EMPLOYMENT AGREEMENT
This Employment Agreement dated as of July 10, 2000 (this "Agreement"),
between LOGIMETRICS, INC., a Delaware corporation (the "Company"), and XXXXXX X.
XXXXXX (the "Employee").
RECITALS
WHEREAS, that in connection with the purchase by L-3 Communications
Corporation ("L-3") of an equity interest in the Company, the Company and the
Employee desire to terminate the employment agreement, dated April 25, 1997 (the
"Existing Agreement"), by and between the Company and the Employee, and enter
into a new agreement for the Employee's services providing for all terms and
conditions of the Employee's continued employment;
WHEREAS, the covenant not to compete set forth in Section 6 is necessary
to protect the Company's legitimate business interests; and
WHEREAS, the Company desires to continue the employment of the Employee
with the Company on the terms and conditions hereof, and the obligations of the
Company and L-3 to effect the closing under the Purchase Agreement, dated July
10, 2000 (the "Purchase Agreement"), between the Company and the Employee, were
conditioned upon the Employee's agreement to be employed by the Company pursuant
to the terms and conditions of this Agreement (including Section 6), and the
Employee desires to be so employed by the Company;
NOW THEREFORE, the Company and the Employee, in consideration of the
premises, the mutual covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which hereby are acknowledged, and
intending to be legally bound, hereby agree as follows:
SECTION 1. EMPLOYMENT GENERALLY
1.1. Employment. The Company hereby offers the Employee employment, and
the Employee hereby accepts such offer of employment and agrees to perform his
duties and responsibilities hereunder, in accordance with the terms and
conditions hereinafter set forth.
1.2. Position and Duties. During the Employment Term (as defined in
Section 2), the Employee shall serve on a full-time basis and devote his entire
working time, attention and
energy exclusively to the Company as Senior Vice President--Administration. The
Employee shall report to the individual acting as or appointed as the President
of the Company. The Employee will perform such executive, managerial and
administrative duties as determined by the President of the Company, will use
his best efforts to promote the interests of the Company, and will comply with
all lawful directives, policies, procedures and directions as may from time to
time be given or determined by the Company.
1.3. Outside Activities. The Employee shall not engage in any activity
or investment if such activity or investment interferes with the performance of
his duties hereunder. Notwithstanding the foregoing, the Employee may engage in
charitable, educational, civic and similar activities and continue to be a
member of boards of directors of other businesses and charitable organizations,
and become a member of boards of directors of other businesses and charitable
organizations, subject to approval by the Board of Directors of the Company, to
the extent that such activities do not adversely affect the performance of his
duties hereunder.
1.4. Other Agreements Superseded. This Employment Agreement supersedes
and replaces all prior agreements and understandings (including the Existing
Agreement), between the Company and the Employee, whether written or oral,
relating to the subject matter hereof, and all such prior agreements and
understandings shall be null and void and without further effect as of the date
hereof.
SECTION 2. EMPLOYMENT TERM. Subject to the provisions of Section 4, the
term of this Agreement shall be for a period commencing on the date hereof and
ending on the earlier of (a) the second anniversary of the date hereof and (b)
termination of the Employee's employment pursuant to this Agreement (the
"Employment Term").
SECTION 3. COMPENSATION.
3.1. Base Salary. The Company agrees to pay, and the Employee agrees to
accept, as base compensation for all services to be rendered by the Employee
hereunder (including any services as an officer, director, employee or member of
any committee of the Company or any of its affiliates), the sum of $210,000 per
year (less appropriate deductions) (the "Base Salary"). The Base Salary shall be
payable in accordance with the ordinary payroll practices of the Company. During
the Employment Term, the Company shall, in good faith,
review the Base Salary in accordance with the Company's customary procedures and
practices regarding the salaries of similarly situated employees and may, if
determined by the Company to be appropriate, increase the Base Salary following
such review (it being understood and agreed by the Employee that the Company
shall not be obligated to increase the Base Salary), and "Base Salary" for all
purposes herein shall be deemed to be a reference to such higher amount.
3.2. Additional Employee Benefits. Initially, the Employee shall receive
such employee benefits that are provided generally to the Company's employees as
of the date of the Purchase Agreement (collectively, the "LogiMetrics
Benefits"). After the date hereof, any of the LogiMetrics Benefits may be
amended, supplemented, terminated or modified from time to time by the Company,
so long as the Company provides the Employee with employee benefits similar to
those provided to other comparably situated Company employees.
