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Exhibit 10.1.12
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made as of April 1, 1997
(the "Effective Date") at Akron, Ohio between TELXON CORPORATION ("Employer"), a
Delaware corporation with offices at 0000 Xxxx Xxxxxx Xxxxxx, Xxxxx, Xxxx 00000,
and XXXXXXX X. XXXXX ("Employee").
WITNESSETH:
WHEREAS, Employer desires to employ Employee initially as Senior Vice
President and Chief Financial Officer of Employer, and thereafter, in such
capacity as the Board of Directors of Employer shall direct, and Employee
desires to be so employed, upon the terms and conditions herein contained; and
WHEREAS, Employer and Employee desire to have this Agreement supersede any
and all prior agreements, oral or written, relating to the employment of
Employee by Employer.
NOW, THEREFORE, in consideration of the foregoing and in consideration of
the mutual promises and agreements contained herein, the parties hereto agree as
follows:
1. EMPLOYMENT PERIOD. Employer agrees to employ Employee, and Employee
agrees to serve Employer, for the period beginning on the Effective
Date and ending March 31, 2000, subject to earlier termination
pursuant to paragraph 4 hereof (the "Employment Period").
2. NATURE OF DUTIES.
a. Employee's duties and responsibilities shall be to serve as
Senior Vice President and Chief Financial Officer of Employer or
in such other capacity as the Board of Directors of Employer may
at any time and from time to time in its discretion direct, in
conformity with management policies, guidelines and directions
issued by Employer. Employee shall report directly to Xxxxx X.
Brick, President and Chief Executive Officer of Employer, or such
other officer of Employer as the Board of Directors shall direct
(the "Supervisor"), and shall have general charge and supervision
of those functions and such other responsibilities as the
Supervisor shall from time to time determine in his discretion.
b. Employee shall work exclusively for Employer on a full-time basis
in such capacity as he is to serve pursuant to paragraph 2(a),
devoting all of his time and attention during normal business
hours to Employer's business.
c. Employee shall perform his duties and responsibilities hereunder
diligently, faithfully and loyally in order to cause the proper,
efficient and successful operation of Employer's business.
3. COMPENSATION AND BENEFITS.
a. BASE SALARY AND EXPENSES. As compensation for Employee's
services, Employer shall pay to Employee during the
Employment Period a salary (the "Base Salary") at the annual
rate of $200,000 for FY `98. Any salary increases for future
fiscal years will be determined by the Board of Directors of
Employer or an appropriate committee thereof (the "Board")
in its discretion based upon the recommendation of
Employer's chief executive officer (the "Chief Executive
Officer"). Base salary will be payable in arrears, in equal
bi-weekly installments or at such other interval as the
Board or applicable Employer policies shall direct. Employer
shall reimburse Employee for all reasonable out-of-pocket
expenses incurred by Employee on
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Employer's behalf during the Employment Period and approved
by the Supervisor or such other officer as the Supervisor or
applicable Employer policies shall direct.
b. BONUS COMPENSATION. In addition to the Base Salary, Employee
shall, at the discretion of the Board, be eligible to
receive bonus compensation ("Bonus Compensation") with
respect to the Employment Period on such basis as shall be
approved by the Board. For FY `98, Employee shall be
eligible for a potential bonus of up to $150,000 based upon
achieving goals and achievements agreed upon by Employee and
Employer's Chief Executive Officer, subject to such approval
thereof as may be required by the Board. Bonus compensation
for subsequent fiscal years will be determined by the Board
in its discretion based upon the recommendation of the Chief
Executive Officer. The Bonus Compensation, if any, in
respect to each fiscal year during the Employment Period
shall be earned and shall accrue at, and Employee shall have
no entitlement thereto (on a pro rata or any other basis)
prior to, the end of the fiscal year to which such Bonus
Compensation relates.
