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EXHIBIT 10.2
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made as of the 22nd day of November, 1999,
by and between STRATTEC SECURITY CORPORATION, a Wisconsin corporation (the
"Company"), and Xxxxxx X. Xxxxx (the "Employee").
RECITAL
The Company desires to employ the Employee and the Employee is willing
to make his services available to the Company on the terms and conditions set
forth below.
AGREEMENTS
In consideration of the premises and the mutual agreements which
follow, the parties agree as follows:
1. Employment. The Company hereby employs the Employee and the Employee
hereby accepts employment with the Company on the terms and conditions set forth
in this Agreement.
2. Term. The term of the Employee's employment hereunder shall commence
effective on November 22, 1999 and shall continue through June 30, 2000, and
shall thereafter be automatically renewed for successive fiscal year terms
unless either the Company or Employee gives notice of nonrenewal not less than
30 days prior to the end of the then current term (the "Employment Period").
3. Duties. The Employee shall serve as the Vice President Business
Operations of the Company and will, under the direction of President and Chief
Operating Officer, faithfully and to the best of Employee's ability, perform the
duties of the Vice President Business Operations. Vice President Business
Operations shall be one of the principal executive officers of the Company and
shall, subject to the control of the President and Chief Operating Officer,
supervise the product business team functions of the Company. The Employee shall
also perform such additional duties and responsibilities which may from time to
time be reasonably assigned or delegated by the President and Chief Operating
Officer of the Company. The Employee agrees to devote Employee's entire business
time, effort, skill and attention to the proper discharge of such duties while
employed by the Company. However, the Employee may engage in other business
activities unrelated to, and not in conflict with, the business of the Company
if the President and Chief Operating Officer consents in writing to such other
business activity.
4. Compensation. The Employee shall receive a base salary of $125,000
per year, payable in regular and semi-monthly installments (the "Base Salary").
Employee's Base Salary shall be reviewed annually by the Board of Directors of
the Company to determine appropriate increases, if any, in such Base Salary.
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5. Fringe Benefits.
(a) Medical, Health, Dental, Disability and Life Coverage. The
Employee shall be eligible to participate in any medical, health, dental,
disability and life insurance policy in effect for senior management of the
Company (collectively, the "Senior Management").
(b) Incentive Bonus and Stock Ownership Plans. The Employee
shall be entitled to participate in any incentive bonus or other incentive
compensation plan developed generally for the Senior Management of the Company,
on a basis consistent with Employee's position and level of compensation with
the Company. The Employee shall also be entitled to participate in any incentive
stock option plan or other stock ownership plan developed generally for the
Senior Management of the Company, on a basis consistent with Employee's position
and level of compensation with the Company.
(c) Reimbursement for Reasonable Business Expenses. Subject to
the terms and conditions of the Company's expense reimbursement policy, the
Company shall pay or reimburse the Employee for reasonable expenses incurred by
Employee in connection with the performance of Employee's duties pursuant to
this Agreement, including, but not limited to, travel expenses, expenses in
connection with seminars, professional conventions or similar professional
functions and other reasonable business expenses.
6. Termination of Employment.
(a) Termination for Cause, Disability or Death. During the
term of this Agreement, the Company shall be entitled to terminate the
Employee's employment at any time upon the "Disability" of the Employee or for
"Cause" upon notice to the Employee. The Employee's employment hereunder shall
automatically terminate upon the death of the Employee. For purposes of this
Agreement, "Disability" shall mean a physical or mental sickness or any injury
which renders the Employee incapable of performing the essential functions of
Employee's job (with or without reasonable accommodations) and which does or may
be expected to continue for more than 4 months during any 12-month period. In
the event Employee shall be able to perform the essential functions of
Employee's job (with or without reasonable accommodations) following a period of
disability, and does so perform such duties, or such other duties as are
prescribed by the President of the Company, for a period of three continuous
months, any subsequent period of disability shall be regarded as a new period of
disability for purposes of this Agreement. The Company and the Employee shall
determine the existence of a Disability and the date upon which it occurred. In
the event of a dispute regarding whether or when a Disability occurred, the
matter shall be referred to a medical doctor selected by the Company and the
Employee. In the event of their failure to agree upon such a medical doctor, the
Company and the Employee shall each select a medical doctor who together shall
select a third
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medical doctor who shall make the determination. Such determination shall be
conclusive and binding upon the parties hereto.
