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EXHIBIT 10.35
DT INDUSTRIES, INC.
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") between DT INDUSTRIES,
INC., a Delaware corporation (hereinafter referred to as the "Company"), and
Xxxx X. Xxxxxx (hereinafter referred to as the "Executive"), is and shall become
effective May 1, 2001.
W I T N E S S E T H:
WHEREAS, the Executive is employed as Chief Operating Officer of the
Company; and
WHEREAS, the Executive has developed extensive experience with respect
to the management and operations of the Company which is considered extremely
valuable to the continued prosperity of the Company; and
WHEREAS, the Company wishes to ensure that it will continue to have the
Executive available to perform for the Company duties as Chief Operating
Officer; and
WHEREAS, the Company and the Executive desire to set forth in this
Agreement the terms, conditions and obligations of the parties with respect to
such employment and this Agreement is intended by the parties to supersede all
previous agreements and understandings, whether written or oral, concerning such
employment, with the exception of the change of control agreement between the
Company and the Executive effective as of May 1, 2001 (the "Change of Control
Agreement") and the confidentiality agreement between the Company and the
Executive effective as of May 1, 2001 (the "Confidentiality Agreement").
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants contained herein, the parties agree as follows:
1. EMPLOYMENT. The Company shall continue to employ the Executive upon
the terms and conditions hereinafter set forth. The Executive shall perform such
duties and responsibilities for the Company which are commensurate with his
position.
2. TERM. Subject to the provisions hereof set forth in Section 7, the
term of this Agreement (herein the "Term") shall be for a period beginning on
the date hereof and ending on the second anniversary of the date hereof.
Thereafter, the Term will be automatically extended for 12-month periods, unless
one party to this Agreement provides notice of non-renewal of this Agreement and
the Change of Control Agreement at least three months before the last day of the
Term, or unless earlier terminated in accordance with the terms hereof. The
Company may not provide a notice of non-renewal of this Agreement without
simultaneously providing a notice of non-renewal of the Change of Control
Agreement. Notwithstanding the foregoing, upon a "Change of Control" (as defined
in the Change of Control Agreement), the Term of this Agreement will be extended
pursuant to the terms of the Change of Control Agreement.
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3. COMPENSATION. Subject to the terms of this Agreement, the Company
will pay to the Executive during the Term an annual base salary of $235,008.00
payable in cash in substantially equal installments not less often than
semi-monthly. The Executive's annual base salary shall be reviewed by the
Company at least once in each calendar year. During the Term, the Executive
shall also receive such benefits and perquisites (the "Benefits") which are made
available to other senior executives of the Company. All such Benefits shall be
provided in such amounts as may be determined from time to time by the Company
in its discretion and pursuant to the terms of the plan documents governing such
Benefits.
4. EXTENT OF SERVICE. During the Term, the Executive shall devote his
full time, attention, and energy to the business of the Company and the
Executive shall not be engaged in any other business activity pursued for gain,
profit, or other pecuniary advantage which interferes with the Executive's
duties and responsibilities provided for herein.
5. NON-COMPETITION AND NON-SOLICITATION. The Executive agrees that:
(a) During the Term and for a period of one year thereafter or
during any Severance Period, if longer (the "Restricted Period"), the Executive
agrees that he will not (without the written consent of the Chief Executive
Officer of the Company) engage in any business within the United States
(financially as an investor or lender or as an employee, director, officer,
partner, independent contractor, consultant or owner or in any other capacity
calling for the rendition of personal services or acts of management, operation
or control) which is competitive with the business conducted by the Company or
any of its Affiliates (as defined below) on the date of termination of
employment. Notwithstanding the foregoing, the Executive shall be entitled to
own securities of any corporation conducting a business competitive with the
business of the Company or any of its Affiliates so long as the securities of
such corporation are listed on a national securities exchange or on the Nasdaq
National Market and the securities owned directly or indirectly by the Executive
do not represent more than two percent (2%) of any class of the outstanding
securities of such company.
