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EXHIBIT 10.4
U.S. ROBOTICS ACCESS CORP.
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") made effective as of the 1st
day of January, 1997, by and between U.S. Robotics Access Corp., a Delaware
corporation (the "Company"), and [FULL NAME] ("Mr. [LAST NAME]").
RECITALS
WHEREAS, the Company is engaged in the business of designing,
manufacturing and selling data communications equipment, including modems, and
other high technology products; and
WHEREAS, Mr. [LAST NAME] has acknowledged knowledge, skill and experience;
and
WHEREAS, the Company desires to obtain the benefit of Mr. [LAST NAME]'s
knowledge, skill, and experience and, therefore, is willing to engage the
services of Mr. [LAST NAME] upon the terms set forth in this Agreement; and
WHEREAS, Mr. [LAST NAME] is willing to render services to the Company on
the terms set forth herein;
AGREEMENTS
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the Company and Mr. [LAST NAME] agree as follows:
1. EMPLOYMENT.
(a) EMPLOYMENT. The Company hereby employs Mr. [LAST NAME] and Mr. [LAST
NAME] hereby accepts employment by the Company, subject to the terms set forth
in this Agreement.
(b) EMPLOYMENT TERM. The term of Mr. [LAST NAME]'s employment under this
Agreement ("Employment Term") shall begin on January 1, 1997, and shall
continue for a period of two (2) consecutive calendar years, unless terminated
sooner in accordance with this Agreement. The Employment Term shall be
automatically extended for successive one-year periods unless a notice of
non-extension is given by one party to the other at least one hundred twenty
(120) days prior to the expiration of the then current term.
(c) TITLE AND DUTIES. Mr. [LAST NAME]'s title shall be __________________
of the Company's parent corporation, U.S. Robotics Corporation (the "Parent
Corporation") and he shall possess such powers and duties as are normally
incident to such position, as he currently exercises and performs and as
provided in the By-laws, all in accordance with Delaware General Corporation
Law. Mr. [LAST NAME]'s title, xxxxxx and duties may be changed by the Chief
Operating Officer of the Parent Corporation, in his discretion, subject to the
approval of the Chief Executive Officer, or by the Chief Executive Officer, in
his discretion. During the Employment Term, Mr. [LAST NAME] shall faithfully
discharge his duties and responsibilities in a diligent manner, devoting
substantially all of his working time to the affairs of the Parent Corporation
and its subsidiaries (collectively, "U.S. Robotics").
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2. COMPENSATION AND RELATED MATTERS.
(a) SALARY. For services rendered by Mr. [LAST NAME] to U.S. Robotics and
upon the condition that Mr. [LAST NAME] fully and faithfully perform all of his
duties and obligations owed during the Employment Term under this Agreement,
the Company shall pay Mr. [LAST NAME] an annual base salary equal to
$____________, payable in twenty-six equal bi-weekly installments per year less
income tax withholdings and other normal employee deductions. The base salary
set forth herein shall be reviewed annually by the Stock Option and
Compensation Committee (the "Stock Option and Compensation Committee") of the
Board of Directors of the Parent Corporation at the end of each fiscal year of
the Company beginning with the fiscal year ending on or about September 30,
1997 (hereafter "Fiscal Year"), or at such other times as may be deemed
appropriate by the Stock Option and Compensation Committee, and may, at the
sole discretion of the Stock Option and Compensation Committee, be increased by
an amount which it deems appropriate.
(b) BONUSES. LANGUAGE FOR 1997 PARTICIPANTS IN SENIOR EXECUTIVE
PERFORMANCE BONUS PLAN. Mr. [LAST NAME] shall be eligible to receive with
respect to each Fiscal Year during the Employment Term an annual bonus under
the Parent Corporation's Senior Executive Performance Bonus Plan or a
comparable bonus program which would afford him the opportunity to earn a
substantially equivalent bonus, subject to the terms, conditions, and
restrictions as set forth in such bonus program. The minimum bonus target set
for each Fiscal Year shall not be less than an amount equal to the sum of the
amounts of the Threshold Bonus, the maximum Incremental Threshold Bonus and the
Base Target Bonus for persons in his Compensation Category for the 1997 Fiscal
Year as heretofore determined by the Stock Option and Compensation Committee.
(c) STOCK OPTION PLAN. Mr. [LAST NAME] shall receive such options to
purchase the common stock of the Parent Corporation, if any, as shall be
granted by the Stock Option and Compensation Committee, in its discretion,
pursuant to the Parent Corporation's Executive Officers and Directors Stock
Option Plan or any other stock option plan which may be applicable.
