Contract
Exhibit 10.1
This Employment Agreement (this “Agreement”), made and entered as of the 23
day of June, 2011, by and between Globecomm Systems Inc., a Delaware corporation with
principal offices located at 00 Xxxx Xxxxxx, Xxxxxxxxx, XX 00000 (the “Company”) and
Xxxxxx Xxxxxxxxxxx (the “Executive”).
WITNESSETH
WHEREAS, the Company has a need for the Executive’s personal services in a senior
executive capacity;
WHEREAS, the Executive possesses the necessary strategic, financial, planning,
operational and managerial skills necessary to fulfill those needs;
WHEREAS, the Executive had been providing services to the Company as its Senior
Vice President and General Manager, Globecomm Network Services since November 19, 2009;
WHEREAS, the Company desires to maintain the continuity of its management team and
provide the Executive with incentive to remain with the Company; and
WHEREAS, the Executive and the Company desire to enter into an employment agreement
to fully recognize the contributions of Executive to the Company and to assure
continuous harmonious performance of the affairs of the Company.
NOW, THEREFORE, in consideration of the mutual promises, terms, provisions, and
conditions contained herein, the parties agree as follows:
1. Position.
The Company hereby agrees to employ the Executive to serve in the role of its
Senior Vice President and General Manager, Globecomm Network Services, subject to the
limitations set forth herein. As such, the Executive shall be responsible for directing
and managing the Company’s services business segment subject to the authority of the
President and Chief Operating Officer of the Company. The Executive accepts such
employment upon the terms and conditions set forth herein, and further agrees
to perform to the best of his abilities the duties generally associated with his
position, as well as such other duties commensurate with his position as Senior Vice
President and General Manager, Globecomm Network Services, as may be
reasonably assigned by the President and Chief Operating Officer of the Company.
The Executive shall, at all times during the Term (as defined below), report directly to
the President and Chief Operating Officer of the Company. The Executive shall perform
his duties diligently and faithfully and shall devote his full business time and
attention to such duties.
2. Term of Employment and Renewal.
The term of Executive’s employment under this Agreement will commence on the date of this
Agreement (the “Effective Date”). Subject to the provisions of Section 10 of this Agreement, the
term of Executive’s employment hereunder shall be for an initial term of one (1) year
from the Effective Date (the “Initial Term”). The Initial Term of this Agreement shall be
automatically extended for successive one (1) year periods (each a “Renewal Period”) unless the
Company or the Executive gives written notice to the other at least ninety (90) days prior to the
expiration of the Initial Term, or a Renewal Period, of such party’s election not to extend this
Agreement. References herein to the “Term” shall mean the Initial Term as it may be so extended
by one or more Renewal Periods. The last day of the Term is the “Expiration Date.”
3. Compensation and Benefits.
(a) Salary. Commencing on the Effective Date, the Company agrees to pay the Executive
a base salary during the Initial Term at an annual rate of Two Hundred Thirty Thousand Fifteen
Dollars ($230,015), payable in such installments as is the policy of the Company (the
“Salary”), but no less frequently than monthly. Thereafter, the Company shall determine
appropriate increases to Executive’s Salary but in no event shall diminish the amount of
Executive’s Salary below the initial rate, or below the increased rates.
(b) Bonus. The Executive shall be eligible to receive annual bonuses at the
discretion of the Company and according to performance goals to be issued by the Company to the
Executive at the appropriate annual review cycle during the Term.
(c) Benefits. The Executive shall be entitled to participate in all employee
benefit plans which the Company provides or may establish from time to time, for the benefit of
its employees, including, without limitation, group life, medical, surgical, dental and other
health insurance, short and long-term disability, deferred compensation, profit-sharing and
similar plans. The Executive shall also be entitled to paid vacation days in accordance with
the Company’s vacation policy, which may be accrued to a maximum of 40 days.
(d) Expenses. The Company shall pay or reimburse the Executive for all
reasonable out-of-pocket expenses actually incurred by him during the Term in performing
services hereunder, provided that the Executive properly accounts for such expenses in accordance
with the Company’s policies.
