EMPLOYMENT AND NONCOMPETITION AGREEMENT
THIS AGREEMENT (this "Agreement"), made as of the 1st day of
October, 1997, by and between Xxxxxxx X. Xxxxxxxxxxx (the "Executive") and IPC
Information Systems, Inc., a Delaware corporation (the "Company").
W I T N E S S E T H :
WHEREAS, the Executive is a stockholder and executive officer of the
Company;
WHEREAS, the Executive is expected to make a major contribution to
the growth, profitability and financial strength of the Company; and
WHEREAS, the Company desires to continue to employ the Executive,
and the Executive desires to continue to be employed by the Company, pursuant to
the terms and conditions hereof.
NOW, THEREFORE, in consideration of the premises and the mutual
promises herein contained and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
1. Employment; Term. The Company hereby employs the Executive, and the
Executive hereby accepts such employment by the Company, on the terms and
conditions set forth herein. The term of this Agreement shall be the period
commencing October 1, 1997 (the "Commencement Date") and terminating on
September 30, 1999 (the "Initial Term"), unless sooner terminated in the manner
hereinafter provided, and thereafter as herein provided. This Agreement may be
extended for subsequent one (1) year terms by the occurrence of the following
events: (i) the Company's giving written notice of the affirmative vote of a
majority of the Company's Board of Directors that the Company desires to extend,
including in such notice any proposed modifications to the terms and conditions
hereof; (ii) within thirty (30) days of the Executive's receipt of such notice,
the Executive shall give written notice to the Company of his acceptance or
rejection of said extension, under the proposed modified terms; (iii) upon
receipt by the Company of written notice of acceptance, the Agreement shall be
deemed extended. Upon
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receipt of written notice of rejection, or upon the failure of Executive to
respond within the required thirty (30) day period, the offer of extension shall
terminate without extension of the term. Failure of the Company to deliver
notice of extension by September 30, 1998, or any later date which is one year
prior to the expiration date of any extended term, shall be deemed to constitute
a decision that the Agreement not be further extended. If, at any time, the term
of the Agreement shall, by action or inaction on the part of the Company or the
Executive, fail to be extended prior to the date which is one year prior to the
date on which the Agreement is then scheduled to expire, the Agreement shall
expire on such scheduled expiration date and shall not be, or deemed to be,
extended further. The Company shall have no obligation to provide written notice
of such a decision.
2. Duties.
2.1 Office. During the term of this Agreement, the Executive shall
serve as an executive officer of the Company, reporting directly to the
President and Chief Executive Officer. Nothing contained herein shall preclude
the Company, by direction of the President and Chief Executive Officer, from
restructuring or reorganizing the functional responsibilities and/or
organizational or reporting position of various executive officers of the
Company, including the Executive. Subject always to the supervision and
direction of the President and Chief Executive Officer of the Company, or such
executive officer as the President and Chief Executive Officer shall designate,
the Executive shall, from time to time, have the duties and responsibilities
consistent with his position as an executive officer.
2.2 Full Working Time. During the term of this Agreement, the
Executive shall devote his full working time and his best efforts, and apply all
of his skill and experience, to the proper performance of his duties hereunder
and to the business and affairs of the Company. The Executive, without the prior
written approval of the Board of Directors of the Company, shall not, either
directly or indirectly, engage in any business other than that specified herein
or accept any employment or business office whatsoever (including but not
limited to serving as a director) from any other person, firm, corporation or
entity (but the foregoing shall not preclude the Executive, except as provided
in Section 5.1 hereof, from (i) serving as a director of any non-
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profit or charitable organization, or (ii) making an investment in any other
business, so long as in any such case the Executive does not actively
participate in such other business or organization and such activity does not
interfere with the Executive's ability to perform his duties hereunder and does
not constitute a conflict of interest with the Company or any of its affiliates
in the reasonable opinion of the Board of Directors of the Company).
3. Salary and Benefits.
3.1 Salary. The Company shall pay the Executive during the term of this
Agreement a base salary at an annual rate of Two Hundred Fifty Thousand Dollars
($250,000) per annum, payable in accordance with the standard payroll practices
of the Company ("Base Salary"). It is understood that the Base Salary shall be
the Executive's minimum annual compensation during his employment with the
Company. The Base Salary shall be reviewed annually by the Compensation
Committee of the Board and may be increased at its discretion.
