Exhibit 10.8
EXECUTION COPY
EMPLOYMENT AND NON-COMPETITION AGREEMENT
This EMPLOYMENT AND NON-COMPETITION AGREEMENT (this "Agreement"), dated as
of December 6, 2005 is between CSAV ASIA PACIFIC LIMITED, a Hong Kong
corporation (the "Employer"), and XXXXXX XXXX BULCRAIG (the "Employee").
WHEREAS, the Employer wishes to employ the Employee as an executive
officer, and the Employee wishes to be employed by the Employer as an executive
officer, on the terms set forth below.
NOW, THEREFORE, it is hereby agreed as follows:
SECTION 1. EMPLOYMENT. The Employer hereby employs the Employee, and the
Employee hereby accepts employment, upon the terms and subject to the conditions
hereinafter set forth.
SECTION 2. DUTIES. The Employee shall be employed as the Managing Director
of the Employer. In such capacity, the Employee shall have the responsibilities
and duties as are assigned by the Board of Directors (the "Board") of CSAV
Holding Corp., a Delaware corporation ("Holdings"), and which are consistent
with the Employee's position. At all times during the performance of this
Agreement, the Employee will adhere to the rules and regulations (the
"Policies") that have been or may hereafter be established by the Board for the
conduct of its employees or the employees of its subsidiaries or for the
position or positions held by the Employee. In the event of any inconsistency or
conflict between the terms and conditions of the Policies and this Agreement,
then the terms and conditions of this Agreement shall prevail. The Employee
agrees to devote his full business time and best efforts to the performance of
his duties to the Employer.
SECTION 3. TERM. The initial term of employment of the Employee hereunder
shall commence on December 6, 2005 (the "Commencement Date") and shall continue
until the second anniversary of the Commencement Date (the "Initial Term"),
unless earlier terminated pursuant to Section 6, and shall be renewed
automatically for additional one (1) year terms thereafter unless terminated by
either party by written notice to the other given at least thirty (30) days
prior to the expiration of the then current term.
SECTION 4. COMPENSATION AND BENEFITS. Until the termination of the
Employee's employment hereunder, in consideration for the services of the
Employee hereunder, the Employer shall compensate the Employee as follows:
(a) BASE SALARY. The Employer shall pay the Employee, in accordance
with the Employer's then current payroll practices (including the timing and
manner of payment), a base salary (the "Base Salary"). The Base Salary will be
paid at an annual rate of US$150,000. The Base Salary may be increased from time
to time at the sole discretion of the Board.
(b) INCENTIVE BONUS. At the end of each fiscal year of the Employer
during the Term, beginning with the fiscal year ending December 31, 2006, the
Employee shall be eligible to receive from the Employer an annual incentive
bonus (the "Incentive Bonus"). The Incentive Bonus criteria for each fiscal year
(i) will be determined by the Board after discussion
with the Employee (and the Employer will advise the Employee of such
determination) prior to the end of the first fiscal quarter of such fiscal year,
and (ii) may be based solely on the achievement of individual performance
criteria, solely on the achievement by the Employer of elements of its business
plan or on a combination of these criteria or such other criteria that the Board
may reasonably determine (including achievement of certain performance criteria
for the business unit for which the Employee is responsible/works). It is
currently contemplated that the Incentive Bonus range for all fiscal years will
be between 20%-50% of the Base Salary depending upon the satisfaction of the
Incentive Bonus criteria to be set in accordance with the immediately preceding
sentence. The Incentive Bonus (if any) payable in connection with any fiscal
year shall be paid on or about May 31 of the following fiscal year. If the
Employee resigns or is terminated for Cause as defined below, no Incentive Bonus
shall be payable for the fiscal in which such resignation or termination occurs.
The amount of any Incentive Bonus payable for any fiscal year shall be paid in
cash; provided, however, that upon the determination of the Board, up to 50% of
any Incentive Bonus for any fiscal year may be paid in the form of shares of
restricted stock of Holdings (the "Bonus Shares") having a value, determined in
good faith by the Board, equal to such percentage of the total Incentive Bonus
payable for such fiscal year. The Employee agrees to execute and deliver to the
Employer all such documents, instruments and agreements relating to the Bonus
Shares as the Employer may request.
(c) VACATION. The Employee shall be entitled to four (4) weeks
vacation each calendar year plus the 17 General Holidays in Hong Kong each
calendar year. Any vacation shall be taken at the reasonable and mutual
convenience of the Employer and the Employee. Up to one (1) week of accrued
vacation that has not been used as of the end of any calendar year may be
carried forward for use in the next calendar year.
