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EXHIBIT 10.04
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as of
September 8, 1998 by and between CyberGuard Corporation, a Florida corporation
(the "Company"), and Xxxxxxxx X. Xxxxxxxxx (the "Employee").
WHEREAS, the Company, through its Board of Directors, desires to retain the
services of Employee, and Employee desires to be retained by the Company, on the
terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:
1. EMPLOYMENT. The Company hereby employs Employee, and Employee hereby
accepts employment, as Vice President of Finance and acting Chief Financial
Officer upon the terms of and subject to this Agreement.
2. TERM. The term (the "Term") of this Agreement shall commence on
September 8, 1998, and shall continue until otherwise terminated in accordance
with the terms of this Agreement.
3. DUTIES. During his employment hereunder, Employee will serve in such
capacity and with such duties as shall be assigned from time to time by the
Chairman of the Board of the Company. The Company acknowledges that Employee is
also an officer and principal of an accounting/consulting firm (the "Accounting
Firm"), and that the Accounting Firm requires that he devote some portion of his
business efforts. Employee shall diligently perform his duties as Chief
Financial Officer and shall devote the substantial portion of his business time
and effort to his employment with the Company and his duties hereunder. With the
exception of his work with the Accounting Firm, during the Term Employee shall
not, directly or indirectly, alone or as a member of a partnership, or as an
officer, director, employee or agent of any other person, firm or business
organization engage in any other business activities or pursuits requiring his
personal service that materially conflict with his duties hereunder or the
diligent performance of such duties.
4. COMPENSATION.
a. SALARY. During his employment hereunder, Employee shall be paid a
salary of $150,000 per year, payable in equal installments not less than
monthly ("Base Salary"). The Employee's Base Salary shall be reviewed at
least annually by the Board of Directors or any Committee of the Board
delegated the authority to review executive compensation.
b. OPTION AND BONUS. In addition to salary, Employee shall be entitled
to participate in the Company's Employee Stock Option Plan (the "Stock
Option Plan"). In addition, Employee shall participate in the management
bonus program established by the Company with an initial annual targeted
bonus equal to 40% of Employee's Base Salary (hereafter the "Management
Bonus Program").
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c. INSURANCE. During his employment hereunder, Employee shall be
entitled to participate in all such health, life, disability and other
insurance programs, if any, that the Company may offer to other key
executive employees of the Company from time to time.
d. OTHER BENEFITS. During his employment hereunder, Employee shall be
entitled to all such other benefits, if any, that the Company may offer to
other key executive employees of the Company from time to time.
e. VACATION. Employee shall be entitled to four weeks' vacation leave
(in addition to holidays) in each calendar year during the Term; however,
Employee may take only two weeks' vacation leave within any calendar month.
Except with respect to vacation time unused as the result of a request by
the Company to postpone a vacation, any unused vacation from one calendar
year shall not carry-over to any subsequent calendar year.
f. EXPENSE REIMBURSEMENT. Employee shall, upon submission of
appropriate supporting documentation, be entitled to reimbursement of
reasonable out-of-pocket expenses incurred in the performance of his duties
hereunder in accordance with policies established by the Company. Such
expenses shall include, without limitation, reasonable entertainment
expenses, gasoline and toll expenses and cellular phone use charges, if
such charges are directly related to the business of the Company.
5. GROUNDS FOR TERMINATION. The Board of Directors of the Company may
terminate this Agreement for Cause. As used herein, "Cause" shall mean any of
the following: (i) an act of willful misconduct or gross negligence by Employee
in the performance of his material duties or obligations to the Company; if such
act is capable of cure, Employee shall be given written notice and such act
shall not be deemed a basis for Cause if cured within 60 days after written
notice is received by Employee specifying the alleged failure in reasonable
detail (and during such 60 day period, Employee shall continue to be employed by
the Company at full pay), or (ii) conviction of Employee of a felony involving
moral turpitude or (iii) a material act of dishonesty or breach of trust on the
part of Employee resulting or intended to result directly or indirectly in
personal gain or enrichment at the expense of the Company.
