Exhibit 10.2
AGREEMENT OF EMPLOYMENT,
CONFIDENTIALITY AND NON-COMPETITION
THIS AGREEMENT OF EMPLOYMENT, CONFIDENTIALITY AND NON-COMPETITION (the
"Agreement") is made and entered into this 27th day of January, 2000, by and
between FRICTION PRODUCTS CO., a Delaware corporation which maintains a place of
business at 000 Xxxx Xxxx, Xxxxxx, Xxxx 00000 (aka Xxxxxxx/Friction Products)
(hereinafter referred to as "Employer"), and XXXXXX X. XXXXXXXX, an individual
who resides at 0000 Xxxx 000xx Xxxxxx, Xxxxx, Xxxxxxxx 00000 (hereinafter
referred to as "Employee").
R E C I T A L S :
A. Employer is engaged in the business of manufacturing and distributing
friction materials for industrial and aerospace markets (the "Company
Business");
B. Employer is considering hiring Employee to work for Employer;
C. It is expected that the work of Employee for Employer will bring
Employee into close contact with many confidential affairs of Employer not
readily available to the public.
ACCORDINGLY, in consideration of the promises hereinafter set forth and in
consideration of the employment of Employee by Employer, the parties agree as
follows:
1. EMPLOYMENT RELATIONSHIP. As soon as practicable after the execution of
this Agreement, and in any event by February 1, 2000, Employer shall hire
Employee to work at the position of President, and Employee shall begin working
at that position. Employee shall report to the president of Hawk Corporation.
The employment relationship between Employer and Employee shall be "at will",
terminable by either party at any time for any reason or no reason.
2. COMPENSATION. For services rendered pursuant to this Agreement, and for
the covenants and agreements of Employee set forth herein, Employee shall
receive the following: (i) a base salary at the rate of $15,416.67 per month
(annual rate: $185,000), (ii) an opportunity to earn a target bonus of $60,000,
with the possibility of a greater or lesser bonus depending upon achieving
objectives, with respect to each full year of employment completed by Employee
hereunder, to be computed at the end of the year in accordance with mutually
agreed objectives and standards for such year, which will be established on an
annual basis, (iii) four weeks of vacation per year, (iv) the right to
participate in the standard benefits which Employer provides to all of its
employees, and (v) the right to participate in the Hawk Corporation 1997 Stock
Option Plan (the "Plan") in accordance with and subject to all of the terms and
conditions contained in the Plan, with an initial grant of options for 40,000
shares of Hawk Corporation
stock, and subject to the execution of such documents as may be required by the
Committee appointed pursuant to the Plan.
3. SEVERANCE. In the event of the termination of Employee's employment by
Employer other than for "cause" (as hereinafter defined), Employer will continue
to pay to Employee the base salary, and will continue to provide medical
insurance benefits on the same basis as such benefits had been provided
immediately prior to the termination, for a period of six months following the
date of termination. For purposes hereof, a termination for "cause" shall
include but not be limited to the following: (i) Employee engaging in fraud,
misappropriation of funds, embezzlement or like conduct committed against
Employer or a customer or supplier of Employer, (ii) Employee being convicted of
a felony or other crime involving dishonesty or moral turpitude, (iii) Employee
engaging in any act of sexual misconduct at or in connection with work,
including sexual harassment, (iv) Employee violating, in a material respect, a
published or otherwise generally recognized policy of Employer, (v) Employee
failing to fulfill the duties and responsibilities of his job, including,
without limitation, failing to meet established performance objectives, and (vi)
Employee violating, in a material respect, any provision of this Agreement. In
the event of such a termination for cause, Employer shall have no further
obligation to Employee pursuant to this Agreement after the date of termination.
4. NON-COMPETE. During the period which includes the entire term of
Employee's employment with Employer and six (6) months following the termination
of such employment, however caused, (the "Restricted Period"), Employee shall
not, directly or indirectly, within any state in which Employer has actively
engaged in the Company Business during any part of the term of Employee's
employment with Employer, or with respect to any customer (wherever located)
with whom Employee has had material dealings during any part of the term of
Employee's employment with Employer, compete with Employer in any manner, on
behalf of Employee or any other person, firm, business, corporation or other
entity (each such other person, firm, business, corporation or other entity
being referred to hereinafter as a "Person"), including, without limitation,
that Employee shall not (i) engage in the Company Business for his own account;
(ii) enter the employ of, or render any services to, any Person engaged in the
Company Business; (iii) request or instigate any account or customer of Employer
to withdraw, diminish, curtail or cancel any of its business with Employer; or
(iv) become interested in any Person engaged in the Company Business as an
owner, partner, shareholder, officer, director, licensor, licensee, principal,
agent, employee, trustee, consultant or in any other relationship or capacity.
In the event of Employee's breach of any provision of this section, the running
of the Restricted Period shall be automatically tolled (i.e., no part of the
Restricted Period shall expire) from and after the date of the first such
breach.
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5. CONFIDENTIAL INFORMATION.
(a) Belonging To Prior Employer. Employee is specifically directed,
and hereby agrees, that he shall not disclose to Employer any trade secrets or
confidential information which belongs to any prior employer of Employee.
