Exhibit 10.1
APPLIED INNOVATION INC.
EMPLOYMENT AGREEMENT
This Agreement is made as of this 4th day of October, 2004, by and between
XXXXXX X. XXXXXXX and APPLIED INNOVATION INC., a Delaware corporation with its
principal office at 0000 Xxxxxxxxxx Xxxxx, Xxxxxx, Xxxx 00000, its subsidiaries,
successors and assigns (the "Company").
RECITALS
A. The Company is engaged in the business of developing, manufacturing,
and marketing data communications and data transmission equipment, software, and
services to telephone companies, interexchange telephone carriers, cable
television companies, and electric utilities, for alarm data communications,
network mediation and management, interoperability of networks, and network
switching and routing, and develops and uses valuable technical and nontechnical
trade secrets and other confidential information which it desires to protect.
B. You will be employed as an executive officer of the Company.
C. The Company considers your continued services to be in the best
interest of the Company and desires, through this Agreement, to assure your
continued services on behalf of the Company on an objective and impartial basis
and without distraction or conflict of interest in the event of an attempt to
obtain control of the Company.
D. You are willing to become employed by and to remain in the employ of
the Company on the terms set forth in this agreement.
AGREEMENT
NOW, THEREFORE, the parties agree as follows:
1. CONSIDERATION. As consideration for your entering into this
Agreement and your willingness to remain bound by its terms, the Company shall
employ you and provide you with access to certain Confidential Information as
defined in this Agreement and other valuable consideration as provided for
throughout this Agreement, including in Sections 3 and 4 of this Agreement.
2. EMPLOYMENT.
(a) POSITION. You will be employed as Vice President of Sales,
reporting to the Executive Vice President and Chief Operating Officer of the
Company. You shall perform the duties, undertake the responsibilities and
exercise the authority customarily performed, undertaken and exercised by
persons employed in similar executive capacities.
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(b) RESTRICTED EMPLOYMENT. While employed by the Company, you shall
devote your best efforts to the business of the Company and shall not engage in
any outside employment or consulting work without first securing the approval of
the Company's Board of Directors. Furthermore, so long as you are employed under
this Agreement, you agree to devote your full time and efforts exclusively on
behalf of the Company and to competently, diligently, and effectively discharge
your duties hereunder. You shall not be prohibited from engaging in such
personal, charitable, or other nonemployment activities that do not interfere
with your full time employment hereunder and which do not violate the other
provisions of this Agreement. You further agree to comply fully with all
policies and practices of the Company as are from time to time in effect.
3. COMPENSATION.
(a) Your compensation will be at an annual base rate of $160,000
through December 31, 2004 ("Basic Salary"), payable in accordance with the
normal payroll practices of the Company. Your base salary may be increased from
time to time by action of the Board of Directors of the Company. You will also
be eligible for a cash bonus under a bonus plan which is determined annually by
the Board of Directors of the Company.
(b) You will be entitled to receive stock options to purchase
shares of the common stock of the Company pursuant to the terms of plans adopted
by the Board of Directors of the Company from time to time. If a "Change in
Control," as defined in Section 9(e)(v), shall occur (i) in which the Company
does not survive as a result of such Change in Control or substantially all of
the assets of the Company are sold as a result of such Change in Control, and
(ii) in which the surviving entity does not assume the obligations of your
outstanding stock options upon the Change in Control, then vesting of all
outstanding stock options issued to you prior to the Change in Control will be
accelerated by twenty-four (24) months plus an additional twelve (12) months for
each full year you have been employed by the Company and such options will be
exercisable (to the extent then vested) for a period of thirty (30) days from
the date of the Change in Control.
(c) Subject to applicable Company policies, you will be reimbursed
for necessary and reasonable business expenses incurred in connection with the
performance of your duties hereunder or for promoting, pursuing or otherwise
furthering the business or interests of the Company.
4. FRINGE BENEFITS. You will be entitled to receive employee benefits
and participate in any employee benefit plans, in accordance with their terms as
from time to time amended, that the Company maintains during your employment and
which are made generally available to all other management employees in like
positions. This includes a 401(k) and profit sharing plan. It is agreed that the
Company will pay any necessary COBRA payments on your behalf due to any break in
medical coverage for any reason, including pre-existing conditions.
5. RESERVED.
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6. CONFIDENTIAL INFORMATION.