6. TERMINATION BY EMPLOYEE. Employee may terminate this Agreement with Good
Reason. In the event of termination by Employee for Good Reason, Employee shall
be entitled to the benefits of Paragraph 7b. of this Agreement. "Good Reason"
means:
a. The Company materially breaches the provisions of this Agreement
(except those set forth in Paragraph 4a.) and Employee provides at least 15
days' prior written notice to the Company of the existence of such breach
and his intention to terminate this Agreement (no such termination shall be
effective if such breach is cured during such period); or
b. The Company fails to comply with the provisions of Xxxxxxxxx 0x. or
to pay any amounts due under the Management Bonus Program provisions of
Paragraph 4b. for an uninterrupted 10 day period; or
c. The Company requires Employee to work in a non-supervisory or
non-management position; or
d. The Company decreases Employee's compensation (salary or percentage
of bonus opportunity); or
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e. The Company materially reduces Employee's welfare benefits,
including without limitation: paid vacation; paid sick time; paid legal and
float holidays; medical, dental and cancer insurance, hospital indemnity,
Flexible Spending, Short- and Long-term Disability insurance, Basic Group
Term Life/Accidental Death & Dismemberment insurance, Supplemental
Life/AD&D insurance, Spouse Life/Spouse AD&D insurance, Dependent Life
insurance, Vision Plan, 401k plan, Employee Assistance Program; education
reimbursement program (collectively, the "Benefits"); provided, however,
that any change in Benefits that is made by the Company that applies to its
employees generally, shall not be considered as giving rise to "Good
Reason"; or
f. The Employee is required, without his prior written consent, to
relocate his office more than seventy-five miles from the office Employee
currently reports to.
7. PAYMENT AND OTHER PROVISIONS UPON TERMINATION.
a. In the event Employee's employment with the Company (including its
subsidiaries) is terminated by the Company for Cause as provided in
Paragraph 5 then, on or before Employee's last day of employment with the
Company, the provisions of this Paragraph 7a. shall apply. These same
provisions shall apply if Employee terminates his employment without Good
Reason as described in Paragraph 6.
i. SALARY, PERFORMANCE AWARD, AND BONUS PAYMENTS. The Company
shall pay in a lump sum to Employee at the time of Employee's
termination such amount of compensation due Employee for services
rendered to the Company, as well as compensation for unused vacation
time and earned bonus, as has accrued but remains unpaid. Any and all
other rights granted to Employee under this Agreement shall terminate
as of the date of termination.
ii. NON-COMPETITION/NON-SOLICITATION PERIOD. The provisions of
Paragraphs 14 and 15 shall, at the option of the Company in its sole
discretion, continue to apply with respect to Employee for a period of
up to six months following the date of termination, so long as the
Company: (x) provides a written notice to Employee within 5 business
days after Employee's termination that the Company wishes to exercise
its right to require that Employee not compete and not solicit in
accordance with Paragraphs 14 and 15 hereof; and (y) Company
thereafter pays to Employee in periodic installments, without
interest, in accordance with the regular salary payment practices of
the Company an amount equal to (.1) the amount of Employee's annual
Base Salary as in effect immediately prior to Employee's date of
termination, multiplied by (.2) the number of months that the Company
is requiring the non-competition and non-solicitation covenants to
remain in place, divided by 12. The first such installment of Base
Salary and target bonus shall be paid on or before the delivery of the
notice described in the prior sentence of this Paragraph 7a(ii). The
non-competition and non-solicitation provisions of this Agreement
shall no longer apply to Employee if the Company fails to pay the
amounts required under this Section 7a(ii) for an uninterrupted 10-day
period and such failure is not cured with 5 days after written notice
of such failure is delivered to the Company.
