Exhibit 10.6
RETENTION AGREEMENT
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THIS RETENTION AGREEMENT (the "Agreement") is made as of June 11, 2002
(the "Effective Date"), by and among Modern Technologies Corp., an Ohio
corporation (the "Company"), MTC Technologies, Inc., a Delaware corporation and
the parent corporation of the Company (the "Parent"), and Xxxxxxx X. Xxxxxx (the
"Executive").
WITNESSETH
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WHEREAS, the Executive is presently the Chief Executive Officer of the
Company and has made and is expected to continue to make major contributions to
the profitability, growth and financial strength of the Company;
WHEREAS, the Company wishes to continue to employ the Executive in his
capacity as Chief Executive Officer;
NOW THEREFORE, in consideration of the mutual covenants and promises
hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Employment Duties.
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(a) This Agreement shall become effective on the Effective Date
noted above. During the employment period fixed by Section 3
hereof (the "Employment Period"), the Executive hereby agrees to
serve as Chief Executive Officer of the Company, and the Company
hereby agrees to employ the Executive as such. The Executive
shall also hold the position of Chief Executive Officer of the
Parent. The Executive shall report to the Board of Directors of
the Parent (the "Parent Board").
(b) During the Employment Period, the Executive will not, without
the prior written consent of the Parent Board, directly or
indirectly engage in any other business activities or pursuits
whatsoever, except activities in connection with (i) any
charitable or civic activities, (ii) personal investments, and
(iii) serving as an executor, trustee or in another similar
fiduciary capacity for a non-commercial entity; provided,
however, that any such activities do not materially interfere
with his performance of his responsibilities and obligations
pursuant to this Agreement. With the approval of the Parent
Board, the Executive may engage in any other business activities
or pursuits not otherwise permitted under this Section 1.
2. Compensation.
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(a) During the Employment Period, the Company shall pay the
Executive a cash base salary of $500,000 per annum (the "Base
Salary"). The Base Salary shall be paid
to the Executive, less applicable withholdings, in installments
pursuant to the Company's normal and customary executive officer
payroll procedures. The Executive's Base Salary shall be
reviewed annually by the Compensation Committee of the Parent
Board (or, if there is no such Committee, the Parent Board)
beginning with calendar year 2003 and may be increased as
determined by the Compensation Committee of the Parent Board
(or, if there is no such Committee, the Parent Board) in its
sole discretion.
(b) The Executive will be eligible for an annual bonus based
on the achievement of specified Company goals (as determined
by the Compensation Committee of the Parent Board (or, if
there is no such Committee, the Parent Board) with input
from the Executive). In addition, the Company shall pay the
Executive a $750,000 one-time cash bonus at any date prior
to December 31, 2002 as determined by the Chairman of the
Parent Board for services performed by, and to be performed
by, the Executive during the second, third and fourth
quarters of this fiscal year 2002.
(c) The Parent has adopted the 2002 Equity and Performance Incentive
Plan (the "Equity Plan") pursuant to which options to purchase
shares of the Parent's common stock, and other equity-based
incentive compensation awards, may be granted to the Executive
and other officers and key employees of the Parent and the
Company. The Executive shall be eligible to receive grants of
options and other awards under the Equity Plan, at the
discretion of the Compensation Committee of the Parent Board
(or, if there is no such Committee, the Parent Board). Under the
terms of the Equity Plan, the Compensation Committee of the
Parent Board (or, if there is no such Committee, the Parent
Board) has the right to amend the Equity Plan. If, at the time
of the grant of any option pursuant to this Section 2(c), the
issuance of shares upon exercise thereof has not been registered
under the Securities Act of 1933, as amended, it shall be a
condition to such grant that the Executive execute and deliver
to the Parent a certificate confirming that the Executive is an
accredited investor (as such term is used in Regulation D under
such Act) and including transfer restrictions and other
provisions customary in connection with grants under such
circumstances.