(a) As used throughout this Agreement, the term "Confidential
Information" means any information you acquire during employment by the Company
(including information you conceive, discover or develop) which is not readily
available to the general public and which relates to the business, including
research and development projects, of the Company, its subsidiaries or its
affiliated companies.
(b) Confidential Information includes, without limitation,
information of a technical nature (such as trade secrets, inventions,
discoveries, product requirements, designs, software codes and manufacturing
methods), matters of a business nature (such as customer lists, the identities
of customer contacts, information about customer requirements and preferences,
the terms of the Company's contracts with its customers and suppliers, and the
Company's costs and prices), personnel information (such as the identities,
duties, customer contacts, and skills of the Company's employees) and other
financial information relating to the Company and its customers (including
credit terms, methods of conducting business, computer systems, computer
software, personnel data, and strategic marketing, sales or other business
plans). Confidential Information may or may not be patentable.
(c) Confidential Information does not include information which
you learned prior to employment with the Company from sources other than the
Company, information you develop after employment from sources other than the
Company's Confidential Information or information which is readily available to
persons with equivalent skills, training and experience in the same fields or
fields of endeavor as you. You must presume that all information that is
disclosed or made accessible to you during employment by the Company is
Confidential Information if you have a reasonable basis to believe the
information is Confidential Information or if you have notice that the Company
treats the information as Confidential Information.
(d) Except in conducting the Company's business, you shall not at
any time, either during or following your employment with the Company, make use
of, or disclose to any other person or entity, any Confidential Information
unless (i) the specific information becomes public from a source other than you
or another person or entity that owes a duty of confidentiality to the Company
and (ii) twelve months have passed since the specific information became public.
However, you may discuss Confidential Information with employees of the Company
when necessary to perform your duties to the Company. Notwithstanding the
foregoing, if you are ordered by a court of competent jurisdiction to disclose
Confidential Information, you will officially advise the Court that you are
under a duty of confidentiality to the Company hereunder, take reasonable steps
to delay disclosure until the Company may be heard by the Court, give the
Company prompt notice of such Court order, and if ordered to disclose such
Confidential Information you shall seek to do so under seal or in camera or in
such other manner as reasonably designed to restrict the public disclosure and
maintain the maximum confidentiality of such Confidential Information.
(e) Upon Employment Separation, you shall deliver to the Company
all originals, copies, notes, documents, computer data bases, disks, and CDs, or
records of any kind that reflect or relate to any Confidential Information. As
used herein, the term "notes" means written or printed words, symbols, pictures,
numbers or formulae. As used throughout this
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Agreement, the term "Employment Separation" means the separation from and/or
termination of your employment with the Company, regardless of the time, manner
or cause of such separation or termination.
7. INVENTIONS.
(a) As used throughout this Agreement, the term "Inventions" means
any inventions, improvements, designs, plans, discoveries or innovations of a
technical or business nature, whether patentable or not, relating in any way to
the Company's business or contemplated business if the Invention is conceived or
reduced to practice by you during your employment by the Company. Inventions
includes all data, records, physical embodiments and intellectual property
pertaining thereto. Inventions reduced to practice within one year following
Employment Separation shall be presumed to have been conceived during
employment.
(b) Inventions are the Company's exclusive property and shall be
promptly disclosed and assigned to the Company without additional compensation
of any kind. If requested by the Company, you, your heirs, your executors, your
administrators or legal representative will provide any information, documents,
testimony or other assistance needed for the Company to acquire, maintain,
perfect or exercise any form of legal protection that the Company desires in
connection with an Invention.
(c) Upon Employment Separation, you shall deliver to the Company
all copies of and all notes with respect to all documents or records of any kind
that relate to any Inventions.
8. NONCOMPETITION AND NONSOLICITATION.
(a) By entering into this Agreement, you acknowledge that the
Confidential Information has been and will be developed and acquired by the
Company by means of substantial expense and effort, that the Confidential
Information is a valuable asset of the Company's business, that the disclosure
of the Confidential Information to any of the Company's competitors would cause
substantial and irreparable injury to the Company's business, and that any
customers of the Company developed by you or others during your employment are
developed on behalf of the Company. You further acknowledge that you have been
provided with access to Confidential Information, including Confidential
Information concerning the Company's major customers, and its technical,
marketing and business plans, disclosure or misuse of which would irreparably
injure the Company.
