EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as of the 9th day of
April, 1998, by and between Tridex Corporation, a Connecticut corporation with a
mailing address of 00 Xxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxx 00000 (the "Company"),
and Xxxxxx X. Xxxxxxxx, an individual with a residence address of 00 Xxxxxx Xxxx
Xxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, (the "Executive").
INTRODUCTION
1. The Company is in the business of manufacturing terminals and other
peripheral devices and integrated systems for retail point-of-sale and other
transaction-based markets (the "Business").
2. The Company desires to employ Executive and Executive desires to accept such
employment on the terms and conditions set forth herein.
AGREEMENT
In consideration of the premises and mutual promises herein below set forth, the
parties hereby agree as follows:
1. Employment Period. The term of this Agreement (the "Employment Period") shall
commence on the date hereof and, subject to earlier termination as hereinafter
provided, shall terminate one (1) year from the date hereof, provided that,
thereafter, the term of this Agreement shall automatically extend by thirty (30)
days for each thirty (30) day period which shall expire without either the
Company or Executive giving written notice of termination.
2. Employment Duties. Subject to the terms and conditions set forth herein, the
Company hereby employs Executive to act as Vice President and Chief Financial
Officer of the Company during the Employment Period, and Executive hereby
accepts such employment. The duties assigned and authority granted to Executive
shall be as set forth in the By-laws of the Company and as determined by its
Board of Directors, and the CEO. Executive agrees to perform his duties for the
Company diligently, competently, and in a good faith manner. The Executive may
also engage in civic and charitable activities to the extent they are not
inconsistent with Executive's duties hereunder.
3. Salary and Bonus.
(a) Base Salary. The Company agrees to pay Executive at an annualized rate
of $150,000, payable semi-monthly, in arrears. Executive's base salary shall not
be decreased. In addition, no later than March 31, 1999 the Board of Directors
of the Company (or any appropriate committee thereof) shall review and may
increase the Executive's annual base salary in its discretion, based upon the
Company's performance and the Executive's particular contributions.
(b) Bonus. Executive shall have an opportunity to earn an annual cash
bonus under the Company's Executive Incentive Compensation Plan, subject to the
discretion of the Company's Board of Directors (or any appropriate committee
thereof).
4. Other Benefits.
(a) Insurance and Other Benefits. The Executive shall be entitled to
participate in, and shall receive the maximum benefits available under, the
Company's insurance programs (including health, disability and life insurance)
and any ERISA benefit plans, as the same may be adopted and/or amended from time
to time, and shall receive all other fringe benefits that are provided by the
Company to other senior executives. The Company shall contribute the maximum
amount permitted under current law to the Executive's 401(k) Plan, and any other
Company pension or retirement plan during the Employment Period.
(b) Vacation. Executive shall be entitled to an annual vacation of such
duration as may be determined by the Board of Directors, but not less than that
generally established for other executives of Company and in no event less than
three (3) weeks, without interruption of salary.
(c) Automobile Allowance. The Company shall provide Executive with an
automobile allowance.
(d) Reimbursement of Expenses. The Company shall reimburse Executive for
all reasonable travel, entertainment and other expenses incurred or paid by the
Executive in connection with, or related to, the performance of his duties or
responsibilities under this Agreement, provided that Executive submits to the
Company substantiation of such expenses sufficient to satisfy the record keeping
guidelines promulgated from time to time by the Internal Revenue Service.
5. Termination by the Company with Cause. The Company may terminate this
Agreement if any of the following events shall occur:
(a) the death or disability of the Executive (for purposes of this
Agreement, "disability" shall mean the Executive's incapacity due to physical or
mental illness which has caused the Executive to be absent from the full-time
performance of his duties with the Company for a period of six (6) consecutive
months).
(b) any action or inaction by the Executive that constitutes larceny,
fraud, gross negligence, a willful or negligent misrepresentation to the
directors or officers of the Company, its successors or assigns, or a crime
involving moral turpitude; or
(c) the refusal of the Executive to follow the reasonable and lawful
written instructions of the Board of Directors of the Company or the CEO, with
respect to the services to be rendered and the manner of rendering such services
by Executive, provided such refusal is material and repetitive and is not
justified or excused either by the terms of this Agreement or by actions taken
by the Company in violation of this Agreement, and with respect to the first two
refusals Executive has been given reasonable written notice and explanation
thereof and reasonable opportunity to cure and no cure has been effected within
a reasonable time after such notice.