c. STOCK OPTIONS. During the Employment Period, Employee shall
be eligible to receive grants of stock option(s) and other
awards and benefits pursuant to such employee stock option
and other stock-based employee benefit plans as Employer may
maintain from time to time during the Employment Period with
respect to Employer executives of like stature and
compensation, in such amounts as may be determined by the
Board in its discretion based upon the recommendation of the
Chief Executive Officer. In the event that, during the
Employment Period or at any time thereafter, Employee is
re-assigned by Employer to a position carrying duties and
responsibilities of lesser stature than the position in
which Employee serves as of the time during the Employment
Period that any such options or other rights or benefits are
granted or awarded to or otherwise received by Employee
(other than a re-assignment occurring as the result of or in
connection with any change in control of Employer, in which
case the provisions of the governing benefit plan applicable
in such a circumstance shall control), such options, rights
and benefits shall, to the extent unvested, unexercised or
otherwise unrealized as of the time of such re-assignment,
be subject to such reduction, cancellation and/or forfeiture
as may then be determined to be appropriate by the Board in
its discretion.
d. VACATION. During the Employment Period, Employee shall be
entitled to vacation in accordance with Employer's policies.
e. HEALTH, DISABILITY, RETIREMENT AND DEATH BENEFITS. Employer
shall provide Employee with the same health, disability,
retirement and death and other fringe benefits as are
generally provided to the executive employees of Employer in
accordance with such terms, conditions and eligibility
requirements as may from time to time be established by
Employer.
4. TERMINATION.
a. This Agreement shall terminate automatically upon Employee's
death.
b. Employer may terminate Employee's employment under this
Agreement at any time, upon five (5) days written notice to
Employee, if Employee becomes permanently disabled.
Permanent disability shall be determined by Employer
according to the same standards applicable to the employees
of Employer generally under the disability benefits referred
to in paragraph 3(e) hereof.
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c. Employer shall have the right to terminate Employee's
employment under this Agreement at any time (i) immediately
for "cause" (which shall mean for any action or inaction of
Employee which is adverse to Employer's interests,
including, without limitation, Employee's dishonesty,
grossly negligent misconduct, willful misconduct,
disloyalty, act of bad faith, neglect of duty or material
breach of this Agreement or of any Employer policy
applicable to its employees generally), or (ii) without
cause upon five (5) days written notice to Employee.
5. EFFECTS OF TERMINATION AND EXPIRATION.
a. In the event of automatic termination by reason of
Employee's death pursuant to paragraph 4(a), or by Employer
by reason of Employee's permanent disability pursuant to
paragraph 4(b), all of Employer's obligations under this
Agreement shall end except for Employer's obligations to pay
Employee's Base Salary and Bonus Compensation, if any, in
each case earned and accrued but unpaid to the date of death
or permanent disability. Employee shall also have the right
to receive any payments under the death or disability
benefits, as the case may be, provided to Employee pursuant
to paragraph 3(e), if any.
b. In the event Employer exercises its right of termination
other than for cause pursuant to paragraph 4(c)(ii), or upon
the expiration of the Employment Period, all of Employer's
obligations under this Agreement shall end except for its
obligations to pay Employee's Base Salary and Bonus
Compensation, if any, in each case earned and accrued but
unpaid to the date of termination (which, for purposes of
this paragraph 5(b) and paragraph 5(c) below, shall be five
(5) days after the date on which notification is provided by
Employer to Employee pursuant to paragraph 4(c)(ii)) or at
the expiration of the Employment Period, whichever the case
may be and, in the case of termination pursuant to paragraph
4(c)(ii), Employer's obligations under paragraph 5(c) of
this Agreement.
c. In the event Employer exercises its right of termination
other than for cause pursuant to paragraph 4(c)(ii),
Employer shall be obligated to pay Employee as severance
pay, for the twelve (12) month period following the date of
such termination, annualized compensation at a rate which
shall be equal to the Base Salary at such termination date.
Such payments shall be made in equal bi-weekly installments
or at such other interval as the Board or Employer's
corresponding payroll policies shall direct.
d. In the event Employer exercises its right of termination
pursuant to paragraph 4(c)(i) for cause, or Employee
otherwise leaves the employ of Employer prior to the
expiration of the Employment Period, all of Employer's
obligations under this Agreement shall end except for
Employer's obligations to pay Employee's Base Salary, if
any, earned and accrued but unpaid to the date of such
termination or of the Employee otherwise leaving Employer's
employ.