3.2 Management Incentive Plan. For each fiscal year of IPC ending during
the term of this Agreement (including, but not limited to, the fiscal year in
which this Agreement is executed), the Executive shall be eligible to
participate in the Management Incentive Plan of IPC, under which the Executive
will be assigned a target bonus of not less than 50% of the Executive's Base
Salary. The terms and conditions of such bonus and the actual amount of any
bonus which may be payable shall be determined according to the terms of such
Management Incentive Plan.
3.3 Benefits. The Executive may participate, to the extent that he is
eligible therefor and subject to the terms and conditions thereof, in any plans
or programs which may be maintained by the Company or its affiliates for their
employees and/or senior executives generally, providing insurance, medical
benefits, retirement benefits, or other like fringe benefits.
3.4 Other Benefits. (a) The Executive shall be provided with an
automobile, in accordance with the Company's policy therefor. (b) The Executive
shall be entitled to five (5) weeks annual paid vacation each year of the term
of employment. (c) The Executive shall be provided with life insurance (in
addition to coverage provided under any group-term insurance
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plan paid for by the Company) providing (i) whole-life insurance in the amount
of $1,000,000, of which the Company shall own and control (by split-dollar
arrangement, collateral assignment or otherwise) the cash surrender value, if
any, of the policy providing such coverage and, for so long as it shall own and
control such cash surrender value, shall be entitled (A) upon the Executive's
death to receive a portion of the death benefit proceeds equal to the greater of
such cash surrender value immediately prior to the time of death or the
aggregate amount of its premiums paid and (B) upon the termination of the
Executive's employment, other than by death, the Executive shall purchase said
policy from the Company by the payment of an amount equal to, the greater of
such cash surrender value immediately prior to the termination of employment or
the aggregate amount of its premiums paid; and (ii) term life insurance in such
amounts as the Executive may acquire for annual premium payments not to exceed
$7,000. Executive and Company shall agree to execute such documents as may be
necessary to ensure the partial assignment of benefits to the Company and the
Executive's repurchase obligations under the aforementioned split-dollar
insurance policy and to otherwise give effect to the intent and purpose of this
Section 3.4 (c).
3.5 Expenses. The Company shall pay or reimburse the Executive for
reasonable business expenses actually incurred or paid by the Executive during
the term of his employment under this Agreement, in the performance of his
services hereunder, provided such expenses are consistent with Company policy.
Such payment or reimbursement shall be made upon presentation of expense
statements or vouchers or other supporting information acceptable to the Company
and otherwise in accordance with Company policy then in effect.
3.6 Deductions. The Company shall deduct from all compensation
payable hereunder such payroll and withholding taxes as may be required by law.
3.7 Bonus Payable Upon Execution. In consideration for the
execution of this Agreement and the covenants contained in Section 6, hereof,
the Company will pay to Executive a signing bonus of Two Hundred Fifty Thousand
Dollars ($250,000.00), such payment to be made upon or as soon as practicable
following the parties' execution of this Agreement.
3.8 Options Granted Upon Execution.
(a) Upon execution of this Agreement, the Company shall grant to
the
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Executive non-qualified stock options under the Company's 1994 Stock Option and
Incentive Plan, as amended (the "1994 Option Plan") in the following amounts and
under the following conditions:
i) 50,000 vesting, contingent upon continued employment on
the earliest date on which the last sales price for a share of
common stock of the Company on the principal national
securities exchange (including as a national securities
exchange for this purpose, the NASDAQ Stock Market) on which
shares of the Company's common stock are listed or admitted to
trading equals or exceeds $25.00 on each of ninety (90)
consecutive trading days;
ii) 50,000 vesting, contingent (except as provided in
Section 3.8 (c)) upon continued employment on the fifth
anniversary of the effective date (9/30/01) provided, however,
that on or prior to such date, the last sales price for a
share of common stock of the Company on the principal national
securities exchange (including as a national securities
exchange for this purpose, the NASDAQ Stock Market) on which
shares of the Company's common stock are listed or admitted to
trading shall have equaled or exceeded $25.00 on each of
ninety (90) consecutive trading days.
(b) The Exercise Price of options granted in accordance with this
Section 3.8 shall be equal to $25.00 per share.
(c) Change in Control Provisions. With respect to options granted in
accordance with this Section 3.8, upon the occurrence of a change in control of
the Company, as such term is defined in the 1994 Option Plan, the vesting of the
options granted under Section 3.8 (a) (ii) would remain contingent upon the
Executive's agreement to enter into and fully perform under a two-year
employment contract with the Company or successor company, under substantially
comparable compensation terms as are then current, provided, however, that said
options would immediately vest upon the
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Company's or successor company's termination without cause of said employment
contract or failure to agree to such an extension prior to the date of the
change in control. In the event that, as a result of the aforementioned change
in control, there no longer exists a public market for the Company's securities,
the stock issued upon exercise of the options referenced in the preceding
sentence would, upon vesting and exercise, be immediately purchased by the
Company or successor company at the Change in Control Price, as defined in the
1994 Option Plan or, if greater, the fair value of the stock determined by the
Company in good faith, such purchase price to be payable in cash in immediately
available funds. The Company shall have the obligation to buy, and the Executive
shall have the obligation to sell the stock covered by this Section 3.8 at the
time and on the terms set forth herein.