b. In the event Employee's employment with the Company (including its
subsidiaries) is terminated by the Company for any reason other than for
Cause as provided in Paragraph 5 and other than as a consequence of
Employee's death, disability, or normal retirement under the Company's
retirement plans and practices, then the following provisions apply. These
same provisions shall apply if Employee terminates his employment with Good
Reason as described in Paragraph 6. In addition to the
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amounts stated below, Employee shall be paid any other amounts by the
Company to which he is entitled.
i. SALARY, PERFORMANCE AWARD, AND BONUS PAYMENTS. On or before
Employee's last day of employment with the Company, the Company shall
pay in a lump sum to Employee as compensation for services rendered to
the Company a cash amount equal to one-half the amount of Employee's
annual Base Salary and the greater of (x) one-half the target bonus
under the Management Bonus Program as in effect immediately prior to
his date of termination or (y) the amount of the bonus under the
Management Bonus Program to which he is entitled but which remains
unpaid. At the election of the Company, the cash amount referred to in
this Paragraph 7b.i. may be paid to Employee in periodic installments,
without interest, in accordance with the regular salary payment
practices of the Company, with the first such installment to be paid
on or before Employee's last day of employment with the Company, and
no interest shall be paid with respect to any amount not paid on the
Employee's date of termination.
ii. VESTING OF OPTIONS AND RIGHTS. Notwithstanding the vesting
period provided for in the Stock Option Plan and any related stock
option agreements between the Company and Employee for stock options
("options") and stock appreciation rights ("rights") granted Employee
by the Company, all options and stock appreciation rights that were
exercisable at the date of termination or within 12 months thereafter
shall be immediately exercisable upon termination of employment. In
addition, Employee will have the right to exercise all such options
and rights for the shorter of (a) six months following his termination
of employment or (b) with respect to each option, the remainder of the
period of exercisability under the terms of the appropriate documents
that grant such options.
iii. BENEFIT PLAN COVERAGE. The Company shall maintain in full
force and effect for Employee and his dependents for six months after
the date of termination, all life, health, accident, and disability
benefit plans and other similar employee benefit plans, programs and
arrangements in which Employee or his dependents were entitled to
participate immediately prior to the date of termination, in such
amounts as were in effect immediately prior to the date of
termination, provided that such continued participation is possible
under the general terms and provisions of such benefit plans, programs
and arrangements.
In the event that participation in any benefit plan, program or
arrangement described above is barred, or any such benefit plan,
program or arrangement is discontinued or the benefits thereunder
materially reduced, the Company shall arrange to provide Employee and
his dependents for six months after the date of termination with
benefits substantially similar to those that they were entitled to
receive under such benefit plans, programs and arrangements
immediately prior to the date of termination. Notwithstanding any time
period for continued benefits stated in this Paragraph 7b.iii., all
benefits in this Paragraph 7b.iii. will terminate on the date that
Employee becomes an employee of another employer and eligible to
participate in the employee benefit plans of such other employer. To
the extent that Employee was required to contribute amounts for the
benefits described in this Paragraph 7b.iii. prior to his termination,
he shall continue to contribute such amounts for such time as these
benefits continue in effect after termination.
iv. OTHER COMPENSATION. Any awards previously made to Employee
under any of the Company's compensation plans or programs and not
previously paid shall immediately vest on the date of his termination
and shall be paid on that date and included as compensation in the
year paid.
v. SAVINGS AND OTHER PLANS. Except as otherwise more specifically
provided herein or under the terms of the respective plans relating to
termination of employment, Employee's active participation in any
applicable savings, retirement, profit sharing or supplemental
employee
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retirement plans or any deferred compensation or similar plan of the
Company or any of its subsidiaries shall continue only through the
last day of his employment. All other provisions, including any
distribution and/or vested rights under such plans, shall be governed
by the terms of those respective plans.
vi. NON-COMPETITION/NON-SOLICITATION PERIOD. The provisions of
Paragraphs 14 and 15 shall continue, beyond the time periods set forth
in such paragraphs, to apply with respect to Employee for six (6)
months following the date of termination. The non-competition and
non-solicitation provisions of this Agreement shall no longer apply to
Employee if the Company fails to pay the amounts required under the
provisions of Paragraph 7b.i. for an uninterrupted 10-day period and
such failure is not cured within 5 days after written notice of such
failure is delivered to the Company.