The Company may terminate this Agreement pursuant to this Section 5
immediately upon written notice to the Executive, except for termination due to
the death of the Executive, which shall require no notice.
6. Termination and Severance.
6.1 Notice/Events/Defined Terms.
(a) Termination of the Executive. Executive may terminate this Agreement
at any time by providing a minimum of two (2) weeks of written notice to the
Company.
(b) Termination by the Company Without Cause. The Company may terminate
this Agreement at any time, without cause by providing written notice to
Executive. As used in this Agreement, the term "without cause" shall mean
termination for any reason not specified in Section 5 hereof, except for
retirement.
(c) Change in Control. A "Change in Control" will be deemed to have
occurred if: (1) the Company effectuates a Takeover Transaction; or (2) any
election of directors of the Company (whether by the directors then in office or
by the stockholders at a meeting or by written consent) where a majority of the
directors in office following such election are individuals who were not
nominated by a vote of two-thirds of the members of the Board of Directors
immediately preceding such election; or (3) the Company effectuates a complete
liquidation of the Company or a sale or disposition of all or
substantially all of its assets. A "Change in Control" shall not be deemed to
include, however, a merger or sale of stock, assets or business of the Company
if the Executive immediately after such event owns, or in connection with such
event immediately acquires (other than in the Executive's capacity as an equity
holder of the Company or as a beneficiary of its employee stock ownership plan
or profit sharing plan), any stock of the buyer or any affiliate thereof.
(d) Takeover Transaction. A "Takeover Transaction" shall mean (i) a merger
or consolidation of the Company with, or an acquisition of the Company or all or
substantially all of its assets by, any other corporation, other than a merger,
consolidation or acquisition in which the individuals who were members of the
Board of Directors of the surviving corporation (or, in the case of an
acquisition involving a holding company, constitute a majority of the Board of
Directors of the holding company) for a period of not less than twelve (12)
months following the closing of such transaction, or (ii) when any person or
entity or group of persons or entities (other than any trustee or other
fiduciary holding securities under an employee benefit plan of the Company,
either related or acting in concert becomes the "beneficial owner" as defined in
Rule 13d-3 under the Securities Exchange Act of 1934, as amended) of securities
of the Company representing more than fifty percent (50%) of the total number of
votes that may be cast for the election of directors of the Company.
Terminating Event. A "Terminating Event" shall mean: (i) termination by the
Company of the employment of the Executive without Cause occurring within twelve
(12) months of a Change in Control; or (ii) resignation of the Executive from
the employ of the Company subsequent to any of the following events occurring
within twelve (12) months of a Change in Control: (A) a significant reduction in
the nature or scope of the Executive's responsibilities, authorities, powers,
functions or duties from the responsibilities, authorities, powers, functions or
duties exercised by the Executive immediately prior to the Change in Control;
(B) a decrease in the salary payable by the Company to the Executive from the
salary payable to the Executive immediately prior to the Change in Control
except for across-the-board salary reductions similarly affecting all management
personnel of the Company; (C) elimination or reduction of the Executive's
participation in the Company's Executive Incentive Compensation Plan; or (D) the
relocation of the Company's executive offices (or, if the Executive is primarily
located at the Company's manufacturing facilities, such facilities) by more than
50 miles from their current location in Westport, Connecticut (unless such new
location is closer than Westport, Connecticut to the Executive's then
residence); provided, however, that a Terminating Event shall not be deemed to
have occurred (iii) solely as a result of the Executive being an employee of any
direct or indirect successor to the business or assets of the Company, rather
than continuing as an employee of the Company, following a Change in Control, or
(iv) while the Executive is receiving payments or benefits from a Company
sponsored plan by reason of the Executive's disability.
