensation plan and a definitive non-qualified
stock option agreement to be entered into by and between the Company and Executive.
4. Termination of Employment. Executive shall at all times be an employee at
will. The Company may terminate Executive’s employment with or without Cause at any time, and
Executive may resign at any time, with or without advance notice, subject to the obligations of the
parties under this Agreement.
5. Payments Upon Involuntary Termination. If Executive’s Date of Termination
occurs prior to expiration of the Term, and if such separation from service is involuntary at the
initiative of the Company for any reason (other than Cause or Executive’s death or Disability),
then, in addition to such compensation that has been earned but not paid to Executive as of the
Date of Termination, the Company will provide to Executive the severance benefits set forth in this
Section 5, subject to the conditions in Section 6.
(a) Separation Pay.
(i) The Company will pay to Executive an amount equal to Executive’s Annual
Base Salary, payable to Executive in equal installments in accordance with
the Company’s regular payroll practices and schedule over the twelve
(12)-month period following the Date of Termination, provided that:
(A) If the Date of Termination occurs on or before December 31, 2008,
any amounts that remain payable as of March 15, 2009 shall be payable
in a lump sum on March 15, 2009, with the intention that the
separation pay payable under this Section 5(a)(i)(A) shall constitute
a short-term deferral under Treas. Reg. § 1.409A-1(b)(4); and
(B) If the Date of Termination occurs after December 31, 2008, then
in no event shall such amount paid under this Section 5(a)(i) exceed
two times the lesser of (x) Executive’s annualized compensation based
upon the annual rate of pay for services to the Company for the
calendar year prior to the calendar year in which
the Date of Termination occurs (adjusted for any increase during that
year that was expected to continue indefinitely if Executive had not
separated from service) or (y) the maximum amount that may be taken
into account under a qualified plan pursuant to Section 401(a)(17) of
the Code for the year that includes the Date of Termination. The
separation pay under this Section 5(a)(i)(B) is intended to
constitute a “separation pay plan due to involuntary separation from
service” under Treas. Reg. § 1.409A-1(b)(9)(iii).
(b) Continued Benefits. If Executive (and/or Executive’s covered dependents) is
eligible for and properly elects to continue group medical and/or dental insurance coverage, as in
place immediately prior to the Date of Termination, the Company will continue to pay the Company’s
portion of any such premiums or costs of coverage until the earlier of (A) twelve (12) months after
the Date of Termination, or (B) the date Executive (and Executive’s covered dependents) is provided
such form of coverage by a subsequent employer, provided the Employee remains eligible for
continuation coverage and timely pays the Employee’s portion, if any, of such coverage. All such
Company-provided medical and/or dental insurance premiums, or costs of coverage, will be paid
directly to the insurance carrier or other provider by the Company and Executive shall make
arrangements with the Company to pay Executive’s portion of such coverage in an amount equal to
such portion that Executive would pay if actively employed by the Company.
6. Termination Payment Conditions. Notwithstanding anything above to the
contrary, the Company will not be obligated to provide any benefits to Executive under Section 5
hereof unless: (a) Executive has signed a release of claims in favor of the Company and its
affiliates and related entities, and their directors, officers, insurers, employees and agents, in
a form prescribed by the Company; (b) all applicable rescission periods provided by law for
releases of claims have expired and Executive has not rescinded the release of claims; and (c)
Executive is in strict compliance with the terms of this Agreement and any other written agreements
between the Company and Executive as of the dates of such payments.
7. Other Terminations. If Executive’s Date of Termination occurs:
(a) by reason of Executive’s abandonment of employment or resignation from employment for any
reason;
(b) by reason of termination of Executive’s employment by the Company for Cause;
(c) by reason of Executive’s death or Disability; or
(d) upon or following expiration of the Term,
then the Company will pay to Executive, or Executive’s beneficiary or Executive’s estate, as the
case may be, such compensation that has been earned but not paid to Executive as of the Date of
Termination, payable pursuant to the Company’s normal payroll practices and procedures, and
Executive shall not be entitled to any additional compensation or benefits provided under this
Agreement.
8. Ventures. If, during Executive’s employment with the Company, Executive
participates in the planning or implementing of any project, program, or venture involving the
Company, all rights in such project, program, or venture belong to the Company. Except as approved
in writing by the Board, Executive will not be entitled to any interest in any such project,
program, or venture or to any commission, finder’s fee, or other compensation in connection
therewith. Executive will have no interest, direct or indirect, in any customer or supplier that
conducts business with the Company.
