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Exhibit 10.6
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of August 1, 1998, between Danka Office
Imaging (the "Company"), and Xxxxxxx Xxxx Xxxxxxxxx ("Executive").
WITNESSETH:
WHEREAS, the Company wishes to provide for the employment of Executive
as President - Latin America, Canada and Specialty Markets of the Company on the
terms and conditions herein set forth; and
WHEREAS, Executive wishes to serve in such capacity on the terms and
conditions herein set forth.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows:
1. Employment, Powers, Duties and Acceptance.
1.1 The Company hereby employs Executive, for the Term
(as hereinafter defined), to render services to the
Company as President - Latin America, Canada and
Specialty Markets of the Company.
1.2 Executive hereby accepts the employment hereunder and
agrees to use his best efforts to carry out the
duties and responsibilities of President - Latin
America, Canada and Specialty Markets of the Company
and such additional assignments and duties (which may
include assignments and duties on behalf of the
Company's affiliates) as may be given to Executive by
the Chief Executive of the Company or his designee.
Executive shall report directly to the Chief
Executive of the Company. Executive agrees to
discharge his obligations hereunder and perform his
duties in accordance with the general policies
established by the Board of Directors of the Company.
1.3 Executive shall be a full-time employee of the
Company, and subject to customary paid holidays and
vacations, Executive agrees to devote his full
working time to the business of the Company.
1.4 The principal place of employment of Executive
hereunder shall be at the offices of the Company in
the City of St. Petersburg, Florida. Executive shall
travel as may be required to discharge his
obligations and perform his duties hereunder.
1.5 Executive shall be entitled to 4 weeks of vacation
with pay during each calendar year of the Term.
2. Term of Employment. The term of Executive's employment under
this Agreement (the "Term") shall commence on the date hereof
and shall end, unless such employment is sooner terminated
pursuant to Section 5 hereof, on August 1, 2001 (the
"Termination Date").
3. Compensation.
3.1 During the Term, the Company shall pay Executive, as
compensation for services to be rendered pursuant to
this Agreement, a salary, payable in accordance with
the Company's standard payroll practices, at the rate
of $360,000.00 per annum (the "Base Compensation").
Executive shall be eligible for annual increases at
the discretion of the Chief Executive.
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3.2 Executive shall have a target bonus of fifty percent
(50%) of his Base Compensation based upon achievement
of established corporate division and individual
objectives as approved by the Chief Executive.
Executive will also be eligible for an additional
"stretch" bonus of an additional fifty percent (50%)
of his Base Compensation based upon established
"stretch" objectives approved by the Chief Executive,
which will be upon the Company obtaining 103% of its
annual profit plan as approved by the Board of
Directors.
3.3 During the Company's Fiscal Year 1999 of this
Agreement, Company shall guarantee that Executive
receive a minimum bonus of not less than $112,500.00
payable after March 31, 1999.
3.3.1. Further, on or before October 15, 1998,
Company shall pay Executive $120,000.00,
which amount represents the bonus Executive
would have received from his prior employer.
3.3.2. In addition, on or before January 31, 1999,
Company shall pay Executive $160,000.00,
which amount represents the vested options
of Executive at his previous employer.
3.3.3. Company shall grant Executive 280,000
ordinary share stock options upon his
employment and grant an additional 120,000
ordinary share stock options on or before
March 31, 1999. Executive understands and
agrees that any granting of stock options is
subject to Board of Directors approval.
3.4 Executive shall be reimbursed for any reasonable
expenses incurred by Executive in his relocation to
the Tampa-St. Petersburg metropolitan area
(reasonable expenses as defined in the Company's
relocation plan). Such reasonable relocation expenses
shall be "grossed up" for tax and withholding
purposes. The Company shall increase Executive's
temporary living expenses to 9 months. Further,
Company shall pay the airfare for Executive to make
trips from Tampa to Portland every other week for a
period of six (6) months. In the event Executive
voluntarily leaves the employment of the Company
within 24 months of the initial date herein,
Executive agrees to pay a prorated amount of
Executive's total relocation cost based on
Executive's time with the Company.