4. Confidentiality, Disclosure of Information.
(a) The Executive recognizes and acknowledges that the Executive has had and will
have access to Confidential Information (as defined below) relating to the business or interests
of the Company or of persons with whom the Company may have business relationships. Except as
permitted herein, the Executive will not during the Term, or at any time thereafter, use,
disclose or permit to be known by any other person or entity, any Confidential Information of
the Company (except as required by applicable law or in connection with the performance of the
Executive’s duties and responsibilities hereunder).
2
The term “Confidential Information” means information relating to the Company’s
business affairs, proprietary technology, trade secrets, patented processes, research and
development data, know-how, market studies and forecasts, competitive analyses, pricing policies,
employee lists, employment agreements (other than this Agreement), personnel policies, the
substance of agreements with customers, suppliers and others, marketing arrangements, customer
lists, commercial arrangements, or any other information relating to the Company’s business that
is not generally known to the public or to actual or potential competitors of the Company (other
than through a breach of this Agreement). This obligation shall continue until such Confidential
Information becomes publicly available, other than pursuant to a breach of this Section 4 by the
Executive, regardless of whether the Executive continues to be employed by the Company.
(b) It is further agreed and understood by and between the parties to this Agreement
that all “Company Materials,” which include, but are not limited to, computers,
computer software, computer disks, tapes, printouts, source, HTML and other
code, flowcharts, schematics, designs, graphics, drawings, photographs, charts, graphs,
notebooks, customer lists, sound recordings, other tangible or intangible manifestation of
content, and all other documents whether printed, typewritten, handwritten, electronic, or stored
on computer disks, tapes, hard drives, or any other tangible medium, as well as samples,
prototypes, models, products and the like, shall be the exclusive property of the Company and,
upon termination of Executive’s employment with the Company, and/or upon the request of
the Company, all Company Materials, including copies thereof, as well as all other
Company property then in the Executive’s possession or control, shall be returned to and left
with the Company.
5. Inventions Discovered by Executive.
The Executive shall promptly disclose to the Company any invention, improvement,
discovery, process, formula, or method or other intellectual property, whether or not
patentable or copyrightable (collectively, “Inventions”), conceived or first reduced to
practice by the Executive, either alone or jointly with others, while performing services
hereunder (or, if based on any Confidential Information, at any time during or after the Term),
(a) which pertain to any line of business activity of the Company, whether then conducted or
then being actively planned by the Company, with which the Executive was or is involved, (b)
which is developed using time, material or facilities of the Company, whether or not during
working hours or on the
Company premises, or (c) which directly relates to any of the Executive’s work during the
Term, whether or not during normal working hours. The Executive hereby assigns to the Company
all of the Executive’s right, title and interest in and to any such Inventions. During and
after the Term, the Executive shall execute any documents necessary to perfect the assignment
of such Inventions to the Company and to enable the Company to apply for, obtain and enforce
patents, trademarks and copyrights in any and all countries on such Inventions, including,
without limitation, the execution of any instruments and the giving of evidence and testimony,
without further compensation beyond the Executive’s agreed compensation during the course of
the Executive’s employment. Without limiting the foregoing, the Executive further acknowledges
that all original works of authorship by the Executive, whether created alone or jointly with
others, related to the Executive’s employment with the Company and which are protectable by
copyright, are “works made for hire” within the meaning of the United States Copyright Act, 17
U.S.C. (Section) 101, as amended, and the copyright of which shall be owned solely, completely
and exclusively by the Company.
3
If any Invention is considered to be work not included in the categories of work covered by
the United States Copyright Act, 17 U.S.C. (Section) 101, as amended, such work is hereby
assigned or transferred completely and exclusively to the Company. The Executive hereby
irrevocably designates counsel to the Company as the Executive’s agent and attorney-in-fact to
do all lawful acts necessary to apply for and obtain patents and copyrights and to enforce the
Company’s
rights under this Section. This Section 5 shall survive the termination of this Agreement.
