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EXHIBIT 10.15
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made this ___
day of __________, 1997, between XXXXX COMMUNICATIONS INC. (formerly known as
ACCESS BEYOND, INC.), a Delaware corporation (the "Company"), and XXXXXX X.
XXXXX, a resident of Gwinnett County, Georgia (the "Executive").
W I T N E S S E T H :
WHEREAS, Xxxxx Microcomputer Products, Inc., a Georgia
corporation ("Xxxxx") and Executive have entered into that certain Employment
Agreement dated July 1, 1983, as amended and restated by that certain Amendment
and Restated Employment Agreement dated April 16, 1996 (the "Employment
Agreement") which are currently in force; and
WHEREAS, pursuant to the April 16, 1996 Employment Agreement
between Executive and Xxxxx, Executive has been entitled to a $1,000,000 annual
base salary and certain benefits and perquisites which Executive and the
Company desire to revise to an incentive-based compensation plan which reflects
that Xxxxx will become a publicly traded company upon completion of the Merger
pursuant to the Merger Agreement (defined below); and
WHEREAS, the Executive and the Company desire to enter into
this Agreement in order to set forth the terms under which Executive's
employment with the Company will commence upon the Effective Time (as defined
below) and certain arrangements with respect to Executive's activities and
obligations following the termination of Executive's employment with the
Company; and
WHEREAS, Xxxxx is engaged in the business of developing,
manufacturing, marketing and distributing certain computer component products,
software and systems and the Company is engaged in the business of developing
and marketing network access devices (hereinafter the collective business of
Xxxxx and the Company referred to as the "Business of the Company"); and
WHEREAS, Xxxxx has entered into that certain Agreement and
Plan of Reorganization between Xxxxx and the Company dated the _____ day of
____________, 1997 (the "Merger Agreement"); and
WHEREAS, execution of this Agreement is a condition precedent
to the effectiveness and enforceability of the Merger Agreement and the closing
of the Merger as contemplated in the Merger Agreement is a condition to the
effectiveness of this Agreement..
NOW, THEREFORE, for and in consideration of the mutual
covenants and agreements contained herein, and other good and valuable
consideration, the receipt and
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sufficiency of which are hereby acknowledged, the Executive, Xxxxx, and the
Company agree as follows:
1. EMPLOYMENT AND DUTIES.
1.1 Appointment as Chairman. For the Term of this Agreement as
set forth in Section 2 hereof, the Executive shall be employed, hold the
office, perform the duties, and have the authority and responsibilities of the
Chairman of the Board of Directors, which shall be a corporate office of the
Company ("Chairman") of the Company as set forth herein.
1.2 Duties of the Chairman. The Executive shall have the
following authority, responsibilities and duties as Chairman of the Company:
1.2.1 The Chairman shall direct the Office of Chairman which
will develop initiatives for the Board of Directors ("Board") and
shareholders in connection with long-term operating and strategic
planning, policy development, new technology strategy and corporate
business development for the Company.
1.2.2 The Chairman shall act as a Company spokesperson and
shall exert his best efforts to interface, develop and maintain
positive relations with the industrial, political, business,
financial, academic, investment and research communities.
1.2.3 The Chairman shall serve as a member of and participate
on the Senior Management Committee to be established by the Board of
Directors of the Company to xxxxxx and enhance communications among
the senior officers of the Company in order to facilitate and
coordinate the strategic and operational activities of the Company.
1.3 Other Duties. The Chairman shall perform such other duties
as may be reasonably assigned from time to time by the Board consistent with
the position of Chairman.
1.4 Duties of CEO. To the extent that the responsibilities of
the Chairman duplicate duties assigned to the Chief Executive Officer of the
Company (the "CEO"), the Chairman shall advise the CEO on those
responsibilities.
1.5 Outside Activities. During the Term, the Executive shall
devote his full business time and efforts to the execution of his duties and
responsibilities hereunder. Notwithstanding the foregoing, nothing in this
Agreement shall be deemed to prohibit the Executive from serving on other
boards of directors, whether or not for compensation (subject to Board approval
and opinion of Company counsel, as may be appropriate) and from consulting for
other non-Competing Businesses, as defined in Section 5.1, on non-Company time,
or from owning copyrights, royalties, or other rights with respect to books,
historical accounts, speeches, presentations, or other works of authorship by
or in collaboration with the Executive, whether or not they relate to the
Company or its affairs to the extent that such activities do not interfere with
his performance of his duties and responsibilities as Chairman and are
permitted by Sections 5, 6, and 7 of this Agreement.