(d) FRINGE BENEFITS. During the Employment Term, Mr. [LAST NAME] shall be
eligible to receive reasonable amounts of paid, noncumulative vacation per
year, to be taken at a time or times reasonably agreeable to both Mr. [LAST
NAME] and the Company, and shall be eligible to participate in and receive
coverage and benefits under all group insurance, pension, profit sharing,
bonus, stock option, stock ownership and other employee benefit plans, programs
and arrangements of U.S. Robotics which are now or hereafter adopted by U.S.
Robotics for the benefit of its similarly situated executive employees, subject
to and on a basis consistent with the terms, conditions and overall
administration of such plans, programs and arrangements. U.S. Robotics shall
not make any changes in such plans, programs, and arrangements which would
adversely affect Mr. [LAST NAME]'s (or, if Section 3 herein is applicable, his
spouse's or dependents') rights or benefits thereunder, unless such change
occurs pursuant to a plan, program or arrangement applicable to all executive
employees of U.S. Robotics and does not result in a proportionately greater
reduction in the rights of or benefits to Mr. [LAST NAME] as compared with any
other similarly situated executive employee of U.S. Robotics. Mr. [LAST NAME]
will also be eligible to receive certain perquisites, payable at the Company's
expense, which are offered to other, similarly situated executive employees and
which are reasonable, necessary and in the best interests of U.S. Robotics.
(e) AUTOMOBILE ALLOWANCE. During the Employment Term, the Company shall
pay to Mr. [LAST NAME] an automobile allowance in the amount of $450 per month,
which amount may be paid in periodic installments, not less frequently than
monthly. Such allowance may be reviewed by the Chief Operating Officer at the
end of each Fiscal Year, or at such other times as deemed appropriate by the
Chief Operating Officer, and may, at the sole discretion of the Chief Operating
Officer, be increased by an amount which he deems appropriate. If such
allowance is increased as provided herein, it shall not be decreased thereafter
during the Employment Term.
(f) BUSINESS EXPENSES. The Company shall reimburse Mr. [LAST NAME] for
the reasonable and necessary business expenses incurred by Mr. [LAST NAME] in
connection with the performance of his duties and obligations as set forth
herein during the Employment Term. Such expenses shall include, but are not
limited to, cellular telephone expenses and all expenses of travel and living
expenses while away from home on business or at
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the request and in the service of the Company, provided that such expenses are
properly incurred and accounted for in accordance with the applicable policies
and procedures established by the Company. Reimbursement shall be made upon
the presentation by Mr. [LAST NAME] to the Company of reasonably detailed
statements of such expenses.
(g) EFFECT OF SALARY AND OTHER BENEFITS. Salary payments pursuant to
Subsection (a) of this Section 2 shall not be deemed exclusive and shall not
prevent Mr. [LAST NAME] from participating in any other compensation or benefit
plan, program or arrangement of U.S. Robotics as provided in this Section 2.
Such salary payments (including any increased salary payments) shall not in any
way limit or reduce any other obligation of the Company pursuant to this
Agreement, and no other compensation, benefit or payment hereunder shall in any
way limit or reduce the obligation of the Company to pay Mr. [LAST NAME]'s
salary pursuant to Subsection (a) of this Section 2. At the same time, nothing
paid to Mr. [LAST NAME] under any benefit plan, program, or arrangement under
this Section 2, which is presently in effect or made available in the future,
shall be deemed to be in lieu of the salary payable to Mr. [LAST NAME] pursuant
to Subsection (a) of this Section 2.
(h) PRORATION OF COMPENSATION. Any salary payable to Mr. [LAST NAME]
under this Section 2, in respect of any Fiscal Year during which the Employment
Term terminates prior to the last day of such Fiscal Year shall, unless
otherwise provided in the applicable plan, program or arrangement, be prorated
in accordance with the number of days in such Fiscal Year during which he is so
employed.
3. BENEFITS FOLLOWING EMPLOYMENT TERM OR TERMINATION. For a period of two
(2) years following the Date of Termination of the Employment Term, other than
as provided in Subsection (a) (cause) of Section 5 herein, the Company shall
permit, at the Company's expense, Mr. [LAST NAME], his spouse and dependents,
as applicable (the "Benefit Participants"), to participate in all group medical
and health insurance plans then made available to the executive employees of
the Company (the "Plans") (including but not limited to such Plans in which Mr.