(d) INSURANCE; OTHER BENEFITS. The Employee shall be entitled to
participate in the Employer's Mandatory Provident Fund scheme subject to its
terms and conditions from time to time in place and receive any health,
accident, disability and life insurance and family leave benefits provided by
the Employer under group health, accident, disability, and life insurance and
family leave plans maintained by the Employer for its full-time, salaried
employees as such employment benefits may be modified from time to time by the
Board for all full-time, salaried employees, provided that (without duplication
of any of the foregoing benefits) the Company shall:
(i) reimburse the Employee for 100% of cost of the premiums (not
to exceed (x) US$7,000 per annum or (y) the average per employee premium
payment contribution that the Employer then currently provides to its
senior executives) associated with the Employee's health insurance coverage
provided by a New Zealand based health insurance provider coverage;
(ii) provide the Employee with a vehicle allowance for a vehicle
to be used primarily in and around the city of Shenzen, the People's
Republic of China, of US$700 per month (plus the costs of fuel and toll
expenses incurred in connection with the performance of the Employee's
duties hereunder) during the term of this Agreement; and
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(iii) provide the Employee with a yearly travel allowance to be
used by the Employee exclusively for travel between the city of Shenzen,
the People's Republic of China and New Zealand, provided further that an
estimate of such amount shall be submitted to the Company for its approval
and shall not exceed US$30,000 in the aggregate in any year during the term
of this Agreement; and
(iv) reimburse the Employee for the annual premiums paid by the
Employee for travel insurance coverage during the Term of this Agreement,
provided further that an estimate of the amount of such premiums shall be
submitted to the Company for its approval and shall not exceed US$1,000 in
the aggregate in any year during the term of this Agreement.
(e) WITHHOLDING. All amounts payable by the Employer to the Employee
hereunder (including, but not limited to, the Base Salary and the Incentive
Bonus) shall be reduced prior to the delivery of such payment to the Employee by
an amount sufficient to satisfy required by any applicable national, local or
other withholding tax requirements.
SECTION 5. EXPENSES. The Employer shall reimburse the Employee for all
reasonable expenses of types authorized by the Employer and incurred by the
Employee in the performance of his duties hereunder. The Employee shall comply
with such budget limitations and approval and reporting requirements with
respect to expenses as the Employer may establish from time to time for Company
executives in the Asia-Pacific region.
SECTION 6. TERMINATION. The Employee's employment hereunder shall commence
on the Commencement Date and continue until the expiration of the Initial Term,
and any extension of such term pursuant to Section 3 above, except that the
employment of the Employee hereunder shall earlier terminate:
(a) DEATH. Upon the death of the Employee during the term of his
employment hereunder.
(b) DISABILITY. At the option of the Employer, in the event of the
Employee's Disability (as defined below), upon thirty (30) days' written notice
from the Employer. For purposes hereof, the Employee shall be deemed to have a
"Disability" if the Employee is unable (as reasonably determined by the Board),
on account of a physical or mental illness, injury or disease or combination
thereof, to perform his duties and obligations under this Agreement for a period
of more than 90 consecutive days or for a total of 120 days (in either case
excluding vacation days) within any 12 month period.
(c) FOR CAUSE. For "Cause" effective immediately upon written notice
by the Employer to the Employee. For purposes of this Agreement, a termination
shall be for Cause if the Board shall determine that any one or more of the
following has occurred:
(i) the Employee shall have committed an act of fraud,
embezzlement, misappropriation, gross negligence or breach of fiduciary
duty against the Employer, any parent company of the Employer (including
Holdings) or any of their respective
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subsidiaries (collectively, the "Companies"), including, but not limited
to, the offer, payment, solicitation or acceptance of any unlawful bribe or
kickback with respect to the business of any of the Companies; or
(ii) the Employee shall have been convicted by a court of
competent jurisdiction of, or pleaded guilty or nolo contendere to, any
felony or the equivalent of a felony in such jurisdiction; or
(iii) the Employee shall have committed a material breach of any
of the covenants, terms and provisions of Sections 7,8 or 9 hereof; or
(iv) the Employee shall have breached in any material respects
any one or more of the provisions of this Agreement (excluding Sections 7,
8 and 9 hereof), including, without limitation, any failure to comply with
the Policies, or any one or more of the provisions of the Stockholder
Agreement, dated as of August 29, 2003 (as amended and in effect from time
to time, the "Stockholder Agreement"), among Holdings and its stockholders,
or the trustees (the "Trustees") of the Happy Valley Trust created by Deed
dated August 17, 2004, shall have breached in any material respect any one
or more of the provisions of the Stockholder Agreement and, in each case,
such breach shall have continued for a period of fifteen (15) days after
written notice to the Employee specifying such breach in reasonable detail;
or
(v) the Employee shall have refused, after explicit written
notice, to obey any lawful resolution of, or direction by, the Board which
is consistent with his duties hereunder; or
(vi) the Employee shall be chronically absent from work
(excluding vacation, illnesses or leaves of absence approved by the Board)
and such absence shall continue following written notice to the Employee;
or
(vii) any other ground justifying summary dismissal under Section
9 of the Employment Ordinance, Cap. 57 of the Laws of Hong Kong.
