EXHIBIT 10.48
EXECUTIVE OFFICER
EMPLOYMENT AGREEMENT
THIS EXECUTIVE OFFICER EMPLOYMENT AGREEMENT (the "Agreement") is made
and entered into this 14th day of May 2001 (the "Effective Date") by and between
UNIVERSAL ELECTRONICS INC. (the "Employer") and XXXXXX X. XXXXXXXXX
("Executive").
RECITALS:
WHEREAS, the Employer is presently headquartered in Cypress, California,
and is engaged in the business of developing and marketing easy to use,
pre-programmed universal remote control products primarily for home video and
audio entertainment equipment and home security and home automation devices; and
WHEREAS, Employer wishes to retain Executive as one of its key
executives and avail itself of Executive's expertise, experience and capability
in Employer's business, and in this connection has offered employment to
Executive as its President and Chief Operating Officer to perform those duties
and assume those responsibilities as set forth in this Agreement and as
identified and outlined in Employer's Amended and Restated By-Laws, and to
undertake such other duties and to assume such other responsibilities
commensurate with Executive's designated position(s) as may be reasonably
assigned to Executive from time to time by the Chief Executive Officer of
Employer and/or the Board of Directors of Employer; and
WHEREAS, Executive hereby accepts such offer of employment and desires
to be employed by the Employer subject to the terms and conditions of this
Agreement.
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
contained herein, and other good and valuable consideration, receipt of which is
hereby acknowledged, the parties, intending to be legally bound, agree as
follows:
1. EMPLOYMENT
Subject to all of the terms and conditions of this Agreement, on the
Effective Date of this Agreement, Employer hereby employs Executive and
Executive hereby accepts employment with Employer.
2. TITLE, AUTHORITY AND DUTIES
(a) TITLE(s) AND POSITION(s). On the Effective Date of this
Agreement, Executive shall be employed in the position(s) of and shall
have the title(s) of President and Chief Operating Officer of Employer.
Until this Agreement is terminated as provided herein, Executive will
continue to occupy such position(s) and hold such title(s) until
Employer and Executive shall mutually agree in writing to change any
such position(s) and title(s).
(b) AUTHORITY AND DUTIES. Executive will, during the term of
this Agreement, and subject to Chief Executive Officer oversight,
perform those duties and assume those responsibilities as set forth in
this Agreement and as identified and outlined in Employer's Amended and
Restated By-Laws, as amended as of the date of this Agreement, report to
the Chief Executive Officer of Employer, and to undertake such other
duties and to assume such other responsibilities commensurate with
Executive's designated position(s) as may be reasonably assigned to
Executive from time to time by the Chief Executive Officer of Employer
and/or the Board of Directors of Employer.
(c) EXCLUSIVE SERVICES AND EFFORTS OF EXECUTIVE. During the term
of this Agreement, Executive shall serve the Employer, under the
direction of Chief Executive Officer of Employer, and shall faithfully,
diligently, competently and, to the best of his ability, exclusively
devote his full time, energy and attention (unless otherwise agreed to
by the parties) to the business of the Employer and to the promotion of
its interest. Executive recognizes that Employer's organization,
business and relationship with clients, prospective clients and others
having business dealings with Employer are and will be the sole property
of Employer and Executive shall have no separate interests or rights
with respect thereto, except as an employee of Employer.
(d) OTHER ACTIVITIES AND INTERESTS. Employer shall be entitled
to all of the benefits, emoluments, profits, discoveries or other issues
arising from, incident to and related to any and all work, services and
advice of Executive to Employer in carrying out his duties and
responsibilities hereunder. Executive shall not, without the written
consent of Employer, directly or indirectly, render services to or for
any person, firm, corporation or other entity or organization, whether
or not in exchange for compensation, regardless of the form in which
such compensation, if any, is paid and whether or not it is paid
directly or indirectly to him if the rendering of such service would
interfere with the performance of his duties and responsibilities to
Employer hereunder. Notwithstanding the foregoing sentence, Executive
may spend time and attention to personal investment and community
activity matters and such other personal matters consistent with
Employer's policies and procedures set forth within Employer's policy
manual in effect from time to time which are equally applicable to all
of Employer's executive employees, so long as the spending of such time
and attention does not substantially interfere with the performance of
his duties and responsibilities to Employer hereunder.