(d) The Company shall reimburse the Executive for all reasonable
expenses incurred by him during the Employment Period in the
course of performing his duties under this Agreement that are
consistent with the Company's policies in effect from time to
time with respect to travel, entertainment and other business
expenses, subject to the Company's requirements applicable
generally with respect to reporting and documentation of such
expenses.
(e) In addition to the salary, bonus(es), stock options and expense
reimbursements payable to the Executive pursuant to this Section
2, the Executive shall be entitled during the Employment Period
to participate, on the same basis as other executives of the
Company, in the Company's Executive Benefits Package. The
Company's "Executive Benefits Package" means those benefits
(including insurance, vacation, Company car or car allowance,
equity-based benefits, and other benefits) for which
substantially all of the executives of the Company are from time
to time generally eligible, as determined from time to time by
the Parent Board. Notwithstanding the above, the Executive shall
be entitled to
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continue to receive those benefits that he was entitled to
receive on the date of this Agreement.
(f) With respect to the Executive's acts or failures to act during
the Employment Period in his capacity as a director, officer,
employee or agent of the Company, the Executive shall be
entitled to indemnification from the Company, and to liability
insurance coverage (if any), on the same basis as other
directors and officers of the Company.
3. Employment Period. The Employment Period shall commence on the
Effective Date and shall terminate on the day preceding the second
anniversary of the Effective Date (the "Scheduled Termination Date," as
such date may be modified by the following clause); provided, that the
Executive's Employment Period and the Scheduled Termination Date shall
automatically extend for one additional year upon each anniversary of
the Effective Date unless the Company or the Executive notifies the
other party in writing of its intent not to extend the term of
employment under this Agreement no less than sixty (60) days before the
applicable anniversary date. Notwithstanding anything in this Section 3
to the contrary, the Executive's employment shall end earlier than the
Scheduled Termination Date, or any renewal period thereafter, if
terminated upon death, by the Company for Cause (as hereinafter
defined) or otherwise by the Executive or the Company pursuant to
notice given as provided in Section 4 hereof.
4. Termination Procedure.
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(a) Subject to section 4(b) below, the Company or the Executive may
terminate this Agreement at any time during the Employment
Period (other than due to the Executive's death or a termination
by the Company for Cause) if notice of such termination is
communicated by written "Notice of Termination" to the Executive
or the Company no later than sixty (60) days prior to the
desired date of termination of this Agreement.
(b) Upon termination of the Executive's employment with the Company
for any reason, the Executive shall also resign from (i) the
Company's Board of Directors, if the Executive then serves on
the Board of Directors of the Company, (ii) the Parent's Board
of Directors, if the Executive then serves of the Board of
Directors of the Parent, and (iii) any position (whether as an
employee, board member or otherwise) of any affiliate or
subsidiary of the Company.
5. Termination Payments.
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(a) Upon the Executive's termination of employment for any reason,
the Company shall pay to the Executive any unpaid Base Salary
then in effect accrued up to the date of termination of
employment and any amount payable for accrued but unused
vacation time up to the date of termination. Other than the
accrued salary and vacation pay referenced in the preceding
sentence, the Executive shall not be entitled to any further
payments or benefits, unless otherwise agreed to in writing
between the Company and the Executive.
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(b) Notwithstanding Section 5(a), if the Executive's employment is
terminated by the Company without Cause: (i) the Company also shall
pay to the Executive an amount equal to the Executive's annual Base
Salary (the "Severance Payment"); and (ii) all stock options
previously granted to the Executive shall become immediately
exercisable in full. The Severance Payment to be made pursuant to this
Section 5(b) shall be made in a lump sum as soon as practicable
following such termination using the Base Salary rate in effect
immediately prior to such termination.
(c) Upon the Company tendering the Severance Payment described in Section
5(b), the Executive shall execute and deliver to the Company a
release, in substantially the same form as the General Release of All
Claims attached hereto as Attachment A.