(d) RESIGNATION OR TERMINATION WITHOUT CAUSE. At any time, upon one
month's written notice by either the Employer or the Employee to the other party
hereto or payment of one month's wages in lieu.
(e) RIGHTS AND REMEDIES ON TERMINATION.
(i) If the Employee's employment hereunder is terminated pursuant
to Section 6(a), Section 6(b) or Section 6(c), by the Employee pursuant to
Section 6(d) or pursuant to Section 3 in connection with the expiration of
the Initial Term or any subsequent term hereunder then the Employee (or his
estate, as applicable) shall be entitled to receive his Base Salary through
the date of termination or expiration, the amount of any unpaid Incentive
Bonus earned for prior fiscal years and any other sums to which the
Employee is entitled pursuant to applicable law.
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(ii) If the Employee's employment hereunder is terminated by the
Employer pursuant to Section 6(d), then the Employee shall be entitled to
continue to receive payment, in accordance with the Employer's then current
payroll practices, of the Employee's Base Salary in effect on the
Termination Date (as defined below), for a five (5) month period following
such termination (or for a one (1) year period following the Termination
Date if the Employer elects to so extend the Severance Period as
contemplated by the last sentence of the definition of the Designated
Period set forth below) (the "Severance Period"); provided, however, that
(A) the Employee's right to receive the foregoing payment is expressly
conditioned upon receipt by the Employer within 30 days following the
Termination Date of a written release executed by the Employee, in form and
substance satisfactory to the Employer, of any and all claims or causes of
action of any nature relating directly or indirectly to such Employee's
employment or termination of employment by the Employer; (B) in the event
that the Employee breaches any of the covenants, terms or provisions of
Sections 7, 8 or 9 hereof, without limiting any other rights that the
Employer may have, the Employer's obligation to make payments under this
Section 6(e)(ii) shall immediately terminate; and (C) the severance payment
shall be reduced by any sums paid to the Employee pursuant to applicable
law as described in Section 6(e)(iii) below. As used herein, the term
"Termination Date" means the date of the termination of the Employee's
employment with the Employer for any reason, including, without limitation,
for resignation, death or Disability and whether or not for Cause.
(iii) Except as otherwise set forth in this Section 6(e), the
Employee shall not be entitled to any severance, bonus or other
compensation after termination other than payment of any expense
reimbursements under Section 5 hereof for expenses incurred in the
performance of his duties prior to termination or benefits or compensation
to which the Employee is entitled pursuant to applicable law.
SECTION 7. INVENTIONS; ASSIGNMENT. The Employee hereby irrevocably and
unconditionally waives in favour of the Employer all rights granted by the
Copyright Ordinance of Hong Kong in connection with his authorship of any
copyright works in the course of his employment with the Employer, including
without limitation any moral rights and any right to claim an additional payment
with respect to use or exploitation of those works. The Employee agrees that (i)
his wages are full compensation for his services and all present and future uses
of copyright works made by him in the course of his employment; and (ii) he will
not make any claims against the Companies with respect to those copyright works.
If the Employee makes any Inventions (as defined below) that do not belong to
the Employer under the Patents Ordinance of Hong Kong, he agrees that he will
forthwith exclusively license or assign (as determined by the Employer) to the
Employer his rights in relation to such Inventions and will deliver to the
Employer all documents and other materials relating to them. The Employer will
pay to the Employee such compensation for the license or assignment as the
Employer will determine in its absolute discretion, subject to the Patents
Ordinance of Hong Kong. All rights to discoveries, inventions, improvements and
innovations (including all data and records pertaining thereto) related to the
business of any of the Companies, whether or not patentable, copyrightable,
registrable as a trademark, or reduced to writing, that the Employee may
discover, invent or
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originate during the term of his employment hereunder, either alone or with
others and whether or not during working hours or by the use of the facilities
of any of the Companies ("Inventions"), shall be the exclusive property of the
Employer. The Employee shall promptly disclose all Inventions to the Employer,
shall execute at the request of the Employer any assignments or other documents
the Employer may deem necessary to protect or perfect the rights of the
Companies therein, and shall assist the Companies, at the Companies' expense, in
obtaining, defending and enforcing the Companies' rights therein. The Employee
hereby appoints the Employer and each of the other Companies, individually, as
his attorney-in-fact to execute on his behalf any assignments or other documents
deemed necessary by the Employer or any of the other Companies to protect or
perfect their rights to any Inventions.