3. TERM OF EMPLOYMENT AND TERMINATION
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(a) TERM. Unless earlier terminated as provided herein, the term
of this Agreement shall commence at the start of business on the
Effective Date of this Agreement and shall continue through the end of
business on May 31, 2002 (the "Initial Term"). Unless terminated by
either party by giving the other party written notice of an intent not
to renew this Agreement at least one hundred twenty (120) days prior to
the end of the Initial Term or any successive one (1) year term, this
Agreement shall automatically extend for one (1) additional year after
the Initial Term and then again for a one (1) year term after each
successive year.
(b) TERMINATION.
(i) BY EMPLOYER FOR JUST CAUSE. Employer may terminate
the employment of Executive under this Agreement for Just Cause
(as defined herein) at any time upon delivery of written notice
to him setting forth, in reasonable specificity, such Just
Cause. For purposes of this Agreement, and particularly this
subsection 3(b)(i), "Just Cause" shall mean:
(1) The continued failure by or refusal of Executive
to substantially perform his duties and responsibilities as set
forth herein; or
(2) Executive's indictment for, conviction of or a
guilty plea to a felony or of any crime involving moral
turpitude, whether or not affecting the Employer; or
(3) The engagement by Executive of personal illegal
conduct which, in the reasonable judgment of Employer, by
association with him, is materially and demonstrably injurious
to the property and/or business of Employer; or
(4) Any material breach by Executive of the terms
and conditions contained herein, including without limitation,
those certain confidentiality provisions set forth in Section
16; or
(5) The commission of any act opposed to the best
interests of Employer for which Executive would not be entitled
to indemnification under Employer's Restated Certificate of
Incorporation and Amended and Restated By-Laws, each as amended
as of the date of this Agreement; or
(6) The failure by Executive to protect the best
interests of Employer through Executive's gross neglect of duty.
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(ii) BY EXECUTIVE FOR GOOD REASON. Executive may terminate his
employment with Employer under this Agreement for Good Reason (as
defined herein) at any time upon delivery of written notice to Employer
setting forth, in reasonable specificity, such Good Reason(s). For
purposes of this Agreement, and particularly this subsection 3(b)(ii),
"Good Reason" shall mean:
(1) The attempted discontinuance or reduction in
Executive's "Base Cash Salary" (as defined herein);
(2) The attempted discontinuance or reduction in
Executive's bonuses and/or incentive compensation award
opportunities under plans or programs applicable to him, unless
such discontinuance or reduction is a result of Employer's
policy applied equally to all executive employees of Employer;
or
(3) The attempted discontinuance or reduction in
Executive's stock option and/or stock award opportunities under
plans or programs applicable to him, unless such discontinuance
or reduction is a result of Employer's policy applied equally to
all executive employees of Employer; or
(4) The attempted discontinuance or reduction in
Executive's perquisites from those historically provided him
during his tenure with the Employer and generally applicable to
executive employees of Employer; or
(5) The relocation of Executive to an office (other
than Employer's headquarters) located more than fifty (50) miles
from his then current office location; or
(6) The significant reduction in Executive's
responsibilities and status within the Employer or change in his
title(s) or position(s); or
(7) The attempted discontinuance of Executive's
participation in any benefit plans maintained by Employer unless
such plans are discontinued by reason of law or loss of tax
deductibility to the Employer with respect to the contributions
to or payments under such plans, or are discontinued as a matter
of the Employer's policy applied equally to all participants; or
(8) The attempted reduction of Executive's paid
vacation to less than that as provided in this Agreement; or
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(9) The failure by Employer to obtain an assumption
of Employer's obligations under this Agreement by any assignee
of or successor to Employer, regardless of whether such entity
becomes a successor to Employer as a result of merger,
consolidation, sale of assets of Employer or other form of
reorganization; or
(10) The occurrence of any of the items set forth in
paragraphs (1) through (9) of this subsection 3(b)(ii), if, in
the reasonable determination by the Executive, such occurrence
happens as a result of and within the shorter of six (6) months
or the remaining term of this Agreement following a "Change in
Control" (as such term is defined below). For the purposes of
this Agreement, a "Change in Control" shall be deemed to occur
when and only when the first of the following events occurs:
a. Any "person" or "group" (as such terms are
used in Sections 3(a), 3(d), and 14(d) of the
Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder (the
"1934 Act"), other than (i) a trustee or other
fiduciary holding securities under any employee
benefit plan of the Corporation or any of its
subsidiaries or (ii) a corporation owned directly or
indirectly by the stockholders of the Corporation in
substantially the same proportions as their
ownership of stock in the Corporation, is or becomes
the "beneficial owner" (as defined in Rule 13d-3
under the 1934 Act)), directly or indirectly, of
securities of the Corporation representing 20% or
more of the total voting power of the then
outstanding securities of the Corporation entitled
to vote generally in the election of directors (the
"Voting Stock"); or
b. Individuals who are members of the
Incumbent Board, cease to constitute a majority of
the Board of Directors of the Corporation. The term
"Incumbent Board" shall mean (i) the members of the
Board of Directors on the effective date of this
Agreement, and (ii) any individual who becomes a
member of the Board of Directors after the effective
date of this Agreement, if his or her election or
nomination for election as a director was approved
by the affirmative vote of a majority of the then
Incumbent Board; or
c. (i) The merger or consolidation of the
Corporation with any other corporation or entity,
other than a merger or consolidation which would
result in the Voting Stock outstanding immediately
prior thereto continuing to represent (either by
remaining
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outstanding or by being converted into voting
securities of the surviving entity) at least 80% of
the total voting power represented by the Voting
Stock or the voting securities of such surviving
entity outstanding immediately after such merger or
consolidation, (ii) the sale, transfer or
disposition of all or substantially all of the
Corporation's assets to any other corporation or
entity, or (iii) the dissolution or liquidation of
the Corporation.
(iii) AUTOMATICALLY IN ACCORDANCE WITH SUBSECTION 3(a).
In addition to the rights to terminate this Agreement as set
forth in subsections 3(b)(i) and 3(b)(ii), this Agreement may
also terminate automatically in accordance with subsection 3(a).
(iv) DISAGREEMENTS. Any disagreement concerning whether
there has been Just Cause for termination by Employer or Good
Reason for termination by Executive will be resolved by binding
arbitration in accordance with the provisions of Section 18 of
this Agreement.
(c) EFFECT OF TERMINATION. Upon termination of Executive's
employment with Employer:
(i) BY EMPLOYER FOR JUST CAUSE. Executive shall not be
entitled to receive payment of any salary, bonus, expenses, or
other benefits beyond the date of termination and, subject to
this subsection 3(c)(i), Section 17, and Executive's agreement
to repay, without set off, all amounts due Employer for monies
loaned Executive as set forth in Section 19, this Agreement
shall become null and void effective as of the date of
termination and Employer and Executive shall have no further
obligation hereunder toward the other except for the payment of
salary, bonus, expenses and benefits, if any, which have accrued
but remain unpaid prior to and as of the termination date.
(ii) BY EXECUTIVE FOR GOOD REASON.
(1) Executive shall be paid by Employer in a lump
sum within twenty (20) business days of such
termination, an amount that is equal to the sum of the
following:
(A) The amount equivalent to salary payments
for twelve (12) months at that rate of pay which
is not less than Executive's rate of Base Cash
Salary in effect immediately prior to the
effective date of such termination (without regard
to any attempted reduction or discontinuance of
such salary); and
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(B) The amount equivalent to twelve (12)
months multiplied by the greater of (i) the
monthly rate of the bonus payment for the bonus
period in the year immediately prior to
Executive's termination date or (ii) the estimated
amount of the bonus for the period which includes
Executive's termination date (without regard to
any attempted reduction or discontinuance of such
bonus).
(2) In addition to such amount under subsection
3(c)(ii)(1) above, Executive shall also receive, (i) in
cash, the value of the incentive compensation
(including, but not limited to, employer contributions
to the Universal Electronics Inc. 401(K) and Profit
Sharing Plan) and (ii) the rights to receive grants of
stock options and stock awards to which he would have
been entitled under all incentive compensation and stock
option and stock award plans maintained by Employer if
Executive had remained in the employ of Employer for
twelve (12) months (without regard to any attempted
reduction or discontinuance of such incentive
compensation). The amount of such payment and/or grants
shall be determined as of the date of termination and
shall be paid and/or issued as promptly as practicable
and in no event later than 30 days after such
termination.