3.9 Change in Control Transaction.
(a) In the event of a closing, during the period commencing August 1,
1997 and ending July 31, 1998, of a transaction that includes a "Change in
Control" of IPC and so long as Employee is not otherwise in breach of this
Agreement, the Company will pay to the Executive a guaranteed bonus computed as
follows:
An incentive payment (the "Incentive Payment") calculated by
multiplying the sum of Two Hundred Eighteen Thousand Dollars ($218,000.00) times
an adjustment factor (as hereinafter specified) based on the price realized by
the Company and/or the stockholders by virtue of the Change of Control, where
"X" equals Eighteen ($18.00) dollars per share.
--------------------------------------------------------------------------------
Change of Control Price Adjustment Factor
--------------------------------------------------------------------------------
Transaction - Less than or equal to "X" 0.70
--------------------------------------------------------------------------------
Transaction - 116.67% "X" 1.00
--------------------------------------------------------------------------------
Transaction - 133.33% "X" 1.50
--------------------------------------------------------------------------------
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--------------------------------------------------------------------------------
Transaction - 150.00% "X" 2.00
--------------------------------------------------------------------------------
For amounts which fall between the percentages specified in the foregoing
table, Company shall use a straight-line interpolation to determine the
adjustment factor hereunder.
The amount, if any, computed under Section 3.9(a) shall be payable in
three (3) annual installments on the date fifteen (15) days following the date
of closing of the transaction and upon each of the first two anniversaries of
the closing date; provided, however, that if the Executive's employment
terminates due to death, disability or discharge without cause prior to the
second anniversary of such closing date, any remaining installments shall be due
and payable upon termination of employment.
(b) For all purposes of this Agreement except Section 3.8, a "Change in
Control" of IPC shall be deemed to have occurred upon the happening of any of
the following events:
(i) the closing of a transaction that would result in the
reorganization, merger or consolidation of IPC, respectively, with one or
more other persons in which IPC is not the surviving entity;
(ii) the acquisition of substantially all of the assets of IPC or
beneficial ownership (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of 35% or more of the outstanding securities of IPC
entitled to vote generally in the election of directors by any person or
by any persons acting in concert; or
(iii) a complete liquidation or dissolution of IPC; or
(iv) the occurrence of any event in connection with an actual or
threatened election contest or other actual or threatened solicitation of
proxies or consents (all within the meaning of Rule 14a-11 of Regulation
14A promulgated under the Exchange Act) if, immediately following such
event, at least fifty percent (50% of the members of the board of
directors of IPC are not individuals who were members of the board of
directors of
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IPC on the date of this Agreement.
In no event, however, shall a Change of Control of IPC be deemed to have
occurred as a result of any acquisition of securities or assets of IPC or any of
its subsidiaries by IPC or any subsidiary of IPC. For purposes of this section,
the term "person" shall have the meaning assigned to it under sections 13(d)(3)
or 14(d)(2) of the Exchange Act.
3.10 Option Vesting Upon Expiration of Agreement. In the event (i) the
Executive's employment is terminated during the Initial Term by the Company
without cause or (ii) this Agreement shall not be extended beyond its Initial
Term at the Company's discretion in accordance with Section 1, hereof, and shall
therefore expire on September 30, 1999 (the "Expiration Date"), any stock
options granted to Executive prior to the date of this Agreement which are not
vested but would have otherwise vested within sixty (60) days of the Expiration
Date shall vest on such date as shall be determined to be Executive's last date
of employ (regardless of Company's obligation, if any, to provide additional
compensation hereunder). Executive shall thereafter have such period of time as
is provided in the applicable option plan document to exercise said options. All
options which are not exercised within the prescribed period(s) shall thereafter
be canceled. Any other termination of Executive's employment, except as
specified in this paragraph, shall not serve to accelerate the vesting of
otherwise unvested options.
