EMPLOYMENT AGREEMENT
AGREEMENT (the "Agreement") made as of the first day of July, 1994 by
and between Parlex Corporation, a Massachusetts corporation (the "Company"),
and Xxxxxxx X. Xxxxxxx of Lexington, Massachusetts (the "Employer").
In consideration of the mutual promises herein contained, the Company
and the Employee hereby agree as follows:
1. Employment
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The Company hereby employs the Employee, and the Employee hereby accepts
employment by the Company to render such services in connection with the
business of the Company as the Company may from time to time request. However,
the services to be rendered shall be consistent with the level of
responsibility that the Employee has previously held and shall be performed
only at the Company's headquarters or at such other location that is
acceptable to the Employee. The term of the Employee's employment hereunder
shall begin on July 1, 1994 and shall end on June 1, 1997.
2. Compensation
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In consideration of all services to be rendered by the Employee during
the term of this Agreement, the Company shall pay to the Employee during the
term of his employment hereunder compensation at the rate of sixteen thousand
four hundred and twenty dollars ($16,420.00) per month, payable on the last
business day of each calendar month or at such other times as the Company and
the Employee shall agree.
3. Death Benefit
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If the Employee dies during the term of employment hereunder, the
Company agrees to pay to the Designated Beneficiary (as hereinafter defined)
the compensation provided in section 2 for the remaining term of this
Agreement. The Company shall also continue to pay the Designated Beneficiary
for a period of twenty-four (24) months after June 30, 1997 an amount equal to
seventy-five percent (75%) of the rate of compensation per month payable to
the Employee pursuant to section 2 hereof at the time of the Employee's death.
For purposes of this Agreement, the term "designated Beneficiary" shall
be the person or persons designated in a writing filed by the Employee with
the Company or, upon the designation, the Employee's estate.
4. Fringe Benefits
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In addition to the compensation provided for in section 2 above, while
this Agreement is in effect Employee shall be entitled to receive all fringe
benefits and perquisites customarily extended to officers and key employees of
the Company, including but no limited to, profit sharing, bonus, stock option,
health and life insurance. The Company agrees to continue medical, hospital
and life insurance benefits for the Employee for a period of 24 months after
completion of the term of the Agreement with co-payments to be made by the
Employee subject to and on a basis consistent with the terms and conditions of
such plans during the term of this Agreement. If the Employee dies during the
term of the Agreement, the Company shall continue to provide medical and
hospital benefits for his spouse for a period of 24 months beginning with the
first month after the Employee's death with co-payments to be made by his
spouse as provided herein.
5. Further Covenants
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5.1 The Employee agrees that all knowledge and information of a secret
or confidential nature with respect to the business of the Company possessed
or acquired by him will be held in confidence and will not, either during or
after his employment by the Company, be disclosed, published, or made use of
without the consent of the Company unless and until such knowledge and
information shall have ceased to be secret or confidential as evidenced by
general public knowledge.
5.2 The Employee agrees that all inventions, developments, patents, and
paten applications relating to the business of the Company made, conceived, or
obtained by him either alone or in conjunction with others during the term of
his employment by the Company shall be the sole property of the Company. The
Employee agrees to promptly disclose and assign to the Company all such
inventions, developments, patents, and patent applications, and, at the
request of the Company to promptly execute and deliver any documents and take
any other action which the Company deems necessary or advisable in order to
vest in it all rights to such inventions, developments, patents, and patent
applications.
5.3 The Employee agrees that at the termination of his employment by
the Company he will promptly deliver to the Company all technical data,
drawings, memoranda, customer lists, and other documents in his possession or
control which relate to the business of the Company.
5.4 The Employee agrees that so long as he is employed by the Company
hereunder, and for a period of twelve (12) months after he ceases to be
employed by the Company, he will not, directly or indirectly, own, operate, or
manage or participate in the ownership, operation, or management of, or be
connected in any matter (whether as owner, employee, or otherwise) with, any
business in competition with that of the Company anywhere in the United
States; provided, however, the Employee shall not be deemed to be in violation
of this subsection 5.4 solely by reason of his ownership of not more than two
percent (2%) of the equity of any securities exchange or in the over-the-
counter market. In the event the Company terminates the Employee's employment
with the Company during the term of this Agreement and said termination was
not for cause (as said term is defined herein), then and in that event only
the post termination provisions of this Section 5.4 shall not apply. For
purposes of this Agreement, the term "cause" shall mean that the Employee
shall have breached or failed to perform his obligations and job
responsibilities in accordance with the terms and conditions of this Agreement
or his job description, shall demonstrate negligence, inefficiency, gross
misconduct, dishonesty, or insubordination in the execution of his duties as
an employee of the Company, or upon conviction of a felony or any crime
involving moral turpitude.
5.5 The Employee agrees that so long as he is employed by the Company
hereunder and for a period of twelve (12) months after he ceases to be
employed by the Company, he will not, directly or indirectly, through one or
more persons, offer employment to any employee of the Company, he will not,
directly or indirectly, through one or more persons, offer employment to any
employee of the Company, assist in the hiring of any employee of the Company
by any other person, or encourage any employee of the Company to terminate his
or her employment by the Company. In the event the Company terminates the
Employee's employment with the Company during the term of this Agreement and
said termination was not for cause (as said term is defined in Section 5.4
above), then and in that event only the post termination provisions of this
Section 5.5 shall not apply.
5.6 The Employee agrees that the remedy at law for the breach of any of
the provisions of this section 5 will be inadequate and that the Company shall
be entitled to injunctive or other equitable relief, in addition to any other
remedy it may have, without having to prove actual damage to the Company
because of any breach hereunder by him.
6. Change of Control
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In the event of a Change of Control (as defined herein), the Company
shall, in the sole discretion of the Employee, pay to the Employee in a lump
sum, an amount equal to the aggregate amount accrued to the deferred
compensation account, including interest, held by the Company for Employee
since May of 1982 and all compensation to be paid to Employee under the terms
of this Agreement through June 30, 1997. The payment shall be made to Employee
within 30 days after receipt of written notice from Employee exercising his
rights under this provision. For purposes of this section, the term "Change of
Control" means the happening of any of the following: (i) when any "person",
as such term is used in Sections 13 (d) and 14(d) of the Securities Exchange
Act of 1934 (the "Act") other than the Company or a subsidiary or any employee
benefit plan (including its trustee) of either the Company or a subsidiary)
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Act),
directly or indirectly of the combined voting power of the Company
representing 30 percent or more of the combined voting power of the Company's
then outstanding securities; or (ii) the occurrence of a transaction requiring
stockholder approval for the acquisition of the subsidiary through purchase of
assets, or by merger, or otherwise or (iii) if, as a result of, or in
connection with, any tender or exchange offer, merger or other business
combination, sale of assets or contested election, or any combination of the
foregoing transactions, the persons who were directors of the Company before
such transaction shall cease to constitute a majority of the Board of
Directors of the Company or of any successor institution. For purposes of this
Section, the term "person" shall exclude all persons who are currently
officers or directors of the Company, or spouses, blood relatives or
stepchildren of such officers or directors, and trusts for the benefit of any
such persons, and the estates of any such persons.
7. Attachment; assignability
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The right of the Employee or his Designated Beneficiary to any payment
hereunder shall not be subject in any manner to attachment or other legal
process for the debts of the Employee or such Designated Beneficiary, and the
right to any such payment shall not be subject to anticipation, alienation,
sale, transfer, assignment, or encumbrance.
8. Severability
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The provisions of this Agreement shall be severable, and the invalidity
of any portion of this Agreement shall not affect the validity of any other
portion hereof.
9. Successors
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This Agreement shall be binding upon and shall inure to the benefit of
the Company, its successors and assigns, and the Employee, his executors,
administrators, and personal representatives.
10. Governing Law
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This Agreement shall be construed and interpreted in accordance with the
laws of the Commonwealth of Massachusetts.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
in its behalf by an officer thereof thereunto duly authorized and has caused
its seal to be hereunto affixed and duly attested, and the Employee has
hereunto set his hand and seal, as of the day and year first above written.
ATTEST: PARLEX CORPORATION:
/s/ Xxxxxxx Xxxxxxxxxx /s/ Xxxx Xxxxxxx Kutchin
_____________________________ By: ______________________________
EMPLOYEE:
/s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
