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EXHIBIT 10.1.17
[TELXON LOGO]
December 29, 1997
Xxxxxx X. Xxxxxxx, Esq.
XXXXXXX XXXXX XXXXXX LLP
000 Xxxxxxxx Xxxxx, 00xx Xxxxx
Xxxxxxxxx, XX 00000-0000
Re: Consulting Agreement
Dear Xx. Xxxxxxx:
Telxon Corporation (the "Company") considers it essential to the best
interests of the Company that the Company continue to have your advice available
to it on an advisory basis. In order to induce you to act as a consultant to the
Company, the Company has offered, and you have accepted, the compensation set
forth in this letter agreement (the "Agreement").
1. Services to be Provided. You agree to perform such consulting
services as the Company may reasonably require from time to time during the
Term, which consulting services shall consist of advising management of the
Company with respect to legal matters relating to the Company's business. The
Company acknowledges and accepts that you may provide consulting and other
services to other companies in addition to the consulting services provided
hereunder and, accordingly, the Company agrees that you shall not be restricted
in any manner whatsoever by this Agreement from providing services to any other
person or entity and that the agreements set forth herein are entered into upon
a non-exclusive basis.
2. Compensation. You shall be paid consulting fees at the rate of
$150,000 per annum, payable in arrears on the last day of each month (the total
amount of such payments over the course of the Term being hereinafter referred
to as the "Consulting Payments"). The Company shall promptly reimburse you for
all reasonable expenses incurred by you in performing services pursuant to the
terms hereof during the Term, provided that you properly account therefor in
accordance with Company policies as in effect from time to time and of which you
are made aware.
3. Term. The term of this Agreement (the "Term") shall commence on the
earliest of (a) the date on which you withdraw from your current law firm,
Xxxxxxx Xxxxx Xxxxxx (the "Firm") (other than by reason of death or Disability
(as determined below)), (b) the date on which
Telxon Corporation
0000 Xxxx Xxxxxx Xxxxxx/P.O. Box 5582/Akron, Ohio 44334-0582
(000) 000-0000/000-000-0000/Fax (000) 000-0000
Telxon's World Wide Web site address is: xxxx://xxx.xxxxxx.xxx
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Xxxxxx X. Xxxxxxx, Esq. [TELXON LOGO]
XXXXXXX XXXXX XXXXXX LLP
December 29, 1997
Page -2-
you become of counsel to the Firm or (c) the date on which the Firm ceases to be
the Company's primary outside counsel (such earliest date being hereinafter
referred to as the "Effective Date"), and shall expire on the tenth anniversary
of the Effective Date, unless sooner terminated pursuant to the provisions of
this Agreement. Should you withdraw from the Firm by reason of death or
Disability or should a Change in Control (as hereinafter defined) occur prior to
the commencement of the Term, this Agreement shall be null and void and of no
force and effect. For purposes of this Section 3, whether or not you have
withdrawn from the Firm by reason of Disability shall be determined in
accordance with the applicable plans, policies and agreements maintained by the
Firm.
4. Termination. (a) Good Reason. You may terminate this Agreement for
"Good Reason," which shall mean a material breach of this Agreement by the
Company which is not cured within ten (10) business days of receipt by the
Company of written notice from you of such breach. If this Agreement is
terminated for Good Reason, you shall be entitled to receive, within ten (10)
days following such termination, a lump sum cash payment equal to that portion
of the Consulting Payments which otherwise would be payable over the remainder
of the original ten-year term.
(b) Cause. The Company may terminate this Agreement for
"Cause," which shall mean a material breach of this Agreement by you which is
not cured within ten (10) business days of receipt by you of written notice
from the Company of such breach. If this Agreement terminates for Cause, you
shall not be entitled to any further compensation under this Agreement.
(c) Death, Disability. This Agreement shall terminate upon
your death or Disability during the Term. For purposes of this Section 4,
Disability shall mean that as a result of your incapacity due to physical or
mental illness, which incapacity is likely to be permanent in nature, you shall
be unable to perform services for the Company as contemplated hereunder. If this
Agreement terminates by reason of your death or Disability, you (or your legal
representative, as applicable) shall be entitled to receive, within ten (10)
days following such termination, a lump sum cash payment equal to that portion
of the Consulting Payments which otherwise would be payable over the remainder
of the original ten-year term.
(d) Change in Control. This Agreement shall terminate upon the
occurrence during the Term of a Change in Control. If this Agreement terminates
by reason of the occurrence of a Change in Control, you shall be entitled to
receive, within ten (10) days following such termination, a lump sum cash
payment equal to that portion of the Consulting Payments which otherwise would
be payable over the remainder of the original ten-year term.
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Xxxxxx X. Xxxxxxx, Esq. [TELXON LOGO]
XXXXXXX XXXXX XXXXXX LLP
December 29, 1997
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For purposes of this Agreement, a "Change in Control" shall be deemed
to have occurred if the event set forth in any one of the following paragraphs
shall have occurred:
(i) the acquisition, directly or indirectly, of at
least 30% of the outstanding common stock of, or voting power in, the
Company calculated on a fully diluted basis;
(ii) a merger or consolidation of the Company with
any company other than one in which the Company then owns at least a
majority of the outstanding common stock or voting power;
(iii) a sale (whether in one or a series of
transactions) of all or substantially all of the assets of the
Company;
(iv) any recapitalization, restructuring or
liquidation of the Company; or
(v) events, during any period of two consecutive
years, as a result of which individuals who at the beginning of any
such period constitute the Directors of the Company cease for any
reason to constitute at least a majority thereof, provided, however,
that for purposes of this clause (v) each director who is first
appointed or elected by the Board or whose nomination for election by
the Company's stockholders was approved or recommended by a vote of at
least two-thirds (2/3) of the directors then still in office who either
were directors on the date hereof or whose appointment, election or
nomination was previously so approved or recommended will be deemed to
have been a Director of the Company at the beginning of such period.