(d) For purposes of this Agreement, "Cause" shall mean a termination of
the Executive's employment by the Company for any of the following
reasons: (i) a material violation by the Executive of this Agreement
which the Executive fails to cure to the Company's reasonable
satisfaction within thirty (30) days after the Company delivers to the
Executive a written notice that specifically identifies such
violation; (ii) the willful failure by the Executive to act in a
manner consistent with the Executive's responsibilities or with the
best interests of the Company, after the Company delivers to the
Executive a written demand for satisfactory performance that
specifically identifies the manner in which the Company believes that
the Executive has not satisfactorily performed the Executive's duties
and the Executive fails to cure the existing problem to the Company's
reasonable satisfaction within thirty (30) days; or (iii) the
conviction of the Executive of a felony (other than an offense related
to the operation of an automobile which results only in a fine,
license suspension or other non-custodial penalty) or other serious
crime involving moral turpitude.
(e) This Agreement shall not be construed to be in lieu of or to the
exclusion of any other rights, benefits and privileges to which the
Executive may be entitled as an executive of the Company, the Parent
or any subsidiaries or affiliates of the Company or the Parent under
any retirement, pension, profit-sharing, insurance, hospitalization or
other plans or benefits which may now be in effect or which may
hereafter be adopted.
6. Confidentiality, Non-Competition and Non-Solicitation. For good and
valuable consideration, the receipt and sufficiency of which the Executive
hereby acknowledges, the Executive hereby agrees as follows:
(a) During the entire term of the Executive's employment with the Company,
the Parent and/or any of their subsidiaries and affiliates
(collectively, the "Employer") and thereafter, the Executive will not
publish or otherwise disclose to persons other than those employed by
Employer, without specific permission from the Employer, any Employer
proprietary or confidential information which the Executive learns or
acquires during the course of employment with or as a result
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of performing services with the Employer, and will not use such information
in any way which might be detrimental to the interests of the Employer. For
purposes of this Agreement, proprietary or confidential information
includes, but is not limited to:
(i) all information not generally known to the public or within the
federal, state or local government market(s) or the commercial
market(s) in which the Employer offers or provides its services,
solutions or products, pertaining to the Employer's marketing,
bidding or cost plans, strategies, forecasts or projections;
practices, procedures, policies, goals or objectives pertaining to
the foregoing; contract proposals, contract bids which have been
prepared or submitted or which are proposed to be prepared or
submitted, or bidding and pricing techniques; information on the
Employer's cost structure; quoting and pricing practices,
procedures and policies; customer data including customer lists,
contracts, contacts, representatives, requirements and needs,
specifications, data provided by or about prospective customers;
supplier information, including joint venture and subcontractor
proposals; employee and consultants' identities, skills, resumes,
records and lists; and the physical embodiments of any of the
foregoing information.
(ii) all information concerning or relating to the way the Employer
conducts its businesses which is not generally known to the public
or within the federal, state or local government market(s) or the
commercial market(s) in which the Employer offers or provides its
services, solutions or products (such as Employer contracts,
internal business procedures, controls, plans, licensing
techniques and practices, supplier, subcontractor and prime
contractor names and contacts and other vendor information,
Employer processes, techniques, data, computer system passwords
and other computer security controls, financial information, and
distributor information) and the physical embodiments of such
information (such as check lists, samples, service and operational
manuals, contracts, proposals, printouts, correspondence, forms,
listings, ledgers, financial statements, financial reports,
financial and operational analyses, financial and operational
studies, management reports of every kind, databases, and any
other written or machine-readable expression of such information
as are filed in any tangible media).
(iii) all information not generally known to the public or within the
federal, state or local government market(s) or the commercial
market(s) in which the Employer offers or provides its services,
solutions or products concerning development of new products,
services or solutions, negotiations for new business ventures or
acquisitions, future business or acquisition plans, and similar
information and the physical embodiments of such information.
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(iv) information which is not a public record and is not generally
known to the public or within the federal, state or local
government market(s) or the commercial market(s) in which the
Employer offers or provides its services, solutions or products
regarding litigation and potential litigation matters and the
physical embodiments of such information.
(v) any information which (A) is not generally known to the public
or within the federal, state or local government market(s) or
the commercial market(s) in which the Employer offers or
provides its services, solutions or products, (B) gives the
Employer a significant advantage over its or their competitors,
or (C) has significant economic value or potentially significant
economic value to the Employer, including the physical
embodiments of such information.
(vi) any other information which would constitute a trade secret of
the Employer, as that term is defined by the Uniform Trade
Secret Act, as amended.
(b) During the entire term of the Executive's employment with the Employer
and thereafter through the one year period following the termination of
the Employment Period by the Company without Cause (such one-year
period to apply only if the Executive's employment is terminated by the
Company without Cause), provided that the Company has paid to the
Executive the Severance Payment required by Section 5(b) hereof within
30 days of termination of the Employment Period (the "Severance
Period"), the Executive shall not:
(i) directly or indirectly, own, manage, operate, control or
participate in the ownership, management, operation or control
of, or be connected as an officer, employee, consultant,
partner, director or otherwise with, or have any financial
interest in, or aid or assist anyone else in the conduct of any
business which competes with any services, solutions or products
conducted, offered or provided by the Employer (any such
service, solution or product, an "Employer Operation"), to any
federal, state or local government market(s) or the commercial
market(s) if such Employer Operation is being conducted or
developed at any time during the term of the Executive's
employment with Employer and at the later time in question; or
(ii) directly or indirectly, solicit any customer covered by Company
contracts that are currently in existence or were in existence
at any time during the Executive's employment with a view to
inducing such customer to enter into an agreement, or otherwise
do business, involving an Employer Operation with any competitor
or attempt to induce any such customer to terminate its
relationship with the Employer or to not enter into a
relationship with the Employer, as the case may be.
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(c) Notwithstanding Section 6(c)(i) above, (i) any company that the
Executive owns, manages, operates, controls, participates in the
ownership, management, operation or control of, or is connected
with as an officer, employee, consultant, partner, director or
otherwise, or has a financial interest in, on the date of this
Agreement and (ii) any company in which the Executive has, or
will have, an indirect investment through his investment in a
fund that invests in such company, provided that Executive has
no control over the investment in such company, shall be
excluded from the operation of Section 6(c)(i) above.
(d) During the Severance Period, the Executive shall not directly or
indirectly solicit or attempt to solicit or induce any
employee(s), sales representative(s), agent(s) or consultant(s)
of the Company, its Parent, any of its subsidiaries and/or of
any other company (each, an "Affiliate") that directly or
indirectly controls, is controlled by, or is under common
control with, the Company, to terminate their employment,
representation or other association with the Company and/or its
Parent, subsidiary or Affiliate.
(e) During the Executive's employment and during the Severance
Period, the Executive shall communicate the contents of this
Agreement to any person, firm, association, partnership,
corporation or other entity which the Executive intends to be
employed by, associated with, or represent and which is engaged
in a business that is competitive to the business of the
Company.
7. Specific Performance; Extension of Period; Severability.
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(a) The Executive acknowledges that the restrictions contained in
Section 6 hereof are reasonable and necessary to protect the
legitimate interests of the Employer and that the Employer would
not have entered into this Agreement in the absence of such
restrictions. The Executive also acknowledges that any breach by
him of Section 6 hereof will cause continuing and irreparable
injury to the Employer for which monetary damages would not be
an adequate remedy. The Executive shall not, in any action or
proceeding by the Employer to enforce Section 6 of this
Agreement, assert the claim or defense that an adequate remedy
at law exists. In the event of such breach by the Executive, the
Employer shall have the right to enforce the provisions of
Section 6 of this Agreement by seeking injunctive or other
relief in any court, and this Agreement shall not in any way
limit remedies at law or in equity otherwise available to the
Employer.
(b) If it shall be judicially determined that the Executive has
violated any of the Executive's obligations under Section 6(c),
then the Severance Period applicable to each obligation that the
Executive shall have been determined to have violated shall
automatically be extended by a period of time equal in length to
the period during which such violation occurred; provided,
however, that the Company shall notify the Executive at the time
that it seeks judicial determination of any suspected violation.
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(c) All provisions of this Agreement are intended to be severable.
