This Employment Agreement (the "Agreement"), made and entered into this 9th
day of October, 2001, by and between Globecomm Systems, a Delaware corporation
with principal offices located at 00 Xxxx Xxxxxx, Xxxxxxxxx, XX 00000 (the
"Company"), and Xxxxxx X. Xxxxx (the "Executive").
WITNESSETH
WHEREAS, the Company has a need for the Executive's personal services in an
executive capacity; and
WHEREAS, the Executive possesses the necessary strategic, financial,
planning, operational and managerial skills necessary to fulfill those needs;
and
WHEREAS, the Executive has been providing services to the Company as its
Vice President & Chief Financial Officer since January 1, 1996; and
WHEREAS, the Company desires to maintain the continuity of its management
team and provide the Executive with incentive to remain with the Company; and
WHEREAS, the Executive and the Company desire to enter into a formal
Employment Agreement to fully recognize the contributions of Executive to the
Company and to assure continuous harmonious performance of the affairs of the
Company;
NOW, THEREFORE, in consideration of the mutual promises, terms, provisions,
and conditions contained herein, the parties agree as follows:
1. Position.
The Company hereby agrees to employ the Executive to serve in the role of
its Vice President & Chief Financial Officer of the Company, subject to the
limitation set forth herein. As such, the Executive shall be responsible for
directing and managing the corporate Accounting function subject to the
authority of the Chief Executive Officer of Globecomm Systems. The Executive
accepts such employment upon the terms and conditions set forth herein, and
further agrees to perform to the best of his abilities the duties generally
associated with his/her position, as well as such other duties commensurate with
his/her position as its Vice President & Chief Financial Officer as may be
reasonably assigned by the Company. The Executive shall, at all times during the
Term, report directly to the Chief Executive Officer of Globecomm Systems Inc.
The Executive shall perform his/her duties diligently and faithfully and shall
devote his/her full business time and attention to such duties.
2. Term of Employment and Renewal.
The term of Executive's employment under this Agreement will commence on
the date of this Agreement (the "Effective Date"). Subject to the provisions of
Section 10 of this Agreement, the term of Executive's employment hereunder shall
be for an initial term of three (3) years from the Effective Date (the "Initial
Term"). The Initial Term of this Agreement shall be automatically extended for
successive one (1) year periods (each a "Renewal Period") unless the Company or
the Executive gives written notice to the other at least ninety (90) days prior
to the expiration of the Initial Term, or a Renewal Period, of such party's
election not to extend this Agreement. References herein to the "Term" shall
mean the Initial Term as it may be so extended by one or more Renewal Periods.
The last day of the Term is the "Expiration Date."
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3. Compensation and Benefits.
(a) Salary. Commencing on the Effective Date, the Company agrees to pay the
Executive a base salary at an annual rate of one hundred forty two thousand
Dollars ($142,000), payable in such installments as is the policy of the Company
(the "Salary"), but no less frequently than monthly. Thereafter, the Company
shall determine appropriate increases to Executive's Salary but in no event
shall diminish the amount of Executive's Salary below the initial rate, or below
the increased rates.
(b) Bonus. The Executive shall be eligible to receive annual bonuses at the
discretion of the Company and according to performance goals to be issued by the
Company to the Executive at the appropriate annual review cycle during the Term.
(c) Benefits. The Executive shall be entitled to participate in all
employee benefit plans which the Company provides or may establish from time to
time for the benefit of its employees, including, without limitation, group
life, medical, surgical, dental and other health insurance, short and long-term
disability, deferred compensation, profit-sharing and similar plans. The
Executive shall also be entitled to paid vacation in accordance with the
Company's vacation policy, which may be accrued to a maximum of 40 days.
(d) Stock Options. The Company has granted the Executive options to
purchase in the Company, under the terms and conditions as set forth in the
Notices Of Grant dated 1/4/96, 11/21/96, 11/13/97, 11/27/98, 11/26/99, 5/26/00,
7/28/00, 8/25/00, 11/24/00, 5/25/01, and 9/28/01, which shall continue in full
force and effect.
(e) Expenses. The Company shall pay or reimburse the Executive for all
reasonable out-of-pocket expenses actually incurred by him during the Term in
performing services hereunder, provided that the Executive properly accounts for
such expenses in accordance with the Company's policies.