(b) In exchange for the consideration specified in Section 1 of
this Agreement -- the adequacy of which you expressly acknowledge -- you agree
that during your employment by the Company and for a period of twelve (12)
months following Employment Separation, you shall not, directly or indirectly,
as an owner, shareholder, officer, employee, manager, consultant, independent
contractor, or otherwise:
(i) Attempt to recruit or hire, interfere with or harm, or
attempt to interfere with or harm, the relationship of the Company, its
subsidiaries or affiliates, with any person who is an employee, customer
or supplier of the Company, it subsidiaries or affiliates;
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(ii) Contact any employee of the Company for the purpose of
discussing or suggesting that such employee resign from employment with
the Company for the purpose of becoming employed elsewhere or provide
information about individual employees of the Company or personnel
policies or procedures of the Company to any person or entity, including
any individual, agency or company engaged in the business of recruiting
employees, executives or officers; or
(iii) Own, manage, operate, join, control, be employed by,
consult with or participate in the ownership, management, operation or
control of, or be connected with (as a stockholder, partner, or
otherwise), any business, individual, partner, firm, corporation, or other
entity that competes or plans to compete, directly or indirectly, with the
Company, its products, or any division, subsidiary or affiliate of the
Company; provided, however, that your "beneficial ownership," either
individually or as a member of a "group" as such terms are used in Rule
13d of the General Rules and Regulations under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), of not more than two percent
(2%) of the voting stock of any publicly held corporation, shall not be a
violation of this Agreement.
9. TERMINATION OF EMPLOYMENT.
(a) Termination Upon Death or Disability. Your employment will
terminate automatically upon your death. The Company will be entitled to
terminate your employment because of your disability upon 30 days written
notice. "Disability" will mean "total disability" as defined in the Company's
long term disability plan or any successor thereto. In the event of a
termination under this Section 9(a), the Company will pay you only the earned
but unpaid portion of your Basic Salary through the termination date.
(b) Termination by Company for Cause. An Employment Separation for
Cause will occur upon a determination by the Company that "Cause" exists for
your termination and the Company serves you written notice of such termination.
As used in this Agreement, the term "Cause" shall refer only to any one or more
of the following grounds:
(i) Commission of an act of dishonesty involving the
Company, its business or property, including, but not limited to,
misappropriation of funds or any property of the Company;
(ii) Engagement in activities or conduct clearly injurious to
the best interests or reputation of the Company;
(iii) Willful and continued failure substantially to perform
your duties under this Agreement (other than as a result of physical or
mental illness or injury), after the Board of Directors of the Company
delivers to you a written demand for substantial performance that
specifically identifies the manner in which the Board believes that you
have not substantially performed your duties;
(iv) Illegal conduct or gross misconduct that is willful and
results in material and demonstrable damage to the business or reputation
of the Company;
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(v) The clear violation of any of the material terms and
conditions of this Agreement or any other written agreement or agreements
you may from time to time have with the Company;
(vi) The clear violation of the Company's code of business
conduct or the clear violation of any other rules of behavior as may be
provided in any employee handbook which would be grounds for dismissal of
any employee of the Company; or
(vii) Commission of a crime which is a felony, a misdemeanor
involving an act of moral turpitude, or a misdemeanor committed in
connection with your employment by the Company which causes the Company a
substantial detriment.
No act or failure to act shall be considered "willful" unless it is
done, or omitted to be done, by you in bad faith or without reasonable belief
that your action or omission was in the best interests of the Company. Any act
or failure to act that is based upon authority given pursuant to a resolution
duly adopted by the Board of Directors, or the advice of counsel for the
Company, shall be conclusively presumed to be done, or omitted to be done, by
you in good faith and in the best interests of the Company.
In the event of a termination under this Section 9(b), the Company
will pay you only the earned but unpaid portion of your Basic Salary through the
termination date.
Following a termination for Cause by the Company, if you desire to
contest such determination, your sole remedy will be to submit the Company's
determination of Cause to arbitration in Columbus, Ohio before a single
arbitrator under the commercial arbitration rules of the American Arbitration
Association. If the arbitrator determines that the termination was other than
for Cause, the Company's sole liability to you will be the amount that would be
payable to you under Section 9(d) of this Agreement for a termination of your
employment by the Company without Cause. Each party will bear his or its own
expenses of the arbitration.