c. The provisions of this Paragraph 7 shall apply if Employee's
employment is terminated prior to or more than one year after the
occurrence of a Change of Control (as defined in Paragraph 8c.). From the
occurrence of any Change of Control until the first anniversary of such
Change of Control, the provisions of Paragraph 8 shall apply in place of
this Paragraph 7, EXCEPT THAT in the event that Employee's employment is
terminated by Employee after a Change of Control without Good Reason, then
the provisions of Paragraph 8 shall not apply and the provisions of
Paragraph 7a. shall apply. Termination upon death, disability and
retirement are covered by Paragraphs 9, 10, and 11, respectively.
8. PAYMENT AND OTHER PROVISIONS AFTER CHANGE OF CONTROL.
a. SALARY, PERFORMANCE AWARD, AND BONUS PAYMENTS. In the event
Employee's employment with the Company is terminated within one year
following the occurrence of a Change of Control (other than as a
consequence of his death or disability, or of his normal retirement under
the Company's retirement plans and practices) either (i) by the Company for
any reason whatsoever or (ii) by Employee with Good Reason as provided in
Paragraph 6, then Employee shall be entitled to receive from the Company,
the following:
i. BASE SALARY. An amount equal to one-half the Employee's annual
Base Salary as in effect at the date of termination shall be paid on
the date of termination;
ii. TARGET BONUS. An amount equal to one-half the Employee's
target bonus under the Management Bonus Program for the fiscal year in
which the date of termination occurs shall be paid on the date of
termination; and
iii. OTHER BENEFITS. All benefits under Paragraphs 7b.i, 7.b.ii.,
7b.iii. 7b.iv. and 7b.v. shall be extended to Employee as described in
such paragraphs except that all options and rights shall be immediately
exercisable and the period for exercise of options and rights described
in the last sentence of Paragraph 7b.ii and benefit plan coverage as
described in Paragraph 7.b.iii shall be one half year.
b. NON-COMPETITION/NON-SOLICITATION PERIOD. In the event of a
termination under the circumstances described in Paragraph 8a., the
provisions of Paragraphs 14 and 15 shall be without force and effect and
shall not apply to Employee.
c. For purposes of this Agreement, the term "Change of Control" shall
mean:
i. The acquisition, other than from the Company, by any
individual, entity or group (within the meaning of Section 13(d)(3) or
Section 14(d)(2) of the Securities Exchange Act of 1934, as amended
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(the "Exchange Act")) of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) (any of the foregoing
described in this Paragraph hereafter a "Person") of 30% or more of
either (a) the then outstanding shares of Capital Stock of the Company
(the "Outstanding Capital Stock") or (b) the combined voting power of
the then outstanding voting securities of the Company entitled to vote
generally in the election of directors (the "Voting Securities"),
PROVIDED, HOWEVER, that any acquisition by (x) the Company or any of
its subsidiaries, or any employee benefit plan (or related trust)
sponsored or maintained by the Company or any of its subsidiaries or
(y) any Person that is eligible, pursuant to Rule 13d-1(b) under the
Exchange Act, to file a statement on Schedule 13G with respect to its
beneficial ownership of Voting Securities, whether or not such Person
shall have filed a statement on Schedule 13G, unless such Person shall
have filed a statement on Schedule 13D with respect to beneficial
ownership of 30% or more of the Voting Securities or (z) any
corporation with respect to which, following such acquisition, more
than 60% of, respectively, the then outstanding shares of common stock
of such corporation and the combined voting power of the then
outstanding voting securities of such corporation entitled to vote
generally in the election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the individuals
and entities who were the beneficial owners, respectively, of the
Outstanding Capital Stock and Voting Securities immediately prior to
such acquisition in substantially the same proportion as their
ownership, immediately prior to such acquisition, of the Outstanding
Capital Stock and Voting Securities, as the case may be, shall not
constitute a Change of Control; or
ii. Individuals who, as of the date hereof, constitute the Board
(the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board, provided that any individual becoming a