Any assignment of copyright hereunder includes all rights of paternity, integrity, disclosure and
withdrawal and any other rights that may be known as or referred to as “moral rights”
(collectively “Moral Rights”). To the extent such Moral Rights cannot be assigned under
applicable law and to the extent the following is allowed by the laws in the various countries
where Moral Rights exist, the Executive hereby waives such Moral Rights and consents to any
action of the Company that would violate such Moral Rights in the absence of such consent. The
Executive agrees to confirm any such waivers and consents from time to time as requested by the
Company.
6. Non-Competition and Non-Solicitation.
The Executive acknowledges that the Company has invested substantial time, money and
resources in the development and retention of its Inventions, Confidential Information (including
trade secrets), customers, accounts and business partners, and further acknowledges that during
the course of the Executive’s employment with the Company the Executive has had and will have
access to the Company’s Inventions and Confidential Information (including trade secrets), and
will be introduced to existing and prospective customers, accounts and business partners of the
Company. The Executive acknowledges and agrees that any and all “goodwill” associated with any
existing or prospective customer, account or business partner belongs exclusively to the Company,
including, but not limited to, any goodwill created as a result of direct or indirect contacts
or relationships between the Executive and any existing or prospective customers,
accounts or business partners. Additionally, the parties acknowledge and agree that Executive
possesses skills that are special, unique or extraordinary and that the value of the Company
depends upon his use of such skills on its behalf.
In recognition of this, the Executive covenants and agrees that:
(a) During the Term, and for a period of one (1) year thereafter, the Executive may
not, without the prior written consent of the Company’s board of directors (the
“Board”), (whether as an employee, agent, servant, owner, partner, consultant, independent
contractor, representative, stockholder or in any other capacity whatsoever) participate in any
business that offers products or services competitive in any way to those offered by the Company
or that were under active development by the Company during the Term, provided that nothing
herein shall prohibit the Executive from owning securities of corporations which are listed on a
national securities exchange or traded in the national over-the-counter market in an amount which
shall not exceed 3% of the outstanding shares of an such corporation.
(b) During the Term, and for a period of one (1) year thereafter, the Executive may
not entice, solicit or encourage any Company employee to leave the employ of the Company or any
independent contractor to sever its engagement with the Company, absent prior written
consent to do so from the Board.
4
(c) During the Term, and for a period of one (1) year thereafter, the
Executive may not, directly or indirectly, entice, solicit or encourage any customer, prospective
customer, vendor, strategic partner or business associate of the Company to cease doing business
with the Company, reduce its relationship with the Company or refrain from establishing or
expanding a relationship with the Company.
7. Non-Disparagement.
The Executive hereby agrees that during the Term, and at all times thereafter, the
Executive will not make any statement that is disparaging about the Company, any of its officers,
directors, or stockholders, including, but not limited to, any statement that disparages the
products, services, finances, financial condition, capabilities or other aspect of the business
of the Company. The Executive further agrees that during the same period the Executive will not
engage in any conduct that is intended to inflict harm upon the professional or personal
reputation of the Company or any of its officers, directors, stockholders or employees.
8. Provisions Necessary and Reasonable.
(a) The Executive agrees that (i) the provisions of Sections 4, 5, 6 and 7 of this
Agreement are necessary and reasonable to protect the Company’s Confidential Information,
Inventions, and goodwill; (ii) the specific temporal, geographic and substantive provisions set
forth in Section 6 of this Agreement are reasonable and necessary to protect the Company’s
business interests in part because the Company’s business is international in scope; and (iii) in
the event of any breach of any of the covenants set forth herein, the Company would suffer
substantial irreparable harm and would not have an adequate remedy at law for such breach. In
recognition of the foregoing, the Executive agrees that in the event of a breach or threatened
breach of any of these covenants, in addition to such other remedies as the Company may have at
law, without posting any bond or security, the Company shall be entitled to seek and obtain
equitable relief, in the form of specific performance, and/or temporary, preliminary or permanent
injunctive relief, or any other equitable remedy which then may be available. The seeking of such
injunction or order shall not affect the Company’s right to seek and obtain damages or other
equitable relief on account of any such actual or threatened breach.
