November 29, 1995
Xxxxxxx Xxxxxx
Vice President, Treasurer and Assistant Secretary
Xxxxxxx, Inc.
000 Xxxxxxxxxxx Xxxx.
El Segundo, CA 90245
PERSONAL AND CONFIDENTIAL
Dear Xxx:
This letter sets forth the agreement we have reached
with respect to certain aspects of your employment by
Xxxxxxx, Inc. ("Merisel"). Your employment status as an "at-
will" employee of Xxxxxxx is not affected by this agreement.
Xxxxxxx retains the right to terminate your employment at
any time, with or without cause. However, we have agreed
that if at any time during the Applicable Time Period (as
defined below), Merisel terminates your employment, without
cause, then Merisel shall do the following:
(a) Xxxxxxx will pay you as severance compensation
(the "Severance Payment") an amount equal to your annual
base salary as in effect on the date of such termination
(the "Determination Date") plus an amount equal to the
amount of any performance bonus payment received by you at
any time during the fifty two weeks prior to the
Determination Date. The Severance Payment shall be paid to
you over a period of fifty two weeks (the "Payment Period"),
one twenty-sixth (1/26) of which shall be paid every two
weeks in accordance with Xxxxxxx's standard payroll
practices. The Payment Period shall commence on the first
Merisel payday following the Determination Date. In the
event that you die or become disabled during the Payment
Period, Xxxxxxx agrees that it shall pay any Severance
Payment remaining unpaid as a death or disability benefit to
your estate on the same terms. Xxxxxxx shall deduct from the
Severance Payment paid to you any required amounts for
social security, federal and state income tax withholding,
federal or state unemployment insurance contributions, and
state disability insurance;
(b) Xxxxxxx will reimburse you for the cost of your
COBRA payments under Xxxxxxx's health insurance plans during
the Payment Period. The amount of such reimbursement will
be grossed up so that you will receive an amount equal to
the COBRA payments, after taking into account all applicable
taxes;
(c) Xxxxxxx will pay you for all unused accrued
vacation pay through the Determination Date; and
(d) Xxxxxxx will recommend to the Merisel, Inc.'s
Option Committee for such Option Committee to cause the next
installment of unvested options to purchase the stock of
Merisel, Inc. previously granted to you to vest as of the
Determination Date.
As used in this agreement, "Applicable Time
Period" shall mean the one year period commencing on the
date of this letter. For purposes of this agreement, your
employment shall be considered to be terminated without
cause, if (i) your employment is terminated for any reason,
other than your misconduct (misconduct includes, but is not
limited to, physical assault, insubordination, falsification
or misrepresentation of facts on company records, fraud,
dishonesty, willful destruction of company property or
assets, or sexual harassment of another Associate by you),
poor job performance (as defined in the then current Roles
and Responsibilities for your position), excessive
absenteeism, abuse of sick time, creating or contributing to
unsafe working conditions, violation of company policy or
your conviction for or a plea of nolo contendere by you to a
felony or any crime involving moral turpitude or (ii) there
is a material reduction in your job responsibilities, other
than as a result of the reasons listed in the preceding
clause (i).
In exchange for Xxxxxxx providing the above described
benefits to you, you agree to the following:
(A) You agree to continue to observe and comply with
all company policies and all lawful and reasonable
directions and instructions during your employment by
Xxxxxxx;
(B) You agree that during the Payment Period, you will
not directly or indirectly (a) engage in; (b) own or control
any debt equity, or other interest in (except as a passive
investor of less that 5% of the capital stock or publicly
traded notes or debentures of a publicly held company); or
(c) (1) act as director, officer, manager, employee,
participant or consultant to or (2) be obligated to or
connected in any advisory business enterprise or ownership
capacity with, any of Tech Data Corp., Xxxxxx Micro, Inc.,
Computer 2000 AG (C2000), Intelligent Electronics, Inc.,
MicroAge, Inc., Inacom Corp., Compucom, Entex Information
Services, Inc. or Vanstar Corp. or with any subsidiary,
division or successor of any of them or with any entity that
acquires, whether by acquisition, merger or otherwise, any
significant amount of the assets or substantial part of any
of the business of any of them;
(C) During the Payment Period, you will not solicit
the employment of or hire any person that is or was employed
by Xxxxxxx, Inc. or any of its subsidiaries at any time on
or after January 1, 1995;
(D) Within two weeks of the Determination Date and
prior to receiving any severance compensation from Xxxxxxx,
you will execute and deliver to Xxxxxxx a Release and a
Confidentiality Agreement, each substantially in the form
enclosed with this agreement, with such changes as Xxxxxxx
might request; and
(E) In the event of any breach by you of the
restrictions contained in this agreement, Xxxxxxx shall have
no further obligation to compensate you hereunder and you
acknowledge that the harm to Xxxxxxx cannot be reasonably or
adequately compensated in damages in any action at law.
Accordingly, you agree that, upon any violation of such
restrictions, Xxxxxxx shall be entitled to preliminary and
permanent injunctive relief in addition to any other remedy,
without the necessity of proving actual damages.
This agreement shall be binding upon and inure to the
benefit of Xxxxxxx and you; provided that you shall not
assign any of your rights or duties under this agreement
without the express prior written consent of Xxxxxxx. This
agreement sets forth our entire agreement with regard to the
subject matter hereof. No other agreements,
representations, or warranties have been made by either
party to the other with respect to the subject matter of
this agreement. This agreement may be amended only by a
written agreement signed by both of us. This agreement shall
be governed by and construed in accordance with the laws of
the State of California. Any waiver by either party of any
breach of any provision of this agreement shall not operate
as or be construed as a waiver of any subsequent breach. If
any legal action is necessary to enforce the terms of this
agreement, the prevailing party shall be entitled to
reasonable attorneys' fees in addition to any other relief
to which that party may be entitled.
If you agree to the terms of this agreement and intend
to be bound by it, please so indicate by signing the
enclosed copy of this letter and returning it to me. Thank
you.
Sincerely,
/s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Senior Vice President, Finance and
Chief Financial Officer
Accepted and agreed to:
/s/ Xxxxxxx Xxxxxx
Xxxxxxx Xxxxxx
