EXHIBIT 10.4
AGREEMENT
MADE, as of the 18th day of December, 2000 by and between XXXXXX XXXXX
COMPANY (the "Company") and XXXXXXX XXXXXXX ("Xxxxxxx").
RECITALS
X. Xxxxxxx is an officer of the Company and prior to becoming such, was an
officer of Penobscot Shoe Company which was acquired by, and became a wholly
owned subsidiary of, the Company.
B. While employed by Penobscot, Xxxxxxx entered into a Change-of-Control
Agreement with Penobscot dated January 6, 1999 whereby Penobscot agreed, upon
any change of control as defined in that Agreement, to pay Xxxxxxx certain
monies (see Exhibit attached hereto).
X. Xxxxxxx and the Company wish to terminate the Change-of-Control
Agreement with Penobscot in favor of this Agreement by the Company to provide
deferred compensation to Xxxxxxx upon his retirement.
COVENANTS
NOW, THEREFORE, in consideration of the covenants herein contained, the
parties agree as follows:
1. Deferred Compensation. Upon Xxxxxxx'x retirement from the Company one
year from the date hereof, or later, or upon Xxxxxxx'x earlier death or total
disability, the Company agrees to pay to Xxxxxxx the sum of $100,000 (less
applicable payroll taxes) in four equal quarterly installments commencing on the
date which is three months after the date of Xxxxxxx'x retirement (or earlier
death or total disability) and continuing on that same day each of the next
three quarters. Payments are conditioned on Xxxxxxx'x compliance with the
provisions of Sections 3 and 4 of this Agreement.
2. Termination of Change-of-Control Agreement. In consideration of the
agreement of the Company to make the deferred compensation payments described in
Section 1 above, Xxxxxxx waives all rights to payments under the
Change-of-Control Agreement and agrees that the same is hereby terminated and of
no further force and effect.
3. Covenant Not to Compete.
(a) Xxxxxxx recognizes and acknowledges that the Confidential
Information (as hereafter defined) constitutes valuable secret, special, and
unique assets of the Company. Xxxxxxx covenants and agrees that, during the term
of this Agreement and for a period of one year following termination (whether
voluntary or involuntary), Xxxxxxx will not disclose the
Confidential Information to any person, firm, corporation, association, or other
entity for any reason or purpose without the express written approval of the
Company and will not use the Confidential Information except in the Company"
business. The term "Confidential Information" includes all information, whether
or not reduced to written or recorded form, that is related to the Company and
that is not generally known to competitors of the Company nor intended for
general dissemination, whether furnished by the Company or compiled by Xxxxxxx,
including but not limited to: (i) lists of the Company's customers, supplies,
agents, manufacturers, distributors or brokers and the terms of all contracts or
relationships with them, (ii) designs and specifications of Company products or
proposed products, (iii) Company strategies, plans (financial, operational or
otherwise), and all other types of written information customarily used by the
Company or available to Xxxxxxx. Xxxxxxx understands that it is the Company's
intention to maintain the confidentiality of this information notwithstanding
that employees of the Company may have free access to the information for the
purpose of performing their duties with the Company, and notwithstanding that
employees who are not expressly bound by agreements similar to this agreement
may have access to such information for job purposes. Xxxxxxx acknowledges that
it is not practical, and shall not be necessary, to xxxx such information as
"confidential," nor to transfer it within the Company by confidential envelope
or communication, in order to preserve the confidential nature of the
information.
(b) For a period of one (1) year following termination of employment
(whether voluntary or involuntary), Xxxxxxx specifically agrees not to engage
in, either as officer, director, stockholder, owner, partner, employee,
promoter, consultant, manager, or otherwise, any business of any kind or
character that competes with the business of the Company wherever the same is
conducted.
(c) Xxxxxxx agrees that the Company shall have the right to
communicate the terms of this Agreement to any prospective employer of Xxxxxxx.
(d) In the event of a breach or threatened breach of the provisions
of this Section 3, the Company shall be entitled to injunctive relief as well as
any other remedies at law or in equity. Xxxxxxx understands, and agrees that
without such protection, the Company's business would be irreparably harmed, and
that the remedy of monetary damages alone would be inadequate.
(e) Should legal proceedings (including arbitration proceedings)
have to be brought by the Company against Xxxxxxx to enforce this Agreement, the
period of restriction under this Section 3 shall be deemed to begin running on
the date of entry of an order granting the Company preliminary injunctive relief
and shall continue uninterrupted for the next succeeding year. Xxxxxxx
acknowledges that the purposes of this Section 3 would be frustrated by
measuring the period of restriction from the date of termination of employment
where Xxxxxxx failed to honor the Agreement until directed to do so by court
order.
(f) The provisions of this Section 3 shall be independent of any
other provision of this Agreement, and the existence of any claim or cause of
action by Xxxxxxx against the Company, whether predicated on this Agreement or
otherwise, shall not constitute a defense to the enforcement of this Section 3
by the Company.
(g) Should a court of competent jurisdiction declare any of the
covenants set forth in this Section 3 unenforceable, each of the parties hereto
agrees that such court shall be empowered and shall grant the Company injunctive
relief reasonably necessary to protect its interest.
4. Soliciting; the Company's Employees. Xxxxxxx agrees that he will not,
for a period of one (1) year following termination of employment with the
Company, directly or indirectly solicit or seek to induce any of the Company's
employees to leave the Company's employ for any reason, including, without
limitation, to work for Xxxxxxx or any other competitive company. Xxxxxxx
acknowledges and agrees that all activities under this Section 4 shall justify
injunctive relief as provided in Section 3.
5. Entire Agreement. This instrument contains the entire agreement of the
parties. This Agreement may not be changed orally but only by an agreement in
writing signed by the party against whom enforcement of any waiver, change,
modification, extension or discharge is sought.
6. Binding Effect. This Agreement shall be binding on and inure to the
benefit of the respective parties and their respective heirs, legal
representatives, successors and assigns.
7. Waiver of Jury Trial. Xxxxxxx and the Company hereby knowingly,
voluntarily and intentionally waive any right either may have to a trial by jury
with respect to any litigation related to or arising out of, under or in
conjunction with this Agreement, or Xxxxxxx'x employment with the Company.
8. Governing Law. This Agreement shall be governed by and construed and
enforced according to the internal laws of the State of New York, excluding laws
related to conflicts of law.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
XXXXXX XXXXX COMPANY
By: /s/ Xxxxx X. Xxxxxxx
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/s/ Xxxxxxx Xxxxxxx
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XXXXXXX XXXXXXX