[LAST NAME] was entitled to participate immediately prior to the Date of
Termination), in the same manner as provided to its other executive employees;
provided, however, that this Section 3 shall not apply in the event that (i)
U.S. Robotics shall hereafter terminate the applicable Plan, or (ii) the
participation of the Benefit Participants in such Plan is prohibited by law or,
if applicable, would disqualify such Plan as a tax qualified plan pursuant to
the Internal Revenue Code of 1986, as amended, or any successor thereto (the
"Code") or (iii) the participation of the Benefit Participants violates the
general terms and provisions of such applicable Plan. In the event that any of
the Benefit Participants' participation in such Plans is prohibited by law or,
if applicable, would disqualify the Plan as a tax qualified plan, the Company
shall permit the Benefit Participants to acquire substantially comparable
coverage at the Company's expense, from a source of Mr. [LAST NAME]'s or his
spouse's choosing, notwithstanding the fact that such coverage or benefit will
result in a higher cost than if provided under a U.S. Robotics Plan. However,
in no event will the Benefit Participants receive from the Company the coverage
contemplated by this Section 3 if the Benefit Participants receive such
coverage from any other source.
4. COMPENSATION UPON TERMINATION OR DURING DISABILITY.
(a) COMPENSATION UPON TERMINATION FOR CAUSE. If the Employment Term shall
be terminated "for cause," as provided in Subsection (a) of Section 5 herein,
the Company shall have no further liability under this Agreement except to pay
Mr. [LAST NAME] (i) the value of any accrued salary or other compensation due
to Mr. [LAST NAME] pursuant to Section 2 herein (including any earned and
awarded but unpaid bonus payment, subject to set-off of amounts owed to the
Company, but excluding any deferred bonus payments based upon annual Fiscal
Year performance), upon the date of delivery of Notice of Termination to Mr.
[LAST NAME], at the rate in effect at the time such Notice of Termination is
delivered, and (ii) any benefits payable under all employee benefit plans,
programs and arrangements of U.S. Robotics in which Mr. [LAST NAME] is a
participant on the date of delivery of Notice of Termination.
(b) COMPENSATION UPON DEATH. If the Employment Term is terminated by Mr.
[LAST NAME]'s death, the Company shall have no further liability under this
Agreement except to pay Mr. [LAST NAME]'s spouse, or if he leaves no spouse, to
his estate or devisee, legatee or other designee, as applicable, (i) the value
of any accrued salary or other compensation due to Mr. [LAST NAME] pursuant to
Section 2 herein (including any earned
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but unpaid bonus payment or prorata share of such earned bonus payment, but
excluding deferred bonus payments based upon annual Fiscal Year performance),
at the time of his death, (ii) an amount equal to the next six (6) bi-weekly
salary payments payable to Mr. [LAST NAME] under Subsection (a) of Section 2
herein at the time of his death, payable on the dates when such payments would
otherwise have been made had Mr. [LAST NAME]'s death not occurred, (iii) any
death benefit payable under all employee benefit plans, programs and
arrangements of the U.S. Robotics in which Mr. [LAST NAME] is a participant on
the date of his death, and (iv) any Plan coverage continuation for Mr. [LAST
NAME]'s spouse and dependents, as applicable, under Section 3 herein.
(c) COMPENSATION UPON DISABILITY. During any period that Mr. [LAST NAME]
fails to perform his duties hereunder as a result of incapacity due to an
"impaired condition," as such term is defined in Subsection (c) of Section 5
herein (the "disability period"), Mr. [LAST NAME] shall continue to receive his
full salary at the rate then in effect for the disability period until the
Employment Term is terminated pursuant to Subsection (c) of Section 5 herein;
provided, however, that such salary payments so made to Mr. [LAST NAME]
pursuant hereto shall be reduced by the sum of the amounts, if any, payable to
Mr. [LAST NAME] prior to or during this period, as the result of such
incapacity, under any disability benefit plan or insurance program of U.S.
Robotics in which Mr. [LAST NAME] participates.
In the event of termination of the Employment Term pursuant to Subsection
(c) (disability) of Section 5 herein, the Company shall have no further
responsibilities under this Agreement except (i) to pay the value of any
accrued salary or other compensation due under Section 2 herein (including any
earned but unpaid bonus payment or prorata share of such earned bonus payment,
but excluding deferred bonus payments based upon annual Fiscal Year
performance), on the Date of Termination to Mr. [LAST NAME] (or in the event of
Mr. [LAST NAME]'s subsequent death, to his estate or devisee, legatee or other
designee, as applicable), together with any benefits payable under all employee
benefit plans, programs or arrangements of U.S. Robotics in which Mr. [LAST
NAME] is a participant on the Date of Termination, (ii) to pay the value of any
severance compensation owed to Mr. [LAST NAME] (or in the event of Mr. [LAST
NAME]'s subsequent death, to his estate or devisee, legatee or other designee,
as applicable), as set forth in Subsection (f)(i) of this Section 4 (which
shall survive the termination of the Employment Term) and (iii) to provide for
any Plan coverage continuation for Mr. [LAST NAME], his spouse and dependents,
as applicable under Section 3 herein.