In the event any provision or restriction contained herein is
held to be invalid or unenforceable in any respect, in whole or
in part, under any applicable law or rule in any jurisdiction,
such finding will in no way affect the validity or
enforceability of any other provision of this Agreement or any
other jurisdiction, but this Agreement shall be reformed,
construed and enforced in such jurisdiction as if such invalid
or unenforceable provision had never been contained therein.
8. Miscellaneous.
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(a) This Agreement constitutes the entire agreement between the
parties hereto with respect to the Executive's employment, and
supersedes and is in full substitution for any and all prior
understandings or agreements, whether oral or written, with
respect to the Executive's employment.
(b) This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio, without reference to the
principles of conflicts of law except to the extent such
principles permit the application of Ohio law. Any dispute
hereunder shall be litigated in federal district court in the
Southern District of Ohio or, if jurisdiction cannot be obtained
in such court, in the Ohio state court.
(c) The Company may withhold from any amounts payable to the
Executive hereunder all federal, state, city or other taxes that
the Company may reasonably determine are required to be withheld
pursuant to any applicable law or regulation.
(d) This Agreement may be executed by facsimile signature and in
several counterparts, each of which shall be deemed an original,
but all of which shall constitute one and the same instrument.
(e) The headings in this Agreement are inserted for convenience of
reference only and shall not be a part of or control or affect
the meaning of any provision hereof.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
MODERN TECHNOLOGIES CORP.
By: /s/ Xxxxxx Xxxx
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Its: Chairman of the Board
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MTC TECHNOLOGIES, INC.
By: /s/ Xxxxxx Xxxx
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Its: Chairman of the Board
---------------------------------
/s/ Xxxxxxx X. Xxxxxx
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Executive
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Attachment A
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GENERAL RELEASE OF ALL CLAIMS
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This General Release of all Claims (this "Agreement") is made and
entered into as of _______________, _____, by and between MODERN TECHNOLOGIES
CORP., an Ohio corporation (the "Company"), and Xxxxxxx X. Xxxxxx (the
"Executive"). As used in this Agreement, the term "Company" will include its
parent, predecessors, subsidiaries, divisions, related or affiliated companies,
officers, directors, stockholders, employees, successors, assigns,
representatives, agents and counsel, unless the context clearly requires
otherwise.
In consideration of the promises set forth in this Agreement, the
Executive and the Company agree as follows:
1. Effectiveness of Agreement. This Agreement will be effective on the
eighth day after it is executed by the Executive, provided that the
Executive has not revoked the Executive's release as provided in
Section 5(b) below (the "Effective Date").
2. Termination of Employment; Resignations. The parties acknowledge that
the Executive's employment relationship with the Company ceased on
___________________ (the "Termination Date"). The Executive hereby
agrees, that effective the day after the Termination Date, the
Executive will resign (a) as an employee of the Company, (b) from all
Company boards and offices, including those of any parent, affiliate or
subsidiary of the Company, and (c) from all administrative, fiduciary
or other positions the Executive may hold or have held with respect to
arrangements or plans for, of or relating to the Company. The Company
consents to and accepts all such resignations. After the Termination
Date, neither the Company nor the Executive will represent or state to
any other party that the Executive has any authority to act for or on
behalf of the Company or has any relationship with the Company [other
than as a stockholder].
3. Severance. In consideration of the promises contained herein, within
five (5) days after the Effective Date, the Company will deliver to the
Executive a check in the amount of $__________, payable to the
Executive. Such payment will be in [full and complete] satisfaction of
the Company's obligations under Sections 5(a) and 5(b) of the
Executive's Retention Agreement, dated as of __________, 2002 (the
"Retention Agreement").
4. Benefits. The benefits described by Sections 5(a) and 5(b) of the
Retention Agreement will be provided to the Executive in accordance
with the terms of the Retention Agreement.
