Exhibit 10.8
EMPLOYMENT AND NON-COMPETE AGREEMENT
This Employment and Non-Compete Agreement ("Employment Agreement") is made this
5th day of November, 1998 by and between Applied Cellular Technology, Inc a
Missouri corporation, with its principal office located at 000 Xxxxx Xxxx Xxx
Xxxxx 000, Xxxx Xxxxx, Xxxxxxx (the "Employer") and Xxxxxx Xxxxxxx (the
"Employee").
WHEREAS, Employer is in the business of the building and selling of
communication systems; and
WHEREAS, Employer desires to retain the services of the Employee; and
WHEREAS, Employee is willing to be employed by the Employer.
WHEREAS, the parties wish to replace and supercede the current Employment
Agreement by and between the Employee and Alacrity Systems Incorporated.
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the
parties agree as follows:
1. Capacity. Employee shall serve the Employer as its Vice President of
Strategic Relations.
2. Best Efforts of Employee. During his employment hereunder, the Employee
shall, subject to the direction and supervision of the President and Board of
Directors, devote his full business time, best efforts, business judgment, skill
and knowledge to the advancement of the Employer's interests and to the
discharge of his duties and responsibilities hereunder. Such duties shall be
provided at Downingtown, Pennsylvania and other such places as the needs,
business or opportunities of the Employer may require from time to time. He
shall not engage in any other business activity, except as may be approved by
the Board of Directors; provided, however, that nothing herein shall be
construed as preventing the Employee from:
a. investing his assets in a manner which shall not require any material
services on his part in the operations or affairs of the companies or other
entities in which such investments are made;
b. serving on the Board of Directors of any company, provided he receives
the approval in writing from the Chief Executive Officer and Board of Directors,
and further provided that he shall not be required to render any material
services with respect to the operations or affairs of any such company; or
c. engaging in religious, charitable or other community or non-profit
activities which does not impair his ability to fulfill his duties and
responsibilities under this Employment Agreement.
EMPLOYMENT AND NON-COMPETE AGREEMENT
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3. Compensation of Employee. As compensation for the services provided by
Employee under this Paragraph, Employer will pay Employee an annual salary of
one hundred twenty thousand dollars ($120,000.00) in accordance with the
Employer's usual payroll procedures. Separate incentive and stock option plans
will be developed by the Employer, together with key management, and that these
plans will reflect company goals and performance objectives.
The Employee shall also be entitled to participate in any and all employee
benefit plans, medical insurance plans, life insurance plans, disability income
plans and other benefit plans, from time to time, in effect for executives of
the Employer. Such participation shall be subject to the terms of the applicable
plan documents, generally applicable Company policies and the discretion of the
Board of Directors or any administrative or other committee provided for in, or
contemplated by, such plan. In addition, the Employee shall be entitled to
receive benefits which are the same or substantially similar to those which are
currently being provided to the other Executives by the Employer.
In addition to the above compensation, Employee shall be eligible to
receive a bonus in the amount of thirty thousand dollars ($30,000.00) based upon
the achievement of those revenue objectives and parameters assigned by the
President in each year of this Employment Agreement. Such bonus, if any, shall
be payable within a reasonable period of time after the completion of the audit
for the calendar year.
4. Termination of Employment. Upon termination of this Employment Agreement,
any and all payments and/or obligations under Section 3, and as accrued under
Section 7, of this Employment Agreement shall cease; provided, however, that the
Employee shall be entitled to payments for periods or partial periods that
occurred prior to the date of termination and for which the Employee has not yet
been paid.
5. Reimbursement for Expenses. In accordance with the Employer's policy, the
Employee will be reimbursed for all "out-of-pocket" and other direct business
expenses (exclusive of daily commuting costs to principal place of business),
upon presentation of appropriate receipts and documentation.
6. Confidentiality. Employee recognizes that the Employer has and will have
inventions, business affairs, products, future plans, trade secrets, customer
lists and other vital information (collectively "Confidential Information")
which are valuable, special and unique assets of the Employer. The Employee
agrees that he will not at any time or in any manner, either directly or
indirectly, divulge, disclose or communicate in any manner any Confidential
Information to any third party without the prior written consent of the
Employer. The Employee will protect the Confidential Information and treat it as
strictly confidential.