The Company may terminate the Employee's employment
under this agreement for "Cause," effective immediately upon delivery of notice
to the Employee. Cause shall be deemed to exist if the Employee shall have (1)
materially breached the terms of this Agreement; (2) willfully failed to
substantially perform his duties, other than a failure resulting from incapacity
due to physical or mental illness; or (3) serious misconduct which is
demonstrably and substantially injurious to the Company. No act or failure to
act will be considered "cause" if such act or failure is done in good faith and
with a reasonable belief that it is in the best interests of the Company.
In the event of termination for Disability or death,
payments of the Employee's Base Salary shall be made to the Employee, his
designated beneficiary or Employee's estate for a period of six months after the
date of the termination (even if this period would extend beyond the Employment
Period); provided, however that the foregoing payments in the event of a
Disability shall be reduced by the amount, if any, that is paid to Employee
pursuant to a disability plan or policy maintained by the Company. During this
period, the Company shall also reimburse the Employee for amounts paid, if any,
to continue medical, dental and health coverage pursuant to the provisions of
the Consolidated Omnibus Budget Reconciliation Act. During this period, the
Company will also continue Employee's life insurance and disability coverage, to
the extent permitted under applicable policies, and will pay to the Employee the
fringe benefits pursuant to section 5 which have accrued prior to the date of
termination. Termination of this Agreement for a Disability shall not change
Employee's rights to receive benefits, if any, pursuant to any disability plan
or policy then maintained by the Company.
(b) Termination Without Cause. If the Employee's employment is
terminated by the Company for any reason other than for Cause, Disability or
death, or if this Agreement is terminated by the Company for what the Company
believes is Cause or Disability, and it is ultimately determined that the
Employee was wrongfully terminated, Employee shall, as damages for such a
termination, receive Employee's Base Salary, for the remainder of the Employment
Period or six months, if longer. During this period, the Company shall also
reimburse the Employee for amounts paid, if any, to continue medical, dental and
health coverage pursuant to the provisions of the Consolidated Omnibus Budget
Reconciliation Act. During this period, the Company will also continue
Employee's life insurance and disability coverage, to the extent permitted under
applicable policies, and will pay to the Employee the fringe benefits pursuant
to section 5 which have accrued prior to the date of termination. The Company's
termination of the Employee's employment under this section 6(b) shall
immediately relieve the Employee of all obligations under this Agreement (except
as provided in sections 7 and 8) and, except as provided below, shall not be
construed to require the application of any compensation which the Employee may
earn in any such other employment to reduce the Company's obligation to provide
severance benefits and liquidated damages under this section 6(b).
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(c) Effect of Termination. The termination of the Employee's
employment pursuant to section 6 shall not affect the Employee's obligations as
described in sections 7 and 8.
7. Noncompetition. The parties agree that the Company's customer
contacts and relations are established and maintained at great expense and by
virtue of the Employee's employment with the Company, the Employee will have
unique and extensive exposure to and personal contact with the Company's
customers, and that Employee will be able to establish a unique relationship
with those individuals and entities that will enable Employee, both during and
after employment, to unfairly compete with the Company. Further, the parties
agree that the terms and conditions of the following restrictive covenants are
reasonable and necessary for the protection of the Company's business, trade
secrets and confidential information and to prevent great damage or loss to the
Company as a result of action taken by the Employee. The Employee acknowledges
that the noncompete restrictions and nondisclosure of confidential information
restrictions contained in this Agreement are reasonable and the consideration
provided for herein is sufficient to fully and adequately compensate the
Employee for agreeing to such restrictions. The Employee acknowledges that
Employee could continue to actively pursue Employee's career and earn sufficient
compensation in the same or similar business without breaching any of the
restrictions contained in this Agreement.