4. Confidentiality, Disclosure of Information.
(a) The Executive recognizes and acknowledges that the Executive has had
and will have access to Confidential Information (as defined below) relating to
the business or interests of the Company or of persons with whom the Company may
have business relationships. Except as permitted herein, the Executive will not
during the Term, or at any time thereafter, use, disclose or permit to be known
by any other person or entity, any Confidential Information of the Company
(except as required by applicable law or in connection with the performance of
the Executive's duties and responsibilities hereunder). The term "Confidential
Information" means information relating to the Company's business affairs,
proprietary technology, trade secrets, patented processes, research and
development data, know-how, market studies and forecasts, competitive analyses,
pricing policies, employee lists, employment agreements (other than this
Agreement), personnel policies, the substance of agreements with customers,
suppliers and others, marketing arrangements, customer lists, commercial
arrangements, or any other information relating to the Company's business that
is not generally known to the public or to actual or potential competitors of
the Company (other than through a breach of this Agreement). This obligation
shall continue until such Confidential Information becomes publicly available,
other than pursuant to a breach of this Section 4 by the Executive, regardless
of whether the Executive continues to be employed by the Company.
(b) It is further agreed and understood by and between the parties to this
Agreement that all "Company Materials," which include, but are not limited to,
computers, computer software, computer disks, tapes, printouts, source, HTML and
other code, flowcharts, schematics, designs, graphics, drawings, photographs,
charts, graphs, notebooks, customer lists, sound recordings, other tangible or
intangible manifestation of content, and all other documents whether printed,
typewritten, handwritten, electronic, or stored on computer disks, tapes, hard
drives, or any other tangible medium, as well as samples, prototypes, models,
products and the like, shall be the exclusive property of the Company and, upon
termination of Executive's employment with the Company, and/or upon the request
of the Company, all Company Materials, including copies thereof, as well as all
other Company property then in the Executive's possession or control, shall be
returned to and left with the Company.
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5. Inventions Discovered by Executive.
The Executive shall promptly disclose to the Company any invention,
improvement, discovery, process, formula, or method or other intellectual
property, whether or not patentable or copyrightable (collectively,
"Inventions"), conceived or first reduced to practice by the Executive, either
alone or jointly with others, while performing services hereunder (or, if based
on any Confidential Information, at any time during or after the Term), (a)
which pertain to any line of business activity of the Company, whether then
conducted or then being actively planned by the Company, with which the
Executive was or is involved, (b) which is developed using time, material or
facilities of the Company, whether or not during working hours or on the Company
premises, or (c) which directly relates to any of the Executive's work during
the Term, whether or not during normal working hours. The Executive hereby
assigns to the Company all of the Executive's right, title and interest in and
to any such Inventions. During and after the Term, the Executive shall execute
any documents necessary to perfect the assignment of such Inventions to the
Company and to enable the Company to apply for, obtain and enforce patents,
trademarks and copyrights in any and all countries on such Inventions,
including, without limitation, the execution of any instruments and the giving
of evidence and testimony, without further compensation beyond the Executive's
agreed compensation during the course of the Executive's employment. Without
limiting the foregoing, the Executive further acknowledges that all original
works of authorship by the Executive, whether created alone or jointly with
others, related to the Executive's employment with the Company and which are
protectable by copyright, are "works made for hire" within the meaning of the
United States Copyright Act, 17 U.S.C. (Section) 101, as amended, and the
copyright of which shall be owned solely, completely and exclusively by the
Company. If any Invention is considered to be work not included in the
categories of work covered by the United States Copyright Act, 17 U.S.C.
(Section) 101, as amended, such work is hereby assigned or transferred
completely and exclusively to the Company. The Executive hereby irrevocably
designates counsel to the Company as the Executive's agent and attorney-in-fact
to do all lawful acts necessary to apply for and obtain patents and copyrights
and to enforce the Company's rights under this Section. This Section 5 shall
survive the termination of this Agreement. Any assignment of copyright hereunder
includes all rights of paternity, integrity, disclosure and withdrawal and any
other rights that may be known as or referred to as "moral rights" (collectively
"Moral Rights"). To the extent such Moral Rights cannot be assigned under
applicable law and to the extent the following is allowed by the laws in the
various countries where Moral Rights exist, the Executive hereby waives such
Moral Rights and consents to any action of the Company that would violate such
Moral Rights in the absence of such consent. The Executive agrees to confirm any
such waivers and consents from time to time as requested by the Company.
6. Non-Competition and Non-Solicitation.
The Executive acknowledges that the Company has invested substantial time,
money and resources in the development and retention of its Inventions,
Confidential Information (including trade secrets), customers, accounts and
business partners, and further acknowledges that during the course of the
Executive's employment with the Company the Executive has had and will have
access to the Company's Inventions and Confidential Information (including trade
secrets), and will be introduced to existing and prospective customers, accounts
and business partners of the Company. The Executive acknowledges and agrees that
any and all "goodwill" associated with any existing or prospective customer,
account or business partner belongs exclusively to the Company, including, but
not limited to, any goodwill created as a result of direct or indirect contacts
or relationships between the Executive and any existing or prospective
customers, accounts or business partners. Additionally, the parties acknowledge
and agree that Executive possesses skills that are special, unique or
extraordinary and that the value of the Company depends upon his use of such
skills on its behalf.