5. Mutual Releases.
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(a) In accordance with Section 5(c) of the Retention Agreement, in
consideration for the promises contained herein, the Executive
hereby releases and forever discharges the Company from, and
agrees not to xxx or join in any suit against the Company for,
any and all charges, complaints, liabilities, claims, promises,
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agreements, controversies, damages, causes of action, suits or
expenses of any kind or nature whatsoever, known or unknown, foreseen
or unforeseen to the date upon which the Executive executes this
Agreement (collectively, "Claims"), including (but not limited to)
claims arising in any way from the Executive's employment with the
Company, the Executive's service as an officer and director of the
Company, the Executive's status as a shareholder of the Company, or
the Executive's agreements to resign the Executive's employment as
provided in Section 2, above, including, without limitation, any and
all alleged discrimination or acts of discrimination that occurred or
may have occurred on or before the date upon which the Executive
executes this Agreement based upon race, color, sex, creed, national
origin, age, disability or any other violation of any equal employment
opportunity law, ordinance, rule, regulation or order (including, but
not limited to, Title VII of the Civil Rights Act of 1964, as amended
("Title VII"); the Civil Rights Act of 1991; the Age Discrimination in
Employment Act of 1967, as amended ("ADEA") (as further described in
Section 5(b) below); the Americans with Disabilities Act ("ADA");
claims under the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"); or any other federal, state or local laws or
regulations regarding employment discrimination or termination of
employment) and any claims for wrongful discharge, fraud, or
misrepresentation under any statute, rule, regulation or under the
common law. Excluded from this Agreement are any claims which cannot
be waived by law, including but not limited to the right to file a
charge with or participate in an investigation conducted by the Equal
Employment Opportunity Commission ("EEOC"). The Executive is waiving,
however, the Executive's right to any monetary recovery or relief
should the EEOC or any other agency pursue any claims on the
Executive's behalf.
(b) The Executive acknowledges that the Company encouraged the Executive
to consult with an attorney of the Executive's choosing prior to
executing this Agreement, and through this Agreement encourages the
Executive to consult with the Executive's attorney with respect to
possible claims under the ADEA and that the Executive understands that
the ADEA is a federal statute that prohibits discrimination, on the
basis of age, in employment, benefits, and benefit plans. The
Executive wishes to waive any and all claims under the ADEA that the
Executive may have, as of the date upon which the Executive executes
this Agreement, against the Company, and hereby waives such claims.
The Executive further understands that by signing this Agreement, the
Executive is in fact waiving, releasing and forever giving up any
claim under the ADEA that may have existed on or prior to the date
upon which the Executive executes this Agreement. The Executive
acknowledges that the Executive is receiving consideration for the
Executive's waiver of any and all claims under the ADEA in addition to
anything of value to which the Executive is already entitled. The
Executive also acknowledges that the Company has informed the
Executive that the Executive has at the Executive's option, twenty-one
(21) days from the date this Agreement was first presented to the
Executive in order to consider this
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Agreement, and, if executed prior to the expiration of the twenty-one
(21) day period, the Executive does hereby knowingly and voluntarily
waive all or part of said twenty-one (21) day period. The Executive
also understands that the Executive has seven (7) days following the
date upon which the Executive executes this Agreement within which to
revoke the release contained in this Section 5(b) (the "Revocation
Period") by providing a written notice of the Executive's revocation
of the release and waiver contained in this Section 5(b) to the
Company. The release of claims under the ADEA contained in this
Section 5(b) does not become effective or enforceable until the
Revocation Period has expired.
(c) Notwithstanding the foregoing, the Executive does not, and will not,
release, discharge or waive any rights to indemnification that the
Executive may have under the By-Laws of the Company, the laws of the
State of Ohio, any indemnification agreement between the Executive and
the Company or any insurance coverage maintained by or on behalf of
the Company, nor will the Company take any action, directly or
indirectly, to encumber or adversely affect the Executive's rights
under any such indemnification arrangement. Further, the release
contained in this Section 5 will not affect any rights granted to the
Executive, or obligations of the Company, under the terms of this
Agreement or under the terms of any employee benefit plan (within the
meaning of Section 3(3) of ERISA) maintained by the Company or, except
to the extent such rights have previously been satisfied or are
satisfied pursuant to this Agreement, under the terms of the Retention
Agreement.