4. Termination.
4.1 Early Termination. The Company shall always have the right to
terminate the employment of Executive for "cause" (as hereinafter defined). In
the event Executive's employment with the Company is terminated prior to the
expiration of the term of this Agreement on account of (i) the Executive's
resignation, death or disability, (ii) the Executive's discharge by the Company
without cause or (iii) the Executive's discharge by the Company for "cause" (any
of (i), (ii) or (iii), an "Early Termination"), all compensation and benefits
described in Section 3 of this Agreement shall terminate as of the date of such
termination.
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4.2 Discharge for Cause. For purposes of this Agreement, "cause" shall
mean an omission, act or action or series of omissions, acts or actions of the
Executive which constitute(s), cause(s) or result(s) in:
(a) the Executive's material dishonesty (e.g., theft, fraud,
embezzlement, material financial misrepresentation or other similar behavior or
action) in his dealings with or with respect to the Company or any affiliate
thereof or entity with which the Company, a subsidiary or affiliate thereof,
shall be engaged in or be attempting to engage in commerce;
(b) the conviction of the Executive for, or the Executive's entry
of a plea of guilty or nolo contendere to, the commission of a felony; or
(c) the repeated and willful refusal of the Executive to follow
the policies or directives of the officer to whom the Executive may from time to
time report, as determined by the Board of Directors of the Company; provided
that discharge pursuant to clause (a) or (c) shall not constitute discharge for
"cause" unless (x) the Executive shall have first received written notice from
the Board of Directors of the Company stating with specificity the nature of
such breach, refusal or failure and affording the Executive an opportunity to
cure fully the acts or omissions complained of within thirty (30) days of actual
receipt by the Executive of notice thereof, and (y) the final determination of
the discharge of the Executive for cause shall be made by a majority of the
non-management directors ofthe Company.
4.3. Death or Disability. The term of employment of the Executive shall
terminate forthwith in the event of the death of the Executive, or, at the
option of the Company, in the event that the Executive shall fail to render and
perform the services required of him under this Agreement because of
"disability" (as hereinafter defined). In the event of such a termination, all
compensation and benefits described in Section 3 of this Agreement shall
terminate as of the date of such termination. For purposes of this Agreement,
"disability" shall mean the inability of the Executive to perform his duties and
obligations for the Company as required by this Agreement, because of a
disability which is not of an apparently temporary nature, which results from
mental or bodily
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injury, sickness or disease or any combination thereof, and which has lasted a
period of more than one hundred eighty (180) consecutive days or more than one
hundred eighty (180) days within any period of 365 consecutive days.
4.4 Termination by Company without Cause. Notwithstanding anything to
the contrary in this Agreement, in the event that the Executive's employment
with the Company is terminated by the Company other than (i) by expiration of
the Term, or any extended Term, in which event no further payments shall be due,
or (ii) for "Cause" during the term of this Agreement (including any extensions
thereof) and at or following a "Change in Control," the Company shall pay to the
Executive severance pay in an amount equal to 225% of the Executive's Base
Salary. Such amount shall be payable in eighteen equal monthly installments,
without interest, on the last day of each calendar month in the period of
eighteen consecutive calendar months that begins on or immediately following the
date of termination. The Company and Executive hereby stipulate that the damages
which may be incurred by Executive as a consequence of any such termination of
employment are not capable of accurate measurement as of the date first above
written and that the benefits and payments provided for in this Agreement
constitute a reasonable estimate under the circumstances of all damages
sustained as a consequence of any such termination of employment. The Company
and the Executive agree that the benefits provided hereunder constitute
reasonable damages under the circumstances and shall be payable without any
requirement of proof of actual damage and without regard to the Executive's
efforts, if any, to mitigate damages. The Company and the Executive further
agree that the Company may condition the payments and benefits (if any) due
under this section on (i) the receipt of the Executive's resignation from any
and all positions which he holds as an officer, director or committee member
with respect to the Company or any subsidiary or affiliate of it and (ii) the
Executive's execution and delivery within twenty-one (21) days after any such
termination of employment, and the non-retraction during any statutory waiting
periods, of a release in favor of the Company, in the form of the attached
Appendix A.
4.5. Excise Tax-Related Provision. If any payment received or to be
received
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by the Executive in connection with a Change of Control of the Company or the
termination of the Executive's employment (whether payable pursuant to the terms
of this Agreement or any other plan, arrangement or agreement with the Company,
any person whose actions result in a Change of Control of the Company, or any
person affiliated with the Company or such person (together with the severance
payment, the "total payment")) would not be deductible by the Company (in whole
or in part) as a result of Section 280G of the Internal Revenue Code of 1986
(the "Code"), the severance payment will be reduced until no portion of the
total payment is not deductible as a result of Section 280G of the Code, or the
severance payment is reduced to zero, whichever occurs first. Provided, however,
that the severance payment will not be reduced if the net after tax benefit to
the Executive resulting from the receipt of the total payments (without
reduction of the severance payment) exceeds the net after-tax benefit to the
Executive resulting from the receipt of the total payments (after reduction of
the severance amount). All such determinations shall be made by the independent
auditor or outside tax counsel retained by the Company, as the Company shall
select, and all such determinations shall be final and binding upon the parties.