In the event of a breach, or threatened breach, by Employee of his
obligations under this Paragraph, the Employee hereby acknowledges and
EMPLOYMENT AND NON-COMPETE AGREEMENT
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stipulates that the Employer shall not have an adequate remedy at law, shall
suffer irreparable harm and, therefore, it is mutually agreed and stipulated by
the parties hereto that, in addition to any other remedies at law or in equity
which Employer may have, the Employer shall be entitled to obtain in a court of
law and/or equity (i) a temporary and/or permanent injunction from disclosing in
whole or in part such Confidential Information or (ii) from providing any
services to any party to whom such Confidential Information has been disclosed,
or may be disclosed. Employer shall not be prohibited by this Paragraph from
pursuing other remedies, including a claim for losses and damages.
7. Vacation. The Employee shall continue to be entitled to two (2) weeks of paid
vacation. Such vacation shall be taken at a time mutually convenient to Employer
and Employee. Unused vacation may be carried over into the next calendar year
only.
8. Sick Days/Personal Business. The Employee shall be entitled to ten (10) paid
sick or personal days off due to illness or personal business each year of
employment beginning on the first day of the Employee's employment.
9. Holidays. The Employee shall be entitled to the standard company holidays.
10. Term. This Employment Agreement shall have an initial term of three (3)
years, beginning at the commencement date so indicated at the end of this
Employment Agreement.
11. Termination. Notwithstanding the provisions of Paragraph 10, the Employee's
employment hereunder shall terminate under the following circumstances:
a. Death or Permanent Disability. In the event of the Employee's death
during the Employee's employment hereunder, the Employee's employment shall
terminate on the date of his death or Permanent Disability (as defined below).
Permanent Disability. For the purposes of this Employment Agreement, the
term "permanent disability" shall mean the Employee's inability to perform the
essential functions of his duties as prescribed in this Employment Agreement,
which, following a written request by either the Employer or the Employee, shall
be determined by agreement between the parties and, if they cannot agree, by a
panel of three (3) physicians, one of whom will be selected by the Employer, one
by the Employee and the third by the first two so selected. Said panel shall
also fix the date of the occurrence of the permanent disability. Said panel's
determination shall be conclusive. Notwithstanding anything to the contrary set
forth herein, the Employee shall be presumed to be permanently disabled as of
the date he is receiving payments for permanent disability under any disability
insurance policies or under the Social Security Act.
b. Temporary Disability. If, due to physical or mental illness, disability
or injury, the Employee shall be disabled so as to be unable to perform
substantially all of his essential duties and responsibilities hereunder, the
Board of Directors may designate another person to act in his place during the
EMPLOYMENT AND NON-COMPETE AGREEMENT
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period of such disability. Notwithstanding any such designation, the Employee
shall continue to receive his full salary and benefits under Paragraph 3 of this
Agreement until he becomes eligible for disability income under the Employer
disability income plan. In the absence of a disability income plan at the time
of such disability, the Employer shall pay the Employee benefits equal to those
the Employee would have received if the Employer's current disability income
plan were in effect at such time; provided however, that the Employer's
obligations hereunder shall cease twelve (12) months from the onset of such
disability.
c. Termination by the Employer for Cause. The Employee's employment
hereunder may be terminated for cause, without further liability on the part of
the Employer, by a majority vote of all of the members of the Board of
Directors. Termination for cause shall be defined as:
(i) Deliberate dishonesty of the Employee with respect to the Employer.
(ii) Conviction of the Employee of a crime involving moral turpitude.
(iii) Gross and willful failure to perform a substantial portion of his
duties and responsibilities hereunder.
(iv) Employee's abandonment of his duties hereunder for a period of more
than thirty (30) days. Abandonment by the Employee of duties hereunder shall be
deemed to have occurred if: the Employee ceases to function and perform duties
hereunder, leaves the geographic area in which the Employer engages in its
business, or conducts himself with intentional disregard of the Employer's
interests and its business.
(v) Any other willful act that has or will have a similar negative
impact on the financial success of the Employer.
d. After the first anniversary date, Employee may, upon thirty (30) days
written notice, terminate this Employment Agreement. Notwithstanding such
termination, the provisions of paragraph 13 shall remain in effect for an
additional one (1) year beyond the date of resignation.
e. Termination Without Good Cause. In the event that Employee terminates
this Employment Agreement with good cause or Employer terminates the Employment
Agreement without good cause; Employee shall continue to receive payments and
benefits, including vesting of options issued by ACT, for the remaining Term of
the Employment Agreement.
12. Resignation as Officer. In the event that the Employee's employment with the
Employer is terminated for any reason whatsoever, the Employee agrees to
immediately resign as an Officer of the Employer.