(d) COMPENSATION UPON TERMINATION BY MR. [LAST NAME]. If Mr. [LAST NAME]
terminates the Employment Term due to "impaired health" or for Good Reason, as
such terms are defined in Subsection (d) of Section 5 herein, the Company shall
have no further responsibility under this Agreement except (i) to pay the value
of any accrued salary or other compensation due under Section 2 herein
(including any earned but unpaid bonus payment or prorata share of such earned
bonus payment, but excluding deferred bonus payments based upon annual Fiscal
Year performance), on the Date of Termination to Mr. [LAST NAME] (or in the
event of Mr. [LAST NAME]'s subsequent death, to his estate or devisee, legatee
or other designee, as appropriate), together with any benefits payable under
all employee benefit plans, programs or arrangements of U.S. Robotics in which
Mr. [LAST NAME] is a participant on the Date of Termination, (ii) to pay the
value of any severance compensation owed to Mr. [LAST NAME] (or in the event of
Mr. [LAST NAME]'s subsequent death, to his estate or devisee, legatee or other
designee, as appropriate), as set forth in Subsection (f) of this Section 4
(which shall survive the termination of the Employment Term) and (iii) to
provide for any Plan coverage continuation for Mr. [LAST NAME], his spouse and
dependents, as applicable, under Section 3 herein.
(e) COMPENSATION UPON TERMINATION BY COMPANY. If the Company breaches
this Agreement by terminating the Employment Term, other than pursuant to
Subsections (a) (cause), (b) (death), or (c) (disability) of Section 5 herein,
including but not limited to termination without "cause" (as such term is
defined in Subsection (a) of Section 5 herein), the Company shall (i) pay the
value of any accrued salary or other compensation due under Section 2 herein
(including any earned but unpaid bonus payment or prorata share of such earned
bonus payment, but excluding deferred bonus payments based upon annual Fiscal
Year performance), on the Date of Termination to Mr. [LAST NAME] (or in the
event of Mr. [LAST NAME]'s subsequent death, to his estate or devisee, legatee
or other designee, as appropriate), together with any benefits payable under
all employee benefit plans, programs or arrangements of U.S. Robotics in which
Mr. [LAST NAME] is a participant on the Date of Termination, (ii) pay the value
of any severance compensation owed to Mr. [LAST NAME] (or in the event of Mr.
[LAST NAME]'s
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subsequent death, to his estate or devisee, legatee or other designee, as
appropriate), as set forth in Subsection (f) of this Section 4 (which shall
survive the termination of the Employment Term) and (iii) provide for any Plan
coverage continuation for Mr. [LAST NAME], his spouse and dependents, as
applicable, under Section 3 herein.
(f) SEVERANCE COMPENSATION.
(i) TERMINATION DUE TO DISABILITY OR IMPAIRED HEALTH. Upon the
termination of the Employment Term under Subsection (c) (disability) of
Section 5 herein or upon the termination of the Employment Term by Mr.
[LAST NAME] due to "impaired health" (as such term is defined in
Subsection (d) of Section 5 herein), the Company shall pay to Mr. [LAST
NAME] (or in the event of Mr. [LAST NAME]'s subsequent death, his estate
or devisee, legatee or other designee, as appropriate) all compensation
and benefits specified under Section 2 herein, for a period of six (6)
months from the Date of Termination, payable in the same manner as if the
Employment Term had not been terminated.
(ii) TERMINATION BY COMPANY OR BY MR. [LAST NAME] FOR GOOD REASON.
If the Company breaches this Agreement by terminating the Employment
Term, other than pursuant to Subsections (a) (cause), (b) (death) or (c)
(disability) of Section 5 herein, including but not limited to
termination without "cause" (as such term is defined in Subsection (a) of
Section 5 herein), or if Mr. [LAST NAME] terminates the Employment Term
for Good Reason, as such term is defined in Subsection (d)(i) of Section
5 herein (other than due to a Change in Control, as hereinafter defined),
then the Company shall pay as severance compensation to Mr. [LAST NAME]
an amount equal Mr. [LAST NAME]'s annual base salary in effect as of the
Date of Termination, payable in cash in a lump sum on or before the
thirtieth (30th) day following the Date of Termination. Such severance
compensation shall not be subject to mitigation or offset due to other
earnings of Mr. [LAST NAME].
(iii) TERMINATION FOLLOWING A CHANGE IN CONTROL. If the Employment
Term is terminated by Mr. [LAST NAME] or by the Company within one
hundred eighty (180) days following a Change in Control, as such term is
defined in Subsection (d)(ii) of Section 5 herein, then the Company shall
pay as severance compensation to Mr. [LAST NAME] an amount equal to (1)
Mr. [LAST NAME]'s annual base salary in effect as of the Date of
Termination, plus (2) the average annual cash bonus received by Mr. [LAST
NAME] with respect to the previous three Fiscal Years of U.S. Robotics
(or, if Mr. [LAST NAME] has been employed by the Company for a period of
less than three Fiscal Years, the average annual cash bonus paid to him
during such shorter period). Such severance compensation shall be
payable in cash in a lump sum on or before the thirtieth (30th) day
following the Date of Termination. Such severance compensation shall not
be subject to mitigation or offset due to other earnings of Mr. [LAST
NAME].