6. COVENANT NOT TO COMPETE.
a. RESTRICTED ACTIVITIES--DURATION. Except as otherwise
consented to or approved by Employer's Board of Directors in
writing, Employee agrees that, in addition to being
operative during the Employment Period, the provisions of
paragraphs 6(a)(i) through (iii) hereof, inclusive, shall be
operative for a period of twelve (12) months after the later
of (1) the date Employee's employment with Employer
(pursuant to this Agreement or otherwise) is terminated or
otherwise ceases, or (2) the end of all severance payments,
if any, which Employer is obligated to make to Employee
under paragraph 5(c) of this Agreement or any other
subsequent written agreement between them, regardless of the
time, manner or reason for the termination or other
cessation of such employment. During such periods, Employee
will not, directly or indirectly,
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acting alone or as a member of a partnership or as an owner,
director, officer, employee, manager, representative or
consultant of any corporation or other business entity:
i. Engage in any business which manufactures, sells,
distributes, services or supports products or services
of a type manufactured, sold, marketed, serviced or
supported, or in any other business in competition with
or adverse to the business that is conducted by
Employer, or which Employer is in the process of
developing and in or of which Employee participated or
has knowledge, at the time of the cessation of
Employee's employment with the Employer, in the United
States, Canada or any European, Asian, Pacific Rim or
other foreign country in which Employer then or
thereafter transacts business or is making a bona fide
attempt to do so;
ii. induce, request or attempt to influence any customer or
supplier of Employer to curtail or cancel their
business or prospective business with Employer or in
any way interfere with Employer's business
relationships; or
iii.induce, solicit or assist or facilitate the inducement
or solicitation by any third person of any employee,
officer, agent or representative of Employer to
terminate his respective relationship with Employer or
in any way interfere with the Employer's employee,
officer, agent or representative relationships.
b. TOLLING; RELIEF OF OBLIGATIONS. In the event that Employee
breaches any provision of this paragraph 6, such violation
(i) shall toll the running of the twelve (12) month period
set forth in paragraph 6(a) from the date of commencement of
such violation until such violation ceases, and (ii) shall
relieve Employer of any obligations to Employee under this
Agreement.
c. "BLUE PENCILING" OR MODIFICATION. If either the length of
time, geographic area or scope of restricted business
activity set forth in paragraph 6(a) is deemed unreasonably
restrictive or unreasonable in any other respect in any
proceeding before a court of competent jurisdiction,
Employee and Employer agree and consent to such court's
modifying or reducing such restriction(s) with respect, but
only with respect, to that jurisdiction to the extent deemed
reasonable under the circumstances then presented.
7. NONDISCLOSURE OF CONFIDENTIAL INFORMATION.
a. For purposes of this Agreement, "Confidential Information"
means all information or trade secrets of any type or
description belonging to Employer which are proprietary and
confidential to Employer and which are not publicly
disclosed or are only disclosed with restrictions. Without
limiting the generality of the foregoing, Confidential
Information includes: strategic and other plans for carrying
on business; cost data and other financial information;
lists of customers, employees, vendors and business partners
and alliances; manufacturing methods and processes; product
research and engineering data, drawings, designs and
schematics; computer programs, flow charts, routines,
subroutines, translators, compilers, operating systems and
object and source codes; specifications, inventions,
know-how, calculations and discoveries; any letters, papers,
documents and instruments disclosing or reflecting any of
the foregoing; and all information revealed to or acquired
or created by Employee during Employee's employment by
Employer relating to any of the foregoing or otherwise to
Employer's past, current or future business.
b. Employee acknowledges that the discharge of Employee's
duties under this Agreement will necessarily involve his
access to Confidential Information. Employee acknowledges
that the
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unauthorized use by him or disclosure by him of such
Confidential Information to third parties might cause
irreparable damage to Employer and Employer's business.
Accordingly, Employee agrees that at all times after the
date hereof he will not, without the prior written consent
of Employer's Board of Directors, copy, publish, disclose,
divulge to or discuss with any third party, nor use for his
own benefit or that of others any Confidential Information,
except in the normal conduct of his duties under this
Agreement, it being understood and acknowledged by Employee
that all Confidential Information created, compiled or
obtained by Employee or Employer, or furnished to Employee
by any person while Employee is associated with Employer, is
and shall be and remain Employer's exclusive property.
c. Promptly upon termination of his employment, irrespective of
the time or manner thereof or reason therefor, Employee
agrees to return and surrender to Employer all Confidential
Information copies thereof in any form which is in any
manner in his control or possession, as well as all other
Employer property.