In recognition of this, the Executive covenants and agrees that:
(a) During the Term, and for a period of one (1) year thereafter, the
Executive may not, without the prior written consent of the Board, (whether as
an employee, agent, servant, owner, partner, consultant, independent contractor,
representative, stockholder or in any other capacity whatsoever) participate in
any business that offers products or services competitive in any way to those
offered by the Company or that were under active development by the Company
during the Term, provided that nothing herein shall prohibit the Executive from
owning securities of corporations which are listed on a national
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securities exchange or traded in the national over-the-counter market in an
amount which shall not exceed 3% of the outstanding shares of an such
corporation.
(b) During the Term, and for a period of one (1) year thereafter, the
Executive may not entice, solicit or encourage any Company employee to leave the
employ of the Company or any independent contractor to sever its engagement with
the Company, absent prior written consent to do so from the Board.
(c) During the Term, and for a period of one (1) year thereafter, the
Executive may not, directly or indirectly, entice, solicit or encourage any
customer, prospective customer, vendor, strategic partner or business associate
of the Company to cease doing business with the Company, reduce its relationship
with the Company or refrain from establishing or expanding a relationship with
the Company.
7. Non-Disparagement.
The Executive hereby agrees that during the Term, and at all times
thereafter, the Executive will not make any statement that is disparaging about
the Company, any of its officers, directors, or shareholders, including, but not
limited to, any statement that disparages the products, services, finances,
financial condition, capabilities or other aspect of the business of the
Company. The Executive further agrees that during the same period the Executive
will not engage in any conduct that is intended to inflict harm upon the
professional or personal reputation of the Company or any of its officers,
directors, shareholders or employees.
8. Provisions Necessary and Reasonable.
(a) The Executive agrees that (i) the provisions of Sections 4, 5, 6 and 7
of this Agreement are necessary and reasonable to protect the Company's
Confidential Information, Inventions, and goodwill; (ii) the specific temporal,
geographic and substantive provisions set forth in Section 6 of this Agreement
are reasonable and necessary to protect the Company's business interests in part
because the Company's business is international in scope; and (iii) in the event
of any breach of any of the covenants set forth herein, the Company would suffer
substantial irreparable harm and would not have an adequate remedy at law for
such breach. In recognition of the foregoing, the Executive agrees that in the
event of a breach or threatened breach of any of these covenants, in addition to
such other remedies as the Company may have at law, without posting any bond or
security, the Company shall be entitled to seek and obtain equitable relief, in
the form of specific performance, and/or temporary, preliminary or permanent
injunctive relief, or any other equitable remedy which then may be available.
The seeking of such injunction or order shall not affect the Company's right to
seek and obtain damages or other equitable relief on account of any such actual
or threatened breach.
(b) If any of the covenants contained in Sections 4, 5, 6 and 7 hereof, or
any part thereof, are hereafter construed to be invalid or unenforceable, the
same shall not affect the remainder of the covenant or covenants, which shall be
given full effect without regard to the invalid portions.
(c) If any of the covenants contained in Sections 4, 5, 6 and 7 hereof, or
any part thereof, are held to be unenforceable by a court of competent
jurisdiction because of the temporal or geographic scope of such provision or
the area covered thereby, the parties agree that the court making such
determination shall have the power to reduce the duration and/or geographic area
of such provision and, in its reduced form, such provision shall be enforceable.
9. Representations Regarding Prior Work and Legal Obligations.
(a) The Executive represents that the Executive has no agreement or other
legal obligation with any prior employer, or any other person or entity, that
restricts the Executive's ability to accept employment with, or to perform any
function for, the Company.
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(b) The Executive has been advised by the Company that at no time should
the Executive divulge to or use for the benefit of the Company any trade secret
or confidential or proprietary information of any previous employer. The
Executive expressly acknowledges that the Executive has not divulged or used any
such information for the benefit of the Company.
(c) The Executive acknowledges that the Executive has not and will not
misappropriate any Invention that the Executive played any part in creating
while working for any former employer.
(d) The Executive acknowledges that the Company is basing important
business decisions on these representations, and affirms that all of the
statements included herein are true.
10.Termination and Severance.