9. Protection of the Company’s Business.
(a) Non-Disclosure of Confidential Information. Executive will not disclose or use at
any time, either during or after Executive’s employment with the Company, any Confidential
Information except for the exclusive benefit of the Company, as required by Executive’s duties for
the Company, or as the Company may consent to in writing. Executive will cooperate with the
Company to implement reasonable measures to maintain the secrecy of, and will use Executive’s best
efforts to prevent the unauthorized disclosure, use or reproduction of, all Confidential
Information. In addition to the foregoing, Executive shall, at all times during or after
Executive’s employment with the Company, comply with such policies and procedures of the Company as
may be adopted from time to time in accordance with applicable laws and regulations regarding the
maintenance, protection, use and disclosure of Customer Information and shall not take any action
in violation of any such laws or regulations. Executive further agrees to comply with such
additional requirements regarding Customer Information contained in any customer agreement to which
the Company is a party, to the extent employee is notified of or otherwise aware of such additional
requirements.
(b) Covenant Not To Solicit Employees. Executive agrees that during Executive’s
employment with the Company and any Affiliated Organization and for a period of twelve (12)
consecutive months from Executive’s Date of Termination, whether such termination is at the
initiative of Executive or the Company (with or without Cause) or occurs before or after expiration
of the Term, Executive will not, directly or indirectly, in any manner or capacity, including
without limitation as a proprietor, principal, agent, partner, officer, director, stockholder,
employee, member of any association, consultant or otherwise, hire, engage or solicit any person
who is then an employee of the Company or any Affiliated Organization or who was an employee of the
Company or any Affiliated Organization at the time of Executive’s Date of Termination. General
advertising, by newspaper or other medium, of an open employment or consulting position will not
constitute solicitation for purposes of this Section 9(b) as long as any person whom Executive is
otherwise precluded from hiring, engaging or soliciting under this Section 9(b) is not hired to
fill such open position.
(c) Covenant Not To Solicit Customers. Executive agrees that during Executive’s
employment with the Company and any Affiliated Organization and for a period of twelve (12)
consecutive months from Executive’s Date of Termination, whether such termination is at the
initiative of Executive or the Company (with or without Cause) or occurs before or after expiration
of the Term, Executive will not, directly or indirectly, in any manner or capacity,
including without limitation as a proprietor, principal, agent, partner, officer, director,
stockholder, employee, member of any association, consultant or otherwise, (i) solicit any then
current or potential customer of the Company or any Affiliated Organization for the sale of any
product or service that is similar to or competitive with any product or service of the Company or
any Affiliated Organization, or (ii) solicit, request, advise or induce any then current or
potential customer, supplier or other business contact of the Company to cancel, curtail or
otherwise adversely change its relationship with the Company or any Affiliated Organization.
(d) Covenant Not To Compete. Executive agrees that during Executive’s employment with
the Company and any Affiliated Organization and for a period of twelve (12) consecutive months from
Executive’s Date of Termination, whether such termination is at the initiative of Executive or the
Company (with or without Cause) or occurs before or after expiration of the Term, Executive will
not (except on behalf of the Company), directly or indirectly, in any manner or capacity, including
without limitation as a proprietor, principal, agent, partner, officer, director, stockholder,
employee, member of any association, consultant or otherwise, perform services for or have any
interest in any business, in the United States or in any other country where the Company or any
Affiliated Organization is then materially engaged in business, that is engaged in the design,
manufacture, marketing, distribution or sale of electronic fencing or other perimeter, containment
or security systems, or otherwise competes with any product or service of the Company or any
Affiliated Organization. Ownership by Executive, as a passive investment, of less than 2% of the
outstanding shares of capital stock of any corporation listed on NASDAQ or traded on a national
securities exchange or publicly traded in the over-the-counter market shall not constitute a breach
of this Section 9(d).
(e) Separation Of Covenants, Severability. The covenants contained in this Section 9
shall be considered as a series of separate covenants, one for each entity or individual with
respect to whom solicitation or competition is prohibited. Except as provided in the previous
sentence, each such separate covenant shall be deemed identical in terms to the covenants contained
in this Section 9. If in any judicial proceeding a court refuses to enforce any of such separate
covenants (or any part thereof), then such unenforceable covenant (or such part) shall be
eliminated from this Agreement to the extent necessary to permit the remaining separate covenants
(or portions thereof) to be enforced. In the event that a provision of this Section 9, or any such
separate covenant or portion thereof, is determined to exceed the time or scope limitations
permitted by applicable law, then such provision shall be reformed to the maximum time or scope
limitations, as the case may be, permitted by applicable law. Executive hereby consents, to the
extent Executive may lawfully do so, to the judicial modification of this Agreement as described
herein.