(3) Employer shall also maintain in full force and
effect for the Executive's continued benefit (and, to
the extent applicable, the continued benefit of her
dependents) all of the employee benefits (including, not
limited to, coverage under any medical and insurance
plans, programs or arrangements) to which he would have
been entitled under all employee benefit plans, programs
or arrangements maintained by Employer if Executive had
remained in the employ of Employer for twelve (12)
months (without regard to any attempted reduction or
discontinuance of such benefits), or if such
continuation is not possible under the terms and
provisions of such plans, programs or arrangements,
Employer shall arrange to provide benefits substantially
similar to those which Executive (and, to the extent
applicable, his dependents) would have been entitled to
receive if he had remained a participant in such plans,
programs or for such twelve (12) month period.
(4) Subject to this subsection 3(c)(ii), Section
17, and Executive's agreement to repay, without set off,
all amounts due Employer for monies loaned Executive as
set forth in Section 19, this Agreement shall become
null and void effective as of the date of termination
and Employer and Executive shall have no further
obligation hereunder toward the other.
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(iii) PURSUANT TO SUBSECTION 3(b)(iii). Executive
acknowledges and agrees that in the event that this Agreement
terminates in accordance with subsection 3(b)(iii), that
Employer and Executive shall have no further obligation
hereunder toward the other except (1) for the payment of salary,
bonus, expenses and benefits, if any, which have accrued but
remain unpaid prior to and as of the termination date, (2) as
set forth in Section 17, and (3) for Executive's agreement to
repay, without set off, all amounts due Employer for monies
loaned Executive as set forth in Section 19.
(iv) SUBMISSION OF RESIGNATIONS BY EXECUTIVE. Upon
termination of this Agreement by either Employer or Executive as
set forth herein and the receipt by Executive of (1) all cash
amounts due him as set forth herein and (2) a written
representation signed by an authorized representative of
Employer that all non-cash obligations of Employer as set forth
herein have been fulfilled or, as the case may be, have been
commenced, Executive shall immediately submit Executive's
resignation for any and all offices or directorships of Employer
and/or any and all subsidiaries and affiliates of Employer which
resignation shall have retroactive application and effect to
such termination date; provided however that during such time
period from the effective date of such termination to the date
Executive submits his resignation, Executive acknowledges and
agrees that he does not have authority to bind Employer to any
contracts or commitments and agrees not to create any obligation
for Employer or bind or attempt to bind Employer in any manner
whatsoever. Executive also acknowledges that he shall have no
supervisory or managerial responsibility or authority from and
after the effective date of his termination, regardless of
whether he submits the resignation or not, and agrees not to
involve himself in any activities of Employer, except as may be
requested by the an authorized officer of Employer.
4. TOTAL COMPENSATION
While employed under this Agreement and in consideration of the services
to be rendered by Executive pursuant hereto, Executive shall receive the
following amounts/benefits as the sole and total compensation for the
performance of his duties and obligations under this Agreement:
(a) BASE CASH SALARY. A salary at the rate of Two Hundred and
Fifty Thousand Dollars (US$250,000) per annum (the "Base Cash Salary"),
which shall be deemed to accrue from day to day, payable in accordance
with Employer's standard payroll practices and procedures;
(b) BONUS. A bonus calculated in accordance with the plans or
programs established by Employer from time to time payable in accordance
with Employer's standard payroll practices and procedures; provided that
any such bonuses whenever earned and paid
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shall be determined without regard to any material gains and losses
which occur outside of the scope of Employer's ordinary operating
business unless any such plans or programs explicitly include such
material gains and losses within the determination of any such bonuses;
(c) STOCK OPTIONS. Stock options grants or stock awards in
accordance with the plans or programs established by Employer from time
to time; provided that on the Effective Date of this Agreement,
Executive shall be granted stock options in accordance with and as set
forth in Exhibit A;
(d) INCENTIVE COMPENSATION. Participation in Employer's
incentive compensation plans and/or programs, including, but not limited
to, receipt of employer contributions to the Universal Electronics Inc.