5. TERMINATION.
(a) CAUSE. The Employment Term may be terminated at any time at the
option of the Company "for cause" (as such term is hereinafter defined),
effective upon the giving of written notice of termination to Mr. [LAST NAME].
As used herein, the term "for cause" shall mean and be limited to: (i) any
felony conviction, (ii) willful misconduct or gross negligence in connection
with the performance of Mr. [LAST NAME]'s duties, responsibilities, agreements
and covenants hereunder, which shall continue for a period of thirty (30) days
after the receipt of notice from the Company, (iii) refusal to comply with
reasonable rules, regulations, policies, directions and restrictions as may be
established from time to time by the Board of Directors of the Parent
Corporation, whereby such refusal continues for thirty (30) days after the
receipt of notice from the Company, or (iv) repeated abuse (following at least
one written warning from the Company) of alcohol or any illegal use of
narcotics or other controlled substances. If Mr. [LAST NAME] is advised that
he is being terminated for cause, he may submit to the Board of Directors of
the Parent Corporation a written objection to such determination.
(b) DEATH. The Employment Term shall terminate automatically upon the
death of Mr. [LAST NAME].
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(c) DISABILITY. In the event Mr. [LAST NAME] becomes mentally or
physically "disabled" during the Employment Term, the Employment Term shall
terminate on the Date of Termination (as such term if defined in Subsection (f)
of this Section 5) once such disability is "established." As used in this
Subsection, the term "disabled" means suffering from any mental or physical
condition, other than that resulting from the use of alcohol or illegal use of
narcotics or other controlled substances, which renders Mr. [LAST NAME] unable
to substantially perform all of his material duties and services under this
Agreement in a satisfactory manner (an "impaired condition") for a period of
one hundred twenty (120) consecutive days or for more than one hundred eighty
(180) days in any twelve (12) month period. For purposes of this Subsection,
the date that Mr. [LAST NAME]'s disability is "established" shall be, in the
case of an impaired condition which exists for a period of one hundred twenty
(120) consecutive days, the one hundred twenty-first (121) day on which such
impaired condition exists, and, in the case of an impaired condition existing
for more than one hundred eighty (180) days in any twelve (12) month period,
the one hundred eighty-first (181) day on which such impaired condition exists.
(d) TERMINATION BY MR. [LAST NAME]. Mr. [LAST NAME] may terminate the
Employment Term (1) for Good Reason, or (2) if his health should become
impaired to an extent that makes his continued performance of his duties and
obligations hereunder hazardous to his physical or mental health or his life
("impaired health"), provided that Mr. [LAST NAME] shall have furnished the
Company with a written statement from a qualified doctor to such effect and
provided, further, that, at the Company's request, Mr. [LAST NAME] shall submit
to an examination by a doctor selected by the Company and such doctor shall
have concurred in the conclusion of Mr. [LAST NAME]'s doctor, or (3)
voluntarily, without Good Reason and not due to "impaired health." In the
event that Mr. [LAST NAME] voluntarily terminates the Employment Term without
Good Reason and not due to "impaired health", such termination shall be treated
as if it were a termination "for cause" by the Company.
(i) GOOD REASON DEFINED. For purposes of this Agreement, "Good Reason"
shall mean:
a. a Change in Control of the Parent Corporation (as defined
in Subsection (d)(ii) below);
b. a failure by the Company to comply with any material
provision of this Agreement which has not been cured within thirty
(30) days after written notice of such noncompliance has been given
by Mr. [LAST NAME] to the Company; or
c. any purported termination of Mr. [LAST NAME]'s employment
which is not effected pursuant to a Notice of Termination
satisfying the requirements of Subsection (e) of this Section 5
(and for purposes of this Agreement no such purported termination
shall be effective).
For the purpose of this Subsection (d)(i), no action or inaction by
Mr. [LAST NAME] within ninety (90) days following the occurrence of the
foregoing events shall be deemed a consent by Mr. [LAST NAME] to such
events, absent written consent from Mr. [LAST NAME] to the Company.
(ii) CHANGE IN CONTROL DEFINED. A "Change in Control" shall be deemed to
have occurred:
a. upon any "person" as such term is used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934 (the "Exchange
Act") (other than U.S. Robotics, any trustee or other fiduciary
holding securities under any employee benefit plan of U.S.