3.4.1 Executive's basis in his current primary
residence is $825,000.00. To the extent
Executive's primary residence sells for less
than $825,000.00, the Company agrees to
make-up any difference in the actual selling
price of Executive's primary residence
between $775,000.00 and $825,000.00, up to a
maximum make-up difference of $50,000.00.
The Company reserves the right to consider
the most tax advantageous way to provide
such makeup payment.
3.4.2 Company shall assist Executive in obtaining
a bridge loan if necessary.
3.5 Executive shall receive all of the fringe benefits
and perquisites of office made available to the
officers of the Company, including the following:
- Airline Club expenses - up to $1,000.00
annually
- Car Allowance - Company shall
provide, at
Company's expense, a
Mercedes class
automobile for
Executive. Company
shall pay for
incidentals
associated with the
automobile including
paying for necessary
repairs due to wear
and tear.
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3.6 Subject to Executive's satisfying the eligibility
requirements thereof, Executive shall be entitled to
participate in and be covered by any Executive
Deferred Compensation Plan, Supplemental Executive
Retirement Plan, pension, life insurance, long term
disability insurance, health insurance,
hospitalization or other employee benefit plan
established and maintained by the Company on the same
basis as generally made available to executives of
the Company without limitation or restriction by
reason of this Agreement. Nothing herein shall be
deemed to require the Company to establish or
maintain any employee benefit plan whatsoever, and
Company shall have the right, in its sole and
absolute discretion, to alter, amend, modify,
discontinue or terminate at any time any and all
employee benefit plans maintained by the Company.
4. Expenses. In addition to the compensation provided to be paid
under Section 3 hereof, the Company shall reimburse Executive
for all reasonable out-of pocket expenses paid or incurred by
Executive in the performance of his duties hereunder upon
submission of signed itemized lists thereof on the forms used,
and in accordance with the procedures established from time to
time, by the Company for that purpose.
5. Termination. This Agreement may be terminated prior to the
Termination Date in accordance with the following:
5.1 If Executive shall die during the Term, this
Agreement shall terminate, except that Executive's
legal representatives or designated beneficiaries
shall be entitled to receive the compensation
provided for herein to the last day of the month in
which his death occurs.
5.2 The Company shall have the right (without any
liability to Executive hereunder other than the
payment of sum due through the date of termination)
to terminate the employment of Executive, to relieve
Executive of any and all functions as President -
Latin America, Canada and Specialty Markets of the
Company, and to terminate his right to the
compensation provided for herein for cause. As used
in this Section 5.2, the term "for cause" shall mean
and be limited to the following events:
5.2.1 Executive's material breach of any term or
condition of this Agreement, unless
Executive cures such breach within ten days
after the Company gives Executive notice of
the breach; or
5.2.2 Executive's commission of any crime that (i)
constitutes a felony in the jurisdiction
involved or (ii) involves loss or damage to
or destruction of property of the Company or
(iii) results in the incarceration of
Executive following his conviction for such
crime; or
5.2.3 Executive's willful and material violation
of any lawful directions of the Chief
Executive or Board of Directors of the
Company; or
5.2.4 Executive's failure or refusal to perform
his duties in accordance with Section 1
hereof; provided, however, that no discharge
"for cause" under this Section 5.2.4 shall
be deemed effective unless Executive shall
have first been given notice by the Company
advising Executive of the specific acts or
omissions alleged to constitute a failure to
perform his duties, and such failure
continues after Executive shall have had a
reasonable opportunity (which shall be
defined as a period of time consisting of at
least three days from the date Executive
receives said notice from the Company) to
correct the acts or omissions so complained
of.
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5.3 The Company shall have the right to terminate the
employment of Executive, to relieve Executive of any
or all functions as President - Latin America, Canada
and Specialty Markets and to terminate his right to
Base Compensation at any time prior to the
Termination Date upon notice to Executive. If the
Company shall terminate the employment of Executive
for any reason not specified in Section 5.1, or 5.2
hereof, the Executive's sole remedy shall be to
receive the following as and for liquidated damages:
a) If the Company terminates the Agreement on
or before August 1, 2000, Company shall pay
Executive his Base Compensation and continue
and/or pay Executive's benefits through the
term of the Agreement, or
b) If the Company terminates the Agreement
after August 1, 2000, Company shall pay
Executive his Base Compensation and continue
and/or pay Executive's benefits for the next
12 succeeding months following termination.
