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EXHIBIT 10.24
EMPLOYMENT AGREEMENT
AGREEMENT dated as of January 11, 1995, between Dataflex Corporation, a
New Jersey corporation, which has its principal office at 0000 Xxxx Xxxxxx,
Xxxxxx, Xxx Xxxxxx 00000 (hereinafter, the "Company") and Xxxxxx Xxxxxxxxx
(hereinafter, the "Executive").
WHEREAS, the Company desires to employ the Executive as President of
Dataflex Southeast, a division of the Company; and
WHEREAS, the Executive is willing to accept such employment as
President of Dataflex Southeast, a division of the Company;
NOW, THEREFORE, in consideration of the foregoing and of the mutual
promises, covenants and conditions hereinafter set forth, the parties hereto
agree as follows:
1. Employment. The Company hereby employs the Executive, and the
Executive hereby accepts employment, upon the terms and conditions hereinafter
set forth.
2. Term. Subject to the provisions for termination as hereinafter
provided, the term of this Agreement shall begin on the "Closing Date," as
defined in that certain Asset Purchase Agreement, dated as of November 17, 1994
(the "Asset Purchase Agreement"), by and between the Company and National Data
Products, Inc. ("NDP") and
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shall terminate on the third anniversary of such Closing Date.
3. Compensation. For the services to be rendered by the Executive under
the terms of this Agreement, the Company shall pay the Executive a basic salary
of $296,460 per year or such greater amount as may be approved from time to
time by the Company's Board of Directors (the "Basic Salary"), payable in equal
by-weekly installments.
4. Duties.
A. The Executive is engaged as President of Dataflex Southeast, a division
of the Company with all of the responsibilities commensurate with such title.
The precise services of the Executive may be modified, enlarged or limited, from
time to time, at the discretion of the Company's Board of Directors or the
Chief Executive Officer. The Executive shall be appointed to the Company's Board
of Directors at the first meeting thereof following the date of this Agreement
and thereafter during the term of this Agreement shall be nominated by the
Company's Board of Directors for election to the Company's Board of Directors by
the Company's shareholders. The Executive will not receive any additional
compensation in respect of his membership on the Company's Board of Directors.
During the term of this Agreement, the Executive shall devote his full
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business time, energy and skill to his employment as President of Dataflex
Southeast, a division of the Company.
B. During the term of this Agreement, the Executive shall not be
required to relocate to any office of the Company which would require him to
change his principal residence from that maintained by the Executive on the date
hereof.
5. Restrictive Covenants.
A. The Executive recognizes and acknowledges that the list of the
Company's customers, as it may exist from time to time, is a valuable, special,
and unique asset of the Company's business. The Executive will not, during, or
for one (1) year after the term of his employment, disclose the list of the
Company's customers or any part thereof to any person, firm, corporation,
association, or other entity for any reason or purpose whatsoever.
B. During the term of this Agreement and for one year after the
termination of this Agreement, the Executive will not, directly or indirectly,
within New Jersey, New York, Connecticut, Massachusetts, Pennsylvania,
California, Illinois, Arizona, Florida and such other states in which the
Company may or does do business, own, manage, operate, control, be employed by,
participate in, or be connected in any manner with the ownership, management,
operation, or
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control of any business competitive with or otherwise similar to the business
conducted by the Company during the term of the Executive's employment
hereunder.
C. In the event of a breach or threatened breach by the Executive of
the provisions of this paragraph 5, the Company shall be entitled to injunctive
relief to enforce its rights hereunder. Nothing herein shall be construed as
prohibiting the Company from pursuing any other remedies available to the
Company for such breach or threatened breach, including the recovery of damages
from the Executive.
D. The Executive acknowledges and agrees that the covenants set forth
in this paragraph 5 are given in consideration of the purchase by the Company of
substantially all of the assets of NDP, as set forth in the Asset Purchase
Agreement, and that such covenants are therefore enforceable under the laws of
the State of Florida.
E. This Paragraph 5 shall survive the termination of this Agreement.
6. Expenses. The Executive is authorized to incur reasonable expenses
in connection with the business of the Company, including expenses for
entertainment, travel, and similar items. The Company shall reimburse the
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Executive for all such expenses upon the presentation by the Executive, from
time to time, of an itemized account of such expenditures.