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1.6 Other Positions. The Executive shall only hold the office of
Chairman. The employment by the Company of the Executive hereunder as the
Chairman shall not preclude appointment or election of the Executive by the
Board to any other corporate office of the Company.
2. TERM AND EFFECTIVE TIME.
The term of the Executive's employment hereunder is conditioned upon
the occurrence of, and shall commence on, the Effective Time under the Merger
Agreement (the "Effective Time"), and shall continue for a period of three (3)
years from January 1, 1998 unless either terminated or extended as provided by
the Agreement (the "Term"). The April 16, 1996 Employment Agreement is
terminated effective as of the Effective Time.
3. COMPENSATION AND OTHER BENEFITS.
3.1 Salary. As compensation for his services to the Company
rendered pursuant hereto, the Executive shall be paid a base salary at the rate
Four Hundred Thousand Dollars ($400,000.00) per annum (hereinafter referred to
as "Base Salary") with increases on each anniversary date of the Effective Time
to the Base Salary directly proportional to any increase (but not decrease) in
the cost of living as reflected by the "Consumer Price Index for Urban Wage
Earners and Clerical Workers-All Items" ("CPI") published by the Bureau of
Labor Statistics of the U.S. Department of Labor (or the official successor to
such index) in effect on such anniversary date as compared to the CPI in effect
on the preceding anniversary date or Effective Time, as appropriate. The Base
Salary shall accrue and be due and payable in equal, or as nearly equal as
practicable, semi-monthly installments, and the Company may deduct from each
such installment all amounts required to be deducted and withheld in accordance
with the provisions of any applicable law now in effect or hereafter in effect
including without limitation federal and state income, FICA and other
withholding tax requirements, and such other deductions permitted by the
Company which Executive may authorize from time to time.
If the Effective Time is on other than the first business day of a
calendar month or if the Executive's employment hereunder shall terminate on
other than the last day of a calendar month, the Executive's Base Salary for
such month shall be prorated according to the number of days during such month
that the Executive was employed hereunder.
3.2 Bonus. Executive shall be eligible for such bonuses as
follows:
3.2.1 Personal Incentive Bonus. Executive shall be paid a
personal incentive bonus up to a maximum of Five Hundred Thousand
Dollars ($500,000.00) per year, payable quarterly, based on
Executive's attaining personal goals in respect to his employment as
Chairman of the Company, such goals to be mutually determined by the
Executive and the Compensation Committee of the Board (the
"Compensation Committee") and approved by the Board.
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3.2.2 Corporate Incentive Bonus. The Executive shall be
eligible to receive a Corporate Incentive Bonus up to a maximum amount
of Three Hundred Thousand Dollars ($300,000.00) per year, payable
semi-annually. The payment of such Corporate Incentive Bonus shall be
based on the Company's attainment of the same goals, objectives and
benchmarks as set by the Board for the payment of a similar corporate
incentive bonus to the President of the Company.
3.3 Stock Option Plan. The Company shall award to Executive each
year during the Term hereof, stock options to purchase 200,000 shares of common
stock of the Company with an exercise price at fair market value as of the date
of award (the "Options"). Fair market value shall mean the average closing
price of the Company's stock for the twenty (20) trading days immediately prior
to the date of the award. Such Options shall have the following additional
features:
(a) The Options will have a term of ten (10) years from
the date of award, and must be exercised within such ten (10) year
period, except as expressly set forth below in this Section 3.3.
(b) The Options will be awarded effective as of January
1 of each year of the Term hereof.
(c) Twenty-five percent (25%) of the Options will vest
at the date of award and twenty-five percent (25%) on December 31 of
such year and each ensuing year, except as otherwise provided in this
Section 3.3.
(d) If Executive voluntarily resigns his employment
(except in the case of a breach hereof by the Company or in the case
of a Change of Control, as hereinafter defined) or if Executive's
employment is terminated by the Company for Cause (as hereinafter
defined), then no further vesting will occur and all unvested Options
will terminate immediately upon such termination of employment.
Executive must exercise any vested Options after such termination of
employment within the earlier to occur of (i) five (5) years after the
date of termination of employment or (ii) the expiration of the ten
(10) year term of the Options.
(e) If Executive's employment is not continued after the
expiration of the Term hereof for a period of at least two (2) years
or if Executive's employment terminates as a result of his death or
disability (as contemplated by Section 3.7.3 hereof), or if
Executive's employment terminates for any reason within one (1) year
after a Change of Control, then all unvested Options shall vest at the
time that such Options would have vested as if Executive's employment
had continued through such time.
(f) If Executive's employment is terminated in breach
hereof by the Company, or if Executive terminates as a result of a
breach by the Company, then all unvested
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Options awarded through such termination date shall vest immediately
upon such termination.
(g) "Change of Control," for purposes of this Section
3.3, means the closing of a merger, consolidation or reorganization of
the Company with or into any other corporation or corporations in
which the Company is not the surviving entity (other than a mere
reincorporation transaction), a sale of all or substantially all of
the assets of the Company or a transaction or series of related
transactions in which the Company issues shares representing more than
50% of the voting power of the Company, immediately after giving
effect to such transaction or series of related transactions, to a
person or persons or other entity or entities who were not
shareholders of the Company immediately prior to such transaction.
3.4 Civic, Trade Organization and Club Dues. Subject to
quarterly review of the Compensation Committee with respect to ongoing business
expenses, the Company shall pay for or reimburse the Executive for dues paid in
connection with his membership in civic organizations or trade organizations
which promote the image or Business of the Company or establish, maintain or
expand the interface and relationship between the Company and various
communities; and for Executive's dues at clubs utilized by Executive or made
available by Executive and other management to entertain customers, vendors and
others with whom the Company or Xxxxx has business relations, or for other
Company-related business activities, entertainment and functions.
3.5 Vacation. The Executive shall receive not less than thirty
(30) working days paid vacation during each twelve (12) month period of the
Term. The Executive shall give the Board members at least five (5) days prior
written or oral notice before commencing each vacation period. To the extent
that any annual vacation provided herein is not taken during the year in which
it accrued, such unused vacation time shall be carried forward to the following
year not to exceed twenty (20) working days per year, and provided that
Executive shall not have more than fifty (50) working days of accrued and
unused vacation at any one time.
3.6 Health Plans. The Executive shall be eligible to participate
in the Company's health plans, in accordance with their terms, which the
Company now or hereafter has in effect and which are generally made available
to the Company's other employees, and the Company shall make contributions for
Executive's participation in such plans as it generally makes for its other
employees. The Company reserves the right to modify, add to or eliminate any or
all of its fringe benefit plans at any time and for any reason.
3.7 Insurance.
3.7.1 Life Insurance. The Company shall continue to
maintain at no cost to the Executive, except as provided in this
Section 3.8.1, those life insurance policies with respect to the
Executive which are set forth on Schedule 3.8. The Executive may
borrow such amounts as are permitted under the terms of such life
insurance policies; provided, however, that on and after the Effective
Time the Executive shall be solely responsible for
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repayment of such borrowed amounts, interest thereon and payment of
any resulting increase(s) in the Company's premium payment and shall
give advance written notice to the Board of his intention to borrow
such amounts.
3.7.2 Errors and Omissions. The Company shall provide
directors' and officers' liability and errors and omissions coverage
for the Executive in an amount and under terms consistent with those
provided other Company officers and directors.
3.7.3 Disability. If the Executive is determined to be
disabled under the Company's short-term disability plan or long-term
disability plan ("Disability Plan"):
(a) The Company shall pay to the Executive,
through insurance or otherwise, an amount
equal to one hundred percent (100%) of the
Executive's Base Salary plus the maximum
amount of the Personal Incentive Bonus for
a period of one year from and after the
occurrence of the disability as determined
under the Disability Plan. The sum of
amounts paid by the Company under this
Section 3.7.3(a) shall be reduced by the
Executive's total income during such period
from: social security, workers'
compensation, compensation from the Company
or any other business entity which
controls, or is controlled by, or is under
common control with the Company including,
but not limited to, any Disability Plan
benefits and earned income from employment
in any capacity ("Offset Amount").
(b) Commencing on the three hundred sixty-sixth
(366th) consecutive calendar day from and
after the Executive's disability as
determined under the Disability Plan, the
Company shall pay to the Executive, through
insurance or otherwise, an amount equal to
seventy-five percent (75%) of the
Executive's Base Salary plus the maximum
amount of the Personal Incentive Bonus. The
sum of amounts paid by the Company under
this Section 3.7.3(b) shall be reduced by
the Offset Amount plus all of the
Executive's proceeds from the sale of
Company stock.
(c) The Company's obligation to make payments,
as set forth in Sections 3.7.3(a) and (b),
to the Executive during the Executive's
period of disability shall cease upon the
later of the termination of the Term or
three (3) years from the commencement of
the disability as described in the first
sentence of this Section 3.7.3.
