EXHIBIT 10(r)
POST-TERMINATION BENEFITS AGREEMENT
This Post-Termination Benefits Agreement (the "Agreement"), dated and
effective as of October 1, 2000 (the "Effective Date"), is entered into by and
between Relm Wireless Corporation, a Nevada corporation with its principal place
of business in West Melbourne, Florida (the "Company"), and the Employee of the
Company named on the signature page hereto (the "Employee").
Preliminary Statements
The Company is exploring various alternatives for enhancing
shareholder value, which alternatives may include a merger, sale or other
transaction involving the Company which may result in a change in control of the
Company, and desires to provide an incentive for the Employee to remain in the
employ of the Company by providing for certain severance compensation to be paid
to the Employee in the event the Employee's employment with the Company is
terminated within six months following a change in control, on the terms and
conditions set forth in this Agreement.
Agreement
In consideration of the premises and the respective covenants and
agreements of the parties set forth below, and intending to be legally bound
hereby, the parties agree as follows:
1. Severance Compensation. Provided the Employee remains
continuously employed by the Company from the Effective Date through the close
of business on the closing date of a Transaction (as hereinafter defined), if,
within six months following the closing date of a Transaction, (i) the Company
terminates the Employee's employment other than (A) for Cause (as hereinafter
defined) or (B) by reason of Employee's disability (as defined under the
Company's disability insurance policy), or (ii) the Employee resigns employment,
the Employee shall receive severance compensation equal to the Severance
Percentage multiplied by the Employee's Annual Compensation, as set forth on
Schedