EXHIBIT 10(c)
AGREEMENT AND GENERAL RELEASE
Agreement made as of this 21st day of March 1997, between
XXXXXXXXXX ELECTRONICS, LTD., whose principal office is located
at 00X000 Xxxxxxxxx Xxxx, XxXxx, Xxxxxxxx 00000 (the "Company"),
and XXXXX XXXXXX of 0000 Xxxxxx Xxxxxx, Xx Xxxxxxxxxx, XX 00000
(the "Employee").
WHEREAS, the Employee has been an officer of the Company
and/or its subsidiaries for many years and the parties agree that
Employee's employment with the Company and/or its subsidiaries as
an officer is to be terminated and the Employee will continue to
be employed as a non-officer employee of the Company for the
period of time herein specified for limited services performed at
mutually convenient times to both parties hereto and that the
payments provided herein shall be in lieu of any payments under
any Company or subsidiary policy relating to termination of
Employee's employment as an officer and eventually as an employee
at the expiration of employment term provided herein and to
resolve and settle all possible claims the Employee may have
against or with respect to the Company and/or its subsidiaries;
and
WHEREAS, the Company is in the business of distributing and
manufacturing electron tubes, RF transistors, silicon controlled
rectifiers ("SCR's") and RF power and microwave semiconductors,
data display products and components, security systems and
components, (hereinafter "The Business") and in the course of
such activities the Company has acquired or developed certain
Proprietary Information, as further defined herein, including,
but not limited to, information not generally known in the others
engaged in the same or similar business to The Business or
otherwise or which could not be gathered or obtained without
significant expenditure of time, effort and money, which
Proprietary Information provides the Company with a competitive
advantage in the marketplace in which it competes, and
WHEREAS, Employee's employment with the Company has
involved, and hereafter may involve, positions of trust and
confidence; and
WHEREAS, in the course of his employment with the Company
Employee has received, and he hereafter may receive, (1)
extensive training in (i) how to successfully purchase and sell
products and (ii) operating policies and procedures, and (2)
access to Proprietary Information, as further defined herein; and
WHEREAS, in the course of his employment with the Company,
or through his use of the facilities and resources of the
Company, Employee may have developed or contributed to the
development of, or may in the future develop or contribute to the
development of, additional Proprietary Information, as further
defined herein; and
WHEREAS, in the course of his employment with the Company,
Employee has had and may hereafter have primary contact with
suppliers and customers of The Business and for this reason, the
suppliers and customers who have been served and dealt with by
Employee may have come or may come to associate the service and
business they received with Employee rather than the Company
itself;
NOW, THEREFORE, IT IS AGREED AS FOLLOWS:
1. The Company and the Employee agree that the Employee's
employment with the Company and/or its subsidiaries as an officer
and any other position with the Company (except non-officer
employee of Company as provided in this Agreement) and/or its
subsidiaries will cease and terminate on the close of business on
May 31, 1997 (the "Termination Date") and Employee hereby resigns
as a member of any of the Boards of Directors of subsidiaries of
the Company on which he may be serving and any committee thereof
and from any officer position therein.
2. Employee shall be entitled to payment of his
compensation and benefits, including bonus, as presently being
paid through the Termination Date, and 136 hours of pay for
earned but unused vacation pay.
3. In consideration of Employee's service with the Company
and/or its subsidiaries as an officer and his other promises and
agreements made in this Agreement and in full settlement of any
and all claims that the Employee may have against the Company,
its subsidiaries, their successors, assigns, affiliates, or any
of their officers, directors, shareholders, employees, agents or
representatives, for compensation or otherwise in connection with
his past employment or termination of his employment as an
officer of the Company and/or its subsidiaries, the Company
agrees to provide the Employee with the following in addition to
the compensation referred to in paragraph 2. above:
(a) The sum of TWO THOUSAND TWO HUNDRED FIFTY DOLLARS
($2,250.00) per month, payable beginning on the 30th
day after the Termination Date and continuing
thereafter for an additional 55 months, provided,
however, that the Employee's right to receive and the
Company's obligation to make such payment shall cease
in the event of Employee's breach of paragraphs 5, 9,
10 or 11 below;
(b) As of the date hereof, to forgive the outstanding
balance and interest, if any, on the personal loan made
to Employee by the Company, which loan now has a
principal balance of $18,306 and accrued interest
through February 28, 1997 of $4,013; and
(c) As of June 1, 1997, without charge, transfer to
Employee ownership and title of Company's 1994 SAAB,
Vehicle Identification # XX0XX00XXX0000000.
4. The parties agree that after the Termination Date,
Employee will continue to be employed with the Company as a non-
officer to work on such matters as may be directly requested by,
and under the direct supervision of, Xxxxxx X. Xxxxxxxxxx through
the period from the Termination Date until May 31, 2002. Such
requested work shall take into consideration the Employee's
health, residence, and personal circumstances, including, without
limitation, other employment in which he may be engaged which
shall take priority over work to be performed for the Company
hereunder, and shall be for limited services provided at mutually
convenient times to both parties. Employee's employment under
this paragraph and his right to receive compensation as provided
for in this paragraph 4 may not be terminated for reasons of the
quality of his work. Employee shall not be required to report to
any office to perform his work unless specifically requested by
Xxxxxx X. Xxxxxxxxxx and agreed to by Employee, and, except by
mutual agreement, shall not be required to perform such work at a
location that is beyond 80 miles of his then residence.
Employee's unavailability for work as provided in this paragraph
4 due to health reasons shall not terminate the Company's
obligation to make the payments provided for in in paragraph 4(a)
below, but, in such event the Company may reduce the amount paid
by any disability or other insurance payments to which the
Employee, directly or indirectly, is entitled or receives or the
benefit of which he receives. In consideration for the promises
made by the Employee in this paragraph 4 and subsequent
paragraphs, the Company agrees to provide the Employee with the
following in addition to the compensation referred to in
paragraphs 2 and 3 above:
(a) Compensation at the rate of FOUR THOUSAND AND NO/100THS
DOLLARS ($4,000.00) per month beginning on the day
following the Termination Date and continuing through
February 15, 2002, payable in such installments as the
regular pay periods of the Company during such period,
provided, however, that the Employee's right to receive
and the Company's obligation to make such payment shall
cease in the event of Employee's breach of paragraphs
5, 9, 10 or 11 below. Employee acknowledges and agrees
that such aggregate amount as the Company is obligated
to pay under this subparagraph (a) shall be full
compensation for all services rendered to Company after
the Termination Date through May 31, 2002 and shall be
in lieu of any payments under any Company policy
relating to termination of Employee's employment at the
expiration of the employment term provided in this
paragraph 4;
(b) During the employment period provided in this paragraph
4, Employee shall be entitled to participate in the
medical, dental, disability and life insurance and
other benefits (notwithstanding the foregoing Employee
shall not be entitled to participate in any bonus or
incentive compensation plan) on the same or similar
terms as such benefits are provided to Company's other
regular employees during such period; provided,
however, that such benefits shall cease to be made
available to Employee if the Company's obligation to
make payment under subparagraph (a) has ceased prior to
February 15, 2002; and, further, if, at any time,
Employee becomes engaged in employment with any entity
or person that offers such types of benefits and
Employee is entitled to participate therein, then
Employee shall elect to participate in such benefits of
the other employer and elects to terminate and cease to
participate in the Company's benefits of such type as
are available to him through his other employment; and
(c) Options previously granted to Employee under the
Company's various stock option or incentive
compensation plans shall continue to be exercisable or
become exercisable in accordance with the terms thereof
through termination of Employee's employment as a non-
officer under this paragraph 4.