SECTION 8. CONFIDENTIAL INFORMATION. The Employee recognizes and
acknowledges that certain assets of the Companies, including, without
limitation, information regarding customers, pricing policies, methods of
operation, proprietary production processes, proprietary computer programs,
sales, products, profits, costs, markets, key personnel, formulae, product
applications, technical processes, and trade secrets (hereinafter called
"Confidential Information") are valuable, special, and unique assets of the
Companies and their affiliates. The Employee shall not, during or after his term
of employment, disclose any or any part of the Confidential Information to any
person, firm, corporation, association, or any other entity for any reason or
purpose whatsoever, directly or indirectly, except as may be required pursuant
to his employment hereunder; provided, that Confidential Information shall in no
event include (a) Confidential Information which was generally available to the
public at the time of disclosure by the Employee or (b) Confidential Information
which becomes publicly available other than as a consequence of the breach by
the Employee of his confidentiality obligations hereunder. In the event of the
termination of his employment, whether voluntary or involuntary and whether by
the Employer or the Employee, the Employee shall deliver to the Employer all
documents and data pertaining to the Confidential Information and shall not take
with him any documents or data of any kind or any reproductions (in whole or in
part) or extracts of any items relating to the Confidential Information. Nothing
contained within this Section 8 shall prohibit the Employee from disclosing
Confidential Information if such disclosure is required by law, governmental
process or valid legal process. In the event that the Employee is legally
compelled to disclose any of the Confidential Information, he shall provide the
Employer with prompt written notice so that the Employer, at its sole cost and
expense, may seek a protective order or other appropriate remedy and/or waive
compliance with the provisions of this Agreement. In the event that such
protective order or other remedy is not obtained, or that Employer waives
compliance with the provisions of this Agreement, Employee shall furnish only
that portion of the Confidential Information that he is advised by counsel is
legally required to be disclosed.
SECTION 9. RESTRICTIONS ON TERMINATION.
(a) NON-COMPETITION. The Employee hereby agrees that he shall not
(without the written consent of the Board) during the Designated Period within
the Prohibited Area and whether on his own behalf or in conjunction with or on
behalf of any other person, firm, company or other organization (and whether as
an employee, director, principal, agent, consultant or in any other capacity
whatsoever (other than as a holder of less than two percent (2%) of the common
stock of any publicly traded corporation)) in competition with the Employer
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directly or indirectly (i) be employed or engaged in, or (ii) perform services
in respect of, or (iii) be otherwise concerned with:-
(i) the research into, development, sourcing, procuring,
manufacture, supply, sale or marketing of any product which is of the same
or similar type to any product researched, or developed, or sourced, or
procured or manufactured, or supplied, or sold, or marketed by the
Companies (including, without limitation, providing any products that are
the same or substantially similar to products researched, or developed, or
sourced, or procured, or manufactured, or supplied or sold or marketed by
AV Supply Group 2001 Limited prior to the Commencement Date) during the
Employee's employment by the Employer (except that after the Termination
Date this clause (i) shall only apply to products that are the same or
similar to products researched, or developed, or sourced, or procured or
manufactured, or supplied, or sold, or marketed by the Companies during the
12 months immediately preceding the Termination Date);
(ii) the development or provision of any services (including, but
not limited to technical and product support, or consultancy or customer
services) which are of the same or similar type to any services provided by
the Companies (including, without limitation, any services that are the
same or substantially similar to the business of AV Supply Group 2001
Limited prior to the Commencement Date) during the Employee's employment by
the Employer (except that after the Termination Date this clause (ii) shall
only apply to services which are of the same or similar type to any
services provided by the Companies during the 12 months immediately
preceding the Termination Date);
PROVIDED HOWEVER that the provisions of this paragraph (a) shall apply only
after the Termination Date in respect of products or services with which the
Employee was either personally concerned or for which he was responsible while
employed by the Employer at any time during the 12 months immediately preceding
the Termination Date.
(b) NON-SOLICITATION OF CUSTOMERS. The Employee hereby agrees that he
shall not during the Designated Period whether on his own behalf or in
conjunction with or on behalf of any person, company, business entity or other
organization (and whether as an employee, director, principal, agent, consultant
or in any other capacity whatsoever (other than as a holder of less than two
percent (2%) of the common stock of any publicly traded corporation)), directly
or indirectly (i) solicit or, (ii) assist in soliciting, or (iii) accept, or
(iv) facilitate the acceptance of, or (v) deal with, in competition with the
Employer, the business of any Customer or Prospective Customer, provided,
however, that after the Termination Date this paragraph (b) shall only apply to
the business of any Customer or Prospective Customer:-
(i) with whom the Employee has had material contact or dealings
on behalf of the Employer during the 12 months immediately preceding the
Termination Date; or
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(ii) for whom the Employee was, in a client management capacity
on behalf of the Employer, directly responsible during the 12 months
immediately preceding the Termination Date.