3.3. Withholding. All payments due to the Employee hereunder shall be
subject to all applicable taxes required to be withheld by the Company pursuant
to federal, state or local law. The Employee shall be solely responsible for
income and earnings taxes imposed on the Employee by reason of any cash or
non-cash compensation and benefits provided hereunder.
3.4 Option Grants. The Company shall, no later than the date hereof,
grant to the Employee options (the "Employee Options") to purchase 750,000
shares of the Company's common stock, par value $.01 per share (the "Common
Stock") pursuant to Section 4.2 of the Purchase Agreement, including, having an
exercise price of $0.54 per share (it being understood and agreed that such
number of shares of Common Stock and such exercise price are before giving
effect to the Reverse Stock Split (as defined in the Purchase Agreement)). The
Employee shall enter into the non-qualified stock option agreement with the
Company to evidence the grant of the Employee Options in the form attached
hereto as Schedule A.
3.5 Annual Bonus. The Employee shall be entitled to participate in any
cash bonus plan or arrangement in which key employees of the Company are
entitled to participate now or during the Employment Term. Any amount payable to
the Employee pursuant to any such cash bonus plan or arrangement shall be
determined by the Board of Directors of the Company or the Compensation
Committee thereof, in its sole discretion.
3.6 Deferred Payments. Not later than the date hereof, the Company shall
pay to
the Employee the sum of $124,056 in full payment of (a) unpaid salary previously
deferred by the Employee, and (b) certain expense reimbursements previously
deferred by the Employee.
3.7 Term Life Insurance. The Company shall reimburse the Employee up to
$2,000 in any calendar year for premiums paid by the Employee to maintain a term
insurance policy insuring the life of the Employee in the face amount of
$1,000,000.
3.8 Vacation. The Employee shall be entitled to four weeks of vacation
in each calendar year during the Employment Term and shall be entitled to carry
over all, part or none of such vacation in accordance with any vacation policy
maintained by the Company for senior executives.
3.9 Expense Reimbursement. The Company shall pay or reimburse the
Employee for all reasonable travel or other expenses incurred by the Employee in
connection with the performance of his duties and obligations under this
Agreement, subject to the Employee's presentation of appropriate vouchers and/or
receipts in accordance with such procedures as the Company may from time to time
establish for senior officers and to preserve any deductions for Federal income
taxation purposes to which the Company may be entitled.
SECTION 4. TERMINATION.
4.1. Termination Events. The Employee's employment with the Company and
the Employment Term shall terminate upon the earliest occurrence of any of the
following events:
(a) The death or resignation of the Employee.
(b) The termination of the Employee's employment by the Company for
Cause (as defined in Section 4.3(a)).
(c) The termination of the Employee's employment by the Company for
Employee Disability.
(d) The termination of the Employee's employment by the Employee for
Good Reason.
(e) The termination of the Employee's employment other than pursuant
to clauses (a), (b), (c) or (d) above.
4.2. Effect of Termination.
(a) If the Employee's employment with the Company is terminated pursuant
to Section 4.1(a), 4.1(b) or 4.1(c), then the Company shall pay the Employee (or
his estate in the event of his death) any portion of the Base Salary accrued
hereunder on or prior to the date of termination but not paid. The Employee
shall not be entitled to any other payments hereunder.
(b) If the Employee's employment with the Company is terminated pursuant
to Section 4.1(d) or 4.1(e), the Employee shall continue to be paid his Base
Salary in accordance with the Company's usual payroll practices until the later
to occur of (i) the second anniversary of the date hereof and (ii) six months
after the end of the Employment Term (the "Severance Period").
4.3. Definitions.
(a) As used herein, the term "Cause" shall mean: (i) gross neglect of or
willful and continuing refusal by the Employee to substantially perform his
duties hereunder (other than due to death or Disability); (ii) any breach of the
provisions of Section 5 or Section 6 by the Employee; (iii) willfully engaging
in conduct that is demonstrably injurious to the Company or the Company's
subsidiaries or affiliates by the Employee; and/or (iv) conviction of, or plea
of nolo contendere, by Employee to (A) any felony, or (B) a misdemeanor
involving moral turpitude.
Termination of the Employee pursuant to Section 4.1(b) shall be made by
delivery to the Employee of written notice, given at least five days prior to
such termination, from the Board of Directors of the Company (the "Board")
specifying the particulars of the conduct by the Employee set forth in any of
clauses (i) through (iv) above. Termination shall be effected by a majority vote
of the Board at a meeting at which the Employee shall have had the opportunity
(along with counsel) to be heard, unless, within five days after receiving such
notice, the Employee shall have cured Cause to the reasonable satisfaction of
the Board; provided, however, that no cure shall be possible if termination for
Cause is made pursuant to clause (ii) or (iv) above. As long as the Employee is
on the Board, he shall reasonably cooperate to cause a valid Board meeting to
occur.
