EXHIBIT 10.23
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement"), effective as of January 4,
2000, is made and entered by and between Xxxx XxXxxxx (the "Executive") and Nx
Networks Corporation, a Delaware corporation (the "Company").
AGREEMENT
WHEREAS, the Company desires to engage the Executive to provide
services pursuant to the terms of this Agreement; and
WHEREAS, the Executive desires to provide such services to the Company
pursuant to the terms of this Agreement;
NOW, THEREFORE, in consideration of the foregoing and of the respective
covenants and agreements set forth below, the parties hereto agree as follows:
1. TERM OF EMPLOYMENT.
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The term of the Executive's employment under this Agreement shall commence
immediately upon the execution of this Agreement and end on the third
anniversary of such date (the "Term of Employment"). If the Company or the
Executive does not deliver to the other party at least 60 days prior written
notice that the Term of Employment shall end on the third anniversary of the
date hereof, the Term of employment shall automatically continue for an
additional one-year period. At the end of such one year period, the Term of
employment shall automatically continue for successive one year terms unless
either party delivers at least 60 days prior written notice that the Term or
employment shall end at the end of such one-year renewal period.
2. DUTIES.
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(a) During the Term of Employment, the Executive shall serve as the
Executive Vice President-Worldwide Sales and Marketing of the Company with such
authority and duties as are generally associated with such position and as may
be assigned to him from time to time by the Board of Directors of the Company
that are consistent with such authority and duties. The Executive shall report
to the President of the Company.
(b) During the Term of Employment the Executive shall devote his full
business time and best efforts to the business and affairs of the Company.
Nothing in this Agreement shall preclude the Executive from engaging in
charitable and community affairs so long as such activities, in the reasonable
determination of the Board of Directors of the Company, do not interfere with
the execution of his duties and responsibilities hereunder or from serving,
subject to the prior approval of the Board of Directors (not to be unreasonably
withheld), as a director or trustee of any other corporation, association or
entity.
3. COMPENSATION AND RELATED MATTERS.
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(a) SALARY. During the Term, the Executive shall receive a base salary
(the "Base Salary") at the rate of $200,000 per annum. Such Base Salary shall be
payable in accordance with the Company's policies in effect from time to time,
but in any event no less frequently than monthly. The Board of Directors from
time to time may increase, but not decrease, the Base Salary.
(b) BONUS. The Executive shall be eligible for an annual bonus in such
amount as the Board of Directors may designate. Payment of any annual bonus
shall be made at the same time that other senior-level executives receive their
bonus but in no event later than April 21 of the following year to which such
bonus relates.
(c) STOCK OPTIONS.
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(i) To induce the Executive to enter into this Agreement, the
Executive is hereby granted an option (the "Stock Option") by the Company
to purchase 250,000 shares of common stock, par value $0.05 per share, of
the Company (the "Common Stock"). The Stock Option shall be memorialized
in a separate stock option agreement, dated the date hereof, between the
Company and the Executive. The exercise price of the Stock Options will be
$6.00 per share of Common Stock. The Stock Options shall vest over time as
follows and be subject to earlier vesting as described below.
Time vesting:
50,000 on the date hereof, and 50,000 semi-annually thereafter.