401(K) and Profit Sharing Plan;
(e) BENEFITS. The benefits provided by Employer to its executive
employees generally, including without limitation, the benefits and
perquisites included under the Universal Electronics Inc. group family
health insurance program in effect from time to time, which includes
comprehensive medical insurance, dental insurance, group disability,
group life insurance, and executive bonus (supplemental life);
(f) VACATION. Three (3) weeks (fifteen (15) working days)
vacation with pay, determined and carried over in accordance with the
policies and procedures set forth within Employer's policy manual in
effect from time to time which are equally applicable to all of
Employer's executive employees;
(g) OTHER PERQUISITES. Such other employee benefits and
perquisites that are provided by Employer to executives generally,
provided that the other perquisites provided to Executive shall be no
less extensive than the most extensive perquisites provided to any other
executive employee of the Employer;
(h) D&O INSURANCE. Director and Officer Liability insurance in a
reasonably sufficient amount;
(i) DISCRETIONARY BONUS. Such other amounts of compensation
and/or bonus which is determined by Employer from time to time;
(j) REVIEWS. The total amount of compensation to be paid and/or
provided to Executive shall be reviewed by the Chief Executive Officer
and the Board of Directors, or such committee thereof, of Employer as of
the first day of each calendar year while this Agreement is in force and
effect. In no event shall such review result in a reduction or
discontinuance of the amount of compensation paid and/or provided to
Executive hereunder except if such reduction or discontinuance occurs by
reason of law or loss of tax deductibility
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to the Employer with respect to the contributions to such plans, or are
discontinued as a matter of the Employer's policy applied equally to all
participants.
5. ADJUSTMENTS IN CASE OF EXCESS PARACHUTE PAYMENTS
In the event that the aggregate present value (determined in accordance
with applicable federal, state and local income tax law, rules and regulations)
of all payments to be made and benefits to be provided to Executive under this
Agreement and/or under any other plan, program or arrangement maintained or
entered into by Employer or any of its subsidiaries shall result in "excess
parachute payments" to him within the meaning of Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"), or any comparable provision of
successor legislation, which subject him to the Excise Tax under Section 4999 of
the Code or any comparable provision of successor legislation, Employer shall
pay to Executive an additional amount (the "gross-up payment") calculated so
that the net amount received by him after deduction of the Excise Tax and of all
federal, state and local income taxes upon the gross-up payment shall equal the
payments to be made and the benefits to be provided to him under this Agreement.
For purposes of determining the amount of the gross-up payment, Executive shall
be deemed to pay federal, state and local income taxes at the highest marginal
rates thereof in the calendar year in which the gross-up payment is to be made,
net of the maximum reduction in federal income taxes obtainable from deduction
of such state and local taxes. The computations required by this Section 5 shall
be made by the independent public accountants then regularly retained by
Employer, in consultation with tax counsel selected by and acceptable to
Executive. Employer shall pay all of its accountants' fees and the lesser of (i)
one-half of Executive's tax counsel's fees or (ii) $2,500.
6. REIMBURSEMENT FOR BUSINESS RELATED EXPENSES
Employer shall reimburse Executive for all reasonable expenses incurred
and paid by him in connection with Employer's business in accordance with
Employer's policy manual in effect from time to time.
7. INTEREST
In the event any payment to Executive under this Agreement is not paid
within five (5) business days after it is due, such payment shall thereafter
bear interest at the prime rate from time to time in effect at Bank of America,
Los Angeles, California; provided however, that this provision shall not excuse
the timely payment of such sums required by this Agreement.
8. NOTICES
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Written notices to be given under this Agreement shall be personally
delivered or sent by overnight courier (such as Federal Express, DHL or UPS and
the like) or by registered or certified mail, return receipt requested, to the
addresses set forth below:
To Employer:
Universal Electronics Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn.: Corporate Secretary
With a required copy to:
Universal Electronics Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Chief Executive Officer
To Executive:
Xx. Xxxxxx X. Xxxxxxxxx
At his last known address as reflected in Employer's records
9. SEVERABILITY
If any one or more of the provisions contained in this Agreement shall
be invalid, illegal or unenforceable in any respect under applicable law, the
validity, legality and enforceability of the remaining provisions contained
herein shall not, in any way, be ineffective or impaired thereby.
10. GOVERNING LAW
This Agreement shall be governed by the law of the state of California
without regard to the conflicts of laws provisions of the state of California.
11. WAIVER
The failure of either party to insist in any one or more instances on
strict performance of any of this Agreement's provisions, or to exercise or
enforce any right, remedy or obligation under this Agreement, shall not be
construed as a waiver or relinquishment of any right, remedy or obligation, and
the right, remedy or obligation shall continue in full force and affect.