5. The payments provided for in subparagraphs 3(a) and
4(a) above shall be payable if and when but not unless, the
Employee shall without additional compensation, fee, or other
payment by the Company;
(a) Refrain (independently of and without reference to
paragraph 11 hereof), after the expiration of a period
of thirty (30) days from the mailing to him of written
notice by the Secretary of the Company of a direction
to do so, from engaging in the operation or management
of a business, whether as owner, shareholder, partner,
officer, employee or otherwise, which then shall be one
in which the Employee could not engage without being in
violation of his obligations not to compete as provided
in paragraph 11 hereof;
(b) Refrain (independently of and without reference to
paragraph 10 hereof) from disclosing to unauthorized
persons information relative to the business,
properties, products, technology or other assets of the
Company or any of its subsidiaries which he shall have
reason to believe is confidential; and
(c) Refrain (independently of and without reference to
paragraph 9 hereof) from acting or conducting himself
in a manner which he shall have reason to believe is
inimical or contrary to the best interests of the
Company.
In the event that the Employee shall fail to comply with any pro-
vision of this paragraph 5, the Company's obligation to make any
further payment provided for in subparagraph 4(a) above shall
forthwith terminate and cease.
6. Employee acknowledges that the payments and other
considerations to be made to him pursuant to the terms of this
Agreement exceed those to which he would be entitled in
connection with the termination of his employment under the
normal operation of any benefit plan, policy or procedure of the
Company or under any previous agreement (written or oral) between
him and the Company. Employee further acknowledges that the
Company's agreement to provide such additional payments and
considerations beyond his entitlement is conditioned upon his
release of all claims against the Company and his compliance with
the terms and conditions of this Agreement.
7. The consideration from the Company set forth herein
constitutes full settlement of any and all claims that the
Employee may have against the Company and its subsidiaries, their
respective successors, assigns, affiliates, or any of their
officers, directors, shareholders, employees, agents or
representatives, for compensation or otherwise in connection with
or related to his employment or its termination, except for any
and all claims arising out of the performance by the Company of
this Agreement, including, but not limited to, rights under the
Company's profit sharing and employee stock ownership plans.
8. In further consideration for the promises made by the
Company herein, the Employee, on behalf of himself, his agents,
assignees, attorneys, heirs, executors, and administrators, fully
releases the Company and it subsidiaries, and each of their
successors, assigns, parents, subsidiaries, divisions,
affiliates, officers, directors, shareholders, employees, agents
and representatives, from any and all liability, claims, demands,
actions, causes of action, suits, grievances, debts, sums of
money, controversies, agreements, promises, damages, back and
front pay, costs, expenses, attorneys' fees, and remedies of any
type, by reason of any matter, act or omission arising out of or
in connection with the Employee's employment with the Company or
any of its subsidiaries or termination thereof, including but not
limited to claims, demands or actions under Title VII of the
Civil Rights Act of 1964, the Americans With Disabilities Act,
the Civil Rights Act of 1986, the Age Discrimination in
Employment Act, the Older Workers Benefit Protection Act, as any
of the foregoing are amended, any other federal, state or local
statute or regulation regarding employment, discrimination in
employment, or the termination of employment, and the common law
of any state relating to employment contracts, public policy
torts, wrongful discharge, or any other matter, including,
without limitation, claims, demands or actions under the False
Claims Act or any qui tam rights, and claims under any prior
contract (written or oral) relating to Employee's employment,
compensation, or termination of employment, except, however, any
and all claims arising out of the performance by the Company of
this Agreement (the "Released Claims").
9. Company's Good Name. Employee agrees that Employee
will at no time engage in conduct which injures, xxxxx, corrupts,
demeans, defames, libels, slanders, destroys or diminishes in any
way the reputation or goodwill of the Company, its subsidiaries,
or their respective shareholders, directors, officers, employees,
or agents, or the products sold by the Company, or its other
properties or assets, including, without limitation, its computer
systems hardware and software and its data or the integrity and
accuracy thereof.
10. Confidentiality.
A. Definition of Proprietary Information. For purposes of
this Agreement, the term "Proprietary Information" shall mean all
of the following materials and information (whether or not
reduced to writing and whether or not patentable) to which
Employee has received or may receive access or has developed or
may develop, in whole or in part, as a direct or indirect result
of his employment with the Company or any of its predecessors or
subsidiaries, or in the course of his employment with the Company
or any of its predecessors or subsidiaries, or through the use of
any of the Company's or any of its predecessors or subsidiaries
facilities or resources:
(1) Customer lists, including, but not limited to, customer
names, customer requirements, and customer data;
supplier lists, including, but not limited to, supplier
names, supplier capabilities, and supplier data;
marketing techniques; practices; methods; plans;
systems; processes; purchasing information; price
lists; pricing policies; quoting procedures; product
information; operating policies and procedures;
financial information; and other materials or
information relating to the manner in which the Company
does business;
(2) Discoveries, concepts and ideas, whether patentable or
not, or copyrightable or not, including, but not
limited to, the nature and results of research and
development activities, processes, formulas,
techniques, "know-how", designs, drawings and
specifications;
(3) Any other materials or information related to the
business or activities of the Company (or by any of its
predecessors in business) which are not generally known
to others engaged in similar businesses or activities
or which could not be gathered or obtained without
significant expenditure of time, effort and money; and
(4) All inventions and ideas which are derived from or
relate to Employee's access to or knowledge of any of
the above enumerated materials or information.
The Proprietary Information shall not include any materials or
information of the types specified above to the extent that such
materials or information are publicly known or generally utilized
by others engaged in the same business or activities in the
course of which the Company utilized, developed or otherwise
acquired such information or materials and which Employee has
gathered or obtained from such other public sources by his own
expenditure of significant time, effort and money. Failure to
xxxx any of the Proprietary Information as confidential shall not
affect its status as part of the Proprietary Information under
the terms of this Agreement.
B. Ownership of Proprietary Information. Employee agrees
that the Proprietary Information is and at all times shall remain
the sole and exclusive property of the Company.
C. Non-Disclosure of Proprietary Information. Employee
represents, warrants and agrees that he has not and will not
(except in the proper course of his employment), either during or
after the period of his employment with the Company, made or make
use of, disseminated or disseminate, published or publish, or
disclosed or disclose to any person, firm, company, association,
or other entity, and shall use his best endeavors to prevent the
use, dissemination, publication, or disclosure of, any
Proprietary Information.
11. Non-Competition.
A. Restrictions. Employee agrees that, during the period
from the date this Agreement is signed through May 31, 2002, he
will not, except with the approval of the Chairman of the Board
of the Company, directly or indirectly (whether or not for
compensation or profit):
1. Engage in any business or enterprise the nature of
which is competitive with that of the Company as
described in the Preamble to this Agreement as The
Business in the territories served by the Company (a
"Prohibited Business"); or
2. Participate as an officer, director, creditor,
promoter, proprietor, associate, agent, employee,
partner, consultant, sales representative or otherwise,
or directly or indirectly own any interest in any
person or entity involved in any Prohibited Business;
or
3. Canvas, call upon, solicit, entice, persuade, or
induce any individual or entity which, during
Employee's term of employment with the Company, was or
is a customer or supplier, or proposed customer or
supplier, of the Company upon whom Employee called or
whose account he supervised on behalf of the Company,
for the following:
(a) to purchase (with respect to customers) or
sell (with respect to suppliers) products of
the types or kinds sold by the Company or
which could be substituted for (including, but
not limited to, rebuilt products), or which
serve the same purpose or function as,
products sold by the Company (all of which
products are herein sometimes referred to,
jointly and severally as "Prohibited
Products"), or
(b) to request or advise any such customer or
supplier to withdraw, curtail or cancel its
business with the Company, and
Employee shall not approach, respond to, or otherwise
deal with any such customer or supplier for such
purpose or authorize or knowingly cooperate with the
taking of any such actions by any other individual or
entity; or
4. For himself or for or through any other individual
or entity call upon, solicit, entice, persuade, induce
or offer any individual who, during Employee's term of
employment with the Company, was an employee of the
Company, employment or with respect to employment by
any one other than the Company, or request or advise
any such employee to cease employment with the Company,
and Employee shall not approach, respond to, or
otherwise deal with any such employee for any such
purpose, or authorize or knowingly cooperate with the
taking of any such actions by any other individual or
entity.