(b) During the Restricted Period, in addition to the
obligations pursuant to Subsection 5(a), the Executive agrees that neither he
nor any business in which he engages will (i) induce any customers of the
Company or of corporations or businesses which directly or indirectly control or
are controlled by or under common control with the Company ("Affiliates") to
patronize any business similar to that of the Company, (ii) canvass, solicit or
accept any similar business from any customer of the Company or any of its
Affiliates, (iii) request or advise any customer of the Company or any of its
Affiliates to withdraw, curtail or cancel such customer's business with the
Company or any of its Affiliates, (iv) disclose to any other person, firm or
corporation the names or addresses of any of the customers of the Company or any
of its Affiliates, or (v) compete with the Company or any of its Affiliates in
acquiring or merging with any other business or acquiring the assets of such
other business.
(c) During the Restricted Period, in addition to the
obligations pursuant to Subsections 5(a) and 5(b), the Executive agrees that
neither he nor any business in which he
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engages will (i) hire or attempt to hire any employee of the Company or any of
its Affiliates nor (ii) encourage any employee of the Company or any of its
Affiliates to terminate employment. Notwithstanding the foregoing, it shall not
be deemed a violation of this subsection if a business which employs the
Executive hires or attempts to hire an employee of the Company or any of its
Affiliates and the Executive demonstrates by clear and convincing evidence that
he has no knowledge or control over or involvement with such solicitation.
(d) In the event that any of the provisions of this Section 5
should ever be deemed to exceed the time, geographic or occupational limitations
permitted by applicable laws, then such provisions shall be and are hereby
reformed to the maximum time, geographic or occupational limitations permitted
by law.
6. CONFIDENTIAL INFORMATION. The Executive acknowledges that in his
employment he is or will be making use of, acquiring or adding to the Company's
confidential information which includes, but is not limited to, memoranda and
other materials or records of a proprietary nature and records and policy
matters relating to finance, personnel, management and operations. Therefore, in
order to protect the Company's confidential information and to protect other
employees who depend on the Company for regular employment, the Executive agrees
that he will not in any way utilize any of said confidential information except
in connection with his employment by the Company, and except in connection with
the business of the Company he will not copy, reproduce or take with him the
original or any copies of said confidential information and will not disclose
any of said confidential information to anyone. Notwithstanding the foregoing,
this Agreement will not supersede the Confidentiality Agreement.
7. TERMINATION.
(a) Death or Disability. If the Executive should become
physically or mentally disabled and unable to perform the essential functions of
his job (in the reasonable opinion of the Company), even with reasonable
accommodation, for a continuous period in excess of ninety (90) days or if the
Executive should die while an employee of the Company, this Agreement and the
Executive's employment with the Company shall immediately terminate.
(b) Termination by the Company for Cause. The following events
shall create in the Company a right to terminate the Executive's employment
under this Agreement prior to the expiration of the Term: (i) the commission of
fraud, embezzlement or theft by the Executive in connection with the Executive's
duties; (ii) the breach of a fiduciary duty to the Company by the Executive;
(iii) the Executive's conviction of a felony; (iv) the intentional violation of
Company procedures; (v) the intentional engaging in one or more acts which are
demonstrably and materially damaging to the Company and/or any of its
Affiliates; (vi) the intentional wrongful disclosure by the Executive of any
secret process or confidential information of the Company and/or any of its
Affiliates; (vii) the material violation of the Executive's non-disclosure,
non-solicitation and non-competition covenants set forth in Sections 5 and 6 or
(viii) the commission or omission of any act which would constitute grounds for
termination for
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cause under applicable state law. In the event of such a termination for cause
pursuant to this Subsection, all of the obligations of the Company under this
Agreement shall immediately terminate.