Notwithstanding the provisions of Section 2 of this Agreement, the
Executive's employment hereunder may terminate under the following
circumstances:
(a) Termination by the Company for Cause. The Company may terminate this
Agreement for Cause at any time, upon written notice to the Executive setting
forth in reasonable detail the nature of such Cause. For purposes of this
Agreement, Cause is defined as (i) the Executive's willful and material breach
of the terms of this Agreement; (ii) the Executive's commission of any felony or
any crime involving moral turpitude; or (iii) gross negligence or willful
misconduct by the Executive in connection with his position hereunder, or (iv)
the Executive's willful refusal to perform his duties hereunder. Upon the
termination for Cause of Executive's employment, the Company shall have no
further obligation or liability to the Executive other than for salary earned
under this Agreement prior to the date of termination, and any accrued but
unused vacation.
(b) Termination by the Company Without Cause or Resignation by the
Executive for Good Reason.
(i) The Executive's employment hereunder may be terminated without
Cause by the Company upon written notice to the Executive. The Executive
may also terminate his employment hereunder for "Good Reason" upon one (1)
month's written notice to the Company within thirty (30) days of the
occurrence of any of the following events (A) a material breach of this
Agreement by the Company, which shall be interpreted to include without
limitation a failure to pay the Executive his salary or bonus, a failure to
provide the Executive his benefits, or a requirement that the Executive
travel a significantly larger number of days than in the previous calendar
year; (B) a material reduction in the Executive's duties or
responsibilities; (C) a change in the Executive's reporting relationship so
that he no longer reports directly to the Chief Executive Officer; (D) a
relocation of the Executive's worksite to a location 75 miles or more from
its current location.
(ii) Subject to Section 11, if the Company terminates the Executive's
employment without Cause, or the Executive terminates his employment for
Good Reason (A) the Company shall continue to pay the Executive the Salary
for a two (2) year severance period commencing upon the effective date of
the termination (the "Severance Period"); (B) the Company shall pay for the
costs of, or reimburse the Executive for the costs he incurs in, continuing
the Executive's and his eligible dependents' health insurance pursuant to
COBRA for as long as the Executive (and/or his eligible dependents, as the
case may be) are eligible for COBRA during the Severance Period, and then
shall pay the cost of medical and dental coverage for the Executive
comparable to that provided pursuant to COBRA, up to a maximum of $2000 per
month; during the balance of the Severance Period; (C) during the Severance
Period, the Company shall pay the cost of conversion of group term life
coverage to an individual policy for the Executive; (D) during the
Severance Period, the Company shall pay to the Executive a monthly lump sum
cash payment equal to one-twelfth of the annual automobile allowance he
received at the time of such termination; and (E) during the Severance
Period, the Company shall pay to the Executive a monthly lump sum cash
payment equal to one-twelfth of the non-elective deferral employer
contribution made for his benefit under the Company's 401(k) plan for the
last fiscal year of the
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Company prior to the termination of Executive's employment. As a condition
of receiving severance payments and benefits pursuant to this Agreement,
the Executive shall execute and deliver to the Company prior to his/her
receipt of such benefits a general release substantially in the form
attached hereto as Exhibit A.
(c) Resignation by the Executive without Good Reason. The Executive may
resign his employment hereunder without Good Reason upon one (1) month's written
notice to the Company. In the event of termination by the Executive pursuant to
this subsection 10(c), the Company may elect to pay the Executive during the
notice period (or for any remaining portion of that period) the Salary and
benefits at the rate of compensation the Executive was receiving immediately
before such notice of termination was tendered in lieu of actual notice.
(d) Death. In the event of the Executive's death during the Term of this
Agreement, the Executive's employment hereunder shall immediately and
automatically terminate, and the Company shall have no further obligation or
duty to the Executive or his estate or beneficiaries other than for the Salary
earned under this Agreement to the date of termination and any payments or
benefits due under Company policies or benefit plans.
(e) Disability. The Company may terminate the Executive's employment
hereunder, upon written notice to the Executive, in the event that the Executive
becomes disabled during the Term through any condition of either a physical or
psychological nature and, as a result, is, with or without reasonable
accommodation, unable to perform the essential functions of the services
contemplated hereunder for (a) a period of one hundred and twenty (120)
consecutive days, or (b) for shorter periods aggregating one hundred twenty
(120) days during any twelve (12) month period during the Term. Any such
termination shall become effective upon mailing or hand delivery of notice that
the Company has elected its right to terminate under this subsection 10(e), and
the Company shall have no further obligation or duty to the Executive other than
for salary earned under this Agreement prior to the date of termination and any
payments or benefits previously vested and due under Company policies or benefit
plans.