Each obligation of each subparagraph and provision of this
paragraph A. shall be independent of any obligation under any
other subparagraph or provision hereof.
B. Permitted Activities. Anything above to the contrary
notwithstanding:
1. Employee may, after the date of this Agreement, own
as an inactive investor, securities of any corporation
engaged in any Prohibited Business which is publicly
traded on a national securities exchange or in the
over-the-counter market, so long as the holdings of
Employee, directly or indirectly, in the aggregate,
constitute less than 1% of the outstanding voting
securities of such corporation;
2. Employee may act as a representative for entities
that are or have been customers or suppliers of the
Company for the purpose of purchasing for, or selling
to, such entities products other than Prohibited
Products; and
3. Employee may purchase Prohibited Products which he
resells to the Company.
12. Employee acknowledges and agrees to Employee's
obligations of confidentiality, use of information and return of
Company property as set forth in the Company's Corporate Code of
Conduct and Employee Handbook and without limiting the foregoing
or the following, the Employee further agrees that all notes,
data, reference materials, memoranda, files and records,
including without limitation computer reports, financial,
accounting, employee, customer, vendor and product data, reports
or records, lists and information, process manuals and notes,
drawings, and technology manuals and notes, in any way relating
to any of the Company's or its predecessors' or subsidiaries'
businesses, operations or products shall belong exclusively to
Company, and Employee agrees to turn over to Company all copies
of such materials and all keys, equipment and other Company
property in Employee's possession or control at the request of
Company or, in the absence of such a request, upon the
Termination Date. Employee shall immediately refrain from
seeking access to or utilization of Company's (a) telephonic
voice mail, E-mail or message system, (b) computer system, and
(c) computer data bases and software.
13. Employee acknowledges that the restrictions contained
in this Agreement will not prevent him from obtaining such other
gainful employment he may desire to obtain or cause him any undue
hardship and are reasonable and necessary in order to protect the
legitimate interests of the Company and that violation thereof
would result in irreparable injury to the Company. Employee
therefor acknowledges and agrees that in the event of a breach or
threatened breach by Employee of the provisions of paragraphs 9,
10, 11 or 12, the Company shall be entitled to an injunction
restraining Employee from such breach or threatened breach and
shall be entitled to terminate all payments otherwise to be made
to or for the benefit of Employee under the provisions of this
Agreement. Nothing herein shall be construed as prohibiting the
Company from pursuing any other remedies available to the Company
for such breach or threatened breach. The parties hereto desire
that this paragraph 13 and paragraphs 9, 10, 11 and 12 shall be
fully enforceable in accordance with the terms hereof and
thereof, but if any portion is held unenforceable or void or
against public policy by any court of competent jurisdiction, the
remainder shall continue to be fully enforceable in accordance
with its terms or as it may be modified by such court. If,
however, such provisions are not enforced in accordance with
their terms there shall be a corresponding reduction in the
consideration provided in this Agreement. The period of
restriction specified in paragraph 11 shall xxxxx during the time
of any violation thereof, and the portion of such period
remaining at the commencement of the violation shall not begin to
run until the violation is cured.
14. The provisions of this paragraph 14 and of paragraphs
9, 10, 11, 12 and 13 shall survive the termination or expiration
of this Agreement for any reason.
15. Employee's death shall not terminate the Company's
obligation to pay the amounts it would otherwise be obligated to
pay Employee under subparagraphs 3(a) or 4(a). In the event of
Employee's death prior to payment of all amounts due under
subparagraphs 3(a) and 4(a), such amounts thereafter shall be
paid to Employee's estate or, if Employee has provided Company
with written direction prior to his death of an alternative
beneficiary, to the beneficiary so designated by Employee in such
written direction; provided, however, that the amount of such
payments shall be reduced by the amount, if any, of any payment
under any life insurance paid or to be paid to Employee's estate
or other beneficiary under any life insurance provide Employee as
a benefit under this Agreement. Such payments shall be made on
the dates and to the extent subparagraphs 3(a) or 4(a), as the
case may be, would require them to be made to Employee if he were
still alive.