5. Confidential Information. During the Term and at all times
thereafter, you shall not, without the prior written consent of the Company
(except as may be required in connection with any judicial or administrative
proceeding or inquiry) disclose to any person, other than an officer or director
of the Company or a person to whom disclosure is reasonably necessary or
appropriate in connection with the performance of your duties hereunder, any
material confidential information obtained by you while consulting with the
Company or otherwise with respect to its business, assets or operations,
including, but not limited to, material confidential information relating to the
properties, accounts, books, records, supplies, trade secrets and contracts of
the Company.
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Xxxxxx X. Xxxxxxx, Esq. [TELXON LOGO]
XXXXXXX XXXXX XXXXXX LLP
December 29, 1997
Page -4-
6. Return of Documents. Upon termination of your consultancy for any
reason, you agree to return all documents and other property provided to you or
prepared by you during your consultancy with the Company.
7. Consultant's Independence and Discretion.
(a) Nothing herein contained shall be construed to constitute
the parties hereto as partners or as joint venturers, or either as agent of the
other, or as employer and employee. By virtue of the relationship described
herein, your relationship to the Company during the Term of this Agreement shall
only be that of an independent contractor and you shall perform all services
pursuant to this Agreement as an independent contractor. You shall not provide
any services under the Company's business name and shall not present yourself as
an employee of the Company.
(b) Subject only to such specific limitations as are contained
in this Agreement, the manner, means, details or methods by which you perform
your obligations under this Agreement shall be solely within your discretion.
The Company shall not have the authority to, nor shall it, supervise, direct or
control the manner, means, details or methods utilized by you to perform your
obligations under this Agreement and nothing in this Agreement shall be
construed to grant the Company any such authority.
(c) The Company shall have no responsibility to you to
withhold, and does not intend to withhold, any amounts from payments advanced to
you on account of withholding taxes or other employment taxes.
8. Disputes; Legal Expenses. Any controversy or claim arising out of or
relating to this Agreement, or any breach hereof, shall be settled by submitting
the mater to binding arbitration in Cleveland, Ohio by and pursuant to the
rules of the American Arbitration Association then in effect. The determination
of the arbitrator shall be conclusive and binding on the Company and you, and
judgment may be entered on the arbitrator's award in any court of competent
jurisdiction. The Company shall pay to you all legal fees and expenses incurred
by you in disputing in good faith any issue hereunder relating to the
termination of your service or any benefit or right provided by this Agreement.
Such payments shall be made within five (5) business days after delivery of your
written request for payment accompanied by such evidence of fees and expenses
incurred as the Company reasonably may require.
9. Notice. For the purpose of this Agreement, notice and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given
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Xxxxxx X. Xxxxxxx, Esq. [TELXON LOGO]
XXXXXXX XXXXX XXXXXX LLP
December 29, 1997
Page -5-
when delivered or mailed by United States registered mail, return receipt
requested, postage prepaid, addressed to the respective addresses set forth on
the first page of this Agreement, provided that all notices to the Company shall
be directed to the Secretary of the Company, or to such other address as either
party may have furnished to the other in writing in accordance herewith, except
that notice of change of address shall be effective only upon receipt.
10. Miscellaneous. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge shall be
agreed to in writing and signed by you and by a duly authorized officer of the
Company. No waiver by either party hereto at any time of any breach by the other
party hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement. All descriptive
headings in this Agreement are inserted for convenience only and shall be
disregarded in construing or applying any provision of this Agreement. The
validity, interpretation, construction and performance of this Agreement shall
be governed by the laws of the State of Delaware. The obligations under Sections
2, 4, 5 and 6 shall survive the expiration of this Agreement or the termination
of the consulting relationship.
11. Successors; Binding Agreement. (a) The Company shall require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that the Company or its affiliates would be
required to perform it if no such succession had taken place. Failure of the
Company to obtain such assumption and agreement prior to the effectiveness of
any such succession shall be a breach of this Agreement and shall entitle you to
compensation from the Company in the same amount and on the same terms as you
would be entitled to pursuant to the terms hereof if you were to terminate your
consultancy for Good Reason. As used in this Agreement, "Company" shall mean the
Company as hereinbefore defined and any successor to its business and/or assets
as aforesaid which assumes and agrees to perform this Agreement by operation of
law, or otherwise.
(b) This Agreement shall inure to the benefit of and be
enforceable by your personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
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Xxxxxx X. Xxxxxxx, Esq. [TELXON LOGO]
XXXXXXX XXXXX XXXXXX LLP
December 29, 1997
Page -6-
12. Validity. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
13. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
If you agree that this letter sets forth our agreement on the subject
matter hereof, please sign and return to the Company the enclosed copy of this
letter which will then constitute our agreement on this subject.
Sincerely,
TELXON CORPORATION
By: /s/ Xxxxx X. Xxxxx
_________________________
Name: Xxxxx X. Xxxxx
_________________
Title: President & CEO
_________________
Agreed to this _____ day of ________________, 1997.
/s/ Xxxxxx X. Xxxxxxx
________________________
Xxxxxx X. Xxxxxxx