director subsequent to the date hereof whose election or nomination
for election by the Company's shareholders, was approved by a vote of
at least a majority of the directors then comprising the Incumbent
Board shall be considered as though such individual were a member of
the Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office is in connection with an
actual or threatened election contest relating to the election of the
Directors of the Company (as such terms are used in Rule 14a-11 of
Regulation 14A, or any successor section, promulgated under the
Exchange Act); or
iii. Approval by the shareholders of the Company of a
reorganization, merger or consolidation (a "Business Combination"), in
each case, with respect to which all or substantially all holders of
the Outstanding Capital Stock and Voting Securities immediately prior
to such Business Combination do not, following such Business
Combination, beneficially own, directly or indirectly, more than 60%
of, respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors, as the case
may be, of the corporation resulting from Business Combination; or
iv. (a) a complete liquidation or dissolution of the Company or
(b) a sale or other disposition of all or substantially all of the
assets of the Company other than to a corporation with respect to
which, following such sale or disposition, more than 60% of,
respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors is then owned
beneficially, directly or indirectly, by all or substantially all of
the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Capital Stock and Voting Securities
immediately prior to such sale or disposition in substantially the
same proportion as their ownership of the Outstanding Capital Stock
and Voting Securities, as the case may be, immediately prior to such
sale or disposition.
9. TERMINATION BY REASON OF DEATH. If Employee shall die while employed by
the Company both prior to termination of employment and during the effective
Term of this Agreement, all Employee's rights under this Agreement shall
terminate with the payment of such amounts of annual Base Salary as have
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accrued but remain unpaid and a prorated amount of targeted bonus under the
Company's Management Bonus Program through the month in which his death occurs,
plus three additional months of the fixed salary and targeted bonus. All
benefits under 7b.ii., 7b.iv and 7b.v. shall be extended to Employee's estate as
described in such paragraphs. In addition, Employee's eligible dependents shall
receive continued benefit plan coverage under Paragraph 7b.iii. for three months
from the date of Employee's death.
10. TERMINATION BY DISABILITY. Employee's employment hereunder may be
terminated by the Company for disability. In such event, all Employee's rights
under this Agreement shall terminate with the payment of such amounts of annual
Base Salary as have accrued but remain unpaid as of thirtieth (30th) day after
such notice is given EXCEPT that all benefits under Xxxxxxxxxx 0x.xx, 0x.xxx,
0x.xx. and 7b.v. shall be extended to Employee as described in such paragraphs.
In addition, the non-competition and non-solicitation provisions of Paragraphs
14 and 15 shall continue to apply to Employee for a period of one year from the
date of termination.
For purposes of this Agreement, "disability" is defined to mean that, as a
result of Employee's incapacity due to physical or mental illness:
a. Employee shall have been absent from his duties as an officer of
the Company on a substantially full-time basis for six (6) consecutive
months; and
b. Within thirty (30) days after the Company notifies Employee in
writing that it intends to replace him, Employee shall not have returned to
the performance of his duties as an officer of the Company on a full-time
basis.
11. RETIREMENT. Retirement by Employee, whether occurring as a result of a
voluntary termination by Employee or an involuntary termination as the result of
reaching the age retirement as set forth in the Company's retirement policies,
shall be treated as a voluntary termination without Good Reason and the
provisions of Paragraph 7a. shall apply. If during the Term or any extension
thereof, the Company adopts a retirement plan with respect to executive officers
of the Company, Employee shall have the right to participate in such policy and
the provisions of such policy shall supersede the provisions of the preceding
sentence.