Executive agrees that in order to receive liquidated
damages described herein, Executive at the time of
termination, agrees to execute the General Release
and Waiver in, a form similar to Exhibit A.
Notwithstanding the foregoing, Executive shall not be
entitled to any liquidated damages hereunder if
termination occurs prior to the Termination Date and
Company or any of their respective affiliates agrees
to employ Executive in an executive capacity with
powers and duties similar to those assigned to
Executive hereunder for a period equal to or greater
than the balance of the Term and to provide Executive
during such period with compensation and benefits
equivalent to those which he would have received
hereunder had termination not occurred.
6. Non-Competition and Confidentiality
6.1 As used in this Section 6, the term "Restricted Area"
shall mean: (i) during the Term, the entire world,
and (ii) during the twelve months following the
termination of Executive's employment hereunder for
any reason specified in Section 5.3 hereof, the area
within 50 miles of the location of any business
activity conducted by the Company, any constituent
partner of the Company or any of their respective
parents, subsidiaries or affiliates. During the Term
and for a period of twelve months following the
termination of Executive's employment hereunder for
any reason specified in Section 5.3 hereof, Executive
shall not, in the Restricted Area, directly or
indirectly, enter the employ of, or render any
services to, any person, firm or corporation engaged
in any business competitive with the businesses
engaged in by the Company, any constituent partners
of the Company or any of their respective parents,
subsidiaries or affiliates; he shall not engage in
such business on his own account in the Restricted
Area; and he shall not become interested in such
business, directly or indirectly, as an individual,
partner, shareholder, director, officer, principal,
agent, employee, trustee, consultant, or any other
relationship or capacity; provided, however, that
nothing contained in this Section 6 shall be deemed
to prohibit Executive from acquiring, solely as an
investment, a less than one percent interest in the
equity of any publicly traded corporation or limited
partnership.
6.2 Executive shall not, at any time hereafter, disclose
to any person, firm or corporation any confidential
information regarding the customers, suppliers,
market arrangements or methods of operations of the
Company, any constituent partner of the Company or
any of their respective parents, subsidiaries or
affiliates or any other information of the Company,
any constituent partner of the Company or any of
their respective parents, subsidiaries, affiliates.
Without limiting the generality of the foregoing, the
parties hereto acknowledge and agree that all
information not otherwise generally known to the
public relating to each of (i) this Agreement, (ii)
the Company, any constituent partner of the Company
or any of their respective parents, subsidiaries or
affiliates is confidential and
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proprietary and is not to be disclosed to any persons
or entities, except to the extent necessary to
conduce the business of the Company, or to comply
with law or the valid order of a governmental agency
or court of competent jurisdiction.
6.3 Any invention, improvement, design, development or
discovery conceived, developed, invented or made by
Executive, alone or with others, during his
employment hereunder and applicable to the business
of the Company, its parents, subsidiaries or
affiliates shall become the sole and exclusive
property of the Company. Executive shall (i) disclose
the same completely and promptly to the Company, (ii)
execute all documents requested by the Company in
order to vest in the Company the entire right, title
and interest, in and to the same, (iii) execute all
documents required by the Company for the filing, and
prosecuting of such applications for patents,
copyrights and/or trademarks, which the Company, in
its sole discretion, may desire to prosecute, and
(iv) provide to the Company all assistance it may
reasonably require including, without limitation, the
giving of testimony in any suit, action or
proceeding, in order to obtain, maintain and protect
the Company's rights therein and thereto.
6.4 Executive, except within the course of the
performance of his duties hereunder, shall not at any
time while he is in the employ of the Company, any
constituent partner of the Company or any of their
respective parents, subsidiaries, or affiliates and
for 12 months thereafter (i) employ any individual
who is then employed by the Company, any constituent
partner of the Company or any of their respective
parents, subsidiaries, affiliates, or (ii) in any way
cause, influence, or participate in the employment of
any individual which would be contrary to the
Company's best interests, as determined by the
Company in its sole discretion.
6.5 Executive's services are unique and any breach or
threatened breach by Executive of any provision of
this Section 6 shall cause the Company irreparable
harm which cannot be remedied solely by damages. In
the event of a breach or threatened breach by
Executive of any of the provisions of this Section 6,
the Company shall be entitled to injunctive relief
restraining Executive and any business, firm,
partnership, individual, corporation or entity
participating in such breach or threatened breach.
