EMPLOYMENT AGREEMENT
Exhibit
10.2
THIS
AGREEMENT ("Agreement") made this 16th day of April, 2009, by and between
Teltronics, Inc., a Delaware corporation with its principal office
at 0000
Xxxxxxxxx Xxxxxxxxxx Xxx, Xxxxxxxx, Xxxxxxx 00000 ("Company"), and Xxxxxx
Xxxxxxxx, an individual residing at 000 Xxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxx
00000 ("Employee").
W I T N E S S E T H
:
WHEREAS, Employee was previously
employed as Managing Director of Teltronics Europe since August 13, 2001 and
that the Employee and the Company wish to transfer him to Teltronics, Inc. with
continuity of Employment; and
WHEREAS,
the Company desires to obtain Employee's abilities and efforts in contributing
to the Company's growth and success; and
WHEREAS,
Employee desires to accept employment with the Company and the Company desires
to employ the Employee.
NOW,
THEREFORE, in consideration of the mutual covenants and agreements hereinafter
set forth, and other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Term of
Employment
(a) Subject
to the terms and conditions of this Agreement, the Company hereby employs, and
Employee hereby accepts employment with the Company for a period of two (2)
years commencing on the date of this Agreement which will be renewable for an
additional two (2) year period unless either Employee or
Company
sends notice of non-renewal to the other at least thirty (30) days prior to the
expiration date of the term or renewal term, unless the term or any renewal term
is earlier terminated as hereinafter provided.
(b) Notwithstanding
paragraph 1(a) above, this Agreement shall terminate prior to the stated
expiration date upon the occurrence of any of the events described in paragraph
4(a) of this Agreement.
2. Duties of
Employee
(a) During
the term of this Agreement, Employee shall serve the Company full time and
devote to the Company his full and exclusive time, attention and energies as
Senior Vice President, Sales and Marketing of the Company, with primary
responsibility as part of the Company’s Senior Management for all of
the management aspects of the Company's North American Sales and
worldwide Marketing (“Core Responsibilities”) and shall perform such other
duties relative to his employment and discharge such responsibilities as shall
be assigned to him by the Company, in a faithful manner and to the best of his
ability. Employee agrees that during the term of this Agreement, he
shall not serve without prior written authorization as a director, officer,
stockholder, proprietor, employee, joint venture, consultant, investor,
participant, or otherwise, in any other business. The foregoing shall
not preclude the Employee from devoting reasonable time to civic, cultural and
charitable affairs.
(b) The
Board of Directors of the Company reserves to itself the right from time to time
to designate the officers of the Company and to assign the duties and
responsibilities of the employees and officers of the Company, including without
limitation, the office, if any, held by Employee. In this regard, the
Board or Directors may from time to time assign additional duties to Employee,
and may from time to time assign to other employees or officers of the Company
duties now discharged by Employee provided, if the Company removes any of
Employee’s Core Responsibilities
and
Employee is not promoted, the such action shall be deemed a termination under 4
(a) (iv).
3. Compensation and
Benefits
(a) Subject
to withholding and social security taxes and all other required deductions, the
compensation to be paid during the term of this Agreement by the Company for the
services performed by Employee shall be a salary of $150,000 per annum, payable
in equal bi-weekly equal instalments ("Salary"). Such compensation shall be
reviewed with Employee annually and adjustments shall be made to the
compensation based on the Employee’s annual performance review. In addition,
Employee shall be eligible to participate in any performance based incentive
compensation plan which may be established by the Company after Business Plans
and Budgets are finalized under which incentive compensation will be determined
from the net income of the Company if mutually acceptable results are attained
by Employee.
In
addition Employee will be eligible for a “Commission Plan” based on the sales
revenue of products sold in North America.
(b) Employee
shall be eligible for five weeks of vacation per year.
(c) Employee
shall be eligible to participate under and in accordance with any and all health
or medical benefit, 401(k) Savings Plan, and life insurance plans which the
Company now or hereafter may provide to its salaried employees. The
plans currently provide for the following:
(i) Health,
dental, and flexible spending effective October 1, 2008 subject to any
conditions and/or exclusions required by the insurer of the
benefits.
(ii) Group
life insurance policy death benefit effective October 1, 2008 of $50,000 at the
cost of the Company with the option at Employee's cost
to
increase the benefit (subject to approval by the insurer) to an amount equal to
five (5) times Employee's Salary, not to exceed $500,000.
(iii) Participation
in the Company administered 401(k) Savings Plan effective October 1,
2008.
(d) The
Company shall reimburse Employee for reasonable expenses, including, without
limitation, business travel and entertainment expenses.
(e) Automobile
allowance of four hundred dollars ($400.00) per month ($184.62
bi-weekly).