5. Proprietary Information.
5.1 Disclosure to Company. The Executive shall promptly disclose to the
Company in such form and manner as the Company may reasonably require (a) all
operations, systems, services, methods, developments, inventions, improvements
and other information or data pertaining to the business or activities of the
Company as are conceived, originated, discovered or developed by Executive
(whether or not copyrighted or patented or capable of being copyrighted or
patented) during the term of his employment with the Company (whether before or
after the Commencement Date), and (b) such information and data pertaining to
the business, operations, personnel, activities, financial affairs, and other
information relating to the Company and its customers, suppliers, employees and
other persons having business dealings with the Company as may be reasonably
required for the Company to operate its business. It is understood that
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such information is proprietary in nature and shall (as between the Company and
Executive) be for the exclusive use and benefit of the Company and shall be and
remain the property of the Company both during the term of this Agreement and
thereafter. If so requested by the Company, the Executive shall execute and
deliver to the Company any instrument as the Company may reasonably request to
effectuate the assignment of any such proprietary information to the Company.
Without limiting the generality of the foregoing, the Executive hereby releases
and waives and assigns to the Company any and all claims and rights which he has
against any of the Company or any of the technology, "know-how," licenses or
other proprietary rights or processes of the Company.
5.2 Post-Employment. In the event that the Executive leaves the employ
of the Company for any reason, including, without limitation, the expiration of
the term of this Agreement, the Executive shall deliver to the Company (and
shall not keep in his possession, recreate or deliver to anyone other than the
Company) any and all devices, records, data, notes, reports, proposals, lists,
correspondence, specifications, drawings, blueprints, sketches, materials,
equipment, other documents or property, together with all copies thereof (in
whatever medium recorded) belonging to the Company, its successors or assigns.
6. Non-Competition and Non-Solicitation.
6.1 Covenant. The Executive acknowledges that: the business of the
Company is (i) the manufacture and sale of telecommunications equipment (trading
turrets), (ii) the sale and installation of communications cabling systems and
datacom hardware, and (iii) the development and marketing of a private
international telecommunications network, all to the financial services industry
(the "Business"); the Business is multinational in scope; his work with respect
to the Business has brought and will continue to bring him into close contact
with many confidential affairs not readily available to the public; and the
Company will suffer substantial and irreparable harm in the event the Executive
should enter into competition with the Company or disclose any of the affairs of
the Company to any third parties. Accordingly, and in order to induce the
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Company to enter into this Agreement, the Executive hereby agrees as follows:
(a) during the term of this Agreement (including any renewal or
extension hereof) and for a period of eighteen (18) months after the
expiration or termination of this Agreement for any reason whatsoever, the
Executive will not, directly or indirectly, engage, whether as an officer,
director, consultant, agent, employee, partner, shareholder, participant,
owner or otherwise, in an enterprise engaged in the Business or any part
thereof, where the Employee's area of responsibility existed during, and
for the one year period prior to, this Agreement (but the foregoing shall
not preclude investments by the Executive in publicly traded companies in
which the Executive does not own more than one percent (1%) of the
outstanding equity and does not actively participate in the business in
which such investment is made); or
(b) for a period running concurrently with, and extending during,
the term of this Agreement (including any renewal or extension thereof)
and for a period of one (1) year after the expiration of the restriction
contained in clause (a) above, the Executive will not, directly or
indirectly, use Company-proprietary knowledge or information obtained
during the course of Executive's employment with Company with the
intention to, or which a reasonable person would construe to (A) interfere
with or disrupt any present or prospective relationship, contractual or
otherwise, between the Company and any customer, supplier, employee,
consultant or other person having business dealings with the Company, or
(B) employ or solicit the employment or engagement by others of any
employee or consultant of the Company who was such an employee or
consultant at the time of termination of the Executive's employment
hereunder or within one (1) year prior thereto.