Nothing herein shall be construed as prohibiting the
Company from pursuing any other remedies available at
law or in equity for such breach or threatened
breach, including the recovery of damages and the
immediate termination of the employment of Executive
hereunder.
6.6 If any of the provisions of or covenants contained in
this Section 6 are hereafter construed to be invalid
or unenforceable in a particular jurisdiction, the
same shall not affect the remainder of the provisions
or the enforceability thereof in that jurisdiction,
which shall be given full effect, without regard to
the invalidity or unenforceability thereof in a
particular jurisdiction because of the duration
and/or scope of such provision or covenant in that
jurisdiction and, in its reduced form, said provision
or covenant shall be enforceable. In all other
jurisdictions this Section 6 shall at all times
remain in full force and effect.
7. Representations and Warranties. Executive hereby represents
and warrants to the Company as follows:
7.1 Executive is an individual residing at the address
set forth in Section 8.2 hereof.
7.2 Executive has full power and authority to enter into
this Agreement and the execution and delivery of this
Agreement by Executive will not conflict with or
result in the breach of or a default under any
agreement or other instrument to which Executive is a
party.
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7.3 Executive is not a party to any covenant
not-to-compete, non-disclosure agreement or other
similar obligation which is inconsistent with, or
which could impair the performance of, Executive's
duties hereunder.
8. Notices. All notices, requests, consents and other
communications, required or permitted to be given hereunder,
shall be in writing and shall be deemed to have been duly
given if delivered personally or sent by prepaid telegram, or
mailed first-class, postage prepaid, by registered or
certified mail (notices sent by telegram or mailed shall be
deemed to have been given on the date sent), as follows (or to
such other address as either party shall designate by notice
in writing to the other in accordance herewith):
8.1 If to the Company:
Danka Office Imaging Company
00000 Xxxxx Xxxxxx Xxxxx
Xx. Xxxxxxxxxx, XX 00000
Attention: General Counsel
8.2 If to Executive:
0000 X.X. Xxxxxx Xxxx Xxxxx
Xxxx Xxxx, XX 00000
Attention: Xxxx Xxxxxxxxx
9. General.
9.1 The section headings contained herein are for
reference purposes only and shall not in any way
affect the meaning or interpretation of this
Agreement.
9.2 This Agreement sets forth the entire agreement and
understanding of the parties relating to the subject
matter hereof, and supersedes all prior agreements,
arrangements and understandings written or oral,
relating to the subject matter hereof. No
representation, promise or inducement has been made
by either party that is not embodied in this
Agreement, and neither party shall be bound by or
liable for any alleged representation, promise or
inducement not so set forth.
9.3 This Agreement, and Executive's rights and
obligations hereunder, may not be assigned or
otherwise transferred by Executive. The Company may
assign its rights hereunder to any parent,
subsidiary, or affiliate and in connection with any
sale, transfer or other disposition of all or
substantially all of its businesses or assets. Upon
such assignment, the assignee thereunder shall be
required to assume the obligations of Executive
hereunder and, upon such assumption, the Company
shall be relieved of its obligations hereunder.
9.4 This Agreement constitutes the entire agreement
between the parties with respect to the transactions
contemplated hereby and may be amended, modified,
superseded, canceled, renewed or extended and the
terms or covenants hereof may be waived, only by a
written instrument executed by both of the parties
hereto, or in the case of a waiver, by the party
waiving compliance. The failure of either party at
any time or times to require performance of any
provision hereof shall in no manner affect the right
at a later time to enforce the same. No
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waiver by either party of the breach of any term or
covenant contained in this Agreement, whether by
conduct or otherwise, in any one or more instances,
shall be deemed to be, or construed as, a further or
continuing waiver of any such breach, or a waiver of
the breach of any other term or covenant contained in
this Agreement.
9.5 This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Florida
applicable to agreements entered into and wholly
performed therein.