10. Creations.
(a) Executive shall communicate promptly and disclose to the Company, or any persons
designated by the Company, in such form as the Company may request, all Creations.
(b) Except with respect to Creations for which no equipment, supplies, facility or trade
secret information of the Company was used and which was developed entirely on Executive’s own
time, and (1) which does not relate (y) directly to the Company’s business or
(z) to the Company’s actual or demonstrably anticipated research or development, or (2) which does
not result from any work performed by Executive for the Company:
(i) Executive agrees that all Creations shall be the sole property of the
Company and its assigns, and the Company and its assigns shall be the sole
owner of all patents and all other intellectual property rights in connection
therewith; accordingly, Executive hereby assigns to the Company any and all
rights in Creations.
(ii) As to all Creations, Executive agrees to assist the Company in every
proper way (at the expense of the Company) to obtain and from time to time
enforce patents and copyrights and trade secrets relating to Creations in any
and all countries, and to that end Executive agrees to fully cooperate with
the Company and execute all documents for use in applying for and obtaining
such patents and copyrights thereon and enforcing same, as the Company may
desire, together with any assignments thereof to the Company or persons
designated by the Company.
(iii) The obligations regarding assignment and assisting the Company in
obtaining and enforcing patents and copyrights for and trade secrets relating
to Creations in any and all countries shall continue beyond the termination
of employment, but the Company shall pay reasonable fees after such
termination for time actually spent at the request of the Company for such
assistance.
(c) Every copyrightable Creation, regardless of whether copyright protection is sought or
preserved by the Company, shall be “work for hire” as defined in 17 U.S.C. § 101 and the Company
shall own all rights in and to such matter throughout the world, without the payment of any royalty
or other consideration to Executive or anyone claiming through Executive.
(d) All right, title and interest in and to any and all Marks and all other materials, ideas
or other property conceived, created, developed, adopted or improved by Executive solely or jointly
during Executive’s employment by the Company and relating to its business, shall be owned
exclusively by the Company. Executive shall not have, and will not claim to have, any right, title
or interest of any kind in or to the Marks or such other property.
(e) Any idea, copyrightable matter or other property relating to the Company’s business and
disclosed by Executive prior to the first anniversary of the Date of Termination shall be deemed to
be governed hereby unless proved by Executive to have been first conceived and made after the Date
of Termination.
11. Other Post-Termination Obligations.
(a) Immediately upon termination of Executive’s employment with the Company for any reason,
Executive will resign all positions then held as a director or officer of
the Company and of any subsidiary, parent or affiliated entity of the Company, including any
Affiliated Organization.
(b) Upon termination of Executive’s employment with the Company for any reason, Executive
shall promptly deliver to the Company any and all Company records and any and all Company property
in Executive’s possession or under Executive’s control, including without limitation manuals,
books, blank forms, documents, letters, memoranda, notes, notebooks, reports, printouts, computer
disks, flash drives or other digital storage media, source codes, data, tables or calculations and
all copies thereof, documents that in whole or in part contain any trade secrets or confidential,
proprietary or other secret information of the Company and all copies thereof, and keys, access
cards, access codes, passwords, credit cards, personal computers, handheld personal computers or
other digital devices, cell phones and other electronic equipment belonging to the Company.
(c) Following termination of Executive’s employment with the Company for any reason, Executive
will, upon reasonable request of the Company or its designee, cooperate with the Company in
connection with the transition of Executive’s duties and responsibilities for the Company; consult
with the Company regarding business matters that Executive was directly and substantially involved
with while employed by the Company; and be reasonably available, with or without subpoena, to be
interviewed, review documents or things, give depositions, testify, or engage in other reasonable
activities in connection with any litigation or investigation, with respect to matters that
Executive then has or may have knowledge of by virtue of Executive’s employment by or service to
the Company or any related entity; provided that if Executive’s services hereunder exceed five (5)
hours in any calendar month then the Company shall pay to Executive an hourly fee for such excess
hours in the amount of $100 per hour.
(d) Executive will not malign, defame or disparage the reputation, character, image, products
or services of the Company, or the reputation or character of the Company’s directors, officers,
employees or agents, provided that nothing in this Section 11(d) shall be construed to limit or
restrict Executive from taking any action that Executive in good faith reasonably believes is
necessary to fulfill Executive’s fiduciary obligations to the Company, or from providing truthful
information in connection with any legal proceeding, government investigation or other legal
matter.
12. Definitions. The capitalized terms used in this Agreement have the
following meanings:
(a) “Affiliated Organization” means a business entity that is treated as a single employer
with the Company under the rules of section 414(b) and (c) of the Code, including the eighty
percent (80%) standard therein.
