AGREEMENT
This Agreement ("Agreement) between ELTRAX SYSTEMS, INC., a Minnesota
corporation having its principal place of business in Southfield, Michigan
("Eltrax"), together with its subsidiaries (collectively, the "Company") and
XXXX XXXXXX, an individual residing in the State of New Jersey ("Xxxxxx") is
dated as of February ___, 1999, but shall become effective only on the date the
merger between Sulcus Acquiring Corporation, a wholly owned subsidiary of Eltrax
("SAC") and Sulcus Hospitality Technologies Corp. ("Sulcus") is consummated (the
"Effective Time"). In the event that the merger between SAC and Sulcus (the
"Merger") does not take place, this Agreement shall be null and void and without
any effect whatsoever.
R E C I T A L S
WHEREAS, Xxxxxx has been employed by Sulcus as its Chief Executive
Officer since March 3, 1997; and
WHEREAS, as a result of the Merger, Sulcus will cease to exist as a
public company and will become a wholly owned subsidiary of Eltrax, and
WHEREAS, Eltrax desires to insure an orderly and smooth integration of
the Sulcus operations with and into Eltrax; and
WHEREAS, Eltrax desires to hire Xxxxxx to assist in the combination of
the Sulcus and Eltrax operations and Xxxxxx desires to serve in such capacity.
NOW, THEREFORE, in consideration for the mutual covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
ARTICLE 1
1.1 TERM. The term of this Agreement shall commence on April 1, 1999 and
shall terminate on August 31, 2000, unless earlier terminated pursuant to
Article 3 of this Agreement.
1.2 POSITION. On and before August 31, 1999 (the "Employment Period"),
Xxxxxx will be employed by the Company as Special Advisor to the Eltrax
Board and the Company's executive officers. From September 1, 1999
through August 31, 2000 (the "Consulting Period"), Xxxxxx will serve as a
consultant to the Company.
1.3 DUTIES.
(a) During the Employment Period, Xxxxxx shall devote his full-
business time and give his best efforts to the Company and to
fulfilling his duties as may from time to time be assigned to him
by the Eltrax Board of Directors or the Chief Executive Officer of
the Company, provided such duties are commensurate with Xxxxxx'
experience and/or skills or expertise. During the Consulting
Period, Xxxxxx shall continue in his role as Special Advisor, but
shall not be required to work more than one (1) day per month on
behalf of the Company.
(b) Xxxxxx shall perform his duties in the best interests of the
Company and its shareholders.
(c) Xxxxxx shall comply with the Company's policies and procedures to
the extent they are not inconsistent with this Agreement in which
case the provisions of this Agreement shall prevail. In addition,
Xxxxxx shall comply with the Company's lawful policies regarding
conduct and business ethics.
ARTICLE 2
2.1 COMPENSATION. For services rendered under this Agreement, during the
Employment Period, the Company shall pay Xxxxxx, in accordance with the
Company's usual pay practice, a monthly salary, exclusive of benefits, of
Twenty Four Thousand Dollars ($24,000). During the Consulting Period,
the Company shall pay Xxxxxx a monthly amount, exclusive of benefits, of
One Thousand Four Hundred and Fifty Dollars ($1,450).
2.2 BENEFITS. During the Employment Period, Xxxxxx will participate in the
Company's medical benefit plan (including, but not limited to, health,
dental and other similar benefits) and all other benefit plans currently
maintained or hereafter established by the Company on the same basis as
other executive employees in accordance with Company policies and plans.
During the Consulting Period, Xxxxxx will only participate in the
Company's medical benefit plan. The Company will pay any premiums (but
not co-pays or other similar expenses) associated with Xxxxxx'
participation in any benefit plan under this Section 2.2.
2.3 VACATION. During the Employment Period, Xxxxxx will be entitled to two
(2) weeks of paid vacation. Sick days and holidays will be in accordance
with Company policy.
2.4 EXPENSES. The Company shall reimburse Xxxxxx for all expenses reasonably
and necessarily incurred by Xxxxxx during this Agreement, subject to and
made in accordance with such reasonable and nondiscriminatory policies
and procedures as may be established by the Company as applicable to its
employees and consultants.