(c) Termination by You. In the event of an Employment Separation
as a result of a termination by you for any reason, you must provide the Company
with at least 14 days advance written notice ("Notice of Termination") and
continue working for the Company during the 14-day notice period, but only if
the Company so desires to continue your employment and to compensate you during
such period.
In the event of such termination under this Section, the Company
will pay you the earned but unpaid portion of your Basic Salary through the
termination date.
(d) Termination by Company Without Cause. In the event of an
Employment Separation as a result of termination by the Company without Cause,
the Company will pay you the earned but unpaid portion of your Basic Salary
through the termination date and will continue to pay you your Basic Salary for
an additional six (6) months (the "Severance Period"); provided, however, any
such payments will immediately end if (i) you are in violation of any of your
obligations under this Agreement, including Sections 6, 7 and/or 8; or (ii) the
Company, after your
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termination, learns of any facts about your job performance or conduct that
would have given the Company Cause, as defined in Section 9(b), to terminate
your employment.
(e) Termination Following Change of Control. If a "Change in
Control", as defined in Section 9(e)(v), shall have occurred and within 13
months following such Change in Control the Company terminates your employment
other than for Cause, as defined in Section 9(b), or you terminate your
employment for Good Reason, as that term is defined in Section 9(e)(vii), then
you shall be entitled to the benefits described below:
(i) You shall be entitled to the unpaid portion of your Basic
Salary plus credit for any vacation accrued but not taken and the
amount of any earned but unpaid portion of any bonus, incentive
compensation, or any other Fringe Benefit to which you are entitled
under this Agreement through the date of the termination as a result
of a Change in Control (the "Unpaid Earned Compensation"), plus 1.0
times your "Current Annual Compensation" as defined in this Section
9(e)(i) (the "Salary Termination Benefit"). "Current Annual
Compensation" shall mean the total of your Basic Salary in effect at
the Termination Date, plus the average annual performance bonus
actually received by you over the last three years fiscal years (or
if you have been employed for a shorter period of time over such
period during which you performed services for the Company), and
shall not include the value of any stock options granted or
exercised, restricted stock awards granted or vested, contributions
to 401(k) or other qualified plans, medical, dental, or other
insurance benefits, or other fringe benefits.
(ii) Vesting of all outstanding stock options and restricted
stock awards issued to you will be accelerated by twenty-four (24)
months plus an additional twelve (12) months for each full year you
have been employed by the Company, and thereafter shall be
exercisable in accordance with such governing stock option or
restricted stock agreements and plans.
(iii) The Company shall maintain for your benefit (or at your
election make COBRA payments for your benefit), until the earlier of
(A) 12 months after termination of employment following a Change in
Control, or (B) your commencement of full-time employment with a new
employer, all life insurance, medical, health and accident, and
disability plans or programs, such plans or programs to be
maintained at the then current standards of the Company, in which
you shall have been entitled to participate prior to termination of
employment following a Change in Control, provided your continued
participation is permitted under the general terms of such plans and
programs after the Change in Control ("Fringe Termination Benefit");
(collectively the Salary Termination Benefit and the Fringe
Termination Benefit are referred to as the "Termination Benefits").
(iv) The Unpaid Earned Compensation shall be paid to you
within 15 days after termination of employment, one-half of the
Termination Benefits shall be payable to you as severance pay in a
lump sum payment within 30 days after termination of employment, and
one-half of the Termination Benefits shall be payable to you as
severance pay in 12 monthly payments commencing 30 days after
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termination of employment; provided, however, the Company may
immediately discontinue the payment of the Termination Benefits if
(i) you are in violation of any of your obligations under this
Agreement, including in Sections 6, 7 and/or 8; and/or (ii) the
Company, after your termination, learns of any facts about your job
performance or conduct that would have given the Company Cause as
defined in Section 9(b) to terminate your employment. You shall have
no duty to mitigate your damages by seeking other employment, and
the Company shall not be entitled to set off against amounts payable
hereunder any compensation which you may receive from future
employment.