(f) Effect of Non-Renewal. In the event that the Company gives notice of
its election not to extend the Initial Term or any Renewal Period pursuant to
Section 2 above, the Executive shall be entitled to payments and benefits
described in Section 10(b)(ii) above commencing on the Expiration Date subject
to his execution and delivery of a general release substantially in the form
attached hereto as Exhibit A.
(g) Change in Control. Subject to Section 11, if the Executive resigns with
Good Reason within one (1) year after a Change in Control, as defined below, he
will be entitled to the payments and benefits described in Section 10(b)(ii)
above (the "Severance Payments") provided that, if the grounds for the
termination for Good Reason are those specified in Section 10(b)(i)(B) and/or
(C), and if the Company gives the Executive written notice (the "Continuation
Notice"), at any time up to ten (10) days after it receives the Executive's
written resignation notice, that it wishes the Executive to continue his
employment until a date not later than one (1) year after the Change in Control
(the "Employment Continuation Date"), the Executive shall not be entitled to the
Severance Payments until and unless he remains employed by the Company through
the Employment Continuation Date. Nothing in this subsection 10(g) shall
obligate the Company to provide the Executive with the Severance Payments upon a
termination for Cause, death or disability. If the Executive does not provide
the Company notice of resignation or non-renewal at any time during the year
following a Change in Control and remains employed by the Company through the
first anniversary of the Change in Control, as defined below, the Executive
shall be paid a one-time bonus payment of 200% of his Salary (the "Special
Bonus"). The Special Bonus shall be in addition to, and not in lieu of, any
Severance Payments to which Executive may otherwise become entitled under this
section 10 in connection with the subsequent termination of his employment. As
used herein, a "Change in Control" shall mean a change of control of the Company
of a nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A (or in response to any similar item on any
similar schedule or form) promulgated under the Securities Exchange Act of 1934,
as amended (the "1934 Act") whether or not the Company is then subject to such
reporting requirement; provided, however, that, without limitation, such a
Change in Control shall be deemed to have occurred if:
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(x) any person or group (as such terms are used in connection with Sections
13(d) and 14(d) of the 0000 Xxx) becomes the "beneficial owner" (as defined in
Rule 13d-3 and 13d-5 under the 1934 Act), directly or indirectly, of securities
of the Company representing 35% or more of the combined voting power of the
Company's then outstanding securities; (y) the Company is a party to a merger,
consolidation, sale of assets or other reorganization, or a proxy contest, as a
consequence of which members of the Board in office immediately prior to such
transaction or event constitute less than a majority of the Board thereafter;
and (z) during any period of twenty-four consecutive months, individuals who at
the beginning of such period constituted the Board (including for this purpose
any new director whose election or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds of the directors then
still in office who were directors at the beginning of such period) cease for
any reason to constitute at least a majority of the Board. Notwithstanding the
foregoing provisions of this subsection 10(g), a "Change in Control" will not be
deemed to have occurred solely because of the acquisition of securities of the
Company (or any reporting requirement under the 1934 Act relating thereto) by an
employee benefit plan maintained by the Company for its employees. As used
herein, the "Company" may include the Company's successors subsequent to a
Change in Control.
11. Benefit Limitation.
(a) Should any payments or benefits become payable hereunder in connection
with a Change in Control, then the aggregate Present Value, measured as of the
Change in Control, of any Severance Payments to which the Executive becomes
entitled under section 10(b)(ii) of this Agreement (namely, the salary
continuation payments, the continued health care coverage, the life insurance
coverage, the equivalent automobile and professional service payments and the
equivalent 401(k) employer contribution payments) and, if applicable, any
portion of the Special Bonus under section 10(g) which is deemed to constitute a
parachute payment under Section 280 G of the Internal Revenue Code of 1986, as
amended (the "Code") shall in no event exceed in amount the greater of the
following dollar amounts (the "Benefit Limit"):
(i) 2.99 times the Executive's Average Compensation, less the Present
Value, measured as of the Change in Control, of all Other Parachute
Payments to which the Executive is entitled, or
(ii) the amount that yields the Executive the greatest after-tax amount
of benefits under this Agreement after taking into account any excise tax
imposed under Code Section 4999 on his payments and benefits under section
10 of this Agreement and any Other Parachute Payments,
The portion of any option that automatically vests on an accelerated
basis upon a Change in Control pursuant to the terms of the agreement evidencing
that option that is deemed to be a parachute payment under Code Section 280G
(the "Option Parachute Payment") shall also be subject to the Benefit Limit. The
Option Parachute Payment shall be calculated in accordance with the valuation
provisions established under Code Section 280G and the applicable Treasury
Regulations and shall include an appropriate dollar adjustment to reflect the
lapse of the Executive's obligation to remain in the Company's employ as a
condition to the vesting of the accelerated installment. In no event, however,
shall the parachute payment attributable to any portion of such option exceed
the excess of the fair market value of the accelerated option shares at the time
of acceleration over the option exercise price of such shares.