9.6 Any controversy or claim arising out of or relating
to this Employment Agreement, other than a claim for
injunctive relief, shall be settled by arbitration in
accordance with the Commercial Arbitration Rules of
the American Arbitration Association (the "Rules") in
effect at the time demand for arbitration is made by
any party. One arbitrator shall be named by the
Company, a second by the Executive and the third
arbitrator shall be named by the two arbitrators so
chosen. In the even that the third arbitrator is not
agreed upon, he or she shall be named by the American
Arbitration Association. Arbitration shall occur in
St. Petersburg, Florida. The award made by all or a
majority of the panel of arbitrators shall be final
and binding, and judgment may be entered in any court
of law having competent jurisdiction. The prevailing
party shall be entitled to an award of reasonable
attorney's fees, costs and expenses incurred in
connection with the arbitration and any judicial
proceedings related thereto.
9.7 This Agreement may be executed in any number of
counterpart copies, each of which shall be deemed an
original, but which together shall constitute a
single instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
DANKA OFFICE IMAGING COMPANY
By:
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Title:
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Executive
By:
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Witness:
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EXHIBIT A
RELEASE OF CLAIMS
DEFINITIONS: I, Xxxxxxx Xxxx Xxxxxxxxx, ("Employee"), intend all words used in
this Release to have their plain meaning in ordinary English. Technical legal
words are not needed to describe what I mean. Specific terms I use in this
Release have the following meanings:
A. I, Me, and My include both me and anyone who has or obtains
any legal rights or claims through me.
B. Employer, as used herein, shall at all times mean Danka
Corporation or any parent company, subsidiaries, affiliated
companies or entities and their employees, officers,
directors, successors and assigns, its attorneys, consultants
and agents, whether in their individual or official
capacities.
C. My Claims means all of the rights I have to any relief of any
kind from Employer, whether or not I now know about those
rights, arising out of or in any way related to my employment
with Employer, any my termination of employment, or any
employee benefit plan, including, but not limited to, common
law, or equitable claims, claims for violation or breach of
any employment agreement or understanding; fraud or
misrepresentation; and any statutory claims including alleged
violations of the, the federal Age Discrimination in
Employment Act, the Americans with Disabilities Act, or any
other federal, state, or local civil rights laws or
ordinances, defamation; intentional or negligent infliction of
emotional distress; breach of the covenant of good faith and
fair dealing; promissory estoppel; negligence, wrongful
termination of employment, any any other claims.
AGREEMENT TO RELEASE MY CLAIMS. I am receiving a substantial amount of money,
among other things, from Employer as consideration for my Release of claims. I
agree to give up all My Claims against the Employer as defined above. I will not
bring any lawsuits, file any charges, complaints, or notices, or make any other
demands against the Employer or any of its employees or agents based on any
alleged claims. The money I am receiving is a full and fair payment for the
release of all My Claims.
ADDITIONAL AGREEMENTS AND UNDERSTANDINGS. Even though the Employer is paying me
to release My Claims, the Employer expressly denies that it is responsible or
legally obligated for My Claims or that is has engaged in any wrongdoing.
I understand that I may have twenty-one (21) calendar days from the day
that I receive this Release, not counting the day upon which I receive it, to
consider whether I wish to sign this Release. I further understand that the
Employer recommends that I consult with an attorney before executing this
Release. I agree that if I sign this Release before the end of the twenty-one
(21) day period, it is because I have decided that I have already had sufficient
time to decide whether to sign the Release.
I understand that I may rescind (that is, cancel) this Release within
seven (7) calendar days of signing it to reinstate federal civil rights claims
(if any). To be effective, my rescission must be in writing and delivered to the
Employer, Attention General Counsel,
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Danka, 11201 Xxxxx Xxxxxx Xxxxx, Xx. Xxxxxxxxxx, Xxxxxxx, 00000, either by hand
or by mail within the required period. If sent by mail, the rescission must be:
1. Postmarked within the relevant period;
2. Properly addressed to the General Counsel; and
3. Sent by certified mail, return receipt requested.
I have read this Release carefully and understand all its terms. I have
had the opportunity to review this Release with my own attorney. In agreeing to
sign this Release, I have not relied on any statements or explanations made by
the Employer or its agents other than those set forth in the Release and
Employment Agreement.
I understand and agree that this Release and Employment Agreement to
which it is attached contain all the agreements between the Employer and me. We
have no other written or oral agreements.
Dated:
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Witness:
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