(c) NON--SOLICITATIION OF EMPLOYEES. The Employee hereby agrees that
he shall not during the Designated Period whether on his own behalf or in
conjunction with or on behalf of any person, company, business entity or other
organization (and whether as an employee, director, principal, agent, consultant
or in any other capacity whatsoever (other than as a holder of less than two
percent (2%) of the common stock of any publicly traded corporation)), directly
or indirectly:-
(i) (i) induce, or (ii) solicit, or (iii) entice or (iv) procure,
any person who is a Company Employee to leave the Employer's or any of the
Companies employment (as applicable) where that person is a Company
Employee; or
(ii) be personally involved to a material extent in (i) accepting
into employment or (ii) otherwise engaging or using the services of, any
person who is a Company Employee.
(d) INTERFERENCE WITH SUPPLIERS. The Employee hereby agrees that he
shall not (i) during the Designated Period, and (ii) in relation to any contract
or arrangement which the Employer has with any Supplier for the exclusive supply
of goods or services to the Companies or any one of them for the duration of
such contract or arrangement, whether on his own behalf or in conjunction with
or on behalf of any person, company, business entity or other organization (and
whether as an employee, director, principal, agent, consultant or in any other
capacity whatsoever (other than as a holder of less than two percent (2%) of the
common stock of any publicly traded corporation)), directly or indirectly:-
(i) interfere with the supply of goods or services to the
Employer from any Supplier; or
(ii) induce any Supplier of goods or services to the Employer to
cease or decline to supply such goods or services in the future.
(e) The provisions of sub-paragraphs (f) and (g) below shall only
apply after the Termination Date in respect of those Companies (i) to whom the
Employee gave his services, or (ii) for whom he was responsible, or (iii) with
whom he was otherwise concerned, in the 12 months immediately preceding the
Termination Date.
(f) Sub-paragraphs (a), (b), (c), (d), (g) and (i) in this Section 9
shall apply as though references to any of the Companies were substituted for
references to the "Employer". The obligations undertaken by the Employee
pursuant to this Section 9 shall, with respect to each of the Companies,
constitute a separate and distinct covenant and the invalidity or
unenforceability of any such covenant shall not affect the validity or
enforceability of the covenants in favour of the Employer or Companies.
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(g) The Employer contracts as trustee and agent for the benefit of
each of the Companies as well as for itself. The Employee agrees that, if
required to do so by the Employer, he will enter into covenants in the same
terms as those set out in sub-paragraphs (a), (b), (c), (d) and (g) hereof
directly with all or any of such Companies, mutatis mutandis. If the Employee
fails, within fifteen (15) days of receiving such a request from the Employer,
to sign the necessary documents to give effect to the foregoing, the Employer
shall be entitled, and is hereby irrevocably and unconditionally authorized by
the Employee, to execute all such documents as are required to give effect to
the foregoing, on his behalf.
(h) The Employee acknowledges that the provisions of this Section 9
are essential to protect the business and goodwill of the Companies. The
Employee will continue to be bound by the provisions of this Section 9 until
their expiration and shall not be entitled to any compensation from the Employer
with respect thereto except as provided above. If at any time the provisions of
this Section 9 shall be determined to be invalid or unenforceable by reason of
being vague or unreasonable as to area, duration or scope of activity, this
Section 9 shall be considered divisible and shall become and be immediately
amended to only such area, duration and scope of activity as shall be determined
to be reasonable and enforceable by the court or other body having jurisdiction
over the matter; and the Employee agrees that this Section 9 as so amended shall
be valid and binding as though any invalid or unenforceable provision had not
been included herein. The Employee hereby acknowledges that he has agreed to be
bound by the provisions of this Section 9 in consideration for the compensation,
severance and other benefits to be provided by the Employer to the Employee
pursuant to the terms of this Agreement.
(i) DEFINITIONS. For the purposes of this Section 9, the following
words and expressions shall have the meanings set out below:
(i) "Agreed Jurisdiction" means:
(1) New Zealand and the Pacific Islands in respect of all
Specified Products; and
(2) All the states of Australia in the case of the CSAV
Product known as PFFPb.