For purposes of applying the Benefit Limit, the value of the
Executive's non-competition covenant under Section 6 of this Agreement shall be
determined by an independent appraisal by a nationally recognized accounting
firm acceptable to both the Executive and the Company, and a portion of his
Severance Payments shall, to the extent of such appraised value, be specifically
allocated as reasonable compensation for such covenant.
"Average Compensation" means the average of the Executive's W-2 wages
from the Company for the five calendar years (or such fewer number of calendar
years of employment with the Company) completed immediately prior to the
calendar year in which the Change in Control occurs.
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Any W-2 wages for a partial year of employment will be annualized, in accordance
with the frequency which such wages are paid during such partial year, before
inclusion in the Executive's Average Compensation.
"Other Parachute Payments" means all payments in the nature of
compensation that are made to the Executive, other than the Severance Payments
described in section 10(b)(ii) of this Agreement or any portion of the Special
Bonus under section 10(g) deemed to constitute a parachute payment, payable in
connection with a Change in Control and which accordingly qualify as parachute
payments with the meaning of Code Section 280G. Other Parachute Payments shall
include, without limitation, the Present Value of any Option Parachute Payment.
"Present Value" means the value, determined as of the date of the
Change in Control, of any payment in the nature of compensation to which the
Executive becomes entitled in connection with the Change in Control. The Present
Value of each such payment shall be determined in accordance with the provisions
of Code Section 280G(d)(4), utilizing a discount rate equal to 120% of the
applicable Federal Rate in effect at the time of such determination, compounded
semi-annually to the effective date of the Change in Control.
(b) In the event there is any disagreement between the Executive and the
Company as to whether one or more payments to which Executive becomes entitled
in connection with the Change in Control constitute parachute payments within
the meaning of Code Section 280G, such dispute shall be resolved by the
nationally recognized firm of certified public accountants used by the Company
prior to the Change in Control (the "Accounting Firm"); provided, that if such
firm declines to serve, the "Accounting Firm" shall be a nationally recognized
firm of certified public accountants selected by mutual agreement of the Company
and the Executive.
(c) Once the requisite determinations have been made, then to the extent
the aggregate Present Value, measured as of the Change in Control, of all
parachute payments attributable to the Severance Payments under this Agreement
and otherwise, including without limitation the Option Parachute Payment,
exceeds the Benefit Limit, the following reductions shall be made to the
payments and benefits under Section 10 of this Agreement, to the extent
necessary to assure that such Benefit Limit is not exceeded: first, the
Executive's salary continuation payments described in Section 10(b)(ii)(A) and
then, if applicable, his Special Bonus under section 10(g), shall be reduced;
and then the period of the Company's Company-paid health-care coverage described
in Section 10(b)(ii)(B) shall be shortened. To the extent the Benefit Limit is
still exceeded following such reductions, then a portion of the aggregate amount
of payments described in Sections 10(b)(ii)(C), (D) and (E) shall be reduced to
the extent necessary to eliminate such excess and, finally, the Option Parachute
Payment shall be reduced.
12. Choice of Law.
The Executive acknowledges that a substantial portion of the Company's
business is based out of and directed from the State of New York. The Executive
also acknowledges that during the course of the Executive's employment with the
Company the Executive will have substantial contacts with New York.
The validity, interpretation and performance of this Agreement shall be
governed by, and construed in accordance with, the internal law of New York,
without giving effect to conflict of law principles. Both parties agree that the
exclusive venue for any action, demand, claim or counterclaim relating to the
terms and provisions of Sections 4, 5, 6 and 7 of this Agreement, or to their
breach, shall be in the state or federal courts located in Suffolk County, New
York and that such courts shall have personal jurisdiction over the parties to
this Agreement.
13. Miscellaneous.
(a) Assignment. The Executive acknowledges and agrees that the rights and
obligations of the Company under this Agreement may be assigned by the Company
to any successors in interest. In any event, however, this Agreement shall be
binding upon and inure to the benefit of any successors in
8
interest to the Company. The Executive further acknowledges and agrees that this
Agreement is personal to the Executive and that the Executive may not assign any
rights or obligations hereunder.
(b) Withholding. All salary, bonus and severance payments required to be
made by the Company to the Executive under this Agreement shall be subject to
withholding taxes, social security and other payroll deductions in accordance
with the Company's policies applicable to employees of the Company at the
Executive's level.