(b) If any of the covenants contained in Sections 4, 5, 6 and 7 hereof, or any part
thereof, are hereafter construed to be invalid or unenforceable, the same shall not affect the
remainder of the covenant or covenants, which shall be given full effect without regard to the
invalid portions.
(c) If any of the covenants contained in Sections 4, 5, 6 and 7 hereof, or any part
thereof, are held to be unenforceable by a court of competent jurisdiction because of the
temporal or geographic scope of such provision or the area covered thereby, the parties agree
that the court making such determination shall have the power to reduce the duration and/or
geographic area of such provision and, in its reduced form, such provision shall be enforceable.
5
9. Representations Regarding Prior Work and Legal Obligations.
(a) The Executive represents that the Executive has no agreement or other legal
obligation with any prior employer, or any other person or entity, that restricts the Executive’s
ability to accept employment with, or to perform any function for, the Company.
(b) The Executive has been advised by the Company that at no time should the Executive
divulge to or use for the benefit of the Company any trade secret or confidential or proprietary
information of any previous employer. The Executive expressly acknowledges that the Executive has
not divulged or used any such information for the benefit of the Company.
(c) The Executive acknowledges that the Executive has not and will not
misappropriate any Invention that the Executive played any part in creating while working for any
former employer.
(d) The Executive acknowledges that the Company is basing important business decisions
on these representations, and affirms that all of the statements included herein are true.
10. Termination and Severance.
Notwithstanding the provisions of Section 2 of this Agreement, the Executive’s employment
hereunder may terminate under the following circumstances:
(a) Termination by the Company for Cause. The Company may terminate this
Agreement for Cause at any time, upon written notice to the Executive setting forth in reasonable
detail the nature of such Cause. For purposes of this Agreement, Cause is defined as (i) the
Executive’s willful and material breach of the terms of this Agreement; (ii) the Executive’s
commission of any felony or any crime involving moral turpitude; (iii) gross negligence or
willful misconduct by the Executive in connection with his position hereunder; or (iv) the
Executive’s willful refusal to perform his duties hereunder. Upon the termination for Cause of
Executive’s employment, the Company shall have no further obligation or liability to the
Executive other than for salary earned under this Agreement prior to the date of termination, and
any accrued but unused vacation.
(b) Termination by the Company Without Cause or Resignation by the Executive for
Good Reason.
(i) The Executive’s employment hereunder may be terminated without Cause by the
Company upon written notice to the Executive. The Executive may also terminate his
employment hereunder for “Good Reason” upon one (1) month’s written notice to
the Company within thirty (30) days of the occurrence of any of the following events (A) a
material breach of this Agreement by the Company, which shall be interpreted to include,
without limitation, a failure to pay the Executive his salary or bonus or a failure to
provide the Executive his benefits; (B) a material reduction in the Executive’s duties or
responsibilities; (C) a change in the Executive’s reporting relationship so that he no
longer reports directly to the Chief Operating or Chief Executive Officer; or (D) a
relocation of the Executive’s worksite to a location seventy five (75) miles or more from
its current location.