(ii) "Company Employee" means any person who was employed by (i)
the Employer or (ii) any of the Companies, provided, however, after the
Termination Date such person must have been employed by the Companies for
at least three (3) months prior to and on the Termination Date and (X) with
whom the Employee had material contact or dealings in performing his duties
of his employment; or (Y) who had material contact with customers or
suppliers of the Employer in performing his or her duties of employment
with the Employer or any of the Companies (as applicable); or (Z) who had
access to confidential information during his employment with the Employer
or any of the Companies (as applicable).
(iii) "CSAV Products" means any products sold by Holdings or any
of its Subsidiaries.
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(iv) "Customer" shall mean any person, firm, company or other
organization whatsoever to whom the Employer has supplied goods or
services.
(v) "Designated Period" shall mean in relation to Section 9(a)
the period commencing on the Commencement Date and ending six (6) months
immediately following the Termination Date and in relation to Section 9(b),
(c) and (d) the period commencing on the Commencement Date and ending
twelve (12) months immediately following the Termination Date.
Notwithstanding the foregoing, if following the occurrence of a Disposition
Event the Employee's employment is terminated by the Employer without
Cause, the Designated Period for all jurisdictions shall end on the earlier
of (A) the date that the Designated Period would otherwise end in
accordance with the previous sentence and (B) (i) 180 days following
Termination Date or (ii) one year following the Termination Date if the
Employer elects to extend the Severance Period until the first anniversary
of the Termination Date.
(vi) "Disposition Event" means (a) (i) the sale of all or
substantially all of the assets of Holdings or its Subsidiaries in a single
transaction or series of related transactions whether by liquidation,
dissolution, merger, consolidation or sale or (ii) the sale or other
transfer of at least 51% of the outstanding shares of Common Stock in a
single transaction or a series of related transactions, in either case to
any Person who is not an Affiliate of the Company, or of a stockholder
thereof, immediately prior to such transaction or transactions, or (b) the
effective time of any merger, share exchange, consolidation, or other
business combination of the Company if immediately after such transaction
Persons who hold a majority of the outstanding voting securities entitled
to vote generally in the election of directors of the surviving entity (or
the entity owning 100% of such surviving entity) are not Persons who,
immediately prior to such transaction, held the securities of the Company
entitled to vote generally in the election of directors.
(vii) "Person" means an individual, partnership, corporation,
limited liability company, association, trust, joint venture,
unincorporated organization, or any government, governmental department or
agency or political subdivision thereof.
(viii) "Pacific Islands" means Norfolk Island, New Caledonia,
Fiji, Tonga, Niue, Xxxx Islands, French Polynesia, Samoa, Easter Island,
Tahiti, Tokelau, Tuvalu, Vanuatu, Solomon Islands, Kiribati, Palau, Wallis
and Futuna, and Palau.
(ix) "Prohibited Area" means: (X) Hong Kong; and (Y) any other
country in the world where, on the Termination Date, the Employer develops,
sells, supplies, manufactures or researches its products or services or
where the Employer is intending within three (3) months following the
Termination Date to develop, sell, supply or manufacture its products or
services and in respect of which the Employee has been responsible (whether
alone or jointly with others), concerned or active on behalf of the
Employer during any part of the 12 months immediately preceding the
Termination Date.
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(x) "Prospective Customer" shall mean any person, firm, company
or other organization with whom the Employer has had any negotiations or
material discussions regarding the possible supply of goods or services by
the Employer prior to the Termination Date.
(xi) "Specified Customers" means wholesale and retail customers
physically located in New Zealand or the Pacific Islands in the case of the
Specified Products, and Pioneer (OEM) Australia in respect only of the
"Sanus" product known as PFFPb.
(xii) "Subsidiary" means any corporation, association, trust, or
other business entity, of which the designated parent shall at any time own
or control directly or indirectly through a Subsidiary or Subsidiaries at
least a majority (by number of votes) of the outstanding shares of capital
stock (or other shares of beneficial interest) which are (a) entitled
ordinarily, in the absence of contingencies, to vote for the election of a
majority of such business entity's directors (or Persons exercising similar
functions), even though the right so to vote has been suspended by the
happening of such a contingency, or (b) entitled at the time to vote for
the election of a majority of such business entity's directors (or Person
exercising similar functions), whether or not the right so to vote exists
by reason of the happening of a contingency.
(xiii) "Specified Products" means mounting solutions, furnishings
and products (including (but not by way of limitation) furniture, mounts,
lifts, units, stands, racks, supports, parts and accessories and systems)
for the ProAV, Home Theatre, Residential and Workstation audio-visual
markets, by whomever manufactured, including any CSAV Products.