6.2 Reasonableness. The Executive acknowledges that the restricted
period of time and geographical area under Section 6.1 hereof are reasonable, in
view of the nature of the business in which the Company is engaged and the
Executive's knowledge of the Company's business, and the fact that the Executive
expects to receive substantial
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compensation pursuant to this Agreement. Notwithstanding the foregoing, if any
provision, or any part thereof, of Section 6.1 is held to be unenforceable
because of the duration thereof or the area covered thereby, the parties agree
that the court making the determination shall have the power to reduce the
duration or the area of such provision, or to delete specific words or phrases,
and in its reduced or amended form such provision shall then be enforceable and
be enforced.
6.3 Enforcement. The Executive intends to, and does hereby, confer
jurisdiction to enforce the covenants contained in this Section 6 upon the
courts of (i) any jurisdiction within the States of Delaware and New York or
(ii) if Executive is alleged to be competing with the Company in violation of
this Section 6 in any other jurisdiction, then in any other jurisdiction in
which such alleged competition takes place. If the courts of any one or more of
such jurisdictions shall hold such covenants wholly unenforceable by reason of
the breadth of such scope or otherwise, such determination shall not bar or in
any way affect the right of the Company to the relief provided above in the
courts of any other jurisdiction in which such covenants may be enforced as
provided herein, as to breaches of such covenants in such other respective
jurisdictions, the above covenants as they relate to each jurisdiction being,
for this purpose, severable into diverse and independent covenants.
7. Nondisclosure. Except with the prior written consent of the Company in
each instance or as may be necessary to perform the Executive's services
hereunder, the Executive shall not disclose, use, publish, or in any other
manner reveal, directly or indirectly, at any time during or after the term of
this Agreement, any confidential information relating to the Company or any
subsidiary or affiliate thereof acquired by him prior to, during the course of,
or incident to, his employment hereunder. Such confidential information shall
include, but shall not be limited to, information relating to (a) the business,
operations, systems, services, know-how, trade secrets, customer lists, pricing
policies, operational methods, market plans, product development plans,
acquisition plans, design and design projects, inventions and research projects
and all
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other plans and processes of the Company, and (b) the business, operations,
personnel, activities, financial affairs, and other information relating to the
Company and its customers, suppliers, employees, consultants, officers,
directors, stockholders and other persons having business dealings with the
Company. In the event Executive is required (by oral questions, interrogatories,
requests for information or documents in legal proceedings, subpoenas, civil
investigative demand or similar process) to disclose any such confidential
information, the Executive shall provide the Company with prompt written notice
of such requirement so that the Company may seek a protective order or other
appropriate remedy and/or waive compliance with the provisions of this Section.
If, in the absence of such a protective order or other appropriate remedy or
receipt of a compliance waiver by the Company, the Executive is nonetheless
advised by his legal counsel that he is legally compelled to disclose such
confidential information, the Executive may, without liability hereunder,
disclose only that portion of such confidential information which such counsel
advises is legally required to be disclosed, provided that the Executive
exercises his best efforts to preserve the confidentiality of the information,
including, without limitation, by cooperating with the Company to obtain an
appropriate protective order or other reliable assurance that confidential
treatment will be accorded the confidential information.
8. Remedies for Certain Breaches. If the Executive commits a breach, or
threatens to commit a breach, of any of the provisions of Sections 5, 6 and/or
7, the Company shall have the following rights and remedies, each of which
rights and remedies shall be independent of the others, and shall be severally
enforceable, and all of which rights and remedies shall be in addition to, and
not in lieu of, any other rights and remedies available under law or in equity
to the Company:
(i) the right and remedy to have the provisions of Sections 5, 6
and/or 7 enforced by any court of competent jurisdiction by injunction,
restraining order, specific performance or other equitable relief in favor
of the Company, it being
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acknowledged and agreed that any breach or threatened breach of Sections
5, 6 and/or 7 by the Executive will cause irreparable injury to the
Company and that money damages will not provide an adequate remedy to the
Company; and
(ii) the right and remedy to require the Executive to account for
and pay over to the Company all compensation, profits, moneys, accruals,
increments or other benefits (collectively, "Benefits") derived or
received by the Executive as the result of any transaction constituting a
breach of any of the provisions of Sections 5,6 and/or 7, and the
Executive hereby agrees to account for such Benefits and pay over all such
Benefits to the Company.
9. Absence of Restrictions. No provision of this Agreement shall be deemed to
restrict the absolute right of the Company at any time to sell or dispose of all
or any part of the assets of the Company, or to reconstitute the same in any one
or more other entities, or to merge, consolidate, sell or liquidate or otherwise
abandon or cease the active conduct of its business, but none of the foregoing
shall relieve the Company of its obligations hereunder. Provided the Executive
has not breached any of its obligations hereunder, in the event the Company
shall liquidate or cease the active conduct of its business, other than in
connection with a sale or disposition of all or substantially all of the assets
of the Company or a merger or consolidation of the Company, the Executive shall
be relieved of any further obligation or restriction under Section 6 hereof,
commencing as of the date of such liquidation or cessation of business.