Accelerated vesting:
NO. SHARES VESTING EVENT
50,000 Common Stock trades at $35/share for 10
consecutive trading days
50,000 Common Stock trades at $40/share for 10
consecutive trading days
50,000 Common Stock trades at $45/share for 10
consecutive trading days
50,000 Common Stock trades at $50/share for 10
consecutive trading days
(ii) Additional stock option compensation will be granted to the
Executive if the Company achieves targeted levels of annual gross revenue
(the "Target Revenue"). With respect to the calendar year ending December
31, 2000, the Target Revenue is $50 million. In each subsequent year the
Target Revenue will be 120% of the actual gross revenue of the Company for
the immediately preceding year (prorated for a partial year, if
applicable, in the last year of this Agreement). If for any calendar year
the Company's gross revenue exceeds the Target Revenue for that year, then
the Executive will be granted additional options at the rate of 1 option
for each $40 of such excess revenue. The determination of the Company's
gross revenues for each year will be based upon its audited financial
statements, as reflected in the Company's Annual Report on Form 10-K, but
subject to adjustment by the President to reflect any gross revenues
booked at calendar year-end but determined by him in good faith not to be
collectible. Each such grant of additional stock options shall be made
promptly after the audited financial statements become available, and
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shall be memorialized in a separate stock option agreement, dated the
grant date, between the Company and the Executive. The exercise price of
each option shall be the market price of the Common Stock on the date of
grant. The additional stock options shall vest in four equal semi-annual
installments with the first such installment vesting on the six-month
anniversary of the grant date. The Target Revenue for any year may be
adjusted by the Compensation Committee of the Board of Directors, as the
Committee may deem appropriate in its good faith determination, to take
into account acquisitions or divestitures of business or business lines by
the Company. Notwithstanding the foregoing, no grant of additional stock
options will be made under this Section 3(c)(ii) for any year in which a
Change in Control of the Company, as defined in the Company's 1999 Long
Term Incentive Plan, occurs or in any year subsequent to a Change of
Control.
(iii) The Company shall use its best efforts to register the Common
Stock underlying the options referred to in this Section 3(c) on
Securities and Exchange Commission Form S-8, including the registration of
any shares underlying stock options vested prior to the date of filing
such Form S-8.
(d) EXPENSES. The Executive is authorized to incur reasonable expenses in
carrying out his duties and responsibilities under this Agreement and the
Company shall promptly reimburse him for all business expenses incurred in
connection therewith, subject to documentation in accordance with the Company's
policy.
(e) OFFICE ALLOWANCE. The Company shall reimburse the Executive for
an office expense up to a maximum of $10,900 per year, prorated for partial
years.
(f) EMPLOYEE BENEFITS. During the Term of Employment, the Executive shall
be entitled to participate in or receive benefits under any and all employee
benefit plans, programs and arrangements on terms no less favorable than those
generally applicable to senior executives of the Company, subject to and on a
basis consistent with the terms, conditions and overall administration of such
employee benefit plans, programs and arrangements. The Executive shall also be
eligible to participate in the Company's executive perquisites in accordance
with the terms and provisions of the arrangements as in effect from time to time
for the Company's senior executives. The Executive will receive a medical
insurance coverage family plan as offered to other Executives. For the term of
his employment, said medical insurance coverage shall be for the maximum
coverage available for said medical coverage. The Executive shall also receive
the sum of $500.00 per month for automobile allowance during the term of
employment. The Executive will receive life insurance coverage as comparable to
that which is offered to any other executive.
(g) VACATION. The Executive shall be entitled to four weeks of paid
vacation for each 12-month period during the Term of Employment, which shall be
taken at such times and intervals as shall be determined by the Executive,
subject to the reasonable business needs of the Company. The Executive shall
also be entitled to the paid holidays and other paid leave set forth in the
Company's policies.
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(h) PAYMENT UPON CHANGE OF CONTROL. In the event of a Change in Control of
the Company, as defined in the Company's 1999 Long Term Incentive Plan, the
Company shall issue to the Executive 200,000 shares of Common Stock (or, if the
Common Stock was modified, exchanged or converted in connection with such Change
of Control, the cash, securities or other property that such 200,000 shares
would represent at the time of the Change of Control if they had been modified,
exchanged or converted in connection with such Change of Control). Such Common
Stock will be registered by the Company at the time of, or as soon as possible
after, such issuance.
4. TERMINATION OF EMPLOYMENT.
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(a) TERMINATION DUE TO DEATH. In the event the Executive's employment is
terminated due to his death, his estate or his beneficiaries, as the case may
be, shall be entitled to and their sole remedies under this Agreement shall be:
(i) Base Salary through the date of death which shall be paid in a
single lump sum not later than 45 days following the Executive's
death;
(ii) the balance of any bonus awarded and earned but not paid at the
time of termination, which shall be paid in a single lump sum
not later than 45 days following the Executive's death; and
(iii) other or additional benefits then due or earned in accordance
with applicable plans and programs of the Company.