(d) Except for Claims based upon fraud or intentional misrepresentation,
the Company, as a material inducement to the Executive to enter this
Agreement, and in consideration of the promises contained herein,
hereby releases and forever discharges the Executive, and the
Executive's family, heirs, successors, assigns, agents and attorneys
from, and agrees not to xxx or join in any suit against such parties
for, any and all Claims, which the Company now has or owns or claims
or could claim to have or own against the Executive and the
Executive's family, heirs, successors, assigns, agents and attorneys
arising from the Executive's employment by the Company, the
Executive's service as an officer, employee or director of the
Company, and the Executive's status as a shareholder of the Company [,
other than ____________________]; provided, however, that the release
contained in this Section 5(d) will not affect any rights granted to
the Company, or the Executive's obligations, under the terms of this
Agreement.
(e) Nothing contained in this Agreement will be deemed or construed as an
admission of wrongdoing or liability on the part of the Company or the
Executive.
6. No Mitigation or Offset. The Executive is under no obligation to mitigate
damages or the amount of any payment or benefit provided for under this
Agreement by seeking other employment or otherwise. Except as otherwise
expressly provided in the Retention
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Agreement, any and all amounts payable and benefits to be provided by
the Company to the Executive under the terms of this Agreement will
not be subject to set-off or counterclaim for amounts claimed by the
Company to be owed to it by the Executive.
7. Survival. The expiration or termination of this Agreement will not
impair the rights or obligations of any party hereto that accrue
hereunder prior to such expiration or termination, except to the
extent specifically stated herein. In addition to the foregoing, (a)
the Executive's and the Company's obligations contained in Section 5
will survive the expiration or termination of this Agreement, and (b)
the Company's and the Executive's respective rights and obligations as
specified in Section 6 of the Retention Agreement will survive any
termination or expiration of this Agreement or the Retention
Agreement, or the termination of the Executive's employment for any
reason whatsoever.
8. Miscellaneous Provisions.
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(a) Binding on successors; assignment. This Agreement will be binding
upon and inure to the benefit of the Company, the Executive and
each of their respective successors, assigns, personal and legal
representatives, executors, administrators, heirs, distributees,
devisees, and legatees, as applicable; provided, however, that
neither this Agreement nor any rights or obligations hereunder
will be assignable or otherwise subject to hypothecation by the
Executive (except by will or by operation of the laws of
intestate succession) or by the Company, except that the Company
may assign this Agreement to any successor (whether by merger,
purchase or otherwise) to all or substantially all of the stock,
assets or businesses of the Company, if such successor expressly
agrees to assume the obligations of the Company hereunder.
(b) Governing law. This Agreement will be governed, construed,
interpreted and enforced in accordance with the substantive laws
of the State of Ohio, without regard to conflicts of law
principles.
(c) Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is
held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other
provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been
contained herein.
(d) Notices. For all purposes of this Agreement, all communications,
including without limitation notices, consents, requests or
approvals, required or permitted to be given hereunder will be in
writing and will be deemed to have been duly given when hand
delivered or dispatched by electronic facsimile transmission
(with receipt thereof confirmed), or five business days after
having been mailed by United States registered or certified mail,
return receipt requested, postage
4
prepaid, or three business days after having been sent by a nationally
recognized overnight courier service such as FedEx, UPS, or Purolator,
addressed to the Company (to the attention of the Secretary of the
Company) at its principal executive office and to the Executive at the
Executive's principal residence, or to such other address as any party
may have furnished to the other in writing and in accordance herewith,
except that notices of changes of address will be effective only upon
receipt.
(e) Counterparts. This Agreement may be executed in several counterparts,
each of which will be deemed to be an original, but all of which
together will constitute one and the same Agreement.