(c) Other Termination by Company. In the event the Company
shall elect to terminate the Executive's employment for any reason other than
those specified in Subsection 7(a) or 7(b), it shall provide written notice of
such termination to the Executive. The Executive may also terminate employment
with the Company for Good Reason by delivering written notice to the Company
within three months of the occurrence of an event qualifying as Good Reason, but
in any event prior to the end of the Term. "Good Reason" is defined as one of
the following events that occurs without the written consent of the Executive:
(i) a material change in the Executive's duties or
responsibilities which results in or reflects a
material diminution of the scope or importance of the
Executive's position;
(ii) a reduction in the Executive's then current annual
base salary (other than as part of reductions in
annual base salary affecting similarly situated
employees of the Company);
(iii) a material reduction in the level of Benefits
available or awarded under employee and officer
benefit plans and programs (other than as part of
reductions in such benefit plans or programs
affecting similarly situated employees of the
Company);
(iv) a relocation of the Executive's primary employment
location that is (A) to a location which is more than
50 miles from his current location, and (B) not due
to any relocation of the Company's corporate
headquarters; or
(v) receipt of notice from the Company of non-renewal of
this Agreement (as provided in Section 2 of this
Agreement) or of non-renewal of the Change of Control
Agreement (as provided in Section 2 of the Change of
Control Agreement).
In either case and subject to the execution and delivery by the Executive to the
Company of the release described in Section 10 hereof, and subject to the terms
of the Change of Control Agreement, the Company shall provide the Executive with
severance compensation and benefits as follows:
(x) the Executive shall receive an amount equal to his
continued current base salary through the end of the
Term, or if longer, for one year, payable at
intervals not less frequently than monthly (such
period of payment to be referred to as the "Severance
Period");
(y) the Executive's medical, dental and vision Benefits
shall be continued on
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the same basis as offered to active salaried
employees for the Severance Period or until such
earlier time as the Executive becomes employed and
eligible for such benefits under a plan of the new
employer; and continuation coverage under COBRA shall
commence at the end of the Severance Period; and
(z) all other Benefits shall be paid or continued only to
the extent the terms thereof provide for payment or
continuation following the termination of employment.
The foregoing shall be in lieu of all salary, bonuses or incentive or
performance based compensation for the remainder of the Term, and any severance
benefits to which the Executive may otherwise be entitled. If the Executive
should die during the Severance Period, any remaining severance payments shall
be made to Executive's surviving spouse or, if none, to his estate.
(d) Voluntary Termination. If during the Term the Executive
should voluntarily terminate his employment with the Company for any reason,
including retirement, other than as described in Subsection 7(c) hereof, the
obligations of the Company under this Agreement shall terminate forthwith, other
than obligations to (i) pay the Executive's base salary to the date of
termination and (ii) pay or make available to the Executive all Benefits which
by their terms or under applicable law survive the voluntary termination of the
Executive's employment; and the Executive shall remain bound by his
non-disclosure, non-solicitation and non-competition covenants set forth in
Sections 5 and 6 hereof. The exercisability of the Executive's outstanding stock
options shall be treated in accordance with the terms of their respective grants
or awards.
8. SUCCESSORS AND ASSIGNS.
(a) This Agreement is personal to the Executive and without
the prior written consent of the Company the Executive's obligations under this
Agreement will not be assignable by the Executive. This Agreement will inure to
the benefit of and be enforceable by the Executive's heirs, executors,
administrators, legal representatives and assigns.
(b) This Agreement will inure to the benefit of and be binding
upon the Company and its successors and assigns.
(c) The Company will require any successor to, or purchaser or
acquirer of (in each case, whether direct or indirect, by purchase, merger,
consolidation, reorganization or otherwise), all or substantially all of the
business and/or assets of the Company to assume expressly and agree to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform it if no such succession, purchase or acquisition had
taken place.