(b) TERMINATION DUE TO DISABILITY. In the event the Executive becomes
Disabled (as defined below), the Company may terminate his employment upon
notice to that effect. Upon such a termination, the Executive or is
representative, as the case may be, shall be entitled to, and their sole
remedies under this Agreement shall be:
(i) Base Salary through the date of termination, which shall be paid
in a single lump sum not later than 45 days following such
termination;
(ii) the balance of any bonus awarded and earned but not paid at the
time of termination, which shall be paid in a single lump sum
not later than 45 days following the date of termination; and
(iii) other or additional benefits then due or earned in accordance
with applicable plans and programs of the Company.
For the purpose of this subsection, the Executive shall have a "Disability" at
such time as he becomes entitled to benefits under the Company's long-term
disability insurance plan as in effect from time to time.
(c) TERMINATION BY THE COMPANY FOR CAUSE.
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(i) "Cause shall mean:
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(A) willful and material breach by Executive of Section 5 or 6
of this Agreement;
(B) conviction of the Executive for a felony or misdemeanor
involving moral turpitude;
(C) breach by the Executive of any alcohol, drug, sexual
harassment or other policy of the Company which provides for
termination of employment for violation;
(D) repeated conscious disregard by the Executive of his
obligations under this Agreement or the failure to perform
at a level deemed reasonably appropriate to the Board of
Directors after written notice by the Board of specific
examples of the unacceptable performance requiring
improvement; or
(E) engagement by the Executive in conduct that constitutes
gross neglect or willful gross misconduct in carrying out
his duties under this Agreement.
(ii) In the event the Company terminates the Executive's employment
for Cause, he shall be entitled to and his sole remedies under
this Agreement shall be:
(A) Base Salary through the date of the termination of his
employment for Cause, which shall be paid in a single lump
sum not later than 45 days following the Executive's
termination of employment;
(B) the balance of any bonus awarded and earned but not paid at
the time of termination, which shall be paid in a single
lump sum not later than 45 days following the date of
termination; and
(C) other or additional benefits then due or earned in
accordance with applicable plans or programs of the Company.
(d) TERMINATION WITHOUT CAUSE OR CONSTRUCTIVE TERMINATION WITHOUT CAUSE.
In the event the Executive's employment with the Company is terminated without
Cause (which termination shall be effective as of the date specified by the
Company in a written notice to the Executive), other than due to death or
Disability, or in the event there is a Constructive Termination Without Cause
(as defined below), the Executive shall be entitled to and his sole remedies
under this Agreement shall be:
(i) Base Salary through the date of termination of the Executive's
employment, which shall be paid in a single lump sum not later
than 15 days following the Executive's termination of employment;
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(ii) Base Salary, at the annualized rate in effect on the date of
termination of the Executive's employment for a period of one
year after the termination of employment (the "Severance Period")
payable in accordance with the Company's standard payroll
practices;
(iii) the balance of any bonus awarded and earned but not paid at the
time of termination, which shall be paid in a single lump sum not
later than 45 days following the date of termination;
(iv) immediate vesting of all stock options which are unvested, but
scheduled to vest during the severance period all of which will
be exercisable during the Severance Period or for the remainder
of the exercise period, if less;
(v) continued participation in all medical, health and life insurance
plans at the same benefit level at which he was participating on
the date of the termination of his employment until the earlier
of:
(A) the end of the Severance Period; or
(B) the date, or dates, he receives equivalent coverage and
benefits under the plans and programs of a subsequent
employer (such coverage and benefits to be determined
on a coverage-by-coverage, or benefit-by benefit,
basis);
provided that (1) if the Executive is precluded from
continuing his participation in any employee benefit plan or
program as provided in this clause (v), he shall receive cash
payments equal on an after-tax basis to the cost to him of
obtaining the benefits provided under the plan or program in
which he is unable to participate for the period specified in
this clause (v), (2) such cost shall be deemed to be the
lowest reasonable cost that would be incurred by the Executive
in obtaining such benefit himself on an individual basis, and
(3) payment of such amounts shall be made quarterly in
advance; and
(vi) other or additional benefits then due or earned in accordance
with applicable plans and programs of the Company.