(b) As used herein, the term "Disability" shall mean the Employee's
absence
from the full-time performance of the Employee's duties pursuant to a reasonable
determination made in accordance with the Company's then existing disability
plan that the Employee is disabled as a result of incapacity due to physical or
mental illness that lasts, or is reasonably expected to last, for at least six
months.
(c) As used herein, the term "Good Reason" means (i) any reduction by
the Company in Employee's Base Salary, (ii) any material adverse change in the
reporting lines described in Section 1.2, (iii) any material diminution or
material adverse change in the Employee's titles, duties or responsibilities,
unless due to a promotion or increased responsibility of the Employee, or (iv)
the relocation of the Company's executive offices more than 50 miles outside
Eatontown, New Jersey or Bohemia, New York without the Employee's prior written
consent.
4.4. Other Consequences of Termination.
(a) In the event of the termination of the Employment Term, for whatever
reason, the Employee agrees to cooperate with the Company and to be reasonably
available to the Company with respect to continuing and/or future matters
arising out of the Employee's employment or any other relationship with the
Company or its affiliates, whether such matters are business-related, legal or
otherwise. The Company agrees to reimburse the Employee for the Employee's
reasonable out-of-pocket expenses incurred in complying with the terms of this
Section 4.4(a) upon delivery by the Employee to the Company of valid receipts
for such expenses.
(b) Subject to the other provisions of this Agreement and the terms of
any benefit plan or arrangement in which the Employee participates, the payments
upon termination pursuant to this Section 4 shall constitute the exclusive
payments due the Employee upon termination under this Agreement. The Employee
shall not be required to mitigate the amount of any payment provided for in this
Agreement by seeking other employment or otherwise.
(c) Upon the termination of the Employment Term for any reason, the
Employee or his estate shall surrender to the Company all correspondence,
letters, files, contracts, mailing lists, customer lists, advertising materials,
ledgers, supplies, equipment, checks, and all other materials and records of any
kind that are the property of the Company or
any of its subsidiaries or affiliates, that may be in the Employee's possession
or under his control, including all copies of any of the foregoing.
(d) The provisions of this Section 4 and of Sections 5 and 6 shall
survive the expiration or earlier termination of the Employment Term and this
Agreement.
SECTION 5. CONFIDENTIALITY; PUBLIC STATEMENTS
5.1. Confidential and Proprietary Information. (a) In addition to the
confidential and proprietary information that the Employee heretofore developed,
conceived, learned or became aware of as an employee, proprietor, owner,
director, officer or stockholder of LogiMetrics (the "Prior Trade Secrets"), the
Company and its affiliates may, pursuant to the Employee's employment hereunder,
provide to him and confide in him additional confidential and proprietary
information (collectively, the "Additional Trade Secrets"), including without
limitation: (i) business methods and systems, techniques and methods of
operation developed by the Company or its affiliates and which the Employee
recognizes to be unique assets of the business of the Company and its
affiliates; (ii) any sales prospects, customer lists, products, research or data
of any kind; (iii) any information relating to strategic plans, sales costs,
profits or the financial condition of the Company, its affiliates or any of
their customers or prospective customers, which is not generally known to the
public; or (iv) computer programs and software, including without limitation
source code, object code and data. All the Prior Trade Secrets and all the
Additional Trade Secrets are herein sometimes referred to collectively as "Trade
Secrets". The Employee shall not, either during or at any time after the
termination of his employment with the Company, directly or indirectly, in any
manner utilize or disclose any Trade Secrets to any individual, firm,
corporation, company, association or other entity without the prior consent of
the Company (unless legally compelled to do so, but subject to the provisions of
Section 5.1(b)). The term "Trade Secrets", however, does not include
information, knowledge or factual data that: (A) becomes part of the public
knowledge or literature other than by reason of any inaction or action of the
Employee; or (B) was disclosed to the Employee without restriction by a third
party having the right to disclose the same. The Employee further covenants and
agrees that he will promptly deliver to the Company all tangible evidence of
Trade Secrets, prior to or at the termination of the Employee's employment.