(b) “Annual Base Salary” means Executive’s annualized base salary, less required deductions
and withholdings, as adjusted in accordance with this Agreement from time to time.
(c) “Board” means the Board of Directors of the Company, including any authorized committee of
the Board.
(d) “Business Information” means any and all proprietary information of the Company that
exists during Executive’s employment with the Company pertaining to the Company’s and Affiliated
Organizations’ (i) then current or proposed products, services and related policies, processes and
procedures; (ii) then current or proposed technologies; (iii) then current or proposed product
tests; (iv) then current or proposed costs, marketing plans, or product or service pricing; and
(iv) financial projections in any way relating to the foregoing.
(e) “Cause” means:
(i) Executive’s commission of any act constituting a
felony, or other criminal act involving moral turpitude;
(ii) gross misconduct, material neglect, or any act of
fraud, disloyalty or dishonesty by Executive related to or connected
with Executive’s employment by the Company or otherwise likely to cause
material harm to the Company or its reputation;
(iii) a material violation by Executive of the
Company’s written policies, codes of conduct, or direction of the Board;
(iv) wrongful appropriation by Executive of Company
funds or property or other material breach of Executive’s fiduciary
duties to the Company; or
(v) the material breach of this Agreement by
Executive.
(f) “Code” means the Internal Revenue Code of 1986, as amended. Any reference to a specific
provision of the Code will include a reference to such provision as it may be amended from time to
time and to any successor provision.
(g) “Company” means the Company as defined in the first sentence of this Agreement and any
successor to its business and/or assets which assumes or agrees to perform this Agreement by
operation of law, assignment or otherwise. If at any time during the Term Executive is employed by
an Affiliated Organization, the term “Company” as used in this Agreement shall in addition include
such Affiliated Organization. In such event, the Company agrees that it shall pay or provide, or
shall cause such Affiliated Organization to pay or provide, any amounts or benefits due Executive
pursuant to this Agreement.
(h) “Confidential Information” includes Trade Secrets, Business Information, Personnel
Information, and Customer Information, but does not include any such information that is or becomes
generally available to the public or that is or becomes available to Executive on a
non-confidential basis through means other than in the course of Executive’s employment by the
Company, provided that the source of such information is not bound by a confidentiality agreement
with the Company or any other party and that such information has not become available, directly or
indirectly, as a result of a breach of any confidentiality obligation to the Company.
(i) “Creations” means all ideas, concepts, improvements, inventions, formulae, processes,
techniques, know-how, data, and information whether or not patentable, made or conceived or reduced
to practice or learned either alone or jointly with others, and all copyrighted or copyrightable
matter created by Executive while employed by the Company, and which are related to or useful in
the business of the Company, or result from tasks assigned by the Company, or result from use of
supplies, facility or Trade Secret information of the Company, and all copyrighted or copyrightable
matter created by Executive that directly relates to the Company’s business.
(j) “Customer Information” means the names, addresses and other information relating to any
current or proposed customer of the Company and any Affiliated Organization that exists during
Executive’s employment with the Company, including the format and content of any database developed
or prepared based on or containing such information and the results of any compilations or analysis
of such information; and the contractual terms and conditions, including prices, that the Company
or any Affiliated Organization has established with any of their customers.
(k) “Date of Termination” means the date of Executive’s “separation from service” with the
Company (including all Affiliated Organizations, as applicable), within the meaning of section
409A(a)(2)(A)(i) of the Code.
(l) “Disability” or “Disabled” means the inability of Executive to perform on a full-time
basis the duties and responsibilities of Executive’s employment with the Company by reason of
Executive’s illness or other physical or mental impairment or condition, if such inability
continues for an uninterrupted period of one hundred twenty (120) days or more during any one
hundred eight (180) day period. A period of inability is “uninterrupted” unless and until
Executive returns to full-time work for a continuous period of at least thirty (30) days.
(m) “Marks” means all trademarks, trade names, service marks and logos adopted, used or
considered for use by the Company during Executive’s employment with the Company (whether or not
developed by Executive) to identify the Company’s goods or services.
(n) “Personnel Information” means information about the names, addresses, compensation,
skills, duties or other personal characteristics of employees of the Company and any Affiliated
Organization.
(o) “Term” means the period commencing on the Effective Date and ending on June 30, 2010 (the
“Original Term”), provided that such period will be automatically extended for successive one-year
periods ending on the last business day of each subsequent fiscal year (each an “Extended Term”),
unless either party gives written notice of non-renewal to the other party at least six (6) months
prior to the last business day of the Original Term or Extended Term then in effect that such party
elects not to extend the Term under this Agreement.