6
(ii) Subject to Section 11, if the Company terminates the Executive’s employment
without Cause, or the Executive terminates his employment for Good Reason (A) the
Company shall continue to pay the Executive the Salary for a one (1) year severance period
commencing upon the effective date of the termination (the “Severance Period”); (B) the
Company shall pay for the costs of, or reimburse the Executive for the costs he incurs in,
continuing the Executive’s and his eligible dependents’ health insurance pursuant to COBRA
for as long as the Executive (and/or his eligible dependents, as the case may be) are
eligible for COBRA during the Severance Period, and then shall pay the cost of medical and
dental coverage for the Executive comparable to that provided pursuant to COBRA, up to a
maximum of $2000 per month, during the balance of the Severance Period; (C) during the
Severance Period, the Company shall pay the cost of conversion of group term life coverage
to an individual policy for the Executive; (D) during the Severance Period, the Company
shall pay to the Executive a monthly lump sum cash payment equal to one-twelfth of any
annual automobile allowance he received at the time of such termination; and (E) during
the Severance Period, the Company shall pay to the Executive a monthly lump sum cash
payment equal to one-twelfth of the non-elective deferral employer contribution made for
his benefit under the Company’s 401(k) plan for the last fiscal year of the Company prior
to the termination of Executive’s employment. As a condition of receiving severance
payments and benefits pursuant to this Agreement, the Executive shall execute and deliver
to the Company prior to his receipt of such benefits a general release substantially in
the form attached hereto as Exhibit A.
(c) Resignation by the Executive without Good Reason. The Executive may resign his
employment hereunder without Good Reason upon one (1) month’s written notice to the Company. In
the event of termination by the Executive pursuant to this subsection 10(c), the Company may
elect to pay the Executive during the notice period (or for any remaining portion of that period)
the Salary and benefits at the rate of compensation the Executive was receiving immediately
before such notice of termination was tendered in lieu of actual notice.
(d) Death. In the event of the Executive’s death during the Term of this
Agreement, the Executive’s employment hereunder shall immediately and automatically terminate,
and the Company shall have no further obligation or duty to the Executive or his estate or
beneficiaries other than for the Salary earned under this Agreement to the date of termination
and any payments or benefits due under Company policies or benefit plans.
(e) Disability. The Company may terminate the Executive’s employment hereunder, upon
written notice to the Executive, in the event that the Executive becomes disabled during the Term
through any condition of either a physical or psychological nature and, as a result, is, with or
without reasonable accommodation, unable to perform the essential functions of the services
contemplated hereunder for (a) a period of one hundred and twenty (120) consecutive days, or (b)
for shorter periods aggregating one hundred twenty (120) days during any twelve (12) month period
during the Term. Any such termination shall become effective upon mailing or hand delivery of
notice that the Company has elected its right to terminate under this subsection 10(e), and the
Company shall have no further obligation or duty to the Executive other than for salary earned
under this Agreement prior to the date of termination and any payments or benefits previously
vested and due under Company policies or benefit plans.
7
(f) Change in Control. Subject to Section 11, if the Executive resigns with
Good Reason within one (1) year after a Change in Control (as defined below) he will
be entitled to the payments and benefits described in subsection 1O(b)(ii) above (the “Severance
Payments”) provided that, if the grounds for the termination for Good Reason are those specified
in subsection 10(b)(i)(B) and/or (C), and if the Company gives the Executive written notice (the
“Continuation Notice”), at any time up to ten (10) days after it receives the Executive’s written
resignation notice, that it wishes the Executive to continue his employment until a date not
later than one (1) year after the Change in Control (the “Employment Continuation Date”), the
Executive shall not be entitled to the Severance Payments until and unless he remains employed by
the Company through the Employment Continuation Date. Nothing in this subsection 1O(f) shall
obligate the Company to provide the Executive with the Severance Payments upon a termination for
Cause, death or disability. If the Executive does not provide the Company notice of resignation
or non-renewal at any time during the year following a Change in Control and remains employed by
the Company through the first anniversary of the Change in Control, as defined below, the
Executive shall be paid a one-time bonus payment of 50% of his Salary during the immediately
preceding calendar year (the “Special Bonus”). The Special Bonus shall be in addition to, and not