Robotics, or any company owned, directly or indirectly, by the
stockholders of the Parent Corporation in substantially the same
proportions as their ownership of common stock of the Parent
Corporation), becoming the owner (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the
Parent Corporation representing twenty-five percent (25%) or more
of the combined voting power of the Parent Corporation's then
outstanding securities;
b. if, during any period of two consecutive years,
individuals who at the beginning of such period constitute the
Board of Directors, and any new director (other than a director
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designated by a person who has entered into an agreement with the
Parent Corporation to effect a transaction described in paragraph
(a), (c) or (d) of this Subsection or a director whose initial
assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11
of Regulation 14A promulgated under the Exchange Act) or other
actual or threatened solicitation of proxies or contests by or on
behalf of a person other than the Board of Directors of the Parent
Corporation) whose election by the Board of Directors or nomination
for election by the Parent Corporation's stockholders was approved
by a vote of at least two-thirds of the directors then still in
office who either were directors at the beginning of the two-year
period or whose election or nomination for election was previously
so approved, cease for any reason to constitute at least a majority
of the Board of Directors;
c. upon the merger or consolidation of the Parent Corporation
with any other corporation, other than a merger or consolidation
which would result in the voting securities of the Parent
Corporation outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) more than fifty
percent (50%) of the combined voting power of the voting securities
of the Parent Corporation or such surviving entity (which entity
shall thereafter be the "Parent Corporation" as defined herein)
outstanding immediately after such merger or consolidation;
provided, however, that a merger or consolidation effected to
implement a recapitalization of the Parent Corporation (or similar
transaction) in which no person (other than those covered by the
exceptions in (a) above) acquires more than twenty-five percent
(25%) of the combined voting power of the Parent Corporation's then
outstanding securities shall not constitute a Change in Control of
the Parent Corporation; or
d. if the stockholders of the Parent Corporation approve a
plan of complete liquidation of the Company or an agreement for the
sale or disposition by the Parent Corporation of all or
substantially all of the Parent Corporation's assets other than the
sale of all or substantially all of the assets of the Parent
Corporation to a person or persons who beneficially own, directly
or indirectly, at least fifty percent (50%) or more of the combined
voting power of the outstanding voting securities of the Parent
Corporation at the time of the sale.
(e) NOTICE OF TERMINATION. Any termination of the Employment Term by the
Company or by Mr. [LAST NAME] (other than termination pursuant to Subsection
(b) (death) of this Section 5) shall be communicated by written Notice of
Termination to the other party hereto. For purposes of this Agreement, a
"Notice of Termination" shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Employment Term under the Section and Subsection so
indicated.
(f) DATE OF TERMINATION. "Date of Termination" shall mean the following,
respectively, if the Employment Term is terminated by: (i) Subsection (a)
(cause) of this Section 5, the date specified in the Notice of Termination,
(ii) Subsection (b) (death) of this Section 5, the date of Mr. [LAST NAME]'s
death, (iii) Subsection (c) (disability) of this Section 5, thirty (30) days
after Notice of Termination is given (provided that Mr. [LAST NAME] shall not
have returned to the satisfactory performance of his duties on a full-time
basis during such thirty (30) day period), and (iv) if for any other reason,
the date on which a Notice of Termination is given.
6. OTHER BUSINESS ACTIVITIES. During the Employment Term, Mr. [LAST NAME]
shall not, without the prior written authorization of the Board of Directors of
the Parent Corporation, directly or indirectly render services of a business,
professional or commercial nature (whether for compensation or otherwise) to
any person or entity competitive or adverse to U.S. Robotics' business welfare
or engage in any activity whether alone, as a partner, or as an officer,
director, employee, consultant, independent contractor, or stockholder in any
other corporation, person, or entity which is competitive with or adverse to
U.S. Robotics' business welfare. This Section 6 shall not, however, prevent
Mr. [LAST NAME] from investing in securities issued by any such competitive or
adverse corporation, provided the holdings thereof by Mr. [LAST NAME] do not
constitute more than five percent (5%) of any one class of such securities.
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7. CONFIDENTIAL INFORMATION.
