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EXHIBIT 10.14
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (this "Agreement") is entered into
by and between Xxxxx Communications Inc., formerly known as Access Beyond, Inc.
(the "Company") and Xxxxxx X. Xxxxxx (the "Executive") on this 29th day of
July, 1997.
For and in consideration of the employment or continued employment, as
the case may be, of the Executive by the Company, the mutual covenants and
promises contained herein, and in the Terms and Conditions of Employment
attached hereto as Exhibit "A," and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Executive hereby covenant and agree as follows:
1. Employment; Duties. Company hereby employs Executive as Vice
Chairman of the Board of Directors and Chief Executive Officer on the terms and
conditions set forth herein and Executive accepts such employment. Executive
shall report as designated by the Board of Directors of the Company and shall
have those duties and responsibilities normally undertaken by the Chief
Executive Officer of a public company, as such are determined from time to time
by the Board of Directors of the Company. At any time after the first
anniversary of the Effective Date of the Merger, at the election of either the
Board or the Executive, Executive shall cease to be employed as the Chief
Executive Officer of the Company and shall thereafter be employed by the
Company as a consultant with the such duties as may be mutually agreed to
between the Executive and the Board of Directors. Executive shall serve as a
member of and participate on the Senior Management Committee consisting of the
Chairman, Vice Chairman and the President, to be established by the Board of
Directors of the Company subject to guidelines established by the Board, 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. The Company agrees that Executive will not be required to relocate
to the Atlanta area; provided that Executive agrees that he will spend as much
time at the Company's headquarters as reasonably determined by the Board of
Directors of the Company to be necessary for Executive to perform his duties.
Any costs associated with Executive's travel to and from the Company's
headquarters, together with any expense associated with Executive's lodging
while at the Company's headquarters, shall be borne by the Company or
reimbursed to Executive, as the case may be, provided that the incurrence and
reimbursement of such costs and expenses must be in accordance with the
Company's policies.
2. Compensation.
(a) Base Salary. Whether employed as Vice Chairman of
the Board of Directors and Chief Executive Officer or as consultant,
Executive's initial base salary shall be $280,000.00 per year and
shall be reviewed and subject to increase but not decrease in the
discretion of the Board on an annual basis for the Term hereof. The
Executive's salary shall not be less than that of the President of the
Company during the first year of the Term hereof.
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(b) Bonus. In addition, Executive shall be eligible for
aggregate bonuses equal to an amount calculated by dividing
Executive's base salary by fifty-nine and four tenths percent (59.4%)
and subtracting from the result so obtained the amount of Executive's
base salary. The amount obtained by such calculation is herein
referred to as the "Bonus Amount".
(i) The Executive shall be eligible for a
Personal Incentive Bonus in the maximum
amount of the product of thirty percent
(30%) multiplied times the remaining sum,
if any, resulting from subtracting
$50,000.00 from the Bonus Amount, and based
on attaining personal goals in respect to
his duties on behalf of the Company as such
goals may be established by the
Compensation Committee of the Company.
(ii) Executive shall be eligible for a Corporate
Incentive Bonus in the maximum amount of
the sum of (x) $50,000.00 plus (y) the
product of seventy percent (70%) multiplied
times the remaining sum, if any, resulting
from subtracting $50,000.00 from the Bonus
Amount, based on the Company's attaining
such goals, objectives and benchmarks as
may be set by the Board of the Company.
3. Stock Option Plan. The Company shall award to Executive each
year during the Term hereof, stock options to purchase 150,000 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.
(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.
(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
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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, 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 hereof by the Company, then all unvested Options awarded
through such termination date shall vest immediately upon such
termination.
(g) "Change of Control," for purposes of this Section 3,
means (i) 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), (ii) a sale of all or substantially all
of the assets of the Company, (iii) 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 who were not shareholders of the Company immediately
prior to such transaction, or (iv) if during any period of two (2)
consecutive years or less there shall cease to be a majority of the
Board comprised of "Continuing Directors", defined as individuals who
constitute the Board as of the date of this Employment Agreement and
any new director(s) whose election by such Board or nomination for
election by Employer"s stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then in office who either were
directors as of the date of this Employment Agreement or whose
election or nomination for election was previously approved.
4. Term. The term of the Executive's employment hereunder is
conditioned upon the occurrence of, and shall commence on, the Effective Time
under the Agreement and Plan of Reorganization between Xxxxx Microcomputer
Products, Inc. and Access Beyond, Inc. (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
Employment Agreement dated November 18, 1996 between Access Beyond, Inc. and
Executive is hereby terminated effective as of the Effective Time.