in lieu of, any Severance Payments to which Executive may otherwise become entitled under this
section 10 in connection with the subsequent termination of his employment. As used herein, a
“Change in Control” shall mean a change of control of the Company of a nature that would be
required to be reported in response to Item 6(e) of Schedule
14A of Regulation 14A (or in response to any similar item on any similar schedule or form)
promulgated under the Securities Exchange Act of 1934, as amended (the “1934 Act”) whether
or not the Company is then subject to such reporting requirement; provided, however, that,
without limitation, such a Change in Control shall be deemed to have occurred if: (x) any person
or group (as such terms are used in connection with Sections 13(d) and 14(d) of the 0000 Xxx)
becomes the “beneficial owner” (as defined in Rule 13d-3 and 13d-5 under the 1934 Act), directly
or indirectly, of securities of the Company representing 35% or more of the combined voting power
of the Company’s then outstanding securities; (y) the Company is a party to a merger,
consolidation, sale of assets or other reorganization, or a proxy contest, as a consequence of
which members of the Board in office immediately prior to such transaction or event constitute
less than a majority of the Board thereafter; and (z) during any period of twenty-four (24)
consecutive months, individuals who at the beginning of such period constituted the Board
(including for this purpose any new director whose election or nomination for election by the
Company’s stockholders was approved by a vote of at least two-thirds of the directors then still
in office who were directors at the beginning of such period) cease for any reason to constitute
at least a majority of the Board. Notwithstanding the foregoing provisions of this subsection
1O(f), a “Change in Control” will not be deemed to have occurred solely because of the
acquisition of securities of the Company (or any reporting requirement under the 1934 Act
relating thereto) by an employee benefit plan maintained by the Company for its employees. As
used herein, the “Company” may include the Company’s successors subsequent to a Change in
Control.
11. Benefit Limitation.
(a) Should any payments or benefits become payable hereunder in connection with a
Change in Control, then the aggregate Present Value, measured as of the Change in Control, of
any Severance Payments to which the Executive becomes entitled under subsection 1O(b)(ii) of
this Agreement (namely, the salary continuation payments, the continued health care coverage,
8
the life insurance coverage, professional services payments, any equivalent automobile
payments and the equivalent 401(k) employer contribution payments) and, if applicable, any
portion of the Special Bonus under subsection 10(f) which is deemed to constitute a parachute
payment under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) shall
in no event exceed in amount the greater of the following dollar amounts (the “Benefit Limit”):
(i) 2.99 times the Executive’s Average Compensation, less the Present Value,
measured as of the Change in Control, of all Other Parachute Payments (as defined
below) to which the Executive is entitled, or
(ii) the amount that yields the Executive the greatest after-tax
amount of benefits under this Agreement after taking into account any excise tax
imposed under Code Section 4999 on his payments and benefits under Section 10 of this
Agreement and any Other Parachute Payments,
The portion of any option that automatically vests on an accelerated basis upon a Change in
Control pursuant to the terms of the agreement evidencing that option that is deemed to be a
parachute payment under Code Section 280G (the “Option Parachute Payment”) shall also be
subject to the Benefit Limit. The Option Parachute Payment shall be calculated in accordance with
the valuation provisions established under Code Section 280G and the applicable Treasury
Regulations and shall include an appropriate dollar adjustment to reflect the lapse
of the Executive’s obligation to remain in the Company’s employ as a condition to the vesting
of the accelerated installment. In no event, however, shall the parachute payment attributable
to any portion of such option exceed the excess of the fair market value of the accelerated
option shares at the time of acceleration over the option exercise price of such shares.
For purposes of applying the Benefit Limit, the value of the Executive’s non-competition
covenant under Section 6 of this Agreement shall be determined by an independent appraisal by a
nationally recognized accounting firm acceptable to both the Executive and the Company, and a
portion of his Severance Payments shall, to the extent of such appraised value, be specifically
allocated as reasonable compensation for such covenant.
“Average Compensation” means the average of the Executive’s W-2 wages from the Company for
the five (5) calendar years (or such fewer number of calendar years of employment with the
Company) completed immediately prior to the calendar year in which the Change in Control occurs.
Any W-2 wages for a partial year of employment will be annualized, in accordance with the
frequency which such wages are paid during such partial year, before inclusion in the
Executive’s Average Compensation.