(a) DISCLOSURE AND USE. Mr. [LAST NAME] shall not disclose or use at any
time, either during or subsequent to the Employment Term, any trade secrets or
other confidential information, whether patentable or not, of U.S. Robotics,
including but not limited to, any technical or non-technical data, any
formula, pattern, compilation, program, device, method, technique, drawing,
process, financial data, or any list of actual or potential customers or
suppliers, of which Mr. [LAST NAME] is or becomes informed or aware during the
Employment Term, whether or not developed by Mr. [LAST NAME], except (i) as may
be reasonably required for Mr. [LAST NAME] to perform Mr. [LAST NAME]'s
employment duties with the Company, (ii) to the extent such information becomes
generally available to the public through no wrongful act of Mr. [LAST NAME],
(iii) information which has been disclosed as a result of a subpoena or other
legal process, provided that Mr. [LAST NAME] has provided the Company with
prompt written notice of the receipt thereof, or (iv) unless Mr. [LAST NAME]
shall first secure the Company's prior written authorization. This covenant
shall survive the termination of Mr. [LAST NAME]'s employment hereunder, and
shall remain in effect and be enforceable against Mr. [LAST NAME] for so long
as any such U.S. Robotics secret or confidential information retains economic
value, whether actual or potential, from not being generally known to other
persons who can obtain economic value from its disclosure or use. Mr. [LAST
NAME] agrees to execute such further agreements and/or confirmations of Mr.
[LAST NAME]'s obligations to U.S. Robotics concerning non-disclosure of U.S.
Robotics trade secrets and confidential information as U.S. Robotics may
reasonably require from time-to-time.
(b) RETURN OF MATERIALS. Upon termination of the Employment Term, Mr.
[LAST NAME] (or in the event of termination due to Mr. [LAST NAME]'s death, his
estate or devisee, legatee or other designee, as applicable) shall promptly
deliver to the Company all materials of a secret or confidential nature
relating to U.S. Robotics' business, which are in the possession or under the
control of Mr. [LAST NAME].
8. INVENTIONS AND DISCOVERIES. Mr. [LAST NAME] hereby assigns to the
Company or its designee all of Mr. [LAST NAME]'s rights, title and interest in
and to all inventions, discoveries, processes, designs, works of authorship and
other intellectual property and all improvements on existing inventions,
discoveries, processes, designs, works and other intellectual property made or
discovered by Mr. [LAST NAME] during the Employment Term. Promptly upon the
development, making, creation, or discovery of any invention, discovery,
process, design, work, intellectual property or improvement, Mr. [LAST NAME]
shall disclose the same to the Company and shall execute and deliver to the
Company or its designee such reasonable documents as the Company may request to
confirm the assignment of Mr. [LAST NAME]'s rights therein, and if requested by
the Company, shall assist the Company or its designee in applying for and
prosecuting any patents and any trademark or copyright registration which may
be available in respect thereof. Any invention, discovery or other work for
which none of U.S. Robotics' equipment, supplies, facilities, or confidential
information was used and which was developed entirely on Mr. [LAST NAME]'s own
time, is exempted from this Section 8 so long as it (i) does not relate in any
way to U.S. Robotics' business, or actual or demonstrably anticipated research
and development; and (ii) does not result in any way from Mr. [LAST NAME]'s
work for the Company.
9. SEVERABILITY. If any provision of this Agreement is held invalid or
unenforceable, either in its entirety or by virtue of its scope or application
to given circumstances, such provision shall thereupon be deemed (i) modified
only to the extent necessary to render the same valid, or (ii) not applicable
to given circumstances, or (iii) excised from this Agreement, as the situation
may require, and this Agreement shall be construed and enforced as if such
provision had been included herein as so modified in scope or application, or
had not been included herein, as the case may be.
10. ARBITRATION OF DISPUTES. In the event of any controversy among the
parties hereto arising out of, or relating to, this Agreement which cannot be
settled amicably by the parties (other than a controversy contemplated by
Sections 6, 7, 8 and 11 herein), such controversy shall be submitted to binding
arbitration. Either the Company or Mr. [LAST NAME] may institute such
arbitration proceeding by giving written notice to the other party and by
designating one independent arbitrator. Unless such independent arbitrator
alone is acceptable to the other party, such other party shall designate within
ten (10) days following receipt of such notice, a second
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independent arbitrator, and such two arbitrators shall thereafter select a
third independent arbitrator. A hearing shall be held by the arbitrator or
arbitrators in the City of Chicago, Illinois, and a decision of the matter so
submitted shall be rendered promptly in accordance with the rules of the
American Arbitration Association. The decision of the arbitrator or, if more
than one, a majority of the arbitrators shall be final and binding upon all
parties hereto. Judgment upon the award rendered may be entered in any court
having jurisdiction thereof. The cost of the arbitration shall be borne by the
Company.
11. ENFORCEMENT. The Company will be entitled to institute proceedings
and avail itself of all remedies at law or in equity to recover damages
occasioned by a breach or threatened breach of any of the provisions of this
Agreement by Mr. [LAST NAME] and shall have the right to pursue one or more of
such proceedings and remedies simultaneously or from time to time. Mr. [LAST
NAME] hereby acknowledges that the Company would suffer irreparable injury if
the provisions of Sections 6, 7 and 8 herein, which shall survive the
termination of this Agreement, were breached and that the Company's remedies at
law would be inadequate in the event of such breach or threatened breach.