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13. Non-Competition. The Employee acknowledges that he has gained, and will gain
extensive and valuable experience and knowledge in the business conducted by
Employer and has had, and will have, extensive contacts with customers of
Employer. Accordingly, the Employee covenants and agrees with Employer that he
shall not compete directly or indirectly with Employer, either during the term
of his employment or during the one (1) year period immediately thereafter and
shall not, during such period, make public statements in derogation of Employer.
For the purposes of this Section 13, the term "Employer" shall be deemed to
include subsidiaries, parents and affiliates of Employer. Competing directly or
indirectly with Employer shall mean engaging or having a material interest,
directly or indirectly, as owner, employee, officer, director, partner,
venturer, stockholder, capital investor, consultant, agent, principal, advisor
or otherwise, either alone or in association with others, in the operation of
any entity engaged in the business of software design and development for office
devices that have telephony, faxing, copying, printing and scanning capabilities
combined in one multifunction product. Competing directly or indirectly with
Employer, as used in this Employment Agreement, shall be deemed not to include
an ownership interest as an inactive investor, which, for purposes of this
Employment Agreement, shall mean the beneficial ownership of less than one
percent (1%) of the outstanding shares of any series or class of securities of
any competitor of Employer, which shares are publicly traded in the securities
markets.
In the event that one or more of the provisions contained herein shall, for
any reason, be held too excessively broad as to duration, geographical scope
activity or such provision shall be construed as limiting and reducing its as
determined by a court of competent jurisdiction and shall be enforceable to the
extent compatible with applicable law.
14. Restriction on Authority of Employee. Notwithstanding anything set forth in
this Employment Agreement to the contrary, the Employee, in the performance of
his duties hereunder, shall not take any of the following actions without the
written consent of the Board of Directors:
a. Enter into negotiations or execute documents that would effect the
existing debt and/or structure or alter, modify or change any banking relations
after such Closing Date.
15. Representations and Warranties. The Employee hereby represents and warrants
that he is free to enter this Employment Agreement and to render his services
pursuant hereto and that neither the execution and delivery of this Employment
Agreement, nor the performance of his duties hereunder, violates the provisions
of any other agreement to which he is a party or by which he is bound.
16. Date of Commencement. This Employment Agreement shall become effective
December 1, 1998.
17. Notices. All notices required or permitted under this Employment Agreement
shall be in writing and shall be deemed delivered when delivered in person or
deposited in the United States mail, postage paid, addressed as follows:
EMPLOYMENT AND NON-COMPETE AGREEMENT
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Employer: Applied Cellular Technology, Inc.
000 Xxxxx Xxx Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Copies to: Xxxx X. Creme, Esq.
Merra, Kanakis, Creme& Xxxxxx
00 Xxxx Xxxxxx
Xxxxxx, Xxx Xxxxxxxxx
Employee: Xxxxxx Xxxxxxx
000 Xxxxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Such addresses may be changed from time to time by either party by
providing written notice in the manner set forth above.
18. Entire Agreement. This Employment Agreement contains the entire agreement of
the parties and there are no other promises or conditions in any other
agreement, whether oral or written. This Employment Agreement supersedes any
prior written or oral agreements between the parties.
19. Amendment. This Employment Agreement may be modified or amended, if the
amendment is made in writing and is signed by both parties.
20. Assignment. This Employment Agreement may not be assigned by Employee.
21. Section Headings. The headings contained in this Employment Agreement are
for reference only and shall not in any way affect the meaning or interpretation
of this Employment Agreement.
22. Severability. If any provision of this Employment Agreement shall
be held to be invalid or unenforceable for any reason, the remaining provisions
shall continue to be valid and enforceable. If a court finds that any provision
of this Employment Agreement is invalid or unenforceable, but that by limiting
such provision it would become valid and enforceable, then such provision shall
be deemed to be written, construed and enforced as so limited.
23. Waiver of Contractual Right. The failure of either party to enforce any
provision of this Employment Agreement shall not be construed as a waiver or
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limitation of that party's right to subsequently enforce and compel strict
compliance with every provision of this Employment Agreement.
24. Applicable Law. This Employment Agreement shall be governed by the laws
(other than the law governing conflict of law questions) of the State of
Florida.
25. Counterparts. This Employment Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument and, in pleading or
proving any provision of this Employment Agreement, it shall not be necessary to
produce more than one of such counterparts.
26. The parties have executed this Employment Agreement the day and year first
above written.
EMPLOYER
Applies Cellular Technology, Inc
By: /S/ Xxxxxxx X. Xxxxxxxx
_________________________________
Xxxxxxx X. Xxxxxxxx
Chairman of the Board
EMPLOYEE
/S/ Xxxxxx Xxxxxxx
______________________________________
Xxxxxx Xxxxxxx