(d) The Executive's Base Salary and vacation
accrual shall cease during payments under
Section 3.7.3(a) and (b), but all other
benefits of this Agreement shall continue.
The Executive's Base Salary and
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vacation accrual shall recommence upon the
cessation of the Executive's disability
during the Term, and said Base Salary shall
be the amount as set forth in Section 3.1
of this Agreement.
3.8 Car. The Company shall provide the Executive with one
Company or Xxxxx employee as a driver on a full-time basis, and a car of
similar quality and status as a Mercedes Benz, 4 door sedan, model 420SEL, or
successor model, as available in North America. Such services and car shall be
paid for or provided by the Company, directly or indirectly, by such method
deemed appropriate by the Compensation Committee.
3.9 Administrative Assistant. The Company shall provide as
necessary the services of a personal administrative assistant based in the
Company's offices, who is paid consistent with a clerical level Company
position to assist the Executive in personal finances, social functions and
other matters in order to enhance Executive's ability to focus on the Business
of the Company.
3.10 Reimbursement of Expenses. The Company shall reimburse the
Executive for all reasonable expenses incurred by the Executive in performing
his duties hereunder, including without limitation, expenditures for
entertainment, travel, lodging, and meals; provided, however, the Executive
shall submit to the Company verification of the nature and amount of such
expenses in accordance with Company policies and procedures as established from
time to time by the Compensation Committee, including audit, related to expense
reimbursement of employees.
3.11 Miscellaneous. The salary, compensation and benefits set
forth in this Section 3 shall not preclude or exclude the payment of any other
or additional compensation to the Executive by the Company (as determined by
the Compensation Committee of the Company) for serving as an officer, director,
Board committee member or in any other capacity for the Company to which he is
appointed or elected by the Board and which is not specifically covered by this
Agreement.
3.12 Repayment Upon Disallowance. Any salary, commission,
expense, reimbursement or other payment to the Executive by the Company
pursuant to this Section 3 which is disallowed in whole or in part as a
deductible expense to the Company for federal or state income tax purposes
shall be promptly repaid to the Company by the Executive to the full extent of
such disallowance, but without the payment by the Executive of any interest or
penalty incurred by the Company in connection with the disallowance of any such
payment as a deductible expense for the Company.
4. TERMINATION/EXTENSION.
4.1 Definition of "Cause." For purposes of this Agreement, Cause
shall mean: (i) felony conviction of the Executive in connection with his
employment, judgment against the Executive in a civil action brought by the
Company relating to fraud or diversion or conversion of Company assets by the
Executive, or other felony conviction of the Executive involving moral
turpitude; (ii) failure by the Executive to perform the duties of his
employment set forth in this
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Agreement or failure to follow lawful policies of the Company or lawful and
reasonable directives of the Board; or (iii) violation of Section 5, 6 or 7 of
this Agreement. The Executive shall be given sixty (60) days written notice by
the Board of an occurrence of a failure or violation of Section 4.1 (ii) or
(iii) and shall be provided an opportunity to cure, if possible, and/or to
cease and desist, as appropriate; provided, however, that if such failure or
violation (or a substantially related failure or violation) occurs more than
three (3) times during any six (6) month period, there shall be no further
notice.
4.2 Definition of "Total Disability." For the purposes of this
Section 4 only, "Total Disability" shall mean the Executive's disability
pursuant to the Company's Disability Plan for a period of at least one hundred
eighty (180) consecutive calendar days. Total Disability shall be deemed to
have occurred on the first (1st) day following said one hundred eighty (180)
calendar day period.
4.3 Termination Events.
The Term shall be terminated with respect to Executive's
employment as set forth below and only for the following reasons:
4.3.1 By mutual agreement of the Board and the Executive;
4.3.2 At the election of and by the Executive, upon a breach
of the Agreement by the Company;
4.3.3 At the election of and by the Board for Cause, as
defined in Section 4.1, with an opportunity to cure and/or cease and
desist, as appropriate, as provided by said Section 4.1;
4.3.4 Automatically three (3) full calendar years after the
Effective Time.
4.3.5 Automatically upon the Executive's death;
4.3.6 At the election of and by the Board upon the
Executive's Total Disability as defined in Section 4.2 of this
Agreement; or
4.3.7 In the event that, after the Effective Time, the
Executive is not re-elected to serve on the Board of Directors of the Company,
then Executive's title as Chairman shall cease and Executive shall for the
remainder of the Term be deemed an employee of the Company with such title,
responsibility and authority as may be delegated to him by the Board of
Directors; provided, however, that all other aspects of this Agreement shall
continue to be in effect in accordance with their terms.