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5. Benefits. Executive shall be afforded the same benefits and
perquisites as shall be made generally available to the other senior executive
officers of the Company. It is expressly agreed that the Company shall continue
to pay the premiums on the life insurance policy that has heretofore been paid
by the Company immediately prior to the Effective Time.
6. Termination and Severance. This Agreement may be terminated
by Company with Cause as defined in the Terms and Conditions of Employment
attached hereto as Exhibit "A". In the event that Company or the Chairman of
the Board terminates Executive's employment for Cause, or Executive voluntarily
terminates employment other than due to breach hereof by the Company, or the
Term expires, the Company shall not be obligated to pay any salary or other
Compensation to Executive after the effective date of termination. Executive
agrees to provide Company with at least six (6) weeks advance written notice
prior to voluntary termination or resignation by Executive.
7. Dispute Resolution.
7.1 Resolution of Disputes and Mediation. Except for the matters
set forth in Sections 2, 3, and 5 of Exhibit "A" hereto, 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 7
as follows:
7.1.1 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.
7.1.2 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.
7.1.3 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.
7.1.4 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.
7.1.5 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.
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7.2 Judicial Resolution. If the parties hereto are not able to
resolve the Dispute concerning this Agreement as set forth in Section 7.1 above
within sixty (60) calendar days, upon the initial written request as provided
in Section 7.1.1, then the parties shall have the option and right to resolve
such Dispute by judicial or other equitable resolution.
8. 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.
9. 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.
10. Repayment Upon Disallowance. Any salary, commission,
expense, reimbursement or other payment to the Executive by the Company
pursuant to Section 9 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.
11. Terms and Conditions. Executive acknowledges that this
Agreement, and his employment obligations hereunder, expressly include the
provisions set forth in the Terms and Conditions of Employment attached hereto
as Exhibit "A", which are incorporated herein by this reference thereto. This
Agreement shall supersede any prior employment agreement, and any restrictive
covenants, previously entered into by Executive with the Company.
IN WITNESS WHEREOF, the parties hereto have set their hands and seals
on the date and year first above written.
EXECUTIVE: COMPANY:
(SEAL) By: (SEAL)
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Xxxxxx X. Xxxxxx Xxxxxx X. Xxxxx, Chairman
[TERMS AND CONDITIONS OF EMPLOYMENT ON FOLLOWING PAGES]
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EXHIBIT "A"
TERMS AND CONDITIONS OF EMPLOYMENT
1. Duties and Responsibilities. Executive shall devote his full
business time and best efforts to the duties and responsibilities assigned by
the Company in accordance with the provisions hereof and shall abide by this
Agreement and the Company's Operations Policies. Notwithstanding the foregoing,
nothing in this Agreement shall be deemed to prohibit the Executive from
serving on boards of directors or from consulting with charitable or other
organizations on non-Company time, so long as such organization is not in
competition with the Company and does not interfere with Executive's
performance of his duties on behalf of the Company. Executive's specific job
description and responsibilities include, but are not limited to, those
described in Section 1 of this Agreement.
2. Confidential Information, Trade Secrets. Executive shall not
use or disclose to any person or entity any Confidential Information or trade
secrets of Company other than as necessary in the fulfillment of this Agreement
in the course of employment. This paragraph shall be effective during the term
hereof and for a period of two (2) years after termination of employment,
whether with or without Cause.
3. Inventions. The Company and Executive acknowledge that in
the course of Executive's employment by the Company, Executive may from time to
time develop or participate in the development of software or technology. All
works or inventions conceived, originated, authored, or discovered, in whole or
in part, by Executive, which result from any work performed for the Company or
related to or useful in the business of the Company are and shall be the
exclusive property of the Company. Executive shall cooperate with the Company
in the protection of the Company's copyrights, patents, and other proprietary
rights therein and, to the extent deemed desirable by the Company, in the
registration of the same. Executive hereby assigns to the Company all of
Executive's right, title and interest in and to any and all inventions,
processes, systems and creations, whether or not patentable or copyrightable,
that Executive may conceive, develop, or create, in whole or in part, during
his employment with the Company, whether or not during normal working hours.
Executive shall sign and deliver all documents relative to said inventions
requested by the Company for the purpose of confirming the Company's title
thereto.
4. Company Property. Upon request of the Company, and without
request promptly on termination of this Agreement or Executive's employment
hereunder, Executive shall deliver all Company Property in Executive's
possession or control to the Company. Executive acknowledges and agrees that
title to all Company Property is vested in the Company, and Executive shall not
retain any such property or any copies thereof in any form, including magnetic
or electronic form.
