Exhibit 10.14
Severance Agreement dated April 29, 2004 between IEC Electronics Corp. and
Xxxxxxx X. Xxxxxxxx
April 29, 2004
Xxxx X. Xxxxxxxx
Xx. #0, Xxx 000 X
Xxxxxxx, XX 00000
Dear Xxxx:
This Letter will summarize the agreement between you and IEC Electronics
Corp. (the "COMPANY") with respect to all issues relating to your cessation of
employment with the Company:
1. The parties agree that your employment and all positions and offices
with the Company terminated on April 12, 2004 ("EMPLOYMENT TERMINATION
DATE").
2. The Company will pay or provide to you the following benefits:
(a) Severance payments in an aggregate amount of $80,307.69, less
applicable deductions for Federal and State income tax withholdings,
FICA and Medicare Tax, will be paid to you by the Company in
twenty-nine (29) equal weekly installments commencing on April 30,
2004 with the last installment to be paid on November 12, 2004.
(b) You will continue to be provided with health insurance at Company
expense through April 30, 2005.
(c) The Company will transfer to you the life insurance policy, in the
face amount of $1,000,000, which is written through Xxxxxxx Penn,
policy number 0000430167 which the Company owns on your life. You
will be responsible for the payment of any future premiums on said
policy after June 13, 2004. Effective with the employment
termination date, the Company shall have no claim on the proceeds
from this policy. One hundred percent of the $1,000,000 will go to
the beneficiary you previously named. The policy will be changed by
the Company to reflect this.
(d) Except as specifically provided in this Letter, all your employee
benefits will be discontinued as of the Employment Termination Date
and you will not be entitled to any other compensation, bonuses or
benefits.
3. (a) The Company will direct the Transfer Agent to remove all restrictive
legends currently on your stock certificate for 50,000 shares, which
shares you acquired upon the exercise of a stock option on March 11,
2004.
(b) You currently hold the following incentive stock options which were
vested in the amounts set forth as of the Employment Termination
Date and which you have indicated your intent to exercise:
page 38 of 46
-1-
-------------------------------------------------------------
DATE OF GRANT NO. OF SHARES EXERCISE PRICE
-------------------------------------------------------------
7/18/02 50,000 $0.07
-------------------------------------------------------------
9/10/01 5,000 $0.52
-------------------------------------------------------------
By their terms, these options will expire three (3) months
after the Employment Termination Date.
The Company agrees that upon your exercise of these options it will
not place any restrictive legends on the certificates for these
shares.
(c) You also hold an incentive stock option for 60,000 shares granted on
March 19, 2001, at an exercise price of $1.31 per share, of which
47,500 shares were vested as of the Employment Termination Date.
You agree that you will not exercise this option. In lieu thereof,
the Company will make a $60,000 loan to you, immediately after the
execution of this agreement, for you to purchase shares in the open
market on or prior to May 31, 2004. These shares may be purchased in
one block or in partial amounts. The loan will extend for a period
of three years from the date of this agreement, or the earlier sale
of said shares, and will be evidenced by a promissory note secured
solely by these shares. The note will bear interest at 5% per annum
which will be payable annually. The note will be secured solely by a
pledge of the shares purchased with the proceeds of the loan, which
shall be deposited with the Company. Said shares shall be free of
restrictions and saleable upon your request.
4. You acknowledge and agree that the Confidentiality provisions in your
March 22, 2001 Non-Disclosure Agreement continue to remain in full force
and effect.
5. (a) You agree that the terms set forth in this Letter are in full
satisfaction of all obligations the Company has to you. You hereby
irrevocably and unconditionally release the Company, its officers, and
directors from any and all claims, demands and liabilities whatsoever.
In exchange for the benefits being accorded to you under this Letter, it
is your intent to provide to the Company the broadest release of claims
and liabilities that may be provided by law.
(b) The Company agrees that this Letter shall be in complete and final
settlement of and releases you, from any claims, which the Company
has against you in any way related to or arising out of your
employment and its termination.
6. You agree that you will not criticize, denigrate or disparage the
Company, its officers, directors or employees, or otherwise engage in
any conduct, which directly or indirectly, impugns or reflects
negatively on the reputation or integrity of the Company.
7. The Company will provide you a mutually agreed upon letter of
recommendation.
8. The Company and the employee agree that the official reason for
resignation from IEC is early retirement.
Page 39 of 46
-2-
9. As further consideration for the benefits provided in this Letter and in
light of the special and unique services that you have furnished to the
Company, and the confidential information that has been disclosed to you
by the Company during your relationship with the Company, you agree that
for a period of two (2) years from the Employment Termination Date (the
"NON-COMPETITION PERIOD"), you will not, without the written consent of
the Company directly or indirectly, whether as an officer, director,
consultant, employee, partner, stockholder or in any other capacity
engage in, or assist another to engage in, any work or activity with
Nu-Vision, MC Assemble, Ansen or any of their related EMS companies. In
addition, during the Non-Competition Period, you will not, directly or
indirectly, (a) induce or attempt to induce any employee of the Company
to leave the employ of the Company, or in any way interfere with the
relationship between the Company and any employee, or manufacturer's
representative thereof, or (b) hire directly or through another entity
any person who was an employee or manufacturer's representative of the
Company on the Employment Termination Date or (c) solicit, induce or
attempt to induce any customer listed on Exhibit A as an "Existing
Customer" or as a "New Prospect" to cease doing business with the
Company, or in any way interfere with the relationship between any such
customer and the Company.
This Letter contains the entire agreement between the parties with
respect to all issues relating to the termination of your employment with the
Company.
If this Letter accurately reflects our agreement, please so indicate by
executing a copy of this Letter as indicated below and returning the same to
Xxxx XxXxx on or before Monday, May 3, 2004.
Sincerely yours,
IEC Electronics Corp.
By: /s/ Xxxxx X. Xxxx
-----------------------
Xxxxx X. Xxxx
Director
ACKNOWLEDGED AND AGREED
/s/ Xxxx X. Xxxxxxxx
--------------------
Xxxx X. Xxxxxxxx
Date: April 29, 2004
Page 40 of 46
-3-
EXHIBIT A
NON-COMPETE CUSTOMER LISTING
EXISTING CUSTOMERS
ACUMENTRICS
AMIRIX SYSTEMS
BEACON POWER
CONCERTO
ECHOBURST
EXCEL SWITCHING
FILTRONICS
FLOWSERVE
GE TRANSPORTATION
INFICON
KULICKE & XXXXX
LUCENT
MANGROVE
OASIS DESIGN
PLUG POWER
SIONEX
SPECTRACOM
TEREADYNE US
TEREADYNE UK
UPS SECURITY
VIASAT
VJ ELECTRONIX
NEW PROSPECTS
MATROX
BP MICROSYSTEMS
AEROFLEX
XXXXX
BATTELLE
TREK
AVID
GM FUEL CELL
INFICON
ASML
ADVANCED ENERGY CONVERSION
MOOG
COMPTECH PST
MARINE ELECTRIC
S2 SECURITY
TITAN
Page 41 of 46
-4-