8. RIGHTS. Employee acknowledges and agrees that any procedure,
design feature, schematic, invention, improvement, development,
discovery, know-how, concept, idea or the like (whether or not
patentable, registrable under copyright or trademark laws, or
otherwise protectable under similar laws) that Employee (whether
individually or jointly with any other person or persons) has
since the inception of his employment with Employer conceived of,
suggested, made, invented, developed or implemented, or may
hereafter conceive of, suggest, make, invent, develop or
implement, during the course of his service to Employer which
relates in any way to the business of Employer or to the general
industry of which Employer is a part, all physical embodiments
and manifestations thereof, and all patent rights, copyrights and
trademarks (and applications therefor) and similar protections
thereof (all of the foregoing referred to as "Work Product") are
and shall be the sole, exclusive and absolute property of
Employer. All Work Product shall be deemed to be works for hire
for the benefit of Employer, and to the extent that any Work
Product may not constitute a work for hire, Employee hereby
assigns to Employer all right, title and interest in, to and
under such Work Product, including, without limitation, the right
to obtain such patents, copyright registrations, trademark
registrations or similar protections as Employer may desire to
obtain. Employee will immediately disclose all Work Product to
Employer and agrees, at anytime, upon Employer's request and
without additional compensation, to execute any documents and
otherwise to cooperate with Employer (including, without
limitation, all lawful testimony and sworn statements or other
certifications as may be appropriate) respecting the perfection
of its right, title and interest in, to and under such Work
Product and in any litigation or administrative or other
proceeding or controversy in connection therewith, all expenses
incident thereto be borne by Employer.
9. INDUCEMENT; REMEDIES INADEQUATE.
a. The covenants made by Employee in favor of Employer under
paragraphs 6, 7 and 8 of this Agreement are being executed
and delivered by Employee in consideration of Employee's
employment with Employer and Employer's obligations
hereunder (including, without limitation, the Base Salary,
the Bonus Compensation and other benefits and payments
provided for herein). Employee further acknowledges that
such covenants were and have been conditions of his
employment since the inception of Employee's employment with
Employer.
b. Employee has carefully considered, and has had adequate time
and opportunity to consult with his own counsel or other
advisors regarding the nature and extent of the restrictions
upon him, and the rights and remedies conferred upon
Employer, under paragraphs 6, 7 and 8 hereof, and hereby
acknowledges and agrees that such restrictions are
reasonable in time, territory and
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scope, are designed to eliminate competition which otherwise
would be unfair to Employer, do not stifle the inherent
skill and experience of Employee, would not operate as a bar
to Employee's sole means of support, are fully required to
protect the legitimate interests of Employer and do not
confer a benefit upon Employer disproportionate to the
detriment to Employee.
c. Employee acknowledges that the services to be rendered by
him to Employer as contemplated by this Agreement are
special, unique and of extraordinary character. Employee
expressly agrees and understand that the remedy at law for
any breach by him of paragraph 6, 7 or 8 of this Agreement
will be inadequate and that the damages flowing from such
breach are not readily susceptible to being measured in
monetary terms. Accordingly, upon adequate proof of
Employee's violation of any legally enforceable provision of
paragraph 6, 7 or 8 hereof, Employer shall be entitled to
immediate injunctive relief, including, without limitation,
a temporary order restraining any threatened or further
breach. In the event any equitable proceedings are brought
to enforce any provision of paragraphs 6, 7 and 8 hereof,
Employee agrees that he will not raise in such proceedings
any defense that Employer has an adequate remedy at law, and
Employee hereby waives any such defense. Nothing in this
Agreement shall be deemed to limit Employer's remedies at
law or in equity for any breach by Employee of any of the
provisions of paragraphs 6, 7 and 8 hereof which may be
pursued or availed of by Employer. Without limiting the
generality of the immediately preceding sentence, any
covenant on Employee's part contained in paragraph 6, 7 or 8
hereof which may not be specifically enforceable shall
nevertheless, if breached, give rise to a cause of action
for monetary damages.