(p) “Trade Secrets” means any information (including without limitation compilations, devices,
techniques, software, technologies, business methods, processes and procedures, customer or
prospect lists, and economic or financial models, projections or analyses) that: (i) derives
independent economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper means by, other persons who
can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy. Trade Secret information may include
the information of the Company and any Affiliated Organization, along with their customers,
suppliers, joint ventures, licensors, licensees, distributors and other entities with which they do
business.
13. Miscellaneous.
(a) Successors. This Agreement shall not be assignable, in whole or in part, by
either party without the written consent of the other party, except that the Company may, without
the consent of Executive, assign or delegate all or any portion of its rights and obligations under
this Agreement to any corporation or other business entity (i) with which the Company may merge or
consolidate, (ii) to which the Company may sell or transfer all or substantially all of its assets
or capital stock, or (iii) that is or becomes an Affiliated Organization. Any such current or
future successor to which any right or obligation has been assigned or delegated shall be deemed to
be the “Company” for purposes of such rights or obligations of this Agreement. In the event of
Executive’s death after Executive has become eligible for any payments under Section 5 of this
Agreement, all amounts payable to Executive thereunder shall be paid to a beneficiary designated by
Executive in the form established by the Company or, if no such beneficiary is designated, then to
Executive’s estate, heirs or representatives.
(b) Tax Withholding. The Company may withhold from any amounts payable under this
Agreement such federal, state and local income and employment taxes as the Company shall determine
are required or authorized to be withheld pursuant to any applicable law or regulation.
(c) Section 409A. This Agreement is intended to provide for severance benefits that
are not deferred compensation subject to the requirements of Code Sections 409A(a)(2), (3), or (4).
To the extent any severance benefits under this Agreement are made in accordance with this
Agreement and are subject to the requirements of Code Sections 409A(a)(2), (3), or (4), this
Agreement is intended to satisfy such requirements, including current and future guidance and
regulations interpreting such provisions, and should be interpreted accordingly.
(d) Governing Law. All matters relating to the interpretation, construction,
application, validity, and enforcement of this Agreement will be governed by the laws of the State
of Minnesota without giving effect to any choice or conflict of law provision or rule, whether of
the State of Minnesota or any other jurisdiction, that would cause the application of laws of any
jurisdiction other than the State of Minnesota.
(e) Jurisdiction and Venue. Executive and the Company consent to jurisdiction of the
courts of the State of Minnesota and/or the United States District Court, District of Minnesota,
for the purpose of resolving all issues of law, equity, or fact arising out of or in connection
with this Agreement. Any action involving claims of a breach of this Agreement must be brought in
such courts. Each party consents to personal jurisdiction over
such party in the state and/or federal courts of Minnesota and hereby waives any defense of lack of
personal jurisdiction. Venue, for the purpose of all such suits, will be in Hennepin County, State
of Minnesota.
(f) Waiver of Jury Trial. To the maximum extent permitted by law, Executive and the
Company waive any and all rights to a jury trial with respect to any dispute arising out of or
relating to this Agreement.
(g) Notice. Notices and all other communications provided for in the Agreement shall
be in writing and shall be deemed to have been duly given when personally delivered, sent by
reliable overnight courier or mailed by United States registered mail (or its equivalent for
overseas delivery), return receipt requested, postage prepaid, and addressed as follows:
If to the Company:
Zareba Systems, Inc.
Attn: Board of Directors
00000 00xx Xxx X., Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attn: Board of Directors
00000 00xx Xxx X., Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
If to Executive, to Executive’s most recent address on file with the Company
or to such other address as either party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon receipt.
(h) Modifications; Waiver. No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing signed by
Executive and the Company. No waiver by either party hereto at any time of any breach by the other
party 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.
(i) Entire Agreement. This Agreement constitutes the entire understandings and
agreements between the Company and Executive with regard to the subject matter hereof, including
payments and benefits upon a termination of Executive’s employment or other separation from service
with the Company. This Agreement supersedes and renders null and void all prior agreements, offer
letters, plans, programs or other undertakings between the parties with regard to the subject
matter hereof (other than those specifically referenced herein), whether written or oral, including
the Offer Letter.
IN WITNESS WHEREOF, the parties have executed this Agreement as of June 2, 2008.
| Zareba Systems, Inc. |
||||
| By: | /s/ X. X. Xxxxxx | |||
| X. X. Xxxxxx | ||||
| Chair, Board of Directors | ||||
| /s/ Xxxx Xxxxxxxxx | ||||
| Xxxx Xxxxxxxxx | ||||