"Termination Without Cause" shall mean the Executive's employment is
terminated by the Company for any reason other than Cause (as defined in
Section 4C) or due to death or disability.
"Constructive Termination Without Cause" shall mean a termination of the
Executive's employment at his initiative as provided in this Section 4(d)
following the occurrence, without the Executive's written consent, of one or
more of the following events (except as a result of a prior termination):
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(A) a material diminution or change, adverse to Executive, in
Executive's positions, titles, or offices as set forth in Section
2;
(B) any other failure by the Company to perform any material
obligation under, or breach by the Company of any material
provision of, this Agreement that is not cured within 30 days;
(C) any failure to secure the agreement of any successor corporation
or other entity to the Company to fully assume the Company's
obligations under this Agreement.
(e) TERMINATION FOLLOWING NON-RENEWAL. In the event that the either party
notifies the other in writing at least 60 days prior to the expiration of the
then current Term of Employment that it is electing to terminate this Agreement
at the expiration of the then current Term of Employment and the Executive's
employment terminates upon such expiration, whether at the Company's initiative
or the Executive's initiative, the Executive shall be entitled to:
(i) Base Salary through the date of termination of the Executive's
employment, which shall be paid in a single lump sum not later
than 45 days following such termination;
(ii) the balance of any bonus awarded and earned but not paid at
the time of termination, which shall be paid in a single lump
sum not later than 45 days following the date of termination;
and
(iii) other or additional benefits then due or earned in accordance
with applicable plans and programs of the Company.
(f) NO MITIGATION, NO OFFSET. In the event of any termination of
employment under this Section 4, the Executive shall be under no obligation to
seek other employment; amounts due the Executive under this Agreement shall not
be offset by any remuneration attributable to any subsequent employment that he
may obtain.
(g) NATURE OF PAYMENTS. Any amounts due under this Section 4 are in the
nature of severance payments considered to be reasonable by the Company and are
not in the nature of a penalty.
5. CONFIDENTIALITY
(a) During the Term of Employment and thereafter, the Executive shall not,
without the prior written consent of the Company, disclose to anyone (except in
good faith in the ordinary course of business to a person who will be advised by
the Executive to keep such information confidential) or make use of any
Confidential Information (as defined below) except in the performance of his
duties hereunder or when required to do so by legal process, by any governmental
agency having supervisory authority over the business of the Company or by any
administrative or legislative body (including a committee thereof) that requires
him to divulge, disclose or make accessible such information. In the event that
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the Executive is so ordered, he shall give prompt written notice to the Company
in order to allow the Company the opportunity to object to or otherwise resist
such order.
(b) "Confidential Information" shall mean all information concerning the
business of the Company or any subsidiary relating to any of their products,
product development, trade secrets, customers, suppliers, finances, and business
plans and strategies. Excluded from the definition of Confidential Information
is information (i) that is or becomes part of the public domain, other than
through the breach of this Agreement by the Executive, (ii) regarding the
Company's business or industry properly acquired by the Executive in the course
of his career as an executive in the Company's industry and independent of the
Executive's employment by the Company, (iii) that becomes available to the
Executive on a non-confidential basis from a source other than the Company,
provided that such source is not known by the Executive to be subject to a
confidentiality agreement or other obligation of secrecy or confidentiality
(whether pursuant to a contract, legal or fiduciary obligation or duty or
otherwise) to the Company or any other person or entity or (iv) approved for
release by the Company or which the Company makes generally available to third
parties without an obligation of confidentiality. For this purpose, information
known or available generally within the trade or industry of the Company or any
subsidiary shall be deemed to be known or available to the public.
6. NON-COMPETITION; NON-SOLICITATION.
---------------------------------
The Executive acknowledges that his employment with the Company will, of
necessity, provide him with specialized, unique knowledge and confidential
information and that, in light of the competitive nature of the Company's
business, the Company could be harmed if such knowledge and information were
used in competition with the Company. The Executive further acknowledges that
the Company would not enter into this Agreement and undertake the substantial
obligations under this Agreement without the Executive's agreement to the
following provisions of this Section 6:
(a) During the Restricted Period (as defined below) he will not, directly
or indirectly, as an officer, director, stockholder, partner, associate,
employee, consultant, owner, agent, co-venturer or otherwise, become or be
interested in or be associated with any other corporation, firm or business
engaged in the manufacture, marketing or sale of products which compete directly
with products of the Company. The Executive's ownership, directly or indirectly,
of not more than three percent (3%) of the issued and outstanding stock of any
corporation or other entity, the shares of which are traded on a national
securities exchange or the Nasdaq Stock Market, shall not in any event be deemed
to be a violation of the provisions of this Section 6(a).