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ARTICLE 3
3.1 TERMINATION FOR CAUSE. The Company may terminate this Agreement and
Xxxxxx' services immediately for Cause. For the purpose hereof, "Cause"
means: (a) engaging in any personal or business activities that are
materially harmful to the Company; (b) theft or embezzlement of the
Company's assets, or misuse of Company funds; (c) willful violation of
law constituting a felony; (d) the commission of any illegal act that
materially xxxxx or is reasonably expected to materially harm the
Company; (e) a material breach of the terms and conditions of this
Agreement not cured within thirty (30) days after written notice
describing the details of such breach; (f) the continued failure by
Xxxxxx to perform his duties as reasonably assigned to Xxxxxx under this
Agreement for a period of thirty (30) days after written notice
describing such failure; (g) willful failure to disclose any improper or
illegal activities that may materially harm the Company; (h) a willful
breach of any confidential Company matters; or (i) breach of any
fiduciary responsibilities or duties to the Company.
In the event of termination for Cause pursuant to this section, Xxxxxx
shall be paid through the date that any notice of termination is received
by Xxxxxx (the "Termination Date").
3.2 TERMINATION WITHOUT CAUSE. Either Xxxxxx or the Company may terminate
this Agreement and Xxxxxx' services without Cause upon fifteen (15) days
advance written notice (the "Termination Notice"). In the event of
termination of this Agreement and of Xxxxxx' services pursuant to this
section, compensation shall be paid as follows:
(a) If the termination is by Xxxxxx, Xxxxxx shall be paid through the
date specified in the Termination Notice.
(b) If the termination is by the Company, Xxxxxx shall be paid through
the term of this Agreement, and all benefits described in Section
2.2 shall continue through the term of this Agreement. The Company
shall be treated as having terminated Xxxxxx without cause if it
commits a material breach of the terms and conditions of this
Agreement.
3.3 TERMINATION IN THE EVENT OF DEATH OR DISABILITY. In the event of Xxxxxx'
death, payments to Xxxxxx shall terminate as of the day immediately
following such death. In the event of Xxxxxx' Disability, payments to
Xxxxxx shall terminate immediately following the thirtieth (30th)
consecutive day of such Disability. For purposes of this Section 3.3,
"Disability" shall mean Xxxxxx' inability, as reasonably determined by
the Company, to perform the essential functions of his duties under this
Agreement because of illness or incapacity for a continuous period of
thirty (30) days.
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ARTICLE 4
CONFIDENTIALITY, DISCLOSURE AND ASSIGNMENT
4.1 CONFIDENTIALITY.
(a) Xxxxxx will not, during the term or after the termination or
expiration of the Agreement, publish, disclose, or utilize in any
manner any Confidential Information (as hereinafter defined)
obtained while performing services for the Company. If Xxxxxx
ceases to perform services on behalf of the Company, Xxxxxx will
not, without its prior written consent, retain or take away any
drawing, writing or other record in any form containing any
Confidential Information. "Confidential Information" means
information or material which is not generally available to or
used by others, or the utility or value of which is not generally
known or recognized as standard practice, whether or not the
underlying details are in the public domain, including:
(a) information or material relating to the Company, and its
businesses as conducted or anticipated to be conducted, business
plans, operations, past, current or anticipated software, products
or services, customers or prospective customers, or research,
engineering, development, manufacturing, purchasing, accounting,
or marketing activities; (b) information or material relating to
the Company's inventions, improvements, discoveries, "know-how,"
technological developments, or unpublished works, or to the
materials, apparatus, processes, formulae, plans or methods used
in the development, manufacture or marketing of the Company's
software, products or services; (c) any information marked
"proprietary," "private," or "confidential"; (d) trade secrets;
(e) software in any stage of development, including source code
and binary code, software designs, specifications, programming
aids(including subroutines and productivity tools), programming
languages, interfaces, visual displays, technical documentation,
user manuals, data files and databases; and (f) any similar
information of the type described above which the Company obtained
from another party and which the Company treats as or designates
as being proprietary, private or confidential, whether or not
owned or developed by the Company.