16. The Employee understands and agrees that the existence
and terms of this Agreement are confidential and shall not be
disclosed to any third party except Employee's immediate family
or Employee's counsel or accountant without the prior written
consent of the Company, except as may be required by law and in
response to a lawful subpoena in which event Employee shall
provide prompt notice to the Company.
17. The existence and execution of this Agreement shall not
be considered, and shall not be admissible in any proceeding, as
an admission by the Employee or the Company, or any of its agents
or employees, of any liability, error, violation or omission.
18. It is agreed that:
(a) This Agreement shall be binding upon the parties
hereto, their heirs, legal representatives, successors
and assigns and shall inure to their respective
benefits.
(b) This Agreement shall not be subject to change,
modification, or discharge, in whole or in part, except
by written instrument signed by the parties; provided,
however, that if any of the terms, provisions or
restrictions of paragraphs 9, 10, subparagraphs A.1,
A.2, A.3, A.4, or B of paragraph 11, or paragraph 12
are held to be in any respect unreasonable restrictions
upon Employee, then the court so holding shall reduce
the territory to which it pertains and/or the period of
time in which it operates or effect any other change to
the extent necessary to render any of said terms,
provisions or restrictions enforceable.
(c) The failure by the Company to insist upon strict
compliance by the Employee with respect to any of the
terms or conditions hereof shall not be deemed a waiver
or relinquishment of any other terms or conditions nor
shall any failure to exercise any right or power
hereunder at one or more times be deemed a waiver or
relinquishment of such right or power at any other time
or times.
(d) This Agreement shall be governed and construed in
accordance with the laws of the State of Illinois.
(e) All notices required to be given hereunder to the
Company shall be addressed to its principal executive
office at 00X000 Xxxxxxxxx Xxxx, XxXxx, Xxxxxxxx 00000;
attention: Xxxxxxx X. Xxxxx, by certified or registered
mail. All notices required or to be given hereunder to
the Employee shall be addressed to the Employee at his
residence as last reflected on the records of the
Company, by certified or registered mail. Notice shall
be deemed given if delivered in person to Xxxxxxx X.
Xxxxx on behalf of the Company or to the Employee, or
if mailed, when deposited in the United States Mail
addressed as aforesaid.
19. The Employee acknowledges that Employee had an adequate
opportunity of at least 21 days to review this Agreement and
General Release and consult with such persons, including legal
counsel, as he saw fit, that Employee fully understands its
terms, that Employee was not coerced into signing it, that
Employee has signed it knowingly and voluntarily, and that he has
not relied on any promise or representation (written or oral)
other than those expressly set forth herein.
20. This Agreement and General Release shall take effect
seven days after the Employee signs it. The Employee has the
right to revoke this Agreement and General Release during that
seven day period. In order to revoke the Agreement and General
Release, the Employee must notify the undersigned representative
of the Company, in writing, of his decision to revoke, and that
notice must be received by the undersigned representative of the
Company no later than seven days after the Employee signed the
Agreement and General Release. If the Employee revokes this
Agreement and General Release, he must promptly repay to the
Company all consideration paid to the Employee under the
provisions hereof.
IN WITNESS WHEREOF, the parties hereto have duly executed
this Agreement the day and year written below their respective
signatures.
EMPLOYEE XXXXXXXXXX ELECTRONICS, LTD.
____________________________ By: ________________________________
Xxxxx Xxxxxx Xxxxxx X. Xxxxxxxxxx,
Chairman of the Board
Dated:__________________ Dated:___________________
Subscribed and sworn to
before me this _______ day
of March, 1997
____________________________
Notary Public