5. Protective Covenants. Executive is and will during the
course of employment become intimately familiar with Confidential Information,
trade secrets, facilities and services, and other property of the Company, and
the protection of the Company requires that all such property and information
must remain the sole and private property of the Company to be used only for
the Company's benefit, not to be disclosed to any other party or used by
Executive
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against Company. Accordingly, Executive does hereby warrant, represent,
covenant and agree, as follows:
(i) Covenant Not to Compete. Executive agrees that, for a
period of eighteen (18) months from the termination of his
employment with Company, whether with or without Cause, he
shall not, directly or indirectly, on behalf of himself or
any other person or entity, compete with the Company within a
fifty (50) mile radius of the Company's principal place of
business in Norcross, Georgia, or its principal place of
business in Gaithersburg, Maryland, by engaging in the
manufacture, assembling, or selling of computer component
products, software, or systems, including modems, competitive
with those manufactured, assembled, or sold by the Company,
in a capacity which requires Executive to perform services
substantially identical to the services performed by
Executive on behalf of Company.
(ii) Covenant Not to Solicit Customers. During the term of
Executive's employment hereunder, and for a period of
eighteen (18) months following the termination of such
employment for any reason whatsoever, Executive shall not
(except on behalf of or with the prior written consent of
Company), either directly or indirectly, on Executive's own
behalf or on behalf of others, solicit, divert, or
appropriate any business for the manufacture, assembling, or
sale of computer component products, software or systems,
including modems, competitive with those manufactured,
assembled or sold by the Company, from any customer or
actively sought prospective customer of the Company to whom
the Company offered or provided products or services, and
with whom Executive had material contact at any time during
the twenty-four (24) months preceding the termination of
Executive's employment.
(iii) Covenant Not to Solicit Employees. During the term of
Executive's employment hereunder, and for a period of
eighteen (18) months following the termination of such
employment for any reason whatsoever, Executive shall not
employ or solicit the employment of any employee of the
Company who was an employee of the Company at any time during
the six (6) months preceding the termination of Executive's
employment with the Company, for the purpose of causing such
employee to take employment with Executive or a competitor of
the Company.
Executive agrees and acknowledges that the restrictions in
this Agreement are not vague, over broad or indefinite, and are reasonable and
designed to protect the legitimate business interests of the Company. In
addition to any other remedies which Company may have under the law for breach
of any or all of said covenants, Company shall be entitled to injunctive and/or
other equitable relief against Executive for any violation of any of said
Covenants.
6. Survival. Paragraphs 2, 3, 4, 5, and 6 hereof, together with
any provisions of the Company's Operations Policies expressly or by necessary
implication applicable after the termination of employment, shall survive
termination of this Agreement. Upon termination, Executive shall repay to
Company immediately any advances by Company, not offset by earnings or other
credits due him or her, even if not expressly made repayable at the time of
such advance, it being the intent of the parties that all such advances shall
be repayable as provided by this
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paragraph. Company may offset any sums owed to Company by Executive against any
amounts otherwise owed by Company to Executive. No sums otherwise due Executive
at termination shall be payable to Executive if, at the time of termination or
thereafter, Executive shall be in violation of any term or provision of this
Agreement.
7. Entire Agreement. This Agreement contains the entire
understanding and agreement between the parties, and all promises,
representations, warranties or inducements made by either party to the other,
including any prior employment agreement or restrictive covenants, not
specifically made in writing or made a part hereof by reference, are expressly
superseded and shall have no force or effect. This Agreement may not be
modified except in a writing signed by both parties hereto.
8. Severability. If any provision of this Agreement (including
any subparts of any paragraph) is invalid or unenforceable by any rule of law
or public policy, this Agreement shall be construed so as to delete herefrom
the invalid or unenforceable covenant or provision. To the extent that any
provision is invalid or unenforceable that may be valid or enforceable by
limitation thereof, then such provision shall be enforceable to the fullest
extent permitted under the law of the jurisdiction in which enforcement is
sought. If any particular provision is held to be invalid, illegal or
unenforceable, all other covenants, terms, conditions and provisions hereof
shall be and remain in full force and effect.
9. Binding Effect. This Agreement shall be binding upon, and
shall inure to the benefit of, each respective party's heirs, successors, legal
representatives, executors and assigns. This Agreement shall be construed and
governed in accordance with the laws of the State of Georgia.