12. INDEMNIFICATION. If litigation shall be brought, in the event of breach
or to enforce or interpret any provision contained herein, the non-prevailing
party shall indemnify the prevailing party for reasonable attorney's fees
(including those for negotiations, trial and appeals) and disbursements incurred
by the prevailing party in such litigation, and hereby agrees to pay prejudgment
interest on any money judgment obtained by the prevailing party calculated at
the generally prevailing NationsBank of Florida, N.A. base rate of interest
charged to its commercial customers in effect from time to time from the date
that payment(s) to him should have been made under this Agreement.
13. (Omitted Intentionally)
14. NON-COMPETITION.
a. At all times during Employee's employment hereunder, and for such
additional periods as may otherwise be set forth in this Agreement in
reference to this Paragraph 14, Employee shall not, directly or indirectly,
engage in any business, enterprise or employment, whether as owner,
operator, shareholder, director, partner, creditor, consultant, agent or
any capacity whatsoever that manufactures products designed to compete
directly with products of the Company or markets such products anywhere in
the world where the Company (i) is engaged in business or (ii) has
evidenced an intention of engaging
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in business. Employee acknowledges that he has read the foregoing and
agrees that the nature of the geographical restrictions are reasonable
given the international nature of the Company's business.
In the event that these geographical or temporal restrictions are
judicially determined to be unreasonable, the parties agree that these
restrictions shall be judicially reformed to the maximum restrictions which
are reasonable.
b. Notwithstanding the provisions of the preceding Paragraph 14a.,
Employee may accept employment with a company that would be deemed to be a
competitor of the Company as described in the previous sentence
("Competitor"), so long as (i) the Competitor has had annual revenues of at
least $1 billion in each of the prior two fiscal years, (ii) the
Competitor's revenues for products and maintenance in direct competition
with the Company does not exceed 50% of its total revenues and (iii)
Employee's responsibilities are solely for divisions or subsidiaries of the
Competitor that do not compete with the Company.
15. NON-SOLICITATION OF EMPLOYEES AND CUSTOMERS. At all times during
Employee's employment hereunder, or for such additional periods as may otherwise
be set forth in this Agreement in reference to this Paragraph 15, Employee shall
not, directly or indirectly, for himself or for any other person, firm,
corporation, partnership, association or other entity (a) attempt to employ,
employ or enter into any contractual arrangement with any employee or former
employee of the Company, its affiliates, subsidiaries or predecessors in
interest, unless such employee or former employee has not been employed by the
Company, its affiliates, subsidiaries or predecessors in interest during the
twelve months prior to Employee's attempt to employ him, or (b) call on or
solicit any of the actual or targeted prospective customers of the Company or
its affiliates, subsidiaries or predecessors in interest with respect to any
matters related to or competitive with the business of the Company.
16. CONFIDENTIALITY.
a. NONDISCLOSURE. Employee acknowledges and agrees that the
Confidential Information (as defined below) is a valuable, special and
unique asset of the Company's business. Accordingly, except in connection
with the performance of his duties hereunder, Employee shall not at any
time during or subsequent to the term of his employment hereunder disclose,
directly or indirectly, to any person, firm, corporation, partnership,
association or other entity any proprietary or confidential information
relating to the Company or any information concerning the Company's
financial condition or prospects, the Company's customers, the design,
development, manufacture, marketing or sale of the Company's products or
the Company's methods of operating its business (collectively "Confidential
Information"). Confidential Information shall not include information
which, at the time of disclosure, is known or available to the general
public by publication or otherwise through no act or failure to act on the
part of Employee.
b. RETURN OF CONFIDENTIAL INFORMATION. Upon termination of Employee's
employment, for whatever reason and whether voluntary or involuntary, or at
any time at the request of the Company, Employee shall promptly return all
Confidential Information in the possession or under the control of Employee
to the Company and shall not retain any copies or other reproductions or
extracts thereof. Employee shall at any time at the request of the Company
destroy or have destroyed all memoranda, notes, reports, and documents,
whether in "hard copy" form or as stored on magnetic or other media, and
all copies and other reproductions and extracts thereof, prepared by
Employee and shall provide the Company with a certificate that the
foregoing materials have in fact been returned or destroyed.