4.4 Severance Payments Upon Termination Events. The Executive
shall receive no severance payment upon the occurrence of the termination of
the Executive's employment
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pursuant to Section 4.3; provided, however, in the event of termination in
accordance with Section 4.3.5, the Executive's estate shall receive an amount
equal to three-twelfths (3/12ths) of Executive's Base Salary.
5. RESTRICTIVE COVENANTS.
5.1 During the Term. During the Term, the Executive shall not,
either directly or indirectly, on his own behalf or as a partner, officer,
director, employee, consultant, agent or trustee of any person, firm,
corporation, partnership or other entity, engage in or be employed by any
business or enterprise which is the same as, or substantially the same as, the
Business of the Company ("Competing Business").
5.2 After the Term. For a period of eighteen (18) months after the
Term (the "Restricted Period"), the Executive shall keep, observe and abide by
each of the following separate covenants:
5.2.1 Except on behalf of the Company, the Executive shall
not, either directly or indirectly, on his own behalf or as a partner,
officer, director, employee, consultant, agent or trustee of any
person, firm, corporation, partnership or other entity, within the
Area, as defined in Section 5.3, engage in or be employed by or have
any interest in any business organization of whatever form engaged,
either directly or indirectly, in a Competing Business in a capacity
that requires him to perform services on behalf of such Competing
Business substantially similar to those performed by him on behalf of
the Company; provided, however, that the Executive may during the
Restricted Period interview and seek to make arrangements for such
employment, engagement or interest that commences after the Restricted
Period.
5.2.2 During the Restricted Period, except on behalf of the
Company, the Executive shall not, either directly or indirectly, on
his own behalf or in the service or on behalf of others, solicit,
divert or hire away, to any Competing Business or attempt to solicit,
divert or hire away, to any Competing Business any person or persons
employed by the Company as of the termination of the Term or within
the six (6) months preceding or subsequent to the termination of the
Term, whether or not such employee is a full-time employee or a
temporary employee of the Company, and whether or not such employment
is pursuant to a written contract with the Company or is for a
determined period or at will, until such employee has ceased his
employment with the Company for at least six (6) months.
5.3 Definition of "Area". The "Area" is defined as the
geographic territory included in a radius of fifty (50) miles from Xxxxx'
business location in Norcross, Georgia and the Company's business location in
Gaithersburg, Maryland.
5.4 No Prior Restrictions. The Executive affirms and represents
that he is under no obligation to any former employer or third party which is
inconsistent with, or which imposes any
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restriction upon, the continued employment of the Executive by the Company or
the Executive's undertakings under this Agreement.
5.5 Survival. The provisions of this Section 5 shall continue
after the Term as set forth herein and shall survive irrespective of the reason
the Executive's employment terminates.
6. OWNERSHIP, NON-DISCLOSURE AND NON-USE OF CONFIDENTIAL
INFORMATION.
6.1 Definition of Confidential Information. For purposes of this
Section 6, "Confidential Information" shall mean any and all data and
information relating to the Business of the Company (whether constituting a
trade secret or not), (i) which is or has been disclosed to the Executive, or
of which the Executive becomes aware as a consequence of or through his
employment relationship with the Company, or which was developed in whole or in
part by him during the term of his employment with the Company; and (ii) which
has value to the Company and is not generally known by its competitors.
Confidential Information shall not include any data or information (A) that has
been voluntarily disclosed to the public by the Company or has become generally
known to the public (except where such public disclosure has been made by the
Executive or another person or entity without authorization by the Company), or
(B) that has been independently developed and disclosed by parties other than
the Executive or the Company to the public generally or to the Executive
without breach of any obligation of confidentiality by any such parties running
directly or indirectly to the Company, or (C) that otherwise enters the public
domain through lawful means. Confidential Information may include, but is not
limited to, information relating to the Company's financial affairs (including
the Company's relationship with its investors and lenders), products,
processes, services, customers, employees, executives' compensation, research,
development, inventions, manufacturing, purchasing, accounting, engineering and
marketing.