(xiv) "Supplier" means any person, company, business entity or
other organization whatsoever who: (X) has supplied goods or services to
the Employer during any part of the 12 months immediately preceding the
Termination Date; or (Y) has agreed prior to the Termination Date to supply
goods or services to the Employer to commence at any time in the 12 months
following the Termination Date; or (Z) as at the Termination Date, supplies
goods or services to the Employer under an exclusive contract or
arrangement between that Supplier and the Employer.
(j) Non-Violation. Anything to the contrary in any deed, agreement
(including this Agreement) or otherwise notwithstanding, neither:
(k) the acquisition, holding and sale by the Employee and/or the
Trustees of the legal and/or beneficial ownership of the shares on issue by AV
Supply Group Limited, a New Zealand limited liability entity registered in the
New Zealand Companies Office under No. 1133246 or of another legal entity whose
principal business operations are located in New Zealand ("NZ Entity"); nor
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(l) the association of the Employee (whether on his own behalf or in
conjunction with or on behalf of any other person, firm, company or other
organization) as a director or principal of (but not as an employee of or
consultant to) a NZ Entity;
during the Designated Period, shall violate the terms of this Section 9 so long
as:
(1) the only activity of the NZ Entity that would violate
the terms of this Section 9 is the designing, sourcing, importing,
distribution, and the sale of Specified Products only to Specified
Customers that have agreed in writing that any such Specific Products
will not be re-sold or further distributed by the Specified Customer
outside of the Agreed Jurisdiction; and
(2) the Employee is not personally actively involved in the
day to day operation of the business of the NZ Entity (other than in
the usual duties of a director of the entity); and
(3) any Specified Product that is a CSAV Product shall be
purchased by the NZ Entity from Holdings or one of its Subsidiaries.
(m) CSAV Products. The Employer shall endeavor to provide AV Supply
Group Limited with a current list of CSAV Products and a current list of
services provided by Holdings and its Subsidiaries at least once a year prior to
the Termination Date. The Employer shall provide AV Supply Group Limited with a
current list of CSAV Products and a current list of services provided by
Holdings and its Subsidiaries upon the reasonable request of AV Supply Group
Limited during the Designated Period.
SECTION 10. GENERAL.
(a) NOTICES. All notices and other communications hereunder shall be
in writing or by written telecommunication, and shall be deemed to have been
duly given if delivered personally or if mailed by certified mail, return
receipt requested, postage prepaid or sent by written telecommunication or
telecopy, to the relevant address set forth below, or to such other address as
the recipient of such notice or communication shall have specified to the other
party hereto in accordance with this Section 10(a):
If to the Employer, to:
CSAV Asia Pacific Limited
Suite 1604, 16th Floor Xxxx Xxx Xxxxxxxxxx
Xxxxxx
000-000 Xxx Xxxxx Xxxx Xxxxxxx
Xxxx Xxxx
Attention: President
Fax: (000) 00000000
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With copies to:
Chief Manufacturing, Inc.
00000 Xxxxxxx 00 Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxx 00000
Attention: President
Fax: (000)000-0000
Xxxxxxxx Xxxxxxxxx & Xxxx, LLC
Xxx Xxxxxxxx Xxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxxx
Fax: (000)000-0000
Xxxxxxx XxXxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
Fax: (000)000-0000
If to the Employee, to:
The Trustees
The Happy Valley Trust
C/O Stuart Bulcraig
AV Supply Group 2001 Limited
Room 1006, Building C, BaiHeXingCheng
LuoGang,
BuJi Town,
Shenzhen
CHINA
Postcode: 518112
Fax: x00 000 0000 0000
With copies sent contemporaneously to
Xxxxxx Xxxxxxx Harford
Lawyers
PO Box 9892
Xxxxx 0
0 Xxxxxxxx
Xxxxxxxxx
Xxxxxxxx
-00-
XXX XXXXXXX
Attention: Xxxxxx X Xxxxxxx III
Fax: x00 0 000 0000
And to:
Prince and Partners
Chartered Accountants
XX Xxx 0000
Xxxxx 0
CustomHouse
00 Xxxxx Xxxxxx
Xxxxxxxx 0
XXX XXXXXXX
Attention: Xxxxxx Xxxxxx
Fax: x00 0 000 0000
(b) EQUITABLE REMEDIES. Each of the parties hereto acknowledges and
agrees that upon any breach by the Employee of his obligations under Sections 7,
8 and 9 hereof, the Employer will have no adequate remedy at law, and
accordingly will be entitled to specific performance and other appropriate
injunctive and equitable relief.
(c) SEVERABILITY. If any provision of this Agreement is or becomes
invalid, illegal or unenforceable in any respect under any law, the validity,
legality and enforceability of the remaining provisions hereof shall not in any
way be affected or impaired.