(b) If the Employee becomes legally compelled (by deposition,
interrogatory,
request for documents, order, subpoena, civil investigative demand or similar
process issued by a court of competent jurisdiction or by a governmental body)
to disclose any Intellectual Property (as defined below) of the Company or any
of its affiliates, then the Employee will give prompt prior written notice of
such requirement to the Company so that the Company or any of its affiliates may
seek a protective order or other appropriate remedy and/or waive compliance with
the terms of this Agreement. If such protective order or other remedy is not
obtained, and irrespective of whether or not compliance with the provisions
hereof is waived, then it is agreed that only that portion of the Intellectual
Property of the Company or any of its affiliates, which the Employee is advised
in writing by the Employee's counsel is legally required to be disclosed, will
be disclosed by the Employee, and reasonable efforts will be made by him to
obtain assurance that confidential treatment will be accorded such portion of
such Intellectual Property.
5.2. Trade Secrets
(a) The Employee agrees that any Trade Secret, invention, improvement,
patent, patent application or writing, and any program, method, process, system
or novel technique (whether or not capable of being trademarked, copyrighted or
patented) (collectively, "Intellectual Property"), conceived, devised,
developed, owned or otherwise obtained by him, whether solely or jointly with
others, either (i) as an employee, proprietor, owner, officer, director or
stockholder of LogiMetrics prior to the date hereof, or (ii) during the
Employment Term relating to the business of the Company or any of its
Subsidiaries, shall in each and every case be and become the property of the
Company. The Employee agrees to give the Company prompt notice of his
conception, invention, authorship, development or acquisition of any
Intellectual Property and, without additional consideration, to execute such
instruments of transfer, assignment, conveyance or confirmation and such other
documents, and to do all appropriate lawful acts, as may be requested by the
Company to transfer, assign, confirm, and perfect in the Company or its
affiliates all legally protectable rights in any Intellectual Property
throughout the world.
(b) The Employee hereby assigns and conveys to and confirms in the
Company the entire right, title and interest in and to the Intellectual
Property, conceived, devised, developed, owned or otherwise obtained by him,
whether solely or jointly with others, as an employee, proprietor, owner,
officer, director or stockholder of LogiMetrics or any of its
subsidiaries (or any predecessor company) prior to the date hereof (the "Prior
Intellectual Property"), or on or after the date hereof and through the end of
the Employment Term relating to the business of the Company or any of its
Subsidiaries (the "Future Intellectual Property") and every priority right that
is or may be predicated upon or arises from any of the Prior Intellectual
Property or any of the Future Intellectual Property.
(c) The Employee, upon the Company's reasonable request and at its
expense, but without additional consideration to the Employee, shall execute
such instruments of transfer, assignment, conveyance or confirmation and such
other documents, and shall do all appropriate lawful acts, as may be requested
by the Company to transfer, assign, confirm and perfect in the Company or its
affiliates all legally protectable rights in any Intellectual Property, whether
Prior Intellectual Property or Future Intellectual Property, throughout the
world.
(d) The Employee represents and warrants that no entity in which the
Employee has an equity interest has any right, title or interest in and to the
Company's Intellectual Property. Without limiting the rights or remedies of the
Company in the event of a breach of the foregoing representation and warranty,
the Employee will cause any such entity in which the Employee has an equity
interest to execute such instruments of transfer, assignment, conveyance or
confirmation and such other documents, and shall do all appropriate lawful acts,
as may be requested by the Company to transfer, assign, confirm and perfect in
the Company or its affiliates all legally protectable rights in any Intellectual
Property, whether Prior Intellectual Property or Future Intellectual Property,
throughout the world.
5.3. Prohibited Public Statements. During the Employment Term, the
Employee shall not make any public statement reflecting adversely on the
Company, its affiliates or their business prospects, except for such statements
which the Employee is required to make by law.
SECTION 6. NON-COMPETE. In further consideration of the Company's
covenants and agreements contained in this Agreement, the Employee agrees to
abide by the terms and conditions contained in this Section 6. The Employee
further acknowledges the sufficiency and receipt of the consideration given in
this Agreement for purposes of enforcing the non-compete provisions contained in
this Section 6.
During the Non-Competition Period (as defined below), Employee will not,
and
will cause his affiliates not to, directly or indirectly, design, manufacture,
market or sell products or provide services which are competitive to those
products manufactured and sold by LogiMetrics during the Employment Term or at
the end of the Employment Term or those services provided by LogiMetrics to its
customers (including improvements or extensions of such products or services)
("Competitive Products and Services").
During the Non-Competition Period, the Employee will not, and will cause
his affiliates not to, directly or indirectly, induce or solicit, or aid or
assist any person or entity to induce or solicit, any employees, salespersons,
agents, consultants, distributors, representatives, advisors, customers or
suppliers of Buyer or the Business to terminate, curtail or otherwise limit
their employment by or business relationship with Buyer or the Business.