12. ENTIRE AGREEMENT AND MODIFICATION
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This Agreement, together with that certain Nonrecourse Secured
Promissory Note and Deed of Trust with Assignment of Rents (Short Form) as both
are described more fully in Section 19 of this Agreement, sets forth the entire
agreement of the parties concerning the employment of Executive by the Employer
and any oral or written statements, representations, agreements or
understandings made or entered into prior to or contemporaneously with the
execution of this Agreement, including without limitation that certain offer
letter dated April 19, 2001, are hereby rescinded, revoked, and rendered null
and void by the parties. This Agreement may be modified only by a written
instrument duly executed by each party hereto.
13. ASSIGNMENT
This Agreement shall be binding upon the parties hereto, their
respective heirs, personal representatives, executors, administrators,
successors and assigns. Any such assignee or successor of Employer shall, within
ten (10) business days after receipt of a written request by Executive, send to
Executive its acknowledgment and agreement that such assignee or successor
expressly assumes all of Employer's obligations under this Agreement as if such
assignee or successor was the original employer and the term "Employer" as used
herein as include any such assignee or successor.
14. INTERPRETATION OF AGREEMENT
The parties have cooperated in the drafting and preparation of this
Agreement. Therefore, the parties hereto agree that, in any construction to be
made of the Agreement the same shall not be construed against any of the
parties. Each of the parties hereto has carefully read this Agreement and has
been given the opportunity to have it reviewed by legal counsel and negotiate
its terms.
15. SPECIFIC OBLIGATIONS OF THE EXECUTIVE
In addition to the general duties set forth herein, Executive shall use
his reasonable efforts for the benefit of Employer by whatever activities
Employer finds reasonably appropriate to maintain and improve Employer's
standing in the community generally and among current and prospective customers,
including such entertainment for professional purposes as Executive and Employer
mutually consider appropriate. Executive shall undertake business development
endeavors as reasonably directed by Employer. Executive (i) knows no reason why
he may not by hired by Employer or cannot carry out his obligations under this
agreement, (ii) is not under an obligation, contractual or otherwise, that would
prohibit Executive from carrying out his obligations hereunder, and (iii) will
not breach or otherwise violate any agreement to which he is a party by entering
into and/or performing his obligations under this Agreement.
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16. NONDISCLOSURE AND NONAPPROPRIATION OF INFORMATION AND NONCOMPETITION
(a) Executive recognizes and acknowledges that while employed by
Employer, he has and will have access to, learn, be provided with and,
in some cases, prepare and create certain confidential, proprietary
business information and/or trade secrets for Employer, including, but
not limited to, lists, files and forms, (hereinafter collectively
referred to as the "trade secrets"), all of which are of substantial
value to Employer and its business. In this connection, Executive
expressly covenants and agrees, during his employment with Employer, to:
(i) Hold in a fiduciary capacity and not reveal,
communicate, use or cause to be used for his own benefit or
divulge any trade secrets, or other proprietary right now or
hereafter owned by the Employer;
(ii) Not sell, exchange or give away, or otherwise
dispose of any trade secrets now or hereafter owned by Employer,
whether the same shall or may have been originated or discovered
by Employer or otherwise;
(iii) Not reveal, divulge or make known to any person,
firm, corporation or other entity any trade secrets of Employer;
and
(iv) Not reveal, divulge or make known to any person
(other than his spouse, attorney and/or accountant), firm,
company or corporation any of the terms of this Agreement.
(b) To protect the legitimate business interests of Employer
from unfair competition by Employee, Employee expressly covenants and
agrees that during his employment with Employer and continuing
thereafter for a period of two (2) years, Employee shall not, directly
or indirectly:
(i) (1) Accept employment of any kind or nature,
including without limitation in a consultancy role, with, (2)
render services to or for, (3) engage in, undertake or carry out
any business activity with, or (4) obtain an ownership interest
in ICX International, Inc., U S Electronics Components
Corporation, or Philips Consumer Electronics BV, or any of such
companies' parents, subsidiaries and affiliates;
(ii) Solicit, interfere with or endeavor to entice away
from Employer any person, firm, company or corporation that, at
the time Employee's employment with Employer ceased, was doing
business with Employer and accounted for ten percent
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(10%) or more of Employer's gross revenue as determined by
Employer's book and records; and
(iii) Solicit for hire, either directly or indirectly,
or hire as a result of such solicitation, any key employee of
Employer, except that Executive may hire any such key employee
so long as such hiring was made as a result of a general
solicitation of employment through typical solicitation means,
such as advertisements and the like, or such solicitation was
initiated by such key employee.