6.2 Severance
(a) Without Cause. If the Company terminates this Agreement without Cause,
other than as a result of a Terminating Event, then commencing on the date of
such termination, and for a period equal to one (1) year thereafter, the Company
shall provide Executive with a severance package which shall consist of the
following: (i) payment on the first business day of each month of an amount
equal to one-twelfth of the Executive's then current annualized base salary
under Section 3(a) hereof; (ii) payment on the first business day of each month
of an amount equal to one-twelfth of the Executive's annual target bonus amount
under the Company's Executive Incentive Compensation Plan for the year of
termination, pro rated for the portion of the fiscal year occurring prior to
termination; and (iii) continuation of all benefits under Section 4(a), (b) and
(d).
(b) With A Terminating Event. If the Company terminates this Agreement as
a result of a Terminating Event, then commencing on the date of such termination
and for a period equal to two (2) years thereafter, the Company shall provide
Executive with a severance package which shall consist of the following: (i)
payment on the first business day of each month an amount equal to one-twelfth
of the Executive's then current annual base salary under Section 3(a) hereof;
(ii) payment on the first business day of each month of an amount equal to
one-twelfth of the Executive's annual target bonus amount
under the Company's Executive Incentive Compensation Plan; and (iii)
continuation of all benefits under Section 4(a), (b), and (d). In addition, if
the Company terminates this Agreement as a result of a Terminating Event, then
the Company shall cause the immediate vesting of all options granted to the
Executive under the Company's stock plans. At any time when the Company is
obligated to make monthly payments under Section 6.2(b), the Company shall, ten
(10) days after receipt of a written request from the Executive, pay the
Executive an amount equal to the balance of the amounts payable under Section
6.2(b)(i)-(ii), provided that the obligation of the Company to continue to
provide benefits pursuant to Section 6.2(b) (iii) or to make monthly payments
under 6.2(b) (i)-(ii) shall cease upon the payment of such amount.
(c) General Release. As a condition precedent to receiving any severance
payment, the Executive shall execute a general release of any and all claims
which Executive or his heirs, executors, agents or assigns might have against
the Company, its subsidiaries, affiliates, successors, assigns and its past,
present and future employees, officers, directors, agents and attorneys.
Resignation. If the Executive terminates this Agreement, he shall have no rights
to receive severance payments from the Company.
7. Non-Competition. During the term of this Agreement and (a) in the case of
termination other than as a result of a Terminating Event, for one (1) year
following the termination of this Agreement or (b) in the case of termination as
a result of a Terminating Event, for two (2) years following the termination of
this Agreement, Executive will not directly or indirectly whether as a partner,
consultant, agent, employee, co-venturer, greater than two percent owner or
otherwise or through any other Person (as hereafter defined): (i) be engaged in
any business or activity which is competitive with the business of the Company
in any part of the world in which the Company is at the time of the Executive's
termination engaged in selling its products directly or indirectly; or (ii)
attempt to recruit any employee of the Company, assist in their hiring by any
other person, or encourage any employee to terminate his or her employment with
the Company; or (iii) encourage any customer of the Company to conduct with any
other person any business or activity which such customer conducts or could
conduct with the Company. For purpose of this Section 7, the term "Company"
shall include any person controlling, under common control with or controlled
by, the Company.
For purposes of this Section 7, the term "Person" shall mean an
individual or corporation, association or partnership in estate or trust or any
other entity or organization.
The Executive recognizes and agrees that because a violation by him
of this Section 7 will cause irreparable harm to the Company that could not be
quantified and for which money damages would be inadequate, the Company shall
have the right to injunctive relief to prevent or restrain any such violation,
without the necessity of posting a bond.
Executive expressly agrees that the character, duration and scope of
this covenant not to compete are reasonable in light of the circumstances as
they exist at the date upon which this Agreement has been executed. However,
should a determination nonetheless be made by a court of competent jurisdiction
at a later date that the character, duration or geographical scope of this
covenant not to compete is unreasonable in light of the circumstances as they
then exist, then it is the intention of both Executive and the Company that this
covenant not to compete shall be construed by the court in such a manner as to
impose only those restrictions on the conduct of Executive which are reasonable
in light of the circumstances as they then exist and necessary to provide the
Company to the fullest extent permitted by law the intended benefit of this
covenant to compete.