“Other Parachute Payments” means all payments in the nature of compensation that are made to
the Executive, other than the Severance Payments described in subsection 1O(b)(ii) of this
Agreement or any portion of the Special Bonus under subsection 1O(f) deemed to constitute a
parachute payment, payable in connection with a Change in Control and which accordingly qualify
as parachute payments with the meaning of Code Section 280G. Other Parachute Payments
shall include, without limitation, the Present Value of any Option Parachute Payment.
9
“Present Value” means the value, determined as of the date of the Change in Control, of
any payment in the nature of compensation to which the Executive becomes entitled in connection
with the Change in Control. The Present Value of each such payment shall be determined in
accordance with the provisions of Code Section 280G(d)(4), utilizing a discount rate equal to
120% of the applicable Federal Rate in effect at the time of such determination, compounded
semi-annually to the effective date of the Change in Control.
(b) In the event there is any disagreement between the Executive and the Company as to
whether one or more payments to which Executive becomes entitled in connection with the Change in
Control constitute parachute payments within the meaning of Code Section 280G, such dispute shall
be resolved by the nationally recognized firm of certified public accountants used by the Company
prior to the Change in Control (the “Accounting Firm”); provided, that if such firm declines to
serve, the “Accounting Firm” shall be a nationally recognized firm of certified public
accountants selected by mutual agreement of the Company and the Executive.
(c) Once the requisite determinations have been made, then to the extent the
aggregate Present Value, measured as of the Change in Control, of all parachute payments
attributable to the Severance Payments under this Agreement and otherwise, including without
limitation the Option Parachute Payment, exceeds the Benefit Limit, the following reductions
shall be made to the payments and benefits under Section 10 of this Agreement, to the extent
necessary to assure that such Benefit Limit is not exceeded: first, the Executive’s salary
continuation payments described in subsection 1O(b)(ii)(A) and then, if applicable, his Special
Bonus under subsection 10(f), shall be reduced; and then the period of the Company’s Company
paid health-care coverage described in subsection 1O(b)(ii)(B) shall be shortened. To the extent
the Benefit Limit is still exceeded following such reductions, then a portion of the aggregate
amount of payments described in subsections 1O(b)(ii)(C), (D) and (E) shall be reduced to the
extent necessary to eliminate such excess and, finally, the Option Parachute Payment shall be
reduced.
12. Choice of Law.
The Executive acknowledges that a substantial portion of the Company’s business is based out
of and directed from the State of New York. The Executive also acknowledges that during the
course of the Executive’s employment with the Company the Executive will have substantial
contacts with New York.
The validity, interpretation and performance of this Agreement shall be governed by, and
construed in accordance with, the internal law of New York, without giving effect to conflict of
law principles. Both parties agree that the exclusive venue for any action, demand, claim or
counterclaim relating to the terms and provisions of Sections 4, 5, 6 and 7 of this Agreement,
or to their breach, shall be in the state or federal courts located in Suffolk County, New York
and that such courts shall have personal jurisdiction over the parties to this Agreement.
10
13. Miscellaneous.
(a) Assignment. The Executive acknowledges and agrees that the rights and
obligations of the Company under this Agreement may be assigned by the Company to any successors
in interest. In any event, however, this Agreement shall be binding upon and inure to the benefit
of any successors in interest to the Company. The Executive further acknowledges and agrees that
this Agreement is personal to the Executive and that the Executive may not assign any rights or
obligations hereunder.
(b) Withholding. All salary, bonus and severance payments required to be made by the
Company to the Executive under this Agreement shall be subject to withholding taxes, social
security and other payroll deductions in accordance with the Company’s policies applicable to
employees of the Company at the Executive’s level.
(c) Entire Agreement. Except as specifically set forth herein, this Agreement
sets forth the entire agreement between the parties and supersedes any prior communications,
agreements and understandings, written or oral, with respect to the terms and conditions of the
Executive’s employment.
(d) Amendments. Any attempted modification of this Agreement will not
be effective unless signed by an officer of the Company and the Executive.
(e) Waiver of Breach. The Executive understands that a breach of any
provision of this Agreement may only be waived by an officer of the Company. The waiver by the
Company of a breach of any provision of this Agreement shall not operate or be construed as a
waiver of any subsequent breach.