10. Definitions. Any word used in this Agreement which is
defined in this paragraph shall have the meaning set forth below:
(a) "Agreement." The Executive Employment Agreement,
together with the Terms and Conditions of Employment and any documents
incorporated therein by reference. In the event of any inconsistency between
the Agreement and any Operations Policies, the Agreement shall control.
(b) Cause. The term "Cause" as used in the within and
foregoing Agreement shall mean (i) Executive's breach of a material covenant or
obligation of this Agreement, including any of the Terms and Conditions of
Employment, or any failure or refusal by Executive to perform Executive's
duties hereunder to the reasonable satisfaction of the Board of Directors, or
to comply with any lawful directive of the Board of Directors consistent with
the provisions of this Agreement, if, after receiving written notice of such
breach, failure or refusal to perform, Executive does not cure or correct such
breach, failure or refusal or cease and desist from such breach if incapable of
being cured, within fifteen (15) business days after Executive's receipt of
such notice; and (ii) conviction of a crime involving any act of Executive in
the course of Executive's employment that constitutes larceny, fraud or moral
turpitude, or (iii) failure to maintain the confidentiality of the Confidential
Information and trade secrets of Company.
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(c) "Company." Xxxxx Microcomputer Products, Inc., and
any successor or assignee hereof.
(d) "Company Property." All property, without
limitation, whether real, personal, tangible or intangible, including all
inventions, confidential information, trade secrets, facilities, trade names,
logos, patents and all tangible materials and supplies (whether originals or
duplicates and including, but not in any way limited to, sample products, video
tape cassettes, film, catalogues, price lists, rate sheets, outstanding
quotations, books, records, manuals, sales presentation literature, training
materials, calling or business cards, customer record cards, customer files,
customer names, addresses and telephone numbers, supplier information,
contacts, pricing and practices, strategic partner information, files and
records, current or prospective business plans, Operations Policies,
directives, correspondence, documents, contracts, orders, messages, memoranda,
notes, circulars, agreements, bulletins, invoices and receipts, and sources of
financing), which in any way pertain to Company's business, whether or not
furnished to Executive by Company and whether or not prepared, compiled, or
acquired by Executive while employed by Company, are the sole property of
Company.
(e) "Compensation." Any and all payments, remuneration
and benefits, provided to Executive by the Company, regardless of the form
thereof. Such compensation as is paid to Executive shall be conclusively deemed
legally sufficient consideration for this Agreement.
(f) "Confidential Information." All confidential
information regarding the Company's business, including but not limited to its
methods of operation, products, software programs, equipment and techniques,
existing and contemplated facilities and services, inventions, systems, devices
(whether or not patentable), financial information and practices, plans,
pricing, selling techniques, names, addresses and phone numbers of the
Company's Customers and prospective Customers and suppliers and prospective
suppliers, credit information and financial data of the Company and the
Company's Customers and prospective customers and suppliers and prospective
suppliers, particular business requirements of the Company's Customers, and
special methods and processes involved in designing, producing and selling
Company's facilities and services, current and prospective business plans,
strategic partner information, files and records, and the terms of this
Agreement, all shall be deemed Confidential Information and the Company's
exclusive property. The parties agree that Confidential Information shall be
deemed to be trade secrets under the Georgia Trade Secrets Act. Confidential
Information shall not include information that is in the public domain or
otherwise readily accessible to members of the public.
(g) "Customer." Each person, corporation, firm,
partnership or other entity whatsoever, which has purchased or shall purchase
the Company's products, facilities or services.
(h) "Executive." The person signing this Agreement as
Executive, regardless of any title or duties which may now or hereafter be
assigned to such person by the Company. This Agreement shall govern the
employment relationship in any and all such situations.
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(i) "Inventions." Any and all devices, systems,
software and other programs, processes, products, patents and any other
creation (all of the foregoing, for purposes of this paragraph, called
"inventions") identical or similar to or relating to devices, processes,
systems, products or services utilized and/or offered by the Company.
(j) "Operations Policies." All written procedures,
policies, instructions from Company's officers, directors or managers, the
Company Employee Manual (if any), and all other written communications from the
Company to Executive individually, not inconsistent with Executive's duties
hereunder, or to all Company's employees. Said Operations Policies are hereby
incorporated herein and expressly made a part of this Agreement by this
reference thereto.
(k) "Termination." Cessation of this Agreement or the
underlying employment relationship, whether by action of the Executive or
Company, and whether voluntary or involuntary. Termination hereby may be with
or without Cause.
(l) "Terms and Conditions of Employment." This document
entitled Terms and Conditions of Employment, which is Exhibit "A" to the
Executive Employment Agreement, and all of the provisions hereof.
PLEASE INITIAL:
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Executive
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