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c. BOOKS AND RECORDS. All books, records and accounts whether prepared
by Employee or otherwise coming into Employee's possession, shall be the
exclusive property of the Company and shall be returned immediately to the
Company upon termination of Employee's employment hereunder or upon the
Company's request at any time.
17. INJUNCTION/SPECIFIC PERFORMANCE SETOFF. Employee acknowledges that a
breach of any of the provisions of Paragraphs 14, 15 or 16 hereof would result
in immediate and irreparable injury to the Company which cannot be adequately or
reasonably compensated at law. Therefore, Employee agrees that the Company shall
be entitled, if any such breach shall occur or be threatened or attempted, to a
decree of specific performance and to a temporary and permanent injunction,
without the posting of a bond, enjoining and restraining such breach by Employee
or his agents, either directly or indirectly, and that such right to injunction
shall be cumulative to whatever other remedies for actual damages to which the
Company is entitled. Employee further agrees that the Company may set off
against or recoup from any amounts due under this Agreement to the extent of any
losses incurred by the Company as a result of any breach by Employee of the
provisions of Paragraphs 14, 15 or 16 hereof.
18. SEVERABILITY. Any provision in this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
only to the extent of such prohibition or unenforceability without invalidating
or affecting the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
19. SUCCESSORS. This Agreement shall be binding upon Employee and inure to
his and his estate's benefit, and shall be binding upon and inure to the benefit
of the Company and any permitted successor of the Company. Neither this
Agreement nor any rights arising hereunder may be assigned or pledged by:
Employee or anyone claiming through Employee; or by the Company, except to any
corporation which is the successor in interest to the Company by reason of a
merger, consolidation or sale of substantially all of the assets of the Company.
The foregoing sentence shall not be deemed to have any effect upon the rights of
Employee upon a Change of Control.
20. CONTROLLING LAW. This Agreement shall in all respects be governed by,
and construed in accordance with, the laws of the State of Florida.
21. NOTICES. Any notice required or permitted to be given hereunder shall
be written and sent by registered or certified mail, telecommunicated or hand
delivered at the address set forth herein or to any other address of which
notice is given:
To the Company: CyberGuard Corporation
0000 Xxxx Xxxxxxxxxx Xxxxxxxxx
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attention: President
To Employee: Xxxxxxxx X. Xxxxxxxxx
X.X. Xxx 0000
Xxxxx Xxxxxxx, XX 00000
22. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties hereto on the subject matter hereof and may not be modified
without the written agreement of both parties hereto.
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23. WAIVER. A waiver by any party of any of the terms and conditions hereof
shall not be construed as a general waiver by such party.
24. COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall be deemed an original and both of which together shall constitute a
single agreement.
25. INTERPRETATION. In the event of a conflict between the provisions of
this Agreement and any other agreement or document defining rights and duties of
Employee or the Company upon Employee's termination, the rights and duties set
forth in this Agreement shall control.
26. CERTAIN LIMITATIONS ON REMEDIES. Paragraph 7b. provides that certain
payments and other benefits shall be received by Employee upon the termination
of Employee by the Company other than for Cause and states that these same
provisions shall apply if Employee terminates his employment for Good Reason. It
is the intention of this Agreement that if the Company terminates Employee other
than for Cause (and other than as a consequence of Employee's death, disability
or normal retirement) or if Employee terminates his employment with Good Reason,
then the payments and other benefits set forth in Paragraph 7b. shall constitute
the sole and exclusive remedies of Employee.
27. SURVIVAL. Notwithstanding the provisions of Paragraph 2, the provisions
of Paragraphs 14, 15, and 16 shall survive the expiration or early termination
of this Agreement.
IN WITNESS WHEREOF, this Employment Agreement has been executed by the
parties as of the date first above written.
COMPANY:
CYBERGUARD CORPORATION
-------------------------------
By: C. Xxxxxxx Xxxxx
Its: Chairman
EMPLOYEE:
-------------------------------
Xxxxxxxx X. Xxxxxxxxx