10. Arbitration. Any dispute, controversy or claim, at any time arising out of
this or relating to this Agreement, or the breach, termination or invalidity
thereof (other than any dispute, controversy or claim pursuant to Sections 5, 6,
7, and/or 8 hereof, which may, at the option of the Company, be submitted to any
court having jurisdiction), shall be referred to final and binding arbitration
by a single arbitrator appointed by mutual
16
agreement of the parties, but in the absence of mutual agreement, selected by
the Chief Judge of the Federal District Court for the Southern District of New
York. The place of arbitration shall be New York City. Costs shall be borne as
the arbitrators shall determine. Any arbitral award may be entered as a judgment
in any court of competent jurisdiction.
11. Notices. Any notice required or permitted under this Agreement shall be
given in writing and shall be deemed effectively given upon personal delivery to
the party to be notified, on the next business day after delivery to a
nationally recognized overnight courier service, upon receipt of a facsimile
transmission or five days after deposit with the United States Post Office, by
registered or certified mail, postage prepaid, and addressed to the party to be
notified at the address or facsimile number (if any) indicated below for such
party, or at such other address as such party may designate upon written notice
to the other parties (except that notice of change of address shall be deemed
given upon receipt).
If to the Executive:
Xxxxxxx X. Xxxxxxxxxxx
0 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Facsimile No.: 000-000-0000
If to the Company:
IPC Information Systems, Inc.
Wall Street Plaza
00 Xxxx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attn: General Counsel
12. Miscellaneous.
12.1 Entire Agreement. This Agreement constitutes the entire agreement
17
between the Executive and the Company with respect to the Company's employment
of the Executive and supersedes all prior agreements and understandings, written
or oral, with respect thereto.
12.2 Amendments and Waivers. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively), only by
(a) an instrument in writing and signed by the party against whom such amendment
or waiver is sought to be enforced, and (b) in the case of the Company, such
amendment or waiver also must be duly authorized by an appropriate resolution of
the Board of Directors of the Company.
12.3 Successors and Assigns. The Company shall have the right to assign
its rights under this Agreement in connection with any sale or disposition of
all or substantially all of the assets of the Company or any merger or
consolidation by the Company. This Agreement calls for the personal services of
the Executive and no part of his rights or obligations hereunder may be
assigned, transferred, pledged or encumbered by the Executive. This Agreement
shall inure to the benefit of, and be binding upon (a) the parties hereto, (b)
the heirs, administrators, executors and personal representatives of the
Executive and (c) the successors and assigns of the Company, as provided for
herein.
12.4 Governing Law. This Agreement, including the validity hereof and the
rights and obligations of the parties hereunder, and all amendments and
supplements hereof and all waivers and consents hereunder, shall be construed in
accordance with and governed by the domestic substantive laws of the State of
New York without giving effect to any choice of law or conflicts of law
provision or rule that would cause the application of the domestic substantive
laws of any other jurisdiction.
12.5 Severability. If any provisions of this Agreement as applied to any
part or to any circumstance shall be adjudged by a court to be invalid or
unenforceable, the same shall in no way affect any other provision of this
Agreement, the application of such provision in any other circumstances or the
validity or enforceability of this Agreement.
12.6 Survival. The rights of the Company and obligations of the Executive
18
pursuant to Sections 4, 5, 6, 7, 8 and 10 shall survive the termination of the
Executive's employment with the Company and the expiration of the term of this
Agreement.
12.7 Affiliates. For purposes of Sections 3, 5, 6, 7, and 8, the
"Company" shall be deemed to include the Company and its subsidiaries and
affiliates.
12.8 Captions. The headings and captions used in this Agreement are used
for convenience only and are not to be considered in construing or interpreting
this Agreement.
12.9 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officer and the Executive has executed this Agreement on
the day and year first above written.
EXECUTIVE:
--------------------------------
Xxxxxxx X. Xxxxxxxxxxx
COMPANY:
IPC Information Systems, Inc.
By:
-----------------------------
Name:
Title:
19
Appendix A - RELEASE
IMPORTANT NOTICE
Your employment with the IPC Information Systems, Inc. (the "Company") is being
terminated. In this regard, the Company is prepared to pay you severance
benefits, but will do so only if you give up your rights to bring or participate
in certain types of lawsuits. By signing this Release, you will give up those
rights, and the Company will pay you severance benefits. YOU SHOULD THOROUGHLY
REVIEW AND UNDERSTAND THE TERMS, CONDITIONS AND EFFECT OF THIS RELEASE.