7. Disability.
A. If the Executive is not able to perform each of the material duties
of his job due to physical or mental disability, does not work at any other
occupation, is unable to do each of the material duties of any job for which he
is fitted by education, training, or experience, and is under the regular
treatment of a physician, all for a period in excess of twelve (12) consecutive
months, then, at the option of the Company, and upon thirty (30) days' notice
in writing to the Executive by the Company, this Agreement (other than the
restrictive covenants set forth in paragraph 5 hereof) shall terminate, and the
Executive shall be paid, within sixty (60) days of the date of termination
of this Agreement, a lump sum equal to all Basic Salary (as then in effect)
earned up to and including the date of termination plus fifty percent (50%) of
the remaining total amount of Basic Salary (as then in effect) which would have
been earned by the Executive hereunder if he had remained in the employ of the
Company through the third anniversary of the date hereof. An additional amount
equal to the balance of the Basic Salary (as then in effect) which would have
been
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earned by the Executive hereunder if he had remained in the employ of the
Company through the third anniversary of the date hereof shall be paid to the
Executive in equal installments through the third anniversary of the date hereof
in accordance with the Company's normal payroll practices. However, such
periodic payments shall immediately terminate, and the Company shall have no
further obligations under this Paragraph 7, in the event of the Executive's
death prior to the third anniversary of the date hereof.
B. In addition to the payments described in Paragraph 7A above, the
Executive shall be entitled to receive the compensation described in the second
sentence of paragraph 3 hereof earned up to and including the date of
termination. Such amount is deemed to be earned on a monthly pro-rata basis, on
the last day of each month, and shall be payable within 90 days after the end
of the fiscal quarter in which termination occurred.
C. Notwithstanding the provisions of Paragraph 7A to the contrary, the
lump sum or periodic payments of Basic Salary in respect of the remaining
original term of this Agreement provided for in Paragraph 7A shall be reduced by
any funds provided or to be provided from disability insurance or other plans or
arrangements which the Company,
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at its sole cost and expense, may obtain for the benefit of the Executive and
by any compensation received by the Executive from another employer subsequent
to the date of disability and during the term of this Agreement. Such reduction
shall first be applied to reduce the fifty (50%) percent payment to be made
within sixty (60) days of the termination of the Agreement and, to the extent
necessary, shall then be applied on a proportionate basis to reduce the
remaining disability payments to be made in accordance with the Company's normal
payroll practices.
D. If at any time, as a result of the total payments received from the
Company, a disability insurance carrier and/or another employer, the Executive
has received benefits or compensation in excess of that which he is entitled to
receive under this Paragraph 7, he shall be obligated to immediately pay such
excess to the Company. In addition, the Company may deduct such excess from any
payments which the Company is otherwise obligated to make to the Executive in
the future under this Agreement.
E. This Paragraph 7 shall survive the termination of this Agreement.
8. Insurance. The Company shall have the right, from time to time, to
apply for and take out in its name and at its own expense, life, health or other
insurance upon the
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Executive in any sum or sums which may be deemed necessary by the Company to
protect its interest under this Agreement, and the Executive shall do all such
things as may be necessary to assist in the procuring of such insurance by
making proper application therefor as may be required by an insurance company
and submitting to the usual and customary medical examination.
9. Other Plans. In addition to the compensation provided for in
Paragraph 3 hereof, the Executive shall be entitled to participate in any group
life, medical, pension, retirement, profit sharing and other employee benefit
plans, vacations, and other types of deferred compensation arrangements
afforded generally by the Company to other officers of the Company, subject to
his meeting applicable eligibility requirements, and nothing herein contained
shall be deemed to preclude the Executive's participation in any such plan.
10. Termination.
A. The Company shall have the right to terminate the Executive's
employment under this Agreement if the Executive:
(i) is convicted of a felony, or pleads guilty or nolo
contendere to such felony or lesser charge which results from plea
bargaining; or
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(ii) breaches any material term or condition of this
Agreement in any material respect and fails to cure such material
breach within the latter of thirty (30) calendar days after receiving
written notice of such breach from the Company or such reasonable
period of time as is necessary to cure such breach; or
(iii) dies, or is disabled pursuant to Paragraph 7 of this
Agreement; or
(iv) the Company shall reasonably believe that the Executive
has committed an act of fraud, theft or dishonesty against the Company.