(v) A "Change in Control" shall be deemed to have occurred if
and when, after the date hereof, (i) any "person" (as that term is
used in Section 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act") on the date hereof), including
any "group" as such term is used in Section 13(d)(3) of the Exchange
Act on the date hereof, shall acquire (or disclose the previous
acquisition of) beneficial ownership (as that term is defined in
Section 13(d) of the Exchange Act and the rules thereunder on the
date hereof) of shares of the outstanding stock of any class or
classes of the Company which results in such person or group
possessing more than 50% of the total voting power of the Company's
outstanding voting securities ordinarily having the right to vote
for the election of directors of the Company; or (ii) as the result
of, or in connection with, any tender or exchange offer, merger or
other business combination, or contested election, or any
combination of the foregoing transactions (a "Transaction"), the
owners of the voting shares of the Company outstanding immediately
prior to such Transaction own less than a majority of the voting
shares of the Company after the Transaction; or (iii) during any
period of two consecutive years during the term of this Agreement,
individuals who at the beginning of such period constitute the Board
of Directors of the Company (or who take office following the
approval of a majority of the directors then in office who were
directors at the beginning of the period) cease for any reason to
constitute at least one-half thereof, unless the election of each
director who was not a director at the beginning of such period has
been approved in advance by directors of the Company representing at
least one-half of the directors then in office who were directors at
the beginning of the period; or (iv) the sale, exchange, transfer,
or other disposition of all or substantially all of the assets of
the Company (a "Sale Transaction") shall have occurred.
(vi) If any portion of the payments and benefits provided
under this Agreement to you, alone or with other payments and
benefits, would constitute "parachute payments" within the meaning
of Section 280G(b)(2) of the Internal Revenue Code of 1986, as
amended (the "Code"), and shall be determined by the Company's
independent compensation specialist to be nondeductible to the
Company, then the aggregate present value of all of the amounts
payable to you under Section 9(e) hereof shall be reduced to the
maximum amount which would cause all of the payments under Section
9(e) to be deductible and in such event you shall have the option,
but not the obligation, to designate or select those kinds of
payments which shall be reduced and the order of such reductions,
but your failure to make such selections within a period of 30 days
following notice of the
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determination that a reduction is necessary will result in a
reduction of all such payments, pro rata. If you disagree with the
determination of the reduced amount by the Company's independent
compensation specialist, you may contest that determination by
giving notice of such contest within 30 days of learning of the
determination and may use an independent compensation specialist of
your choice in connection with such contest. The Company shall pay
all of your costs in connection with such contest if the ultimate
determination by the two independent compensation specialists in
consultation with each other, or by a third independent compensation
specialist, jointly chosen by the two first-named independent
compensation specialists in the event the first two cannot agree,
represents a lesser reduction in the amounts payable under Section
9(e) hereof than the Company's independent compensation specialist
established in the first instance. Otherwise, you shall pay your own
and any additional costs incurred by the Company in contesting such
determination. If there is a final determination by the Internal
Revenue Service or a court of competent jurisdiction that the
Company overpaid amounts under Section 280G of the Code, the amount
of the overpayment shall be treated as a loan to you and shall be
repaid immediately, together with interest on such amount at the
prime rate of interest at Huntington National Bank, Columbus, Ohio,
or any successor thereto, in effect from time to time. If the
Internal Revenue Service or a court of competent jurisdiction
finally determines, or if the Code or regulations thereunder shall
change such that the Company underpaid you under Section 280G of the
Code, the Company shall pay the difference to you with interest as
specified above.