(c) Executive further covenants and agrees to return to Employer
either before or immediately upon his termination of employment with
Employer any and all written information, material or equipment that
constitutes, contains or relates to Employer's proprietary information
trade secrets and which relate to Employer's business which are in
Executive's possession, custody and control, whether confidential or
not, including any and all copies thereof which may have been made by or
for Executive. Executive shall maintain no copies thereof after
termination of his employment.
17. SURVIVAL OF OBLIGATIONS
In addition to those specific provisions of Section 3, which by their
express terms survive the termination of this Agreement under certain
circumstances, the terms and conditions and obligations of the parties as
contained or described in Sections 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 16, 17,
18, 19, and 20 shall survive the termination of this Agreement and,
notwithstanding such termination, shall remain fully binding on the parties
hereto.
18. ARBITRATION
Except for any claim or dispute in which equitable relief under this
Agreement is sought, any disagreement, dispute or controversy concerning whether
there has been Just Cause, Good Reason or breach of any of the terms of this
Agreement shall be settled exclusively and finally by arbitration. The
arbitration shall be conducted in accordance with the Commercial Arbitration
Rules of the American Arbitration Association in effect from time to time (the
"AAA Rules"). The arbitration shall be conducted in Los Angeles, California, or
in such other city as the parties to the dispute may designate by mutual
consent. The arbitral tribunal shall consist of three arbitrators (or such
lesser number as may be agreed upon by the parties) selected according to the
procedure set forth in the AAA Rules, with the chairman of the arbitral tribunal
selected in accordance with the AAA Rules. Except as otherwise set forth in this
Agreement, the fees and expenses of the arbitral tribunal in connection with
such arbitration shall be borne by the parties to the dispute as shall be
determined by the arbitral tribunal.
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19. RELOCATION LOAN MADE TO EXECUTIVE
At such time as demanded by Executive, Employer shall loan One Hundred
Thousand Dollars ($100,000) to Executive which Executive shall use solely for
relocating his home and family from his present place of residence in Austin,
Texas to a new residence located in Southern California and in this connection
the Executive shall execute and deliver to Employer a Nonrecourse Secured
Promissory Note and Deed of Trust with Assignment of Rents (Short Form) in favor
of Employer in the form acceptable to Employer, the terms and conditions of
which are incorporated into this Agreement by this reference. On each December
15 during the term of such Note and on the payment of principal of the Note,
Employer shall pay to Executive an amount equal to 1.045 times the amount of
interest due by Executive under the Note as of each of such dates (the "Interest
Compensation"), regardless of whether Executive is employed by Employer on such
dates. Such loan and such Interest Compensation is in addition to all amounts to
be paid and/or reimbursed to Executive pursuant to Employer's Executive
Relocation Policy.
IN WITNESS WHEREOF, the parties have executed the Agreement as of this
14th day of May, 2001
Signed and acknowledged in UNIVERSAL ELECTRONICS INC.
the presence of:
By:
--------------------------- ----------------------------------------
Corporate Secretary Xxxx X. Xxxxxx, Chief Executive Officer
XXXXXX X. XXXXXXXXX
--------------------------- ----------------------------------------
Signature
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EXHIBIT A
STOCK OPTION AWARD
PURSUANT TO SECTION 4(c)
Options to acquire up to 125,000 shares of the common stock of Employer with an
exercise price determined as market price of the average of the beginning and
the end of business on April 25, 2001, the date of your acceptance of Employer's
offer of employment. These options shall vest at a rate of 25% per year for four
years, but all in accordance with the terms and conditions of the Stock Option
Agreement and Stock Option Plans of Employer.
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EXHIBIT
COPY OF NONRECOURSE SECURED PROMISSORY NOTE
AND
DEED OF TRUST WITH ASSIGNMENT OF RENTS (SHORT FORM)
PURSUANT TO SECTION 19
[TO BE PROVIDED TO EXECUTIVE WHEN LOAN REQUESTED PURSUANT TO SECTION 19]
17