As used herein, "Non-Competition Period" shall mean the period beginning
on the date hereof and ending on the 180th day following the last day of the
Employment Term.
The parties hereto agree that the provisions of this Section 6 are
reasonable. If a court determines, however, that any provision of this Section 6
is unreasonable, either in period of time, geographical area or otherwise, then
the parties hereto agree that the provisions of this Section 6 should be
interpreted and enforced to the maximum extent which such court deems
reasonable.
SECTION 7. ENTIRE AGREEMENT. This Agreement constitutes the full and
complete understanding and agreement of the Employee and the Company respecting
the subject matter hereof, and supersedes all prior understandings and
agreements, oral or written, express or implied, respecting the Employee's
employment with the Company.
SECTION 8. HEADINGS. The headings of this Agreement are for convenience
of reference only and are not to be considered in the interpretation of the
terms and conditions of this Agreement.
SECTION 9. NOTICES. Any notice, consent, approval or other communication
required or permitted to be given under this Agreement (each a "Notice") shall
be in writing and shall be given by personal delivery, by nationally recognized
overnight courier or by registered or certified mail, postage prepaid, addressed
as follows:
If to the Company:
LogiMetrics, Inc.
000 Xxxxxxxxxx Xxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Chairman of the Board of Directors
With a copy to:
L-3 Communications Corporation
Xxxxx Microwave East Division
000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: President
If to the Employee, at his personal residence, as reflected in the
personnel records of the Company.
Any party may change the persons and addresses to which notices are to
be sent by giving a Notice of such change to the other party in the manner
provided herein for giving Notices.
A Notice given hereunder shall be deemed given upon actual receipt or
refusal of receipt.
SECTION 10. WAIVER OF BREACH. No waiver by either party of any condition
or of the breach by the other party of any term or covenant contained in this
Agreement, whether by conduct or otherwise, in any one or more instances shall
be deemed or construed as a further or continuing waiver of any such condition
or breach or a waiver of any other condition, or of the breach of any other term
or covenant set forth in this Agreement. Moreover, the failure of either party
to exercise any right hereunder shall not bar the later exercise thereof.
SECTION 11. BINDING; NONALIENATION. This Agreement shall inure to the
benefit of and be binding on (a) the Company and its successors and assigns, and
(b) the Employee. The Employee shall not pledge, hypothecate, anticipate or in
any way create a lien upon any amounts provided under this Agreement. This
Agreement and the benefits payable hereunder shall not be assignable by the
Employee; provided, however, that nothing in this
Section shall preclude the Employee from designating a beneficiary to receive
any benefit payable hereunder upon his death, or the executors, administrators
or other legal representatives of the Employee or his estate from assigning any
rights hereunder to which they become entitled, to the person or persons
entitled thereto under applicable law.
SECTION 12. GOVERNING LAW. This Agreement shall be governed in all
respects, including as to validity, interpretation and effect by the internal
laws of the State of New York without giving effect to the conflict of laws
rules thereof.
SECTION 13. CONTINUATION OF COVENANTS. Those covenants and agreements of
the Employee contained in this Agreement that by the terms thereof are intended
to continue to operate after termination of the Employee's employment, including
without limitation the covenants and agreements in Sections 5 and 6, shall
survive termination of the Employee's employment with the Company.
SECTION 14. INVALIDITY OR UNENFORCEABILITY. If any term or provision of
this Agreement is held to be invalid or unenforceable, for any reason, then such
invalidity or unenforceability shall not affect any other term or provision
hereof and this Agreement shall continue in full force and effect as if such
invalid or unenforceable term or provision (to the extent of the invalidity or
unenforceability) had not been contained herein.
SECTION 15. COUNTERPARTS. This Agreement may be executed (including by
facsimile transmission) with counterpart signature pages or in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
SECTION 16. AMENDMENTS. No provision of this Agreement may be amended,
waived or discharged unless such waiver, amendment or discharge is agreed to in
writing and signed by the parties.
SECTION 17. SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damage would occur if any of the provisions of this Agreement were
not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof in any court of the United States
or any
state having jurisdiction, this being in addition to any other remedy to which
they are entitled at law or in equity.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first written above.
LOGIMETRICS, INC.
By: /s/ Xxxxxxx X. Brand
----------------------------
Name:
Title:
/s/ Xxxxxx X. Xxxxxx
-------------------------------
XXXXXX X. XXXXXX