(vii) As used in this Agreement, the term "Good Reason" means,
without your written consent:
(A) a material change in your status, position or
responsibilities which, in your reasonable judgment, does not
represent a promotion from your existing status, position or
responsibilities as in effect immediately prior to the Change
in Control; the assignment of any duties or responsibilities
or the removal or termination of duties or responsibilities
(except in connection with the termination of employment for
total and permanent disability, death, or Cause, or by you
other than for Good Reason), which, in your reasonable
judgment, are materially inconsistent with such status,
position or responsibilities;
(B) a reduction by the Company in your Basic Salary as
in effect on the date hereof or as the same may be increased
from time to time during the term of this Agreement or the
Company's failure to increase (within twelve months of your
last increase in Basic Salary) your Basic Salary after a
Change in Control in an amount which at least equals, on a
percentage basis, the average percentage increase in Basic
Salary for all executive and senior officers of the Company,
in like positions, which were effected in the preceding twelve
months;
(C) the relocation of the Company's principal executive
offices to a location outside the Columbus metropolitan area
or the relocation of you by
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the Company to any place other than the location at which you
performed duties prior to a Change in Control, except for
required travel on the Company's business to an extent
consistent with business travel obligations at the time of a
Change in Control;
(D) the failure of the Company to continue in effect, or
continue or materially reduce your participation in, any
incentive, bonus or other compensation plan in which you
participate, including but not limited to the Company's stock
option plans, unless an equitable arrangement (embodied in an
ongoing substitute or alternative plan), has been made or
offered with respect to such plan in connection with the
Change in Control;
(E) the failure by the Company to continue to provide
you with benefits substantially similar to those enjoyed or to
which you are entitled under any of the Company's pension,
profit sharing, life insurance, medical, dental, health and
accident, or disability plans at the time of a Change in
Control, the taking of any action by the Company which would
directly or indirectly materially reduce any of such benefits
or deprive you of any material fringe benefit enjoyed or to
which you are entitled at the time of the Change in Control,
or the failure by the Company to provide the number of paid
vacation and sick leave days to which you are entitled on the
basis of years of service with the Company in accordance with
the Company's normal vacation policy in effect on the date
hereof;
(F) the failure of the Company to obtain a satisfactory
agreement from any successor or assign of the Company to
assume and agree to perform this Agreement;
(G) any request by the Company that you participate in
an unlawful act or take any action constituting a breach of
your professional standard of conduct; or
(H) any breach of this Agreement on the part of the
Company.
Notwithstanding anything in this Section to the contrary, your
right to terminate your employment pursuant to this Section
shall not be affected by incapacity due to physical or mental
illness.
(viii) Upon any termination or expiration of this Agreement or
any cessation of your employment hereunder, the Company shall have
no further obligations under this Agreement and no further payments
shall be payable by the Company to you, except as provided in
Section 9 above and except as required under any benefit plans or
arrangements maintained by the Company and applicable to you at the
time of such termination, expiration or cessation of your
employment.
(ix) Enforcement of Agreement. The Company is aware that upon
the occurrence of a Change in Control, the Board of Directors or a
shareholder of the
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Company may then cause or attempt to cause the Company to refuse to
comply with its obligations under this Agreement, or may cause or
attempt to cause the Company to institute, or may institute
litigation seeking to have this Agreement declared unenforceable, or
may take or attempt to take other action to deny you the benefits
intended under this Agreement. In these circumstances, the purpose
of this Agreement could be frustrated. Accordingly, if following a
Change in Control it should appear to you that the Company has
failed to comply with any of its obligations under Section 9 of this
Agreement or in the event that the Company or any other person takes
any action to declare Section 9 of this Agreement void or
enforceable, or institutes any litigation or other legal action
designed to deny, diminish or to recover from you the benefits
entitled to be provided to you under Section 9, and that you have
complied with all your obligations under this Agreement, the Company
authorizes you to retain counsel of your choice, at the expense of
the Company as provided in this Section 9(e)(ix), to represent you
in connection with the initiation or defense of any pre-suit
settlement negotiations, litigation or other legal action, whether
such action is by or against the Company or any Director, officer,
shareholder, or other person affiliated with the Company, in any
jurisdiction. Notwithstanding any existing or prior attorney-client
relationship between the Company and such counsel, the Company
consents to you entering into an attorney-client relationship with
such counsel, and in that connection the Company and you agree that
a confidential relationship shall exist between you and such
counsel, except with respect to any fee and expense invoices
generated by such counsel. The reasonable fees and expenses of
counsel selected by you as hereinabove provided shall be paid or
reimbursed to you by the Company on a regular, periodic basis upon
presentation by you of a statement or statements prepared by such
counsel in accordance with its customary practices, up to a maximum
aggregate amount of $50,000. Any legal expenses incurred by the
Company by reason of any dispute between the parties as to
enforceability of Section 9 or the terms contained in Section 9(f),
notwithstanding the outcome of any such dispute, shall be the sole
responsibility of the Company, and the Company shall not take any
action to seek reimbursement from you for such expenses.
(f) The noncompetition periods described in Section 8 of this
Agreement shall be suspended while you engage in any activities in breach of
this Agreement. In the event that a court grants injunctive relief to the
Company for your failure to comply with Section 8, the noncompetition period
shall begin again on the date such injunctive relief is granted.