B. If this Agreement is terminated pursuant to Paragraph 10A hereof,
and except as otherwise provided in Paragraphs 7 and 11 hereof, the Company
shall be under no obligation or liability to the Executive except to pay to him
such Basic Salary to which he may be entitled pursuant hereto through the date
of such termination and the compensation described in the second sentence of
paragraph 3 hereof through the last full fiscal quarter completed prior to the
date of termination. No compensation in excess of Basic Salary will be earned
for the fiscal quarter of termination. Such funds shall be payable to the
Executive, or his personal representative, within sixty (60) days after
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such termination, or the appointment of a duly authorized personal
representative, whichever is later.
C. The Company shall also have the right to terminate the Executive's
employment without cause. In such event, the Company shall be required to pay to
the Executive the remaining Basic Salary as then in effect to which the
Executive is entitled for the remaining term of this Agreement. The Company's
Board of Directors may not reduce the Executive's Basic Salary in contemplation
of such termination. The remaining Basic Salary shall be payable in one lump sum
within thirty-one (31) days after such termination. In addition, the Executive
will be entitled to the compensation described in the second sentence of
Paragraph 3 hereof through the date of termination. For this purpose, such
compensation is deemed to be earned on a monthly pro-rata basis, on the last day
of each month. Such amount shall be payable within ninety (90) days after the
end of the fiscal quarter in which termination occurs.
11. Death During Employment. Notwithstanding any other provision in
this Agreement to the contrary, if the Executive dies during the term of his
employment hereunder, the Company shall:
A. pay to the estate of the Executive within six (6) months of the
Executive's death, all of the Basic Salary
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which would otherwise be payable to him up to the later of (i) three years from
the date of death or (ii) the third anniversary of the date hereof. The amount
of Basic Salary to be used in determining the amount payable to his estate
pursuant to the preceding sentence shall be the Basic Salary in effect on the
date of his death; and, in addition,
B. pay a total of $5,000 to the estate of the Executive, within sixty
(60) days after the death of the Executive.
12. Payment In the Event of Change in Control of the Company.
A. If in a single transaction or as a result of a series of
transactions occurring in concert with each other, the control of the Company
shall change, and subsequent to such change in control, this Agreement, or any
subsequent employment agreement then in effect which expires prior to the
Executive's attaining sixty-five (65) years of age, is terminated or is not
renewed by the Company at the expiration of the term of such agreement or any
renewals, extensions or modifications thereof, the Executive shall be entitled
to compensation in addition to all amounts otherwise payable to the Executive
under this Agreement, in an amount equal to two hundred ninety nine percent
(299%) of the annual Basic Salary payable to the Executive at the time
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when his employment is terminated. For purposes of this Paragraph 12, a "change
in control" shall occur if a person, together with such person's affiliates or
associates, acquire 50% or more of the outstanding voting stock of the Company.
The amount payable under this Paragraph 12 shall be paid in one single payment
to the Executive within sixty (60) days of the termination of employment.
B. Notwithstanding any other provisions of this Agreement to the
contrary, the total amounts deemed to be payable to the Executive under this
Agreement as a result of a change in control shall not exceed three (3) times
the "base amount" as determined under Section 28OG of the Internal Revenue Code
of 1986, as amended. In the event the amounts payable to the Executive as a
result of a change of control are reduced pursuant to the preceding sentence,
the amounts payable under this paragraph 12 shall be reduced prior to the
reduction of any other payments to the Executive hereunder.
C. This paragraph 12 shall survive the termination of this Agreement.
13. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing, and if sent by registered or
certified mail to his
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residence, in the case of the Executive, or to its principal office, in the case
of the Company.
14. Waiver of Breach. The waiver by the Company of a breach of any
provision of this Agreement by the Executive shall not operate or be construed
as a waiver of any subsequent breach by the Executive.
15. Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of New Jersey.
16. Entire Agreement. This instrument contains the entire agreement of
the parties. It may not be changed or modified except by an agreement in writing
signed by the parties hereto.
17. Severaability. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validly or enforceability of any other
provision of this Agreement, each of which shall remain in full force and
effect.
18. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
19. Successors and Assigns. This Agreement shall inure to the benefit
of and be binding on the parties hereto
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and their respective successors and assigns; provided, however, that this
Agreement may not be assigned by the Executive without the prior written consent
of the Company.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first written above.
ATTEST: DATAFLEX CORPORATION
By: /s/ Xxxxxxx X. Xxxx
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Title: Chairman and Chief Executive Officer
/s/ Xxxxxx Xxxxxxxxx
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Xxxxxx Xxxxxxxxx