(f) Severability. If any provision of this Agreement should,
for any reason, be held invalid or unenforceable in any respect by a court of competent
jurisdiction, then the remainder of this Agreement, and the application of such provision in
circumstances other than those as to which it is so declared invalid or unenforceable, shall not
be affected thereby, and each such provision of this Agreement shall be valid and enforceable to
the fullest extent permitted by law.
(g) Notices. Any notices, requests, demands and other communications provided
for by this Agreement shall be in writing and shall be effective when delivered by private
messenger, private overnight mail service, or facsimile as follows (or to such other address as
either party shall designate by notice in writing to the other in accordance herewith):
If to the Company:
11
With a copy to (which shall not constitute notice):
Xxxxxx Xxxxx Xxxxxxxx & Xxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxx, Esq.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxx, Esq.
If to Executive:
Xxxxxx Xxxxxxxxxxx
000 Xxxxxxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
000 Xxxxxxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
(h) Survival. The Executive and the Company agree that certain provisions of
this Agreement shall survive the expiration or termination of this Agreement and the termination
of the Executive’s employment with the Company. Such provisions shall be limited to those within
this Agreement which, by their express and implied terms, obligate either party to perform beyond
the termination of the Executive’s employment or termination of this Agreement.
(i) Disclosure and Confidentiality. The Executive agrees to provide, and agrees that
the Company similarly may provide in its discretion, a copy of the covenants contained in this
Agreement to any business or enterprise which the Company may directly or indirectly own, manage,
operate, finance, join, control or in which the Company participates in the ownership,
management, operation, financing or control, or with which the Company may be connected or may
become connected as an officer, director, executive, partner, principal, agent, representative,
consultant or otherwise. The Executive also agrees that the Company may disclose a copy of this
Agreement if legally required to do so, and in connection with a partnering transaction or
financing, assuming that an appropriate confidentiality agreement is in place. The Executive
further agrees not to disclose the existence or terms of this Agreement to any person other than
the Executive’s immediate family and legal, financial or accounting professional.
G) Arbitration of Disputes. Any controversy or claim arising out of this Agreement or
any aspect of the Executive’s relationship with the Company including the cessation thereof
(other than disputes with respect to alleged violations of the covenants contained in Sections 4,
5, 6 or 7 hereof, and the Company’s pursuit of the remedies described in Section 8 hereof in
connection therewith) shall be resolved by arbitration in accordance with the then existing
Employment Dispute Resolution Rules of the American Arbitration Association, in New York, New
York, and judgment upon the award rendered may be entered in any court having jurisdiction
thereof. Except as awarded by the arbitrator pursuant to applicable statutory or legal standards,
the parties shall split equally the costs of arbitration and each party shall pay its own
attorneys’ fees. The parties agree that the award of the arbitrator shall be final and binding.
(k) Rights of Other Individuals. This Agreement confers rights solely
on the Executive and the Company. This Agreement is not a benefit plan and confers no rights on
any individual or entity other than the undersigned.
12
(l) Headings. The parties acknowledge that the headings in this
Agreement are for convenience of reference only and shall not control or affect the
meaning or construction of this Agreement.
(m) Advice of Counsel. The Executive and the Company hereby
acknowledge that each party has had adequate opportunity to review this Agreement,
to obtain the advice of
counsel with respect to this Agreement, and to reflect upon and consider the terms and
conditions of this Agreement. The parties further acknowledge that each party fully
understands the terms
of this Agreement and has voluntarily executed this Agreement.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of the
day and year set forth below.
| EXECUTIVE | GLOBECOMM SYSTEMS INC. | |||||||
| /s/ Xxxxxx Xxxxxxxxxxx | /s/ Xxxxx X. Xxxx | |||||||
Name: Xxxxxx Xxxxxxxxxxx
|
Name: | Xxxxx X. Xxxx | ||||||
| Title: | President and Chief Operating Officer | |||||||
13