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9. INDEMNIFICATION. The Executive shall be eligible for indemnification
as provided in the Company's Articles of Incorporation or Bylaws or pursuant to
other agreements in effect as of the effective date of this Agreement, and the
Company shall also advance expenses for which indemnification may be ultimately
claimed as such expenses are incurred to the fullest extent permitted under
applicable law. The Executive will provide an undertaking to repay such advances
if it is ultimately determined that the Executive is not entitled to
indemnification; provided, however, that any determination required to be made
with respect to whether Executive's conduct complies with the standards required
to be met as a condition of indemnification or advancement of expenses under
applicable law and the Company's Articles of Incorporation or Bylaws or other
agreement shall be made by independent counsel mutually acceptable to the
Executive and the Company (except to the extent otherwise required by law). Any
other provision herein to the contrary notwithstanding, the Company shall not be
obligated to (a) indemnify or advance expenses to the Executive with respect to
claims initiated or brought voluntarily by the Executive and not by way of
defense (except with respect to actions or proceedings to establish or enforce a
right to indemnification under this Agreement or any other agreement or
insurance policy or under the Company's Articles of Incorporation or Bylaws) or
(b) indemnify the Executive for expenses and the payment of profits arising from
the purchase and sale by the Executive of securities in violation of Section
16(b) of the Securities Exchange Act of 1934. After the effective date of this
Agreement, the Company shall not amend its Articles of Incorporation or Bylaws
or any agreement in any manner which adversely affects the rights of the
Executive to indemnification thereunder. In addition, the Company will maintain
directors' and officers' liability insurance in effect and covering acts and
omissions of the Executive, during the Term and for a period of six years
thereafter, on terms customary for companies that are similar to the Company.
10. GENERAL RELEASE AND COOPERATION AGREEMENT. Notwithstanding anything
in Subsection 7(c) to the contrary and in consideration therefor, severance
benefits thereunder shall only become payable by the Company if the Executive
executes and delivers to the Company a General Release and Cooperation Agreement
on or after the date of written notice of termination of Executive's employment
and in substantially the form attached as Exhibit A hereto.
11. NOTICE. Any notice required or permitted to be given under this
Agreement shall be in writing, signed by the party or parties giving or making
the same, and shall be served on the person or persons for whom it was intended
or who should be advised or notified, by Federal Express or other similar
overnight service. If the notice is sent to the Executive, the notice should be
sent to the address listed on the signature page of this Agreement or to such
other address furnished by the Executive in writing in accordance herewith. If
the notice is sent to the Company, the notice should be sent to:
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DT Industries, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: President
With a copy to:
DT Industries, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: General Counsel
or to such other address as furnished by the Company in writing in accordance
herewith. Notice and communications will be effective when actually received by
the addressee.
12. MISCELLANEOUS.
(a) This Agreement shall be subject to and governed by and the
laws of the State of Ohio, without reference to principles of conflict of laws.
The captions of this Agreement are not part of the provisions hereof and will
have no force or effect.
(b) The Executive's or the Company's failure to insist upon
strict compliance with any provision hereof or any other provision of this
Agreement or the failure to assert any right the Executive or the Company may
have hereunder, including, without limitation, the right of the Executive to
terminate employment for Good Reason, will not be deemed to be a waiver of such
provision or right or any other provision or right of this Agreement.
(c) This Agreement may not be modified except by an agreement
in writing executed by the parties hereto.
(d) The invalidity or unenforceability of any provision of
this Agreement will not affect the validity or enforceability of any other
provision of this Agreement.
(e) The Company may withhold from any amounts payable under
this Agreement such Federal, state or local taxes as may be required to be
withheld pursuant to any applicable law or regulation.
(f) This Agreement shall supersede any and all prior
employment agreements or understandings, written or oral, with the Executive;
provided, however, that this Agreement shall not supersede the Confidentiality
Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
DT INDUSTRIES, INC.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxxx
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Its: President and Chief Executive Officer
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/s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
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Xxxxxx
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Xxxx, Xxxxx and Zip Code
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