6.2 Definition of Trade Secrets. For the purposes of this
Section 6, Trade Secrets shall mean, in addition to the information described
in the Georgia Trade Secrets Act, (i) any Invention, as defined herein, which
is being used or studied by the Company and is not described in a printed
patent, described in any literature already published and distributed
externally by the Company, and which is not readily ascertainable from
inspection of a product of the Company, (ii) any engineering, technical, or
product specifications including those of features to be used, or use of which
is contemplated, in a future product of the Company; and (iii) any machine,
process or method of manufacturing employed by the Company, whether patentable
or not, which is not generally known to competitors of the Company. Trade
Secrets shall not include any data or information (A) that has been voluntarily
disclosed to the public by the Company or has become generally known to the
public (except when such public disclosure has been made by Executive or
another person or entity without authorization by the Company), or (B) that has
been independently developed and disclosed by parties other than the Executive
or the Company to the public generally or to the Executive without a breach of
any obligation of non-disclosure by any such parties running directly or
indirectly to the Company, or (C) that otherwise enters the public domain
through lawful means.
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6.3 Ownership. The Executive acknowledges and agrees that all
Confidential Information and Trade Secrets, and all physical embodiments
thereof, are confidential to and are and shall remain the sole and exclusive
property of the Company, and that any of the Confidential Information or Trade
Secrets produced by him shall be considered proprietary to the Company. The
Executive agrees: (i) immediately to disclose solely to the Company all
Confidential Information and Trade Secrets developed in whole or in part by him
during the term of his employment with the Company; (ii) to assign to the
Company any right, title or interest he may have in such Confidential
Information and Trade Secrets, and (iii) at the request and expense of the
Company, to do all things and sign all documents or instruments reasonably
necessary in the opinion of the Company to eliminate any ambiguity as to the
ownership by and rights of the Company in such Confidential Information and
Trade Secrets including, without limitation, providing to the Company his full
cooperation in any litigation, unless between the Executive and the Company
after termination of Executive's employment, or other proceeding to establish,
protect or obtain such ownership and rights. Upon request by the Company, and
in any event upon termination of his employment with the Company for any
reason, the Executive shall promptly deliver to the Company all property
belonging to the Company, including, without limitation, all Confidential
Information and Trade Secrets (and all embodiments thereof) then in his
custody, control or possession.
6.4 Non-Disclosure. The Executive agrees that, during the term
of his employment by the Company and (i) at all times following the termination
of such employment for any reason whatsoever, with respect to Trade Secrets
under the Georgia Trade Secrets Act and (ii) during the Restricted Period with
respect to other Confidential Information, he will not use, disclose or make
available, directly or indirectly, any Confidential Information or Trade
Secrets to any person, concern or entity, except in the performance of his
duties and responsibilities hereunder or with the prior written consent of the
Company. The provisions of this Section 6 shall continue after the Term as
provided herein and shall survive irrespective of the reason the Executive's
employment terminates.
7. INVENTIONS AND TRADEMARKS.
7.1 Definition of Invention and Executive Invention.
7.1.1 For the purposes of this Section 7, Invention shall
mean any discovery, whether or not patentable, including, but not
limited to, any useful process, method, formula, technique, machine,
manufacture, composition of matter, algorithm or computer program, as
well as improvements thereto, which is new or which the Executive has
a reasonable basis to believe may be new.
7.1.2 For the purposes of this Section 7, Executive
Invention shall mean any Invention which is conceived by the Executive
or conceived by the Executive in a joint effort with others during the
Executive's employment by the Company which (i) may be reasonably
expected to be used in a current product of the Company, a projected
future product of the Company, or a product similar to a Company
product; (ii) results from
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work that the Executive has been assigned as part of his duties as an
employee, officer or director of the Company; (iii) is in an area of
technology which is the same or substantially related to the areas of
technology with which the Executive is involved in the performance of
the Executive's duties as an employee, officer or director of the
Company; (iv) is useful, or which may reasonably be expected to be
useful, in any manufacturing process, product design or internal
control system of the Company; or (v) is in an area of technology
which includes machinery or processes with which the Executive
normally works in performing his duties as an employee, officer or
director of the Company.
7.2 Property of the Company. The Executive hereby agrees that all
Executive Inventions shall become the property of the Company. The Company
makes no claim of rights to any Inventions of the Executive which are not
Executive Inventions, except to the extent that, by operation of law, the "shop
rights doctrine" provides the Company with any such rights.
7.3 Conception of Invention. The Executive hereby agrees that if
he conceives any Invention during his employment, for which there is a
reasonable basis to believe that the conceived Invention may be an Executive
Invention, the Executive will provide notice containing a written description
of the Invention to each Board member, adequate to allow evaluation thereof by
the Board for a determination of whether the Invention is an Executive
Invention. In the event of any dispute regarding such determination, the
dispute shall be resolved pursuant to Section 9 hereof.