8. Confidentiality Covenants. Executive understands that Company may impart to
him confidential business information including, without limitations, designs,
financial information, personnel information, strategic plans, product
development information and the like (collectively
"Confidential Information"). Executive hereby acknowledges Company's exclusive
ownership of such Confidential Information.
Executive agrees as follows: (1) only to use the Confidential
Information to provide services to the Company; (2) only to communicate
Confidential Information to fellow employees, agents and representatives of the
Company on a need-to-know basis; and (3) not to otherwise disclose or use any
Confidential Information. Upon demand by the Company or upon termination of
Executive's employment, Executive will deliver to the Company all manuals,
photographs, recordings, and any other instrument or device by which, through
which, or on which Confidential Information has been recorded and/or preserved,
which are in the Executive's possession, custody or control. Executive
acknowledges that for purposes of this Section 8 that term "Company" means any
person or entity now or hereafter during the term of this Agreement which
controls, is under common control with, or is controlled by, the Company.
The Executive recognizes and agrees that because a violation by him
of this Section 8 will cause irreparable harm to the Company that could not be
quantified and for which money damages would be inadequate, the Company shall
have the right to injunctive relief to prevent or restrain any such violations,
without the necessity of posting a bond.
9. Governing Law/Jurisdiction. This Agreement shall be governed by and
interpreted and governed in accordance with the laws of the State of
Connecticut. The parties agree that this Agreement was made and entered into in
Connecticut and each party hereby consents to the jurisdiction of a competent
court in Connecticut to hear any dispute arising out of this Agreement.
10. Entire Agreement. This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof and thereof and
supersedes any and all previous agreements, written and oral, regarding the
subject matter hereof between the parties hereto. This Agreement shall not be
changed, altered, modified or amended, except by a written agreement signed by
both parties hereto.
11. Notices. All notices, requests, demands and other communications required or
permitted to be given or made under this Agreement shall be in writing and shall
be deemed to have been given if delivered by hand, sent by generally recognized
overnight courier service, telex or telecopy, or certified mail, return receipt
requested.
(a) to the Company at:
00 Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: Chairman and CEO
(b) to the Executive at:
00 Xxxxxx Xxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Any such notice or other communication will be considered to have been
given (i) on the date of delivery in person, (ii) on the third day after mailing
by certified mail, provided that receipt of delivery is confirmed in writing,
(iii) on the first business day following delivery to a commercial overnight
courier, or (iv) on the date of facsimile transmission (telecopy) provided that
the giver of the notice obtains telephone confirmation of receipt.
Either party may, by notice given to the other party in accordance with
this Section, designate another address or person for receipt of notices
hereunder.
12. Severability. If any term or provision of this Agreement, or the application
thereof to any person or under any circumstance, shall to any extent be invalid
or unenforceable, the remainder of this Agreement, or the application of such
terms to the persons or under circumstances other than those as to which it is
invalid or unenforceable, shall be considered severable and shall not be
affected thereby, and each term of this Agreement shall be valid and enforceable
to the fullest extent permitted by law. The invalid or unenforceable provisions
shall, to the extent permitted by law, be deemed amended and given such
interpretation as to achieve the economic intent of this Agreement.
13. Waiver. The failure of any party to insist in any once instance or more upon
strict performance of any of the terms and conditions hereof, or to exercise any
right of privilege herein conferred, shall not be construed as a waiver of such
terms, conditions, rights or privileges, but same shall continue to remain in
full force and effect. Any waiver by any party of any violation of, breach of or
default under any provision of this Agreement by the other party shall not be
construed as, or constitute, a continuing waiver of such provision, or waiver of
any other violation of, breach of or default under any other provision of this
Agreement.
14. Successors and Assigns. This Agreement shall be binding upon the Company and
any successors and assigns of the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
Tridex Corporation
by: /s/ Xxxx X. Xxxxxx
Title: Chairman and CEO
EXECUTIVE:
/s/ D. A. Xxxxxxxx
Xxxxxx X. Xxxxxxxx