(g) Nothing contained in this Section 9 shall be construed as
limiting your obligations under Sections 6, 7, or 8 of this Agreement concerning
Confidential Information, Inventions, or Noncompetition and Nonsolicitation.
10. REMEDIES; VENUE; PROCESS.
(a) You hereby acknowledge and agree that the Confidential
Information disclosed to you prior to and during the term of this Agreement is
of a special, unique and extraordinary character, and that any breach of this
Agreement will cause the Company irreparable injury and damage, and consequently
the Company shall be entitled, in addition to all other legal and equitable
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remedies available to it, to injunctive and any other equitable relief to
prevent or cease a breach of Sections 6, 7, or 8 of this Agreement without
further proof of harm and entitlement; that the terms of this Agreement, if
enforced by the Company, will not unduly impair your ability to earn a living or
pursue your vocation; and further, that the Company may cease paying any
compensation and benefits under Section 9 if you fail to comply with this
Agreement, without restricting the Company from other legal and equitable
remedies. The parties agree that the prevailing party in litigation concerning a
breach of this Agreement shall be entitled to all costs and expenses (including
reasonable legal fees and expenses) which it incurs in successfully enforcing
this Agreement and in prosecuting or defending any litigation (including
appellate proceedings) concerning a breach of this Agreement.
(b) Except for actions brought under Section 9(b) of this
Agreement, the parties agree that jurisdiction and venue in any action brought
pursuant to this Agreement to enforce its terms or otherwise with respect to the
relationships between the parties shall properly lie in either the United States
District Court for the Southern District of Ohio, Eastern Division, Columbus,
Ohio, or the Court of Common Pleas of Franklin County, Ohio. Such jurisdiction
and venue is exclusive, except that the Company may bring suit in any
jurisdiction and venue where jurisdiction and venue would otherwise be proper if
you may have breached Sections 6, 7, or 8 of this Agreement. The parties further
agree that the mailing by certified or registered mail, return receipt
requested, of any process required by any such court shall constitute valid and
lawful service of process against them, without the necessity for service by any
other means provided by statute or rule of court.
11. EXIT INTERVIEW. Prior to Employment Separation, you shall attend an
exit interview if desired by the Company and shall, in any event, inform the
Company at the earliest possible time of the identity of your future employer
and of the nature of your future employment.
12. NO WAIVER. Any failure by the Company to enforce any provision of
this Agreement shall not in any way affect the Company's right to enforce such
provision or any other provision at a later time.
13. SAVING. If any provision of this Agreement is later found to be
completely or partially unenforceable, the remaining part of that provision of
any other provision of this Agreement shall still be valid and shall not in any
way be affected by the finding. Moreover, if any provision is for any reason
held to be unreasonably broad as to time, duration, geographical scope, activity
or subject, such provision shall be interpreted and enforced by limiting and
reducing it to preserve enforceability to the maximum extent permitted by law.
14. NO LIMITATION. You acknowledge that your employment by the Company
may be terminated at any time by the Company or by you with or without cause in
accordance with the terms of this Agreement. This Agreement is in addition to
and not in place of other obligations of trust, confidence and ethical duty
imposed on you by law.
15. GOVERNING LAW. This Agreement shall be interpreted and enforced in
accordance with the laws of the State of Ohio without reference to its choice of
law rules.
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16. FINAL AGREEMENT. This Agreement replaces any existing agreement
between you and the Company relating to the same subject matter and may be
modified only by an agreement in writing signed by both you and a duly
authorized representative of the Company.
17. FURTHER ACKNOWLEDGMENTS. YOU ACKNOWLEDGE THAT YOU HAVE RECEIVED A
COPY OF THIS AGREEMENT, THAT YOU HAVE READ AND UNDERSTOOD THIS AGREEMENT, THAT
YOU UNDERSTAND THIS AGREEMENT AFFECTS YOUR RIGHTS, AND THAT YOU HAVE ENTERED
INTO THIS AGREEMENT VOLUNTARILY.
APPLIED INNOVATION INC.
By: /s/ Xxxxxx X. Xxxxxxxxx, Xx.
-----------------------------------------------
Xxxxxx X. Xxxxxxxxx, Xx.
Chairman, President and Chief Executive Officer
EXECUTIVE:
/s/ Xxxxxx X. Xxxxxxx
-----------------------------------------------
Xxxxxx X. Xxxxxxx
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