(d) WAIVERS. No delay or omission by either party hereto in exercising
any right, power or privilege hereunder shall impair such right, power or
privilege, nor shall any single or partial exercise of any such right, power or
privilege preclude any further exercise thereof or the exercise of any other
right, power or privilege.
(e) COUNTERPARTS. This Agreement may be executed in multiple
counterparts (including by telecopier), each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
(f) ASSIGNS. This Agreement shall be binding upon and inure to the
benefit of the heirs and successors of each of the parties hereto, including any
entity which acquires substantially all of the assets or stock of the Employer.
(g) ENTIRE AGREEMENT. This Agreement contains the entire understanding
of the parties and supersedes all prior agreements and understandings relating
to the subject matter hereof. This Agreement shall not be amended except by a
written instrument hereafter signed by each of the parties hereto.
(h) GOVERNING LAW; PROCESS SERVICE AGENT. This Agreement and the
performance hereof shall be governed by the laws of the Hong Kong Special
Administrative Region ("Hong Kong") and the parties hereby submit to the
non-exclusive jurisdiction of the
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Hong Kong courts and Labour Tribunal. The Employee hereby irrevocably and
unconditionally appoints Prince and Partners with an office on the date hereof
at Xxxxx 0, 0 XxxxxxXxxxx, 00 Xxxxx Xxxxxx, Xxxxxxxx, Xxx Xxxxxxx, as his agent
to receive copies of the summons and complaint and any other process which may
be served in any such action or proceeding and agrees promptly to appoint a
successor agent reasonably satisfactory to the Employer prior to the termination
for any reason of the appointment of the person then serving as agent hereunder.
The Employee shall cause the initial agent to accept its appointment hereunder,
such acceptance to be in form and substance reasonably satisfactory to the
Employer, and prior to the termination for any reason of the appointment of the
person then serving as agent hereunder, the Employee shall cause the successor
agent to accept its appointment as agent for service of process, such acceptance
to be in form and substance reasonably satisfactory to the Employer.
(i) REPRESENTATIONS AND WARRANTIES OF THE EMPLOYEE. The Employee
represents and warrants to the Company that the execution and delivery by the
Employee of this Agreement do not, and the performance by the Employee of the
Employee's obligations hereunder will not, with or without the giving of notice
or the passage of time, or both: (a) violate any judgment, writ, injunction, or
order of any court, arbitrator, or governmental agency applicable to the
Employee or (b) conflict with, result in the breach of any provisions of or the
termination of, or constitute a default under, any agreement to which the
Employee is a party or by which the Employee is or may be bound.
(j) ACKNOWLEDGEMENTS. The Employee hereby acknowledges that he has had
the opportunity to be advised by counsel of his choice in the negotiation,
execution and delivery of this Agreement and the transactions contemplated
hereby.
(k) NEW EMPLOYMENT AGREEMENT. The Employer is in the process of
establishing a Foreign-Invested Commercial Enterprise (the "FICE") in the
Peoples Republic of China (the "PRC"). It is the intention of the parties that
once the FICE is duly licensed to commence business in the PRC, the FICE will
become the employer of the Employee. The parties agree to negotiate in good
faith modifications of the terms of this Agreement or a new employment agreement
as the Employer may reasonably require to evidence such change of employer and
the jurisdiction in which such employment shall take place (including increases
in the duration of the restrictions of the types set forth in Section 9 for a
period not to exceed 24 months following any termination of employment).
(l) TRANSACTION DOCUMENTS. No party shall be bound to any of the
Transaction Documents until all parties to each of them has signed all the
Transaction Documents to which they are a party, and each such document shall be
fully effective.
(m) CURRENCY. All moneys payable to the Employee under this Agreement
are denominated in and will be paid in United States Dollars.
* * * * *
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IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties
hereto have caused this Agreement to be duly executed as of the date and year
first above written.
CSAV ASIA PACIFIC LIMITED
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
SIGNED, SEALED and )
DELIVERED as a ) /s/ Xxxxxx Xxxx Bulcraig
DEED by ) ----------------------------------------
XXXXXX XXXX BULCRAIG ) Xxxxxx Xxxx Bulcraig
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IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties
hereto have caused this Agreement to be duly executed as of the date and year
first above written.
CSAV ASIA PACIFIC LIMITED
By: /s/ Xxxxx Xxxx
------------------------------------
Name: Xxxxx Xxxx
Title: Director
SIGNED, SEALED and )
DELIVERED as a )
DEED by ) ----------------------------------------
XXXXXX XXXX BULCRAIG ) Xxxxxx Xxxx Bulcraig
