EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made and entered into as of
November 14, 1997 (the "Effective Date") by and between Audio International,
Inc. ("Company") and Xxxx Xxxxx ("Executive"), based on the following facts:
A. Executive has been an employee and has served as President of the
Company since 1987.
B. This Employment Agreement is being entered into concurrent with the
closing of a purchase agreement between Company and DAH.
C. The Company shall recommend to the Board of Directors of DAH to make
a stock option grant of 8,500 shares of the Common Stock of DAH to Executive on
the terms and conditions of the DAH Stock Option Plan.
Based on the foregoing facts and circumstances, the Company and Executive
agree as follows:
1. EMPLOYMENT.
1.1 Company hereby employs Executive on a full time basis to perform
all the duties currently performed by Executive in all capacities in which he
currently serves and to serve as President of Company, together with such other
duties as may be reasonably assigned by the Board of Directors. Company shall
cause the Board of Directors of Company to appoint Executive as President of
Company.
1.2 Executive shall conduct his activities at the Company's offices
at such locations as the Board of Directors may reasonably authorize.
1.3 Executive shall report to the Chairman of the Company and shall
be subject to the general supervision of the Chairman of the Company.
1.4 Executive shall perform his duties on a full time basis and
shall render his services to the Company in a faithful, diligent and competent
manner. During the term of employment, Executive shall not perform services
for, or earn compensation other than income from passive investments from, any
other Person. As used herein, "Person" shall mean any corporation, partnership,
limited liability company, natural person, government, or any other business
entity, domestic or foreign. Notwithstanding the foregoing, and subject to the
prior written approval (which approval shall not be unreasonably withheld) of
the Chairman of the
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Company, Executive may serve as a member of the Board of Directors of other
companies so long as such activity does not interfere with the Executive's
obligations pursuant to this Agreement.
2. TERM OF EMPLOYMENT.
2.1 This Agreement shall become effective on the Closing Date.
Unless sooner terminated pursuant to the provisions of Section 2 of this
Agreement, Company shall employ Executive commencing on the Effective Date
which term shall continue until March 31, 2000.
2.2 The term of employment shall be terminated by the death or
disability of Executive. Disability shall mean the inability of Executive to
provide the services specified in Section 1 for a period of three (3)
consecutive months.
2.3 On or before the date six (6) months prior to the date specified
in Section 2.1, the Company shall give notice to the Executive if the Company
intends to renew the Executive's employment after the term specified in Section
2.1. Any renewal of this Employment Agreement shall be on such terms as are
agreed between Executive and Company.
3. COMPENSATION AND EXPENSES.
3.1 As full compensation, other than fringe benefits for all
services rendered by Executive to Company, Executive shall receive an annual
salary of $225,000.00, paid on the regular pay dates of Company during the
period of his employment pursuant to Sections 2.1 and 2.2.
3.2 Company shall withhold from the compensation payable to
Executive, amounts for taxes and similar matters as required by applicable law,
rules or regulation of any appropriate government authority.
3.3 Upon presentation of properly completed expense statements on
the Company's expense forms, Company shall pay or reimburse Executive for all
reasonable expenses incurred or paid by him during his employment pursuant to
this Agreement. As used in this Section 3.3, the term "reasonable" shall mean
that such expenses are consistent with those of executives in comparable
positions with the operating companies of DAH.
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3.4 Except for compensation (which is limited to the payments
specified in Section 3.1), Executive shall be entitled to the same benefits as
other executives in comparable positions with the operating companies of DAH,
including medical and health benefits, paid vacation and such other benefits as
Company in its sole discretion may provide to Executive, or as DAH shall
provide to executives in comparable positions with the operating companies of
DAH.
3.5 The Chairman of the Company shall recommend to the Board of
Directors of DAH to make a stock option grant of 8,500 shares of the Common
Stock of DAH to Executive on the terms and conditions of the DAH Stock Option
Plan and shall make recommendations in future year(s) consistent with (i) other
executives in comparable positions with operation companies of DAH and (ii)
comparable performance.
3.6 During the term of this Agreement, Executive shall retain his
Company automobile.
4. PROTECTION OF CONFIDENTIAL INFORMATION.
4.1 Executive acknowledges that his employment by Company gives him
knowledge of confidential and proprietary information about the Company, which
may include matters involving costs, markets, customer identification and
contacts, information about customers and vendors, plans for future products
and development, potential patents and methods of operation, which information
is not readily available to and not known by the public (such matters are
referred to herein as "Company Confidential Information"). With respect to
Company Confidential Information:
(a) Executive will keep secret and not use or permit any other
Person to use for the benefit of any person other than the
Company or any of its affiliates any Company Confidential
Information.
(b) Concurrent with the termination of the employment of
Executive, Executive shall deliver to Company all writings
in the possession of, or under the control of, the Executive
relating to the business of the Company.
4.2 In the event of a material breach of any portion of this Section
4 by Executive, the Company shall have the right to have this Section 4
specifically enforced and to obtain an injunction against Executive.
4.3 All inventions (including any contribution, improvement, ideas
and
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discoveries, whether or not subject to patent protection) made by Executive
during his employment by Company, and which are related to the business of
Company, shall belong to Company. Executive shall promptly disclose such
inventions to Company and perform all actions (without expense to Executive)
reasonably requested by Company in support of his invention and of the
ownership thereof by the Company.
5. NOTICES.
All notices, requests, consents and other communications required or
permitted to be given hereunder, shall be in writing and shall be deemed to
have been duly given if delivered personally or sent by confirmed facsimile and
mailed first-class, postage prepaid, by registered or certified mail, as
follows (or to such other address as either party shall designate by notice in
writing to the other party in accordance herewith):
If to Company:
Audio International, Inc.
c/x XxXxxxx Aircraft Holdings, Inc.
0000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xx Xxxxxxx, Xxxxxxxxxx 00000
Attention: R. Xxxx XxXxxxx, Chairman
Fax: (000) 000-0000
with a copy to:
Xxxxxxx X. Xxxxxxxxx, Esq.
c/o Spolin & Xxxxxxxxx
000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Fax: (000) 000-0000
If to Executive:
Xxxx Xxxxx
0000 Xxxxxxxxx Xxxx
Xxxxx Xxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
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with a copy to:
Xxx X. Xxxxxx
Xxxxxx, Xxxxxxx, Xxxxxx & Xxxxxx
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, XX 00000
Facsimile: (000) 000-0000
6. GENERAL.
6.1 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
6.2 COSTS AND ATTORNEYS' FEES. If any action, suit or other
proceeding is instituted concerning or arising out of this Agreement, the party
in whose favor judgment is rendered shall recover such party's reasonable costs
and attorneys' fees incurred.
6.3 HEADINGS. The section and paragraph headings contained in this
Agreement are for convenience only and shall not control or affect the meaning
or construction of any of the provisions of this Agreement.
"Company"
Audio International, Inc.
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By: R. Xxxx XxXxxxx,
Chairman
"Executive"
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Xxxx Xxxxx
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