Accordingly, Mr. [LAST NAME] hereby agrees that any such breach or threatened
breach may, in addition to any and all other available remedies, be
preliminarily and permanently enjoined by any court of competent jurisdiction
without any requirement that the Company post a bond.
12. LEGAL FEES AND EXPENSES. In the event of litigation or arbitration
proceeding under this Agreement, both the Company and Mr. [LAST NAME] shall pay
their own attorneys' fees and other legal expenses; provided, however, that (i)
the Company shall pay Mr. [LAST NAME]'s attorneys' fees and legal expenses in
connection with any proceeding which results in a court refusing to issue a
preliminary or permanent injunction against Mr. [LAST NAME] due to his alleged
breach or threatened breach of any provision of this Agreement, and (ii) the
Company shall pay the reasonable legal fees and expenses which Mr. [LAST NAME]
may incur in connection with the enforcement of this Agreement in connection
with the termination of the Employment Term under Subsections (c) (disability)
and (d) (termination by Mr. [LAST NAME] for Good Reason) of Section 5 herein or
due to the termination of the Employment Term by the Company for any reason
other than as provided in Section 5 herein, including but not limited to
termination without "cause" as such term is defined in Subsection (a) of
Section 5 herein.
Such fees and expenses shall be paid in cash within forty-five (45) days
after the submission to the Company's Secretary, and inquiry into the
reasonableness of such fees and expenses shall not delay such payment.
13. GENERAL PROVISIONS.
(A) NOTICES. Any notice, request, demand or other communication required
or permitted to be given hereunder shall be in writing and personally delivered
or sent by registered or certified mail, return receipt requested, or by a
facsimile, telegram or telex followed by a confirmation letter sent by
registered or certified mail, return receipt requested, addressed as follows:
To the Company: U.S. Robotics Corporation
0000 XxXxxxxxx Xxxx.
Xxxxxx, Xxxxxxxx 00000
Attention: Vice President of Human Resources
cc: General Counsel
To Mr. [LAST NAME]: Mr. [FULL NAME]
_________________________
_________________________
Either the Company or Mr. [LAST NAME] may, at any time, by notice to the other,
designate another address for service of notice on such party. When the
letter, facsimile, telegram or telex is dispatched as provided for above, the
notice shall be deemed to be made when the addressee actually receives the
letter, facsimile, telegram or telex, or upon the third (3rd) business day
after the date it is sent, whichever is earlier.
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(b) AMENDMENTS. Neither this Agreement nor any of the terms or conditions
hereof may be waived, amended or modified except by means of a written
instrument duly executed by the party to be charged therewith.
(c) CAPTIONS AND HEADINGS. The captions and Section headings used in this
Agreement are for convenience of reference only, and shall not affect the
construction or interpretation of this Agreement or any of the provisions
hereof.
(d) GOVERNING LAW. This Agreement, and all matters or disputes relating
to the validity, construction, performance or enforcement hereof, shall be
governed, construed and controlled by and under the laws of the State of
Illinois without regard to principles of conflicts of law.
(e) SUCCESSORS AND ASSIGNS. In light of the unique personal services to
be performed by Mr. [LAST NAME] hereunder, it is acknowledged and agreed that
any purported or attempted assignment or transfer by Mr. [LAST NAME] of this
Agreement or any of Mr. [LAST NAME]'s duties, responsibilities, or obligations
hereunder shall be void. The Company shall not assign this Agreement to any
third party entity which is not affiliated with the Company, the Parent
Corporation or any of their direct or indirect subsidiaries. Subject to the
foregoing, this Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective heirs, executors, administrators,
personal representatives, successors and permitted assigns.
(f) COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original hereof, but all
of which together shall constitute one and the same instrument.
(g) ENTIRE AGREEMENT. Except as otherwise set forth or referred to in
this Agreement, this Agreement constitutes the sole and entire agreement and
understanding between the parties hereto as to the subject matter hereof, and
supersedes all prior discussions, agreements and understandings of every kind
and nature between them as to such subject matter.
(h) RELIANCE BY THIRD PARTIES. This Agreement is intended for the sole
and exclusive benefit of the parties hereto and their respective heirs,
executors, administrators, personal representatives, successors and permitted
assigns, and no other person or entity shall have any right to rely on this
Agreement or to claim or derive any benefit therefrom absent the express
written consent of the party to be charged with such reliance or benefit.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.
ATTEST: U.S. ROBOTICS ACCESS CORP.
_________________________________ By: _______________________________________
Xxxxxx X. Xxxxxxx, Secretary Xxxx XxXxxxxxx, Chief Operating Officer
________________________________________
[FULL NAME]
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