(a) During Term of Employment. The Employee hereby covenants
and agrees that, during Employee's employment with the Company, Employee shall
not, directly or indirectly, either individually or as an employee, principal,
agent, partner, shareholder, owner, trustee, beneficiary, co-venturer,
distributor, consultant or in any other capacity, participate in, become
associated with, provide assistance to, engage in or have a financial or other
interest in any business, activity or enterprise which is competitive with or a
supplier to the Company or any successor or assign of the Company. The ownership
of less than a one percent interest in a corporation whose shares are traded in
a recognized stock exchange or traded in the over-the-counter market, even
though that corporation may be a competitor of the Company, shall not be deemed
financial participation in a competitor.
(b) Upon Termination of Employment. The Employee agrees that
during a period after termination of Employee's employment with the Company
equal to the shorter of one year or the duration of Employee's employment with
the Company, Employee will not, directly or indirectly, either individually or
as an employee, agent, partner, shareholder, owner, trustee, beneficiary,
co-venturer, distributor, consultant or in any other capacity:
(i) Canvass, solicit or accept from any person or
entity who is a customer of the Company (any such person or entity is
hereinafter referred to individually as a "Customer" and collectively as the
"Customers") any business in competition with the business of the Company or the
successors or assigns of the Company, including the canvassing, soliciting or
accepting of business from any individual
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or entity which is or was a Customer of the Company within the two-year period
preceding the date on which the canvassing, soliciting or accepting of business
begins.
(ii) Request or advise any of the Customers,
suppliers, or other business contacts of the Company who currently have or have
had business relationships with the Company within two years preceding the date
hereof or within two years preceding the date of such action, to withdraw,
curtail or cancel any of their business or relations with the Company.
(iii) Induce or attempt to induce any employee, sales
representative, consultant or other personnel of the Company to terminate his or
her relationship or breach his or her agreements with the Company.
(iv) Use, disclose, divulge or transmit or cause to
be used by or disclosed, divulged or transmitted to any third party, any
information acquired by the Employee during the Employment Period which relates
to the trade secrets and confidential information of the Company, except as may
be required by law.
(v) Participate in, become associated with, provide
assistance to, engage in or have a financial or other interest in any business,
activity or enterprise which is competitive with the business of the Company or
any successor or assign of the Company to the extent such activities relate to
products or services which are competitive with the products and services of the
Company; provided, however, that the ownership of less than 1% of the stock of a
corporation whose shares are traded in a recognized stock exchange or traded in
the over-the-counter market, even though that corporation may be a competitor of
the Company, shall not be deemed financial participation in a competitor.
For purposes of this section 7, a
competitive business is defined as a business which is involved in designing,
developing, manufacturing or marketing mechanical, electro-mechanical and/or
electronic security and access control products in the global motor vehicle
industry.
8. Confidential Information. The parties agree that the Company's
customers, business connections, suppliers, customer lists, procedures,
operations, techniques, and other aspects of its business are established at
great expense and protected as confidential information and provide the Company
with a substantial competitive advantage in conducting its business. The parties
further agree that by virtue of the Employee's employment with the Company,
Employee will have access to, and be entrusted with, secret, confidential and
proprietary information, and that the Company would suffer great loss and injury
if the Employee would disclose this information or use it to compete with the
Company. Therefore, the Employee agrees that during the term of Employee's
employment, and for a period of two years after the termination of his
employment with the Company, Employee will not, directly or indirectly, either
individually or as an employee, agent, partner, shareholder, owner, trustee,
beneficiary,
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co-venturer, distributor, consultant or in any other capacity, use or disclose,
or cause to be used or disclosed, any secret, confidential or proprietary
information acquired by the Employee during Employee's employment with the
Company whether owned by the Company prior to or discovered and developed by the
Company subsequent to the Employee's employment, and regardless of the fact that
the Employee may have participated in the discovery and the development of that
information. Employee also agrees and acknowledges that Employee will comply
with all applicable laws regarding xxxxxxx xxxxxxx or the use of material
nonpublic information in connection with the trading of securities.