d. As used in paragraphs 6, 7 and 8 hereof and in this
paragraph 9, the term "Employer" (other than with respect to
the Board of Directors) shall include, in addition to
Employer, all subsidiaries and other affiliates of Employer,
whether so related to Employer during Employee's employment
with Employer or at any time thereafter.
e. Subject only to such time limitations as may be expressly
set forth therein, the covenants and agreements made by
Employee in paragraphs 6, 7 and 8 hereof and this paragraph
9 shall survive full payment by Employer to Employee of the
amounts to which Employee is entitled under this Agreement,
the expiration of the Employment Period and the expiration
or termination of this Agreement.
10. ASSIGNMENT OF EMPLOYEE'S RIGHTS. In no event shall Employer be
obligated to make any payment under this Agreement to any
assignee or creditor of Employee. Prior to the time provided for
the making of any payment under this Agreement, neither Employee
nor his legal representative shall have any right by way of
anticipation or otherwise to assign or otherwise dispose of any
interest under this Agreement.
11. RIGHT OF SET-OFF. Any payments to be made to Employee under this
Agreement shall be subject to offset by Employer for any claims
for damages, liabilities or expenses which it may have against
Employee.
12. EMPLOYER'S OBLIGATIONS UNFUNDED. Except as to any benefits that
may be required to be funded under any benefit plan of Employer
pursuant to law or under any other written agreement, the
obligations of Employer under this Agreement are not funded, and
Employer shall be not required to deposit in escrow or otherwise
set aside any moneys in advance of the due date for payment
thereof to Employee.
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13. NOTICES. Any notice to be given hereunder by Employer to Employee
shall be deemed to be given if delivered to Employee in person,
or if mailed to Employee, by certified mail, postage prepaid,
return receipt requested, at his address last shown on the
records of Employer, and any notice to be given by Employee to
Employer shall be deemed to be given if delivered in person or by
mail, postage prepaid, return receipt requested to the President
and Chief Executive Officer of Employer at Employer's principle
executive office, unless Employee or Employer shall have duly
notified the other parties in writing of a change of address. If
mailed, notice shall be deemed to have been given when deposited
in the mail as set forth above.
14. AMENDMENTS. This Agreement shall not be modified or discharged,
in whole or in part, except by an agreement in writing signed by
the parties hereto.
15. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties with respect to Employee's employment by
Employer from and after the Effective Date. The parties are not
relying on any other representation or understanding with respect
thereto, express or implied, oral or written. This Agreement
supersedes any prior employment agreement, written or oral,
between Employee and Employer.
16. CAPTIONS. The captions contained in this Agreement are for
convenience of reference only and do not affect the meaning of
any terms or provisions hereof.
17. GENDER AND NUMBER. Whenever the context may permit, any pronouns
used herein shall include the corresponding masculine, feminine
and neuter forms, and the singular form of any noun or pronoun,
including any terms defined herein, shall include the plural and
vice versa.
18. BINDING EFFECT. The rights and obligations of Employer hereunder
shall inure to the benefit of, and shall be binding upon,
Employer and its respective successors and assigns, and the
rights and obligations of Employee hereunder shall inure to the
benefit of, and shall be binding upon, Employee and his heirs,
personal representatives and estate.
19. SEVERABLE PROVISIONS. The provisions of this Agreement are
severable, and if any one or more provisions may be determined to
be illegal or otherwise unenforceable in any jurisdiction, in
whole or in part, the remaining provisions and any partially
enforceable provision shall be binding and enforceable to the
extent enforceable in such jurisdiction.
20. GOVERNING LAW. This Agreement shall be interpreted, construed,
and enforced in all respects in accordance with the laws of the
State of Ohio.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the Effective Date.
TELXON CORPORATION EMPLOYEE
By: /s/ Xxxxx X. Brick /s/ Xxxxxxx X. Xxxxx
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Xxxxx X. Brick Xxxxxxx X. Xxxxx
President & Chief Executive Officer Senior Vice President &
Chief Financial Officer
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