THEREFORE, PLEASE CONSIDER IT FOR AT LEAST TWENTY-ONE (21) DAYS BEFORE SIGNING
IT. YOU ARE ADVISED TO CONSULT WITH AN ATTORNEY BEFORE YOU SIGN.
In consideration of the mutual terms and conditions and covenants and
understandings set forth in that certain Employment and Noncompetition Agreement
made as of the 1st day of October, 1997, by and between the Company and Xxxxxxx
X. Xxxxxxxxxxx, on behalf of myself and also on behalf of any other person or
persons claiming or deriving a right from me, unconditionally and irrevocably
forever release and discharge IPC Information Systems, Inc. and its agents,
servants, employees, directors, officers, affiliates and/or subsidiaries, and
any agents, servants, employees, directors and/or officers of all such
affiliates and/or subsidiaries and their respective heirs, successors and
assigns (collectively, "the Releasees") from any and all charges, complaints,
claims, liabilities, obligations, promises, agreements, controversies, actions,
demands, debts, costs, expenses, damages, injuries or causes of action
("Claims") which I now have, or ever have had, against any one or more of the
Releasees arising out of my employment with, or termination of my employment
with, the Company, up to and including the date on which I sign this Release,
whether arising in equity or pursuant to any law, rule or regulation, including
any Claims of which I am not aware or do not suspect to exist as of the date on
which I sign this Agreement. This release includes, but is not limited to, any
Claims that I (or any person or persons claiming or deriving a right from me)
may have based on discrimination due to age, race, sex, religion or national
origin, or any other claims pursuant to the Age Discrimination in Employment Act
of 1967, as amended, the National Labor Relations Act, Title VII of the Civil
Rights Act of 1964, the Civil Rights Act of 1866, the Family and Medical Leave
Act, the Rehabilitation Act of 1973, the Americans with Disabilities Act, the
Equal Pay Act, the Fair Labor Standards Act, the Employee Retirement Income
Security Act of 1974, as amended, the Internal Revenue Code of 1986, Executive
Orders Nos. 11246 and 11141, the New York Human Rights Law, the New York Equal
Pay Law, the New York Equal Rights Law, and any other federal, state or local
statute, rule, constitutional provision, regulation, ordinance or common law,
including, but not limited to, those for wrongful discharge, fraud, intentional
or negligent infliction of emotional distress and breach of any expressed or
implied covenant of good faith and fair dealing, and including but not limited
to, any Claims for recovery of attorney's fees. I UNDERSTAND THAT BY SIGNING
THIS RELEASE, I AM GIVING UP ALL RIGHTS THAT I HAVE UNDER THESE AND OTHER LAWS.
I acknowledge that: (a) the payment referred to above is in consideration for
the release contained herein and is in addition to any other payments or
benefits to which I am otherwise entitled from the Company; (b) I have received,
read and understood an information sheet ("Information Sheet"), if applicable,
specifying (1) the constituencies of the Company considered for any group
termination program in which I am included, (2) the eligibility factors for such
program, (3) the applicable time limits for such program, (4) the job titles and
ages of all individuals eligible or selected for such program, and (5) the ages
of all individuals who were neither eligible nor selected, but were in the same
job classifications or organizational units as those chosen; (c) I have had the
opportunity to consider this Agreement and the Information Sheet for at least 21
days; (d) I have read this document in its entirety, understand its terms, and
knowingly and voluntarily consent to its terms and conditions; (e) I have signed
this document knowingly and voluntarily, and without coercion by the Company or
any of the Releasees; and (f) I remain bound by any confidentiality,
non-solicitation, non-compete or other restrictive covenants that I have
previously agreed to.
This Release will become effective and enforceable seven (7) days after
___________, 199___. During this 7-day period, this Release may be revoked by
me, by written notice delivered to the General Counsel of the Company, 00 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx; thereafter, it may not be changed or revoked by me
without the prior written
consent of the Company. I will not receive any payment until this seven day
period has expired.
(L.S.)
-----------------------------
STATE OF )
: ss.:
COUNTY OF )
On this ____ day of _______________, 199___, before me personally came
__________________, to me known, who did depose and say that (s)he resides at
_____________________________________________________, that (s)he is the person
who signed the foregoing Release, and that (s)he signed the foregoing Release as
his/her free act and deed.
-----------------------------------
Notary Public