(g) In
addition to the above, Employee shall be eligible to receive options covering
100,000 shares of the Company's common stock under, in accordance with and
subject to the terms of the Teltronics Incentive Stock Option Plan, as amended
from time to time in 2001 and may be considered for additional options based on
performance of the Employee.
4. Termination
(a) This
Agreement and all rights of Employee under this Agreement shall terminate upon
any of the following events:
(i) Resignation
and/or discontinuance of services by the Employee whether by death, mental or
physical disability or otherwise;
(ii) Notice
of termination sent to the Employee by the Company at any time for malfeasance,
misconduct, wilful disobedience to the directives of the Company, or failure to
perform any of the terms and conditions of Sections 5, 6 and 7 of this
Agreement; or
(iii) Notice
of termination sent to the Employee by the Company at any time for failure to
adequately perform, in the Company's judgment, the services, duties and
responsibilities assigned to Employee by the Company, whether or not such
failure is intentional.
(iv) Notice
of termination sent to the Employee by the Company at any time without
cause.
(b) In
the event of termination under subparagraphs 4(a) (i) or 4(a) (ii) and 4(a)
(iii) of this Agreement, the compensation payable under paragraph 3(a) of this
Agreement shall immediately cease and be pro-rated as of the date of
termination. All other rights and benefits of Employee shall
immediately cease as of the date of termination.
(c) In
the event of termination under subparagraph 4(a) (iv) of this Agreement,
Employee shall continue to receive Salary payable under subparagraph 3(a) of
this Agreement for a period of twelve (12) months paid bi-weekly. The
Employer will also cover health insurance benefits for the Employee and his
family for a period of twelve (12) months. All other rights and benefits of
Employee shall immediately cease as of the date of
termination. The twelve (12) month salary continuation
described in this paragraph 4(c) is subject to Employee’s agreement and
representation to the Company that if Employee should elect to resign, Employee
shall provide not less than ninety (90) days prior notice or notice mutually
agreed upon by Employer and Employee if Employee voluntarily resigns under
Section 4 (a) (i) .
5. Disclosure and Assignment of
Intellectual Property
(a) Employee
agrees that any Intellectual Property (as hereinafter defined) that he, alone or
with others, may conceive, develop, make or perfect, in whole or in part, during
the term of this Agreement and with respect to Intellectual Property arising out
of Employee's employment hereunder for a period of six (6) months after any
termination of his employment, which relate to the Company's business, or that
he, alone or with others, may conceive, develop, make or perfect, in whole or in
part, in the performance of the duties of his employment by the Company, shall
be promptly and fully disclosed in writing by the Employee to the
Company.
All of
the right, title and interest in and to any Intellectual Property shall be and
hereby is assigned exclusively to the Company or its nominee regardless of
whether or not the conception, development, marketing or perfection of such
Intellectual Property involved the use of the Company's time, facilities or
materials and regardless of where such Intellectual Property may be conceived,
made or perfected, and shall become the sole property of the Company or its
nominee. For purposes hereof, the term "Intellectual Property" shall
mean inventions, discoveries, ideas, concepts, systems, works, trade secrets,
know-how, intellectual property, software, software protocols, software
documentation, products, processes or improvements or modifications of current
products, processes or designs, or methods of software development, manufacture,
distribution, management or otherwise (whether or not covered by or able to be
covered by a patent or copyright) which relate to the business of the Company
and/or its affiliates.
(b) The
Employee agrees to execute and deliver all documents and do all acts which the
Company shall deem necessary or desirable to secure to the Company or its
nominee the entire right, title and interest in and to applications for any
United States and/or Foreign Letters Patent or Certificates of Copyright
Registration in the name of or for the benefit of the Company or, in the
discretion of the Company, in the Employee's name, which patents and copyrights
shall then be assigned by the Employee to the Company. Any document
described above which is prepared and filed pursuant to this paragraph, shall be
so prepared and filed at the Company's expense. Employee and the
Company agree that wherever and whenever possible, any such document shall be in
the name of and executed by the Company but if it is necessary for such document
to be in the name of and executed by the Employee and the Employee is unwilling
or unable to execute such document, the Employee hereby irrevocably appoints the
President of the Company, or his successor, as his attorney-in-fact, with
authority to execute for him and on his behalf, any and all
assignments,
patent or
copyright applications, or other instruments and documents pursuant to
subparagraph 5(a) above.
(c) The
Company shall have no obligation to use, attempt to protect by application for
Letters Patent or Certificates of Copyright Registration or promote any of the
Intellectual Property; provided, however, that the Company, in its sole
discretion, may (in addition to the compensation described in paragraph 3(f)
above) reward the Employee for any especially meritorious contributions in any
manner it deems appropriate or may provide the Employee with full or partial
releases as to any subject matter contributed by the Employee in which the
Company is not interested.