9. Common Law of Torts and Trade Secrets. The parties agree that
nothing in this Agreement shall be construed to limit or negate the common law
of torts or trade secrets where it provides the Company with broader protection
than that provided herein.
10. Specific Performance. The Employee acknowledges and agrees that
irreparable injury to the Company may result in the event the Employee breaches
any covenant and agreement contained in sections 7 and 8 and that the remedy at
law for the breach of any such covenant will be inadequate. Therefore, if the
Employee engages in any act in violation of the provisions of sections 7 and 8,
the Employee agrees that the Company shall be entitled, in addition to such
other remedies and damages as may be available to it by law or under this
Agreement, to injunctive relief to enforce the provisions of sections 7 and 8.
11. Waiver. The failure of either party to insist, in any one or more
instances, upon performance of the terms or conditions of this Agreement shall
not be construed as a waiver or a relinquishment of any right granted hereunder
or of the future performance of any such term, covenant or condition.
12. Notices. Any notice to be given hereunder shall be deemed
sufficient if addressed in writing, and delivered by registered or certified
mail or delivered personally, in the case of the Company, to its principal
business office, and in the case of the Employee, to his address appearing on
the records of the Company, or to such other address as he may designate in
writing to the Company.
13. Severability. In the event that any provision shall be held to be
invalid or unenforceable for any reason whatsoever, it is agreed such invalidity
or unenforceability shall not affect any other provision of this Agreement and
the remaining covenants, restrictions and provisions hereof shall remain in full
force and effect and any court of competent jurisdiction may so modify the
objectionable provision as to make it valid, reasonable and enforceable.
Furthermore, the parties specifically acknowledge the above covenant not to
compete and covenant not to disclose confidential information are separate and
independent agreements.
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14. Amendment. This Agreement may only be amended by an agreement in
writing signed by all of the parties hereto.
15. Governing Law. This Agreement shall be governed by and construed
exclusively in accordance with the laws of the State of Wisconsin, regardless of
choice of law requirements. The parties hereby consent to the jurisdiction of
the state courts of the State of Wisconsin and of any federal court in the venue
of Wisconsin for the purpose of any suit, action or proceeding arising out of or
related to this Agreement, and expressly waive any and all objections they may
have as to venue in any of such courts.
16. Dispute Resolution. The parties hereto shall attempt to resolve
disputes arising out of or relating to this Agreement. Any dispute not resolved
in writing within 21 days may be referred by either party to mediation involving
a mediator (a third party neutral), trained and experienced in the mediation
process and mutually agreed to by the parties. The mediator shall ascribe to and
follow the AAA/SPIDR or ABA code of ethics for mediators in conduct and
management of the mediation process. Expenses for the mediation shall be shared
equally by the parties unless otherwise agreed during the mediation process. The
parties may be accompanied in the mediation process by legal counsel, and/or
other persons mutually agreed to by the parties and the mediator. All
participants will openly and honestly participate in the mediation. The
mediation may be terminated at any time, for any reason by the mediator or by
either party. Any resolution reached by the parties during the mediation shall
be recorded in writing and agreed to by the parties. Such resolution may be
drafted and/or revised by the parties' legal counsel and shall be legally
binding on the parties.
17. Benefit. This Agreement shall be binding upon and inure to the
benefit of and shall be enforceable by and against the Company, its successors
and assigns and the Employee, his heirs, beneficiaries and legal
representatives. It is agreed that the rights and obligations of the Employee
may not be delegated or assigned.
IN WITNESS WHEREOF, the parties have executed or caused this
Agreement to be executed as of the day, month and year first above written.
EMPLOYEE STRATTEC SECURITY CORPORATION
/s/ Xxxxxx X. Xxxxx BY /s/ Xxxxxx X. Xxxxxxxx XX
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Xxxxxx X. Xxxxx Xxxxxx X. Xxxxxxxx XX,
Chairman of the Board
and Chief Executive Officer
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