(b) During the Restricted Period, the Executive shall not call upon,
solicit, divert or take away, or attempt to call upon, solicit, divert or take
away, business of a type the same or similar to the business as conducted by the
Company prior to the date of termination of the Executive's employment with the
Company from any of the Customers of the Company upon whom he called or whom he
solicited or to whom he catered or with whom he became acquainted after entering
the employ of the Company.
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(c) The Executive acknowledges and agrees that during the time of his
employment with the Company, he will gain valuable information about the
identity, qualifications and ongoing performance of the employees of the
Company. During the Restricted Period, the Executive shall not (i) hire, employ,
offer employment to, or seek to hire, employ or offer employment to, any of the
Company's senior level employees with whom he had contact prior to such
termination of employment or (ii) solicit or encourage any such senior level
employee to seek or accept employment with any other person or entity.
(d) The Executive represents and warrants that the knowledge, skills and
abilities he currently possesses are sufficient to permit him, in the event of
his termination of employment hereunder for any reason, to earn a livelihood
satisfactory to himself without violating any provision of this Agreement.
(e) For the purposes of this Section 6, "Restriction Period" shall mean
the period beginning on the date hereof and ending with:
(i) in the case of a termination of the Executive's employment
pursuant to Section 4(c) above, or if the Executive terminates
his employment other than pursuant to Constructive Termination
Without Cause or pursuant to Section 4(3), the first
anniversary of such termination;
(ii) in the case of a termination of the Executive's employment
pursuant to Section 4(d) above, the end of the Severance
Period; and
(iii) in the case of a termination of the Executive's employment
pursuant to Section 4(e) above, the date of such termination;
PROVIDED, HOWEVER, that within 10 days after the Executive
announces that he will not renew his employment hereunder at
the end of the then current Term of Employment the Company may
notify the Executive that it will cause the Restriction Period
to be 12 months and, in consideration for such period, the
Company will pay to the Executive the amounts specified in
Section 4(e) above plus the following:
(A) continued participation in all medical and dental plans
at the same benefit level at which he was participating on
the date of the termination of his employment until the
earlier of:
a. the end of the Restriction Period; or
b. the date, or dates, he received equivalent coverage
and benefits under the plans and programs of a
subsequent employer (such coverage and benefits to be
determined on a coverage-by-coverage, or benefit-by-
benefit, basis);
provided that (x) if the Executive is precluded from
continuing his participation in any employee benefit plan or
program as provided in this clause (iii) of this Section 4(e),
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he shall receive cash payments equal on an after-tax basis to
the cost to him of obtaining the benefits provided under the
plan or program in which he is unable to participate for the
period specified in this clause (iii) of this Section 4(e),
(y) such cost shall be deemed to be the lowest cost that would
be incurred by the Executive in obtaining such benefit himself
on an individual basis, and (z) payment of such amounts shall
be made quarterly in advance; and
(B) Base Salary, at the annualized rate in effect on the
date of the Company's notice, through the end of the
Restriction Period, payable in accordance with the Company's
standard payroll practices.
7. REMEDIES.
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In addition to whatever other rights and remedies the Company may have at
equity or in law, if the Executive breaches any of the provisions contain in
Sections 5 or 6 above, the Company (a) shall have the right to immediately
terminate all payments and benefits due under this Agreement and (b) shall have
the right to seek injunctive relief. The Executive acknowledges that such a
breach would cause irreparable injury and that money damages would not provide
an adequate remedy for the Company.