(b) With respect to paragraph (a) above, the restrictions on Xxxxxx'
use of Confidential Information shall not apply to any
information:
(i) which is lawfully received by Xxxxxx, free of restriction
from another source, having the right to so furnish such
information; or
(ii) after it has become generally available to the public
without breach of this Agreement by Xxxxxx; or
(iii) which at the time of disclosure to Xxxxxx was known to
Xxxxxx; or
(iv) which the Company agrees in writing is free of such
restrictions.
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4.2 BUSINESS CONDUCT AND ETHICS. During the term which Xxxxxx provides
services to the Company, Xxxxxx will dutifully comply with all
reasonable, nondiscriminatory Company policies and guidelines and will
observe the highest standard of ethical business conduct.
4.3 DISCLOSURE. Xxxxxx will disclose promptly in writing to an officer of
the Company all inventions, discoveries, software, writings and other
works of authorship which are conceived, made, discovered, or written
jointly or singly on business time during the term of this Agreement,
provided the invention, improvement, discovery, software, writing or
other work of authorship is capable of being used by the Company in the
normal course of business, and all such inventions, improvements,
discoveries, software, writings and other works of authorship shall
belong solely to the Company.
4.4 INSTRUMENTS OF ASSIGNMENT. Xxxxxx will sign and execute all instruments
of assignment and other papers to evidence the granting of all entire
right, title and interest in such inventions, improvements, discoveries,
software, writings or other works of authorship to the Company, at the
request and the expense of Company, and Xxxxxx will do all acts, give any
needed testimony and sign all instruments of assignment and other papers
the Company may reasonably request relating to applications for patents,
copyrights, and the enforcement and protection thereof.
4.5 SURVIVAL. The obligations of this Article 4 shall survive the expiration
or termination of this Agreement.
ARTICLE 5
5.1 NON-COMPETITION. Xxxxxx agrees that during the term of this Agreement
and until August 31, 2000.
(a) Xxxxxx will not, directly or indirectly, alone or as a partner,
member, officer, director, shareholder or consultant of any other
firm or entity, engage in any commercial activity in competition
with any part of the Company's business at any time during the
term of this Agreement. For purposes of this section,
"shareholder" shall not include beneficial ownership of less than
five percent (5%) of the combined voting power of all issued and
outstanding voting securities of a publicly held corporation whose
voting stock is traded in a public market. Also for purposes of
this section, "the Company's business" shall mean businesses
conducted during the term of this Agreement by the Company;
(b) Divert, or by aid to others, do anything which would tend to
divert, or may divert from the Company, any trade or business with
any customer, supplier or vendor with whom the Company has had any
contact or association; or
(c) Take any affirmative action to induce or attempt to induce any
person employed by the Company to leave the employment of the
Company.
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5.2 ENFORCEMENT. In addition to any other rights and remedies available to
the Company for breach of this Article 5, the Company shall be entitled
to enforcement by court injunction.
5.3 EFFECT OF TERMINATION. Upon the termination of Xxxxxx' performance of
services, no additional compensation shall be paid for the non-
competition obligation.
ARTICLE 6
6.1 NO ADEQUATE REMEDY. The parties acknowledge it is impossible to measure
in money the damages which will accrue to either party by reason of a
failure to perform any of the obligations under this Agreement.
Therefore, in the event of a claim for equitable relief, each party
hereby waives the claim or defense that the other has an adequate remedy
at law.
6.2 SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, this
Agreement shall be binding upon and inure to the benefit of the
successors and assigns of the Company. This Agreement shall not be
assignable by Xxxxxx, but its economic terms shall inure to the benefit
of Xxxxxx' heirs and beneficiaries.
6.3 NOTICES. All notices, requests and demands given to or made pursuant
hereto shall, except as otherwise specified herein, be in writing and be
delivered or mailed to any such party at its address which:
(a) In the case of the Company shall be:
Eltrax Systems, Inc.
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Clunet X. Xxxxx
With a copy to:
Xxxxxxx X. Xxxxx, Esq.
Jaffe, Raitt, Heuer & Xxxxx, P.C.