(c) Entire Agreement. Except as specifically set forth herein, this
Agreement sets forth the entire agreement between the parties and supersedes any
prior communications, agreements and understandings, written or oral, with
respect to the terms and conditions of the Executive's employment.
(d) Amendments. Any attempted modification of this Agreement will not be
effective unless signed by an officer of the Company and the Executive.
(e) Waiver of Breach. The Executive understands that a breach of any
provision of this Agreement may only be waived by an officer of the Company. The
waiver by the Company of a breach of any provision of this Agreement shall not
operate or be construed as a waiver of any subsequent breach.
(f) Severability. If any provision of this Agreement should, for any
reason, be held invalid or unenforceable in any respect by a court of competent
jurisdiction, then the remainder of this Agreement, and the application of such
provision in circumstances other than those as to which it is so declared
invalid or unenforceable, shall not be affected thereby, and each such provision
of this Agreement shall be valid and enforceable to the fullest extent permitted
by law.
(g) Notices. Any notices, requests, demands and other communications
provided for by this Agreement shall be in writing and shall be effective when
delivered by private messenger, private overnight mail service, or facsimile as
follows (or to such other address as either party shall designate by notice in
writing to the other in accordance herewith):
If to the Company:
Globecomm Systems Inc.
00 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Chief Executive Officer
With a copy to:
Xxxxxxx, Phleger & Xxxxxxxx LLP
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxx
If to Executive:
Xxxxxx X. Xxxxx
00 Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
(h) Survival. The Executive and the Company agree that certain provisions
of this Agreement shall survive the expiration or termination of this Agreement
and the termination of the Executive's employment with the Company. Such
provisions shall be limited to those within this Agreement which, by their
express and implied terms, obligate either party to perform beyond the
termination of the Executive's employment or termination of this Agreement.
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(i) Disclosure and Confidentiality. The Executive agrees to provide, and
agrees that the Company similarly may provide in its discretion, a copy of the
covenants contained in this Agreement to any business or enterprise which the
Company may directly or indirectly own, manage, operate, finance, join, control
or in which the Company participates in the ownership, management, operation,
financing or control, or with which the Company may be connected or may become
connected as an officer, director, executive, partner, principal, agent,
representative, consultant or otherwise. The Executive also agrees that the
Company may disclose a copy of this Agreement if legally required to do so, and
in connection with a partnering transaction or financing, assuming that an
appropriate confidentiality agreement is in place. The Executive further agrees
not to disclose the existence or terms of this Agreement to any person other
than the Executive's immediate family and legal, financial or accounting
professional.
(j) Arbitration of Disputes. Any controversy or claim arising out of this
Agreement or any aspect of the Executive's relationship with the Company
including the cessation thereof (other than disputes with respect to alleged
violations of the covenants contained in Sections 4, 5, 6 or 7 hereof, and the
Company's pursuit of the remedies described in Section 8 hereof in connection
therewith) shall be resolved by arbitration in accordance with the then existing
Employment Dispute Resolution Rules of the American Arbitration Association, in
New York, New York, and judgment upon the award rendered may be entered in any
court having jurisdiction thereof. Except as awarded by the arbitrator pursuant
to applicable statutory or legal standards, the parties shall split equally the
costs of arbitration and each party shall pay its own attorneys' fees. The
parties agree that the award of the arbitrator shall be final and binding.
(k) Rights of Other Individuals. This Agreement confers rights solely on
the Executive and the Company. This Agreement is not a benefit plan and confers
no rights on any individual or entity other than the undersigned.
(l) Headings. The parties acknowledge that the headings in this Agreement
are for convenience of reference only and shall not control or affect the
meaning or construction of this Agreement.
(m) Advice of Counsel. The Executive and the Company hereby acknowledge
that each party has had adequate opportunity to review this Agreement, to obtain
the advice of counsel with respect to this Agreement, and to reflect upon and
consider the terms and conditions of this Agreement. The parties further
acknowledge that each party fully understands the terms of this Agreement and
has voluntarily executed this Agreement.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of
the day and year set forth below.
EXECUTIVE Globecomm Systems Inc.
/s/ Xxxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------- ---------------------------------
XXXXXX X. XXXXX Title: President
------------------------------
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EXHIBIT A
SEPARATION AGREEMENT
AND GENERAL RELEASE
This Separation Agreement and General Release ("Agreement") is made and
entered into this ____ day of _____, _____, by and between [COMPANY NAME]
(hereinafter the "Company" or "Employer") and [EMPLOYEE NAME] ("Employee")
(hereinafter collectively referred to as the "Parties"), and is made and entered
into with reference to the following facts.