6. Covenant Not to Disclose
Confidential Information
The Employee acknowledges that during
the course of his employment with the Company he has or will have access to and
knowledge of certain information and data which the Company considers
confidential and that the release of such information or data to unauthorized
persons would be extremely detrimental to the Company. As a
consequence, the Employee hereby agrees and acknowledges that he owes a duty to
the Company not to disclose, and agrees that without the prior written consent
of the Company he will not communicate, publish or disclose, to any person
anywhere or use, any Confidential Information (as hereinafter
defined). The Employee will use his best efforts at all times to hold
in confidence and to safeguard any Confidential Information from falling into
the hands of any unauthorized person and, in particular will not permit any
Confidential Information to be read, duplicated or copied except as necessary to
perform his duties hereunder. Any copies of Confidential Information
authorized hereunder shall also be Confidential Information. The
Employee will return to the Company all Confidential Information in the
Employee's possession or under the Employee's control, when the duties of
Employee no longer required the Employee's possession thereof, or whenever the
Company shall so request,
and in
any event will promptly return all such Confidential Information if the
Employee's relationship with the Company is terminated for any reason and will
not retain any copies thereof. For purposes hereof, the term
"Confidential Information" shall mean any information or data used by or
relating to the Company and/or its affiliates that is not known generally to the
industry in which the Company and/or its affiliates are or may be engaged
including, without limitation, any and all trade secrets, confidential or
proprietary data or information relating to their business and products, price
lists, customer lists, processes, procedures or standards, know-how, manuals,
business strategies, records, drawings, specifications, designs, financial
information, or data which the Company advises the Employee should be treated as
Confidential Information.
7. Non-Solicitation
Employee agrees that during his
employment by the Company and for a period of one (1) year after the termination
of Employee's employment by the Company for any reason, Employee will not
directly or indirectly:
(a) solicit
or divert or attempt to solicit or divert the business of any clients or
customers or accounts, or potential clients, customers or accounts, of the
Company and/or its affiliates.
(b) entice
or induce or in any manner influence, or attempt to entice, induce or in any
manner influence, any person who is or shall be in the employ of or providing
services to the Company and/or its affiliates to leave such employ or
discontinue services to them for the purpose of engaging in a business which may
be in competition with their business.
In the event of a breach or threatened
breach by Employee of the provisions of this paragraph 7, the Company shall be
entitled to specific performance of this paragraph and an injunction restraining
Employee from so soliciting customers, clients, accounts, employees, funding
sources or contractors of the Company.
Nothing
herein shall be construed as prohibiting the Company from pursuing any other
remedies available to the Company at law or in equity for such breach or
threatened breach, including recovery of damages from Employee.
8. Notices
All notices by any party to the other
party hereunder shall be in writing and shall be deemed received when delivered
personally, or sent by registered or certified mail, return receipt requested,
addressed to the other party as follows, or at such other place as the other
party may from time to time designate by written notice:
If to the
Company: Attn: President
Teltronics, Inc.
0000 Xxxxxxxxx Xxxxxxxxxx
Xxx
Xxxxxxxx,
Xxxxxxx 00000
If to
Employee: Xxxxxx
Xxxxxxxx
9. General
(a) This
Agreement shall constitute the entire agreement of Employee and the Company as
to subject matter of this Agreement and shall supersede any and all prior
agreements and understandings, whether oral or in writing.
(b) This
Agreement shall be binding upon Employee and the Company, and shall be governed
and construed in accordance with the laws of the State of Florida.
(c) The
headings in this Agreement are included only for convenience of reference and
shall not affect the construction of this Agreement.
(d) This
Agreement may not be modified or amended orally or by course of conduct, but
rather may be modified or amended only by a writing duly executed by each of
Employee and the Company.
(e) This
Agreement is an agreement for personal services and the rights, obligations,
duties and interest of Employee hereunder may not be sold, transferred,
assigned, pledged or hypothecated.
(f) No
waiver at any time of any provision of this Agreement shall be deemed a waiver
of any other provision of this Agreement at that time or a waiver of that or any
other provision at any other time.
(g) The
prevailing party in any litigation shall be entitled to
recover from the non prevailing party all of its fees and costs, including
attorneys fees and expects fees and costs through all phases of litigation
including collection, in addition to any other remedy.
IN
WITNESS WHEREOF, the Employee and the Company have duly executed this Agreement
the day and year first above written.
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Teltronics,
Inc.
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By:
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/s/
Ewen R. Xxxxxxx
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Xxxx
X. Xxxxxxx, President
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By:
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/s/
Xxxxxx Xxxxxxxx
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Xxxxxx
Xxxxxxxx,
Employee
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