8. RESOLUTION OF DISPUTES.
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Any disputes arising under or in connection with this Agreement shall be
resolved by binding arbitration, to be held in Washington, DC in accordance with
the rules and procedures of the American Arbitration Association, except that
disputes arising under or in connection with Sections 5 and 6 above shall be
submitted to a court of appropriate jurisdiction. Judgment upon the award
rendered by the arbitrators) may be entered in any court having jurisdiction
thereof. Each party shall bear his or its own costs of the arbitration or
litigation, including, without limitation, attorneys' fees. Pending the
resolution of any arbitration or court proceeding, the Company shall continue
payment of all amounts and benefits due the Executive under this Agreement.
9. INDEMNIFICATION.
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(a) The Company agrees that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "Proceeding"), by reason of the
fact that he is or was a director, officer or employee of the Company or any
subsidiary or is or was serving at the request of the Company or any subsidiary
as a director, officer, member, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether or not the basis of such Proceeding
is the Executive's alleged action in an official capacity while serving as a
director, officer, member, employee or agent, the Executive shall be indemnified
and held harmless by the Company to the fullest extent legally permitted or
authorized by the Company's certificate of incorporation or bylaws or
resolutions of the Company's certificate of incorporation or by laws or
resolutions of the Company's Board of Directors or, if greater, by the laws of
the State of Delaware, against all cost, expense, liability and loss (including,
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without limitation, attorney's fees, judgments, fines, ERISA excise taxes or
penalties and amounts paid or to be paid in settlement) reasonably incurred or
suffered by the Executive in connection therewith, and such indemnification
shall continue as to the Executive even if he has ceased to be a director,
member, officer, employee or agent of the Company or other entity and shall
inure to the benefit of the Executive's heirs, executors and administrators. The
Company shall advance to the Executive all reasonable costs and expenses
incurred by him in connection with a Proceeding within 20 days after receipt by
the Company of a written request for such advance. Such request shall include an
undertaking by the Executive to repay the amount of such advance if it shall
ultimately be determined that he is not entitled to be indemnified against such
costs and expenses.
(b) Neither the failure of the Company (including its board of directors,
independent legal counsel or stockholders) to have made a determination prior to
the commencement of any proceeding concerning payment of amounts claimed by the
Executive under Section 9(a) above that indemnification of the Executive is
proper because he has met the applicable standard of conduct, nor a
determination by the Company (including its board of directors, independent
legal counsel or stockholders) that the Executive has not met such applicable
standard of conduct, shall create a presumption that the Executive has not met
the applicable standard of conduct.
(c) The Company agrees to continue and maintain a directors and officers'
liability insurance policy covering the Executive to the extent the Company
provides such coverage for its other executive officers.
10. EFFECT OF AGREEMENT ON OTHER BENEFITS.
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Except as specifically provided in this Agreement, the existence of this
Agreement shall not be interpreted to preclude, prohibit or restrict the
Executive's participation in any other employee benefit or other plans or
programs in which he currently participates.
11. ASSIGNABILITY; BINDING NATURE.
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This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors, heirs (in the case of the Executive)
and permitted assigns. No rights or obligations of the Company under this
Agreement may be assigned or transferred by the Company except that such rights
or obligations may be assigned or transferred in connection with the sale or
transfer of all or substantially all of the assets of the Company, provided that
the assignee or transferee is the successor to all or substantially all of the
assets of the Company and such assignee or transferee assumes the liabilities,
obligations and duties of the Company, as contained in this Agreement, either
contractually or as a matter of law. The Company further agrees that, in the
event of a sale or transfer of assets as described in the preceding sentence, it
shall take whatever action it legally can in order to cause such assignee or
transferee to expressly assume the liabilities, obligations and duties of the
Company hereunder. No fights or obligations of the Executive under this
Agreement may be assigned or transferred by the Executive other than his rights
to compensation and benefits, which may be transferred only by will or operation
of law, except as provided in Section 17 below.
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12. WARRANTY OF EXECUTIVE.
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As an inducement to the Company to enter into this Agreement, the
Executive represents and warrants that he is not a party to any other agreement
or obligation for personal services, and that there exists no impediment or
restraint, contractual or otherwise, on his power, right or ability to enter
into this Agreement and to perform his duties and obligations hereunder.