7.4 Patent Registration. The Executive hereby agrees that should
the Company elect to file any application for patent protection either in the
United States or in any foreign country on an Executive Invention, the
Executive will execute all necessary papers and documents, including formal
assignments to the Company, relating to such patent application. The Executive
further agrees that he will cooperate with any attorneys or other persons
designated by the Company by explaining the nature of the Executive Invention,
reviewing applications and other papers, and providing any other assistance
reasonably required for the orderly prosecution of the patent applications.
7.5 Discontinuance of Use. On or after the termination of the
Term, the Executive may request that the Board approve the transfer or
assignment to the Executive of a (i) patent or an Executive invention which
existed during the Term but has not been practiced or used for a period of one
(1) year or more prior to the Executive's request therefor or (ii) trademark,
service xxxx or tradename which was owned by the Company during the Term but
has not been used for a period of one (1) year or more prior to the Executive's
request therefor. The Board shall make a determination with respect to such
transfer or assignment and the value thereof in its sole discretion.
7.6 Survival. The provisions of this Section 7 shall continue
after the Term as provided herein and shall survive irrespective of the reason
for the Executive's termination.
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8. BREACH OF COVENANTS BY EXECUTIVE.
The Executive agrees that the covenants and agreements contained in
Sections 5, 6 and 7 of this Agreement are of the essence of this Agreement and
that each of such covenants is reasonable and necessary to protect and preserve
the interests and properties of the Company and the Business of the Company.
The Executive further agrees that the Company is engaged in and through the
Area in the Business of the Company and that irreparable loss and damage will
be suffered by the Company should the Executive breach any of such covenants
and agreements. Each of such covenants and agreements is separate, distinct and
severable not only from the other of such covenants and agreements but also
from the other and remaining provisions of this Agreement and the
unenforceability of any such covenant or agreement shall not affect the
validity or enforceability of any other such covenants or agreements or any
other provision or provisions of this Agreement. The Executive acknowledges
that damages are inadequate for any breach of Sections 5, 6 or 7, and that the
Company shall, whether or not it is pursuing any potential remedies at law, be
entitled to equitable relief in the form of both temporary and permanent
injunctions to prevent a breach or contemplated breach by the Executive of any
of such covenants or agreements. The Executive shall further be liable for
damages, if any, resulting from any breach of such covenants and agreements.
9. RESOLUTION OF DISPUTES.
9.1 Resolution of Disputes and Mediation. Except for the matters
set forth in Sections 5, 6, and 7 hereof, any dispute between the parties
either with respect to the interpretation of any provision of this Agreement or
with respect to the performance by the Executive or by the Company hereunder
(the "Dispute") shall be resolved in accordance with this Section 9 as follows:
9.1.1 Upon the written request of either party hereto, each
of the parties shall appoint a designated representative, whose task
it shall be to meet for the purpose of endeavoring to resolve the
Dispute. The Company's designated representative shall be a member of
the Board excluding (i) the Executive and (ii) the Board member
selected by the Executive to be a Board member.
9.1.2 The designated representatives shall meet as often as
necessary to gather and furnish to the other all information with
respect to the Dispute which is appropriate and germane in connection
with its resolution.
9.1.3 Such representatives shall discuss the Dispute and
negotiate in good faith in an effort to resolve the Dispute without
the necessity of any formal proceeding relating thereto.
9.1.4 During the course of such negotiations all reasonable
requests made by one party to the other for non-privileged information
reasonably related to the Dispute, shall be honored in order that each
of the parties may be fully advised of the other's position.
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9.1.5 The specific format for such discussions shall be left
to the discretion of the designated representatives but may include
the preparation of agreed upon statements of fact or written
statements of position furnished to the other party.
9.2 Judicial Resolution. If the parties hereto are not able to
resolve the Dispute concerning this Agreement as set forth in Section 9.1 above
within sixty (60) calendar days, upon the initial written request as provided
in Section 9.1.1, then the parties shall have the option and right to resolve
such Dispute by judicial or other equitable resolution.
10. MISCELLANEOUS.
10.1 Key Man Insurance. The Executive agrees that during the
Term, the Company in its sole discretion may purchase in addition to those
specified in Section 3.9.1 insurance policies on the Executive's life with the
Company as the primary beneficiary, provided that all costs of such insurance
are paid by the Company.
10.2 Assignment. This Agreement may not be assigned by any party
hereto without the prior written agreement of the other party hereto.