RECITALS
WHEREAS, Employee was hired by the Company on or about ________, as a
____________; and
WHEREAS, the Company and Employee have agreed to terminate their employment
relationship effective ______, ____; and
WHEREAS, the Parties each desire to resolve any potential disputes which
exist or may exist arising out of Employee's employment with the Company and/or
the termination thereof.
NOW THEREFORE, in consideration of the covenants and promises contained
herein, the Parties hereto agree as follows:
AGREEMENT
1. AGREEMENT BY THE COMPANY. In exchange for Employee's agreement to be
bound by the terms of this entire Agreement, including but not limited to the
Release of Claims in paragraph 3, the Company agrees to provide Employee with a
lump-sum payment in the amount of __________ dollars ($________), less statutory
deductions and withholdings, which amount represents _____ (_)
weeks'/months'/years' salary at Employee's rate of pay as of the Termination
Date, to be paid within ten (10) days of the Company's receipt of this
Agreement, fully executed by Employee.
Employee acknowledges that, absent this Agreement, s/he has no legal,
contractual or other entitlement to the consideration set forth in this
paragraph and that the amount set forth in this paragraph constitute valid and
sufficient consideration for Employee's release of claims and other obligations
set forth herein.
2. RELEASE OF CLAIMS. Employee hereby expressly waives, releases, acquits
and forever discharges the Company and its divisions, subsidiaries, affiliates,
parents, related entities, partners, officers, directors, shareholders,
investors, executives, managers, employees, agents, attorneys, representatives,
successors and assigns (hereinafter collectively referred to as "Releasees"),
from any and all claims, demands, and causes of action which Employee has or
claims to have, whether known or unknown, of whatever nature, which exist or may
exist on Employee's behalf from the beginning of time up to and including the
date of this Agreement. As used in this paragraph, "claims," "demands," and
"causes of action" include, but are not limited to, claims based on contract,
whether express or implied, fraud, stock fraud, defamation, wrongful
termination, estoppel, equity, tort, retaliation, intellectual property,
personal injury, spoliation of evidence, emotional distress, public policy, wage
and hour law, statute or common law, claims for severance pay, claims related to
stock options and/or fringe benefits, claims for attorneys' fees, vacation pay,
debts, accounts, compensatory damages, punitive or exemplary damages, liquidated
damages, and any and all claims arising under any federal, state, or local
statute, law, or ordinance prohibiting discrimination on account of race, color,
sex, age, religion, sexual orientation, disability or national origin, including
but not limited to, the Age Discrimination in Employment
11
Act, Title VII of the Civil Rights Act of 1964 as amended, the Americans with
Disabilities Act, the Family and Medical Leave Act or the Employee Retirement
Income Security Act.
3. ACCEPTANCE OF AGREEMENT/REVOCATION. This Agreement was received by
Employee on ______, ____. Employee may accept this Agreement by returning a
signed original to the Company. This Agreement shall be withdrawn if not
accepted in the above manner on or before _______.
4. CONFIDENTIALITY. Employee understands and agrees that this Agreement,
and the matters discussed in negotiating its terms, are entirely confidential.
It is therefore expressly understood and agreed that Employee will not reveal,
discuss, publish or in any way communicate any of the terms, amount or fact of
this Agreement to any person, organization or other entity, with the exception
of his/her immediate family members and professional representatives, unless
required by subpoena or court order. Employee further agrees that s/he will not,
at any time in the future, make any statements to any third parties that
disparage any of the Releasees personally or professionally.
5. [NEW YORK] LAW APPLIES. This Agreement, in all respects, shall be
interpreted, enforced and governed by and under the laws of the State of [NEW
YORK]. Any and all actions relating to this Agreement shall be filed and
maintained in the federal and/or state courts located in the State [AND COUNTY
OF NEW YORK], and the parties consent to the jurisdiction of such courts. In any
action arising out of this Agreement, or involving claims barred by this
Agreement, the prevailing party shall be entitled to recover all costs of suit,
including reasonable attorneys' fees.
6. VOLUNTARY AGREEMENT. EMPLOYEE UNDERSTANDS AND AGREES THAT S/HE MAY BE
WAIVING SIGNIFICANT LEGAL RIGHTS BY SIGNING THIS AGREEMENT, AND REPRESENTS THAT
S/HE HAS ENTERED INTO THIS AGREEMENT KNOWINGLY AND VOLUNTARILY, WITH A FULL
UNDERSTANDING OF AND IN AGREEMENT WITH ALL OF ITS TERMS.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the
dates provided below.
DATED: , [COMPANY NAME]
--------------------- -----
By:
----------------------------------
Its:
---------------------------------
DATED: , [EMPLOYEE NAME]
--------------------- -----
-------------------------------------
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