(f) Entire agreement. The terms of this Agreement are intended by the
parties to be the final expression of their agreement with respect to
the matters addressed herein and may not be contradicted by evidence
of any prior or contemporaneous agreement. The parties further intend
that this Agreement will constitute the complete and exclusive
statement of its terms and that no extrinsic evidence whatsoever may
be introduced in any judicial, administrative or other legal
proceeding to vary the terms of this Agreement.
(g) Amendments; waivers. This Agreement may not be modified, amended, or
terminated except by an instrument in writing, signed by the Executive
and the Company. Failure on the part of either party to complain of
any action or omission, breach or default on the part of the other
party, no matter how long the same may continue, will never be deemed
to be a waiver of any rights or remedies hereunder, at law or in
equity. The Executive or the Company may waive compliance by the other
party with any provision of this Agreement that such other party was
or is obligated to comply with or perform only through an executed
writing; provided, however, that such waiver will not operate as a
waiver of, or estoppel with respect to, any other or subsequent
failure.
(h) No inconsistent actions; enforcement. The Company and the Executive
will not voluntarily undertake or fail to undertake any action or
course of action that is inconsistent with the provisions or essential
intent of this Agreement. Furthermore, it is the intent of the parties
hereto to act in a fair and reasonable manner with respect to the
interpretation and application of the provisions of this Agreement. In
the event the Executive initiates or voluntarily participates in any
suit (as provided in Section 5(a)), or if the Executive fails to abide
by any of the terms of this Agreement, the Company may, in addition to
any other remedies it may have, reclaim any amounts paid to the
Executive under the provisions of this Agreement or terminate any
benefits or payments that are subsequently due under this Agreement,
without waiving the release granted herein. In the event the Executive
revokes the ADEA release contained in Sections 5(a) and 5(b) within
the seven-day period provided under Section 5(b), the Company may, in
addition to any other remedies it may have, reclaim any amounts paid
to the Executive
5
under the provisions of this Agreement or terminate any benefit or
payments that are subsequently due under this Agreement. The Executive
acknowledges and agrees that the remedy at law available to the
Company for breach of any of the Executive's obligations under Section
5 would be inadequate and that damages flowing from such a breach may
not readily be susceptible to being measured in monetary terms.
Accordingly, the Executive acknowledges, consents and agrees that, in
addition to any other rights or remedies that the Company may have at
law, in equity or under this Agreement, upon adequate proof of the
Executive's violation of any such provision of this Agreement, the
Company will be entitled to immediate injunctive relief and may obtain
a temporary order restraining any threatened or further breach,
without the necessity of proof of actual damage. The Executive
understands that by entering into this Agreement, the Executive will
be limiting the availability of certain remedies that the Executive
may have against the Company and limiting also the Executive's ability
to pursue certain claims against the Company.
(i) Headings and section references. The headings used in this Agreement
are intended for convenience or reference only and will not in any
manner amplify, limit, modify or otherwise be used in the construction
or interpretation of any provision of this Agreement. All section
references are to sections of this Agreement, unless otherwise noted.
(j) Withholding. The Company will be entitled to withhold from payment any
amount of withholding required by law.
(k) Authority. The Company represents and warrants that it and its
signatory hereto are duly authorized and empowered to execute and
enter into this Agreement without any further action or approval.
THIS AGREEMENT INCLUDES A COMPLETE AND PERMANENT RELEASE OF ALL KNOWN AND
UNKNOWN CLAIMS. THE EXECUTIVE ACKNOWLEDGES THAT THE EXECUTIVE HAS READ THIS
AGREEMENT AND THAT THE EXECUTIVE FULLY KNOWS, UNDERSTANDS, AND APPRECIATES ITS
CONTENTS, AND THAT THE EXECUTIVE HEREBY EXECUTES THE SAME AND MAKES THIS
AGREEMENT AND THE RELEASE AND AGREEMENTS PROVIDED FOR HEREIN VOLUNTARILY AND OF
THE EXECUTIVE'S OWN FREE WILL.
6
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
MODERN TECHNOLOGIES CORP.,
an Ohio corporation
By:
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Name:
------------------------------------
Title:
-----------------------------------
-----------------------------------------
Xxxxxxx X. Xxxxxx
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