10.3 Severability. If any provision of this Agreement shall be
held to be illegal, invalid or unenforceable, such provision shall be enforced
to the maximum extent permissible so as to effect the intent of the parties,
and the validity, legality and enforceability of the remaining provisions shall
not in any way be affected or impaired thereby.
10.4 Beneficiary. All of the terms and provisions of this
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective successors, heirs, executors,
administrators and permitted assigns.
10.5 Entire Agreement. This Agreement embodies the entire
agreement of the parties hereto relating to the subject matter hereof. This
Agreement supersedes all prior and contemporaneous agreements, understandings,
negotiations and discussions, written or oral, of the parties hereto, relating
to the subject matter of this Agreement. Nothing in this Agreement is intended
or shall confer upon or give any person other than the parties hereto any
rights or remedies under or by reason of this Agreement.
10.6 No Amendments. No amendments or modifications of this
Agreement shall be valid or binding upon the Company unless made in writing and
approved by the Board and signed by a Board member duly authorized by the Board
(other than a Board member designated by the Executive or the Executive), or
upon the Executive unless made in writing and signed by the Executive.
10.7 Waiver. The waiver by either party hereto of a breach by the
other party of any provision of this Agreement shall not operate or be
construed as a waiver of any subsequent breach of the same or any other
provision by the breaching party.
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10.8 Notices. Any notice required or permitted to be given
hereunder shall be in writing and delivered personally or by facsimile/telecopy
transmission. Any notice delivered personally shall be deemed given as of the
date of delivery. Notice given by facsimile/telecopy shall be evidenced by the
facsimile/telecopy verification confirming that the notice was satisfactorily
transmitted and received and shall be deemed given as of the date of
confirmation; provided, however, that its receipt shall be confirmed by
telephone and all notices sent by facsimile/telecopy transmission must be
thereafter transmitted to the party to be notified by an overnight express mail
delivery service within three (3) days of said facsimile/telecopy transmission.
AS TO THE COMPANY:
Xxxxx Communications Inc.
______ Peachtree Xxxxxxx Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Chief Executive Officer
Facsimile: (770) __________
AS TO EXECUTIVE:
Xxxxxx X. Xxxxx
Xxxxx Communications Inc.
_____ Peachtree Xxxxxxx Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxx 00000
Private Fax: (000) 000-0000
AS TO XXXXX:
Xxxxx Microcomputer Products, Inc.
_____ Peachtree Xxxxxxx Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Chief Executive Officer
Facsimile: (770) ____________
10.9 Headings. The enumeration and headings contained in this
Agreement are for convenience of reference only and are not intended to have
any substantive significance in interpreting this Agreement.
10.10 Number. Unless the context otherwise requires, whenever used
in this Agreement, the singular shall include the plural and the plural shall
include the singular.
10.11 Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Georgia.
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10.12 Counterparts. This Agreement may be executed in four (4)
counterparts and each of such counterparts, when duly executed, shall be deemed
an original document.
IN WITNESS WHEREOF, Xxxxxx X. Xxxxx, the Executive, and the
Company, acting by and through its duly authorized officers, have hereunto
executed, delivered and sealed this Agreement effective as of the Effective
Time.
EXECUTIVE:
(SEAL)
--------------------------------------
XXXXXX X. XXXXX
0000 Xxxxxxxxx Xxxxxxx Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxx 00000
Private Fax: (000) 000-0000
COMPANY:
ATTEST: XXXXX COMMUNICATIONS INC.
[CORPORATE SEAL] BY:
-----------------------------------------
Name:
------------------------------------
Title:
------------------------- -----------------------------------
Secretary
The undersigned Xxxxx Microcomputer Products, Inc.,is made a
signatory hereto for the sole purpose of terminating the Employment Agreement
dated April 16, 1996, pursuant to paragraph 2 of this Agreement.
XXXXX MICROCOMPUTER PRODUCTS, INC.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
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SCHEDULE 3.8 TO EMPLOYMENT AGREEMENT
LIFE INSURANCE POLICIES
Policy Number
& Company Policy Date Policy Owner Beneficiary
------------- ----------- ------------ -----------
1. Amer. United Life 04/18/84 Company Company
#0-000-0000
2. Amer. United Life 08/18/86 Executive Estate of Executive
#0-000-0000
3. Amer. United Life 04/18/84 Company Company
#0-000-000
4. Confederation Life 06/28/92 Company Estate of Executive
# 542 0411
5. Security Life 07/08/92 Company Estate of Executive
# 001045302