13. COMPANY REPRESENTATIONS.
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The Company represents to the Executive that this Agreement has been duly
authorized, executed and delivered by the Company and is a legal, valid and
binding obligation of the Company and that the execution, delivery and
performance of this Agreement by the Company will not breach or be in conflict
with any agreements to which the Company is a party or by which it is bound.
14. ENTIRE AGREEMENT.
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This Agreement contains the entire understanding and agreement between the
parties concerning the subject matter hereof and supersedes all prior
agreements, understandings, discussions, negotiations and undertakings, whether
written or oral, between the parties with respect thereto.
15. AMENDMENTS; WAIVERS.
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No provision in this Agreement may be amended unless such amendment is
agreed to in writing and signed by the Executive and an authorized officer of
the Company. No waiver by either Party of any breach by the other Party of any
condition or provision contained in this Agreement to be performed by such other
Party shall be deemed a waiver of a similar or dissimilar condition or provision
at the same or any prior or subsequent time. Any waiver must be in writing and
signed by the Executive or an authorized officer of the Company, as the case may
be. No failure to exercise and no delay in exercising any right, remedy or power
hereunder shall preclude any other or further exercise of any other right,
remedy or power provided herein or by law or in equity.
16. SEVERABILITY OF PROVISIONS.
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In the event that any provision or any portion thereof should ever be
adjudicated by a court of competent jurisdiction to exceed the time or other
limitations permitted by applicable law, as determined by such court in such
action, then such provisions shall be deemed reformed to the maximum time or
other limitations permitted by applicable law, the parties hereby acknowledging
their desire that in such event such action be taken. In addition to the above,
the provisions of this Agreement are severable, and the invalidity or
unenforceability of any provision or provisions of this Agreement or portions
thereof shall not affect the validity or enforceability of any other provision,
or portion of this Agreement, which shall remain in full force and effect as if
executed with the unenforceable or invalid provision or portion thereof
eliminated. Notwithstanding the foregoing, the parties hereto affirmatively
represent, acknowledge and agree that it is their intention that this Agreement
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and each of its provisions are enforceable in accordance with their terms and
expressly agree not to challenge the validity or enforceability of this
Agreement or any of its provisions, or portions or aspects thereof, in the
future. The parties hereto are expressly relying upon this representation,
acknowledgment and agreement in determining to enter into this Agreement.
17. BENEFICIARIES/REFERENCES.
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The Executive shall be entitled, to the extent permitted under any
applicable law, to select and change a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive's death by
giving the Company written notice thereof. In the event of the Executive's death
or a judicial determination of his incompetence, reference in this Agreement to
the Executive shall be deemed, where appropriate, to refer to his beneficiary,
estate or other legal representative.
18. GOVERNING LAW.
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This Agreement shall be governed by and construed and interpreted in
accordance with the laws of the Commonwealth of Virginia without reference to
principles of conflict of laws. The parties hereby irrevocably consent to the
service of any and all process in any action or proceeding arising out of or
relating to this Agreement by the mailing of copies of such process to the
parties at the address specified in Section 19 hereof.
19. NOTICES.
-------
All notices, requests, demands and other communications which are required
or may be given under this Agreement shall be in writing and shall be deemed to
have been duly given when received if personally delivered; when transmitted if
transmitted by telecopy, electronic or digital transmission method upon receipt
of telephonic or electronic confirmation; the day after it is sent, if sent for
next day delivery to a domestic address by a recognized overnight delivery
service (e.g., Federal Express); and upon receipt, if sent by certified or
registered mail, return receipt requested. In each case notice shall be sent to
the Company c/o the Board of Directors at the Company's principal executive
offices and to the Executive at his last known permanent address, or to such
other place as either party may designate as to itself or himself by written
notice to the other.
20. HEADINGS.
---------
The headings of the sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.
21. COUNTERPARTS.
------------
This Agreement may be executed in several counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute
one and the same Agreement.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first written above.
NETRIX CORPORATION
By: /s/ Xxxxxx X. Francesco
-----------------------------------
Title: Chairman and Chief Executive
Officer
--------------------------------
/s/ Xxxx XxXxxxx
--------------------------------------
Xxxx XxXxxxx
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