(b) Belonging to Employer. Employee recognizes and acknowledges that
confidential information, including, without limitation, information, knowledge
or data (i) of a technical nature such as but not limited to methods, know-how,
formulae, compositions, processes, machinery (including computer hardware),
discoveries, inventions, products, product specifications, computer programs and
similar items or research projects; (ii) of a business nature such as but not
limited to information about products, cost, purchasing or suppliers, profits,
market, sales or customers, including lists of customers, and the financial
condition of Employer; (iii) pertaining to future developments such as but not
limited to strategic planning, research and development or future marketing or
merchandising, and trade secrets of Employer; and (iv) all other matters which
Employer treats as confidential (the items of Employer described above being
referred to collectively hereinafter as "Confidential Information"), are
valuable, special and unique assets of Employer. During and after the Restricted
Period, Employee shall keep secret and retain in strictest confidence, and shall
not use for the benefit of himself or others except in connection with the
business and affairs of Employer, any and all Confidential Information learned
by Employee before or after the date of this Agreement, and shall not disclose
such Confidential Information to anyone outside of Employer either during or
after employment by Employer, except as required in the course of performing
duties of his employment with Employer, without the express written consent of
Employer or as required by law.
6. PROPERTY OF EMPLOYER. Employee agrees to deliver promptly to Employer
all drawings, blueprints, manuals, letters, notes, notebooks, reports, sketches,
formulae, computer programs and files, memoranda, customer lists and all other
materials relating in any way to the Company Business and in any way obtained by
Employee during the period of his employment with Employer which are in his
possession or under his control, and all copies thereof, (i) upon termination of
Employee's employment with Employer, or (ii) at any other time at Employer's
request. Employee further agrees he will not make or retain any copies of any of
the foregoing and will so represent to Employer upon termination of his
employment.
7. EMPLOYEES AND CONSULTANTS OF EMPLOYER. During the Restricted Period,
Employee shall not, directly or indirectly (i) hire, solicit, or encourage to
either leave the employment of or cease working with Employer, any person who is
then an employee of Employer, or any consultant who is then engaged by Employer,
or (ii) hire any employee or consultant who had left the employment of or had
ceased consulting with Employer but who had not yet been a former employee or
former consultant of Employer for two full years.
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8. RIGHTS AND REMEDIES UPON BREACH. Both parties recognize that the rights
and obligations set forth in this Agreement are special, unique and of
extraordinary character. If Employee breaches, or threatens to commit a breach
of, any of the provisions of paragraphs 4 through 7 of this Agreement (the
"Restrictive Covenants"), then Employer shall have, in addition to, and not in
lieu of, any other rights and remedies available to Employer under law or in
equity, the right to specific performance and/or injunctive relief, it being
acknowledged and agreed that any such breach or threatened breach will cause
irreparable injury to Employer and that money damages will not provide an
adequate remedy to Employer. If any court determines that any one or more of the
Restrictive Covenants, or any part thereof, shall be unenforceable because of
the scope, duration and/or geographical area covered by such provision, such
court shall have the power to reduce the scope, duration or area of such
provision and, in its reduced form, such provision shall then be enforceable and
shall be enforced.
9. DISCLOSURE. Employer may notify anyone employing Employee or evidencing
an intention to employ Employee as to the existence and provisions of this
Agreement.
10. GOVERNING LAW AND JURISDICTION. The parties intend that the validity,
performance and enforcement of this Agreement shall be governed by the laws of
the State of Ohio. In the event of any claim arising out of or related to this
Agreement, or the breach thereof, the parties intend to and hereby confer
jurisdiction to enforce the terms of this Agreement upon the courts of any
jurisdiction within the State of Ohio, and hereby waive any objections to venue
in said courts.
11. BINDING EFFECT. This Agreement shall inure to the benefit of and be
binding upon the parties hereto, their heirs, representatives and successors.
12. SEVERABILITY. In case any one or more of the provisions contained in
this Agreement shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
of this Agreement, but this Agreement shall be construed as if such invalid,
illegal, or unenforceable provision had never been contained herein.
13. NOTICES. All notices, requests, demands or other communications
hereunder shall be sent by registered or certified mail to the parties at the
addresses set forth on the first page of this Agreement, or to such other
address as a party may designate by notice given pursuant to this paragraph.
14. ACKNOWLEDGMENT. Employee acknowledges that: (i) he has carefully read
all of the terms of this Agreement, and that such terms have been fully
explained to him; (ii) he understands the consequences of each and every term of
this Agreement; (iii) he had other employment opportunities at the time he
entered into this Agreement; (iv) he specifically understands that by signing
this Agreement he is giving up certain rights he may have otherwise
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had, and that he is agreeing to limit his freedom to engage in certain
employment during and after the termination of this Agreement, and (v) the
limitations to his right to compete contained in this Agreement represent
reasonable limitations as to scope, duration and geographical area, and that
such limitations are reasonably related to protection which Employer reasonably
requires.
15. ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding between Employer and Employee and supersedes all prior agreements
and understandings relating to the subject matter hereof.
IN WITNESS WHEREOF, the undersigned have hereunto set their hands on the
date first hereinabove mentioned.
FRICTION PRODUCTS CO.
("Employer")
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------
Its: President/COO
/s/ Xxxxxx X. Xxxxxxxx
----------------------------------------
XXXXXX X. XXXXXXXX ("Employee")
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