Xxx Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
(b) In the case of Xxxxxx shall be:
Xxxx Xxxxxx
000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxxx, Xxx Xxxxxx 00000
With a copy to:
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Xxxxxxx Xxxxx, Esq.
Benesch, Friedlander, Xxxxxx & Aronoff, LLP
0000 XX Xxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000-0000
Any notice, if mailed properly addressed, postage prepaid, registered or
certified mail, shall be deemed sent on the registered date or that
stamped on the certified mail receipt, and shall be deemed received on
the second business day thereafter.
6.4 CAPTIONS. The various headings or captions in this Agreement are for
convenience only and shall not affect the meaning or interpretation of
this Agreement.
6.5 GOVERNING LAW. The validity, construction and performance of this
Agreement shall be governed by the laws of the State of Michigan without
giving effect to the conflict of laws principles thereof.
6.6 CONSTRUCTION. Wherever possible, each provision of this Agreement shall
be interpreted in such manner as to be effective and valid under
applicable law. If any provision of this Agreement shall be prohibited or
invalid, all remaining clauses shall remain fully enforceable.
6.7 WAIVERS. No failure on the part of either party to exercise, and no
delay in exercising, any right or remedy hereunder shall operate as a
waiver thereof; nor shall any partial exercise of any right or remedy
hereunder preclude any exercise of that or any other right or remedy
granted hereby by law.
6.8 MODIFICATION. This Agreement may not be and shall not be modified or
amended except by written instrument signed by all parties.
6.9 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and
understanding between the parties hereto in reference to all the matters
herein agreed upon and supersedes all prior or contemporaneous
agreements, understandings and negotiations with respect to the subject
matter hereof.
6.10 ARBITRATION. With the sole exception of the injunctive relief
contemplated by Section 5.2 of this Agreement, any controversy or claim
arising out of any aspect of the relationship of the parties hereto, will
be settled by binding arbitration in Southfield, Michigan by a panel of
three arbitrators in accordance with the Commercial Arbitration Rules of
the American Arbitration Association. Judgment upon any arbitration
award may be entered in any court having jurisdiction thereof and the
parties consent to the jurisdiction of the courts of the State of
Michigan for this purpose.
6.11 ATTORNEYS' FEES. In the event there is litigation or other proceedings
between the parties hereto with respect to their rights and obligations
under this Agreement, the prevailing party in any such litigation shall
be entitled to recover from the opposing party all reasonable
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attorneys' fees and expenses (including fees of accountants) incurred by
the prevailing party in connection with such proceeding.
6.12 VENUE; JURISDICTION. The parties agree that all actions or proceedings
arising in connection with this Agreement and the instruments, agreements
and documents executed pursuant to the terms of this Agreement shall be
tried, litigated and arbitrated only in the courts of the United States
located in the Eastern District of Michigan, the Michigan state courts or
the offices of the American Arbitration Association located nearest
Southfield, Michigan. Xxxxxx irrevocably accepts for himself and in
respect of his property, generally and unconditionally, the jurisdiction
of such courts. Xxxxxx irrevocably consents to the service of process
out of any such courts in any such action or proceeding by the mailing of
copies thereof by registered or certified mail, postage prepaid, to him,
at his address as set forth in the records of the Company, such service
to become effective ten (10) days after such mailing. Nothing in this
Section 6.12 shall affect the right of any party to serve process in any
other manner permitted by law. Xxxxxx irrevocably waives any right he
may have to assert the doctrine of forum non conveniens or to object to
venue to the extent any proceeding is brought in accordance with this
Section 6.12.
6.13 NON-AFFILIATE STATUS. The Company hereby acknowledges that Xxxxxx is
not an "affiliate" of the Company as defined in Rule 144 promulgated
under the Securities Act of 1933, as amended, and will not otherwise be
restricted from buying or selling shares of common stock of the Company,
except to the extent prohibited by applicable federal and state
securities laws.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
CONSULTANT ELTRAX SYSTEMS, INC., TOGETHER WITH
ITS SUBSIDIARIES
__________________________ By:__________________________________
Xxxx Xxxxxx Clunet X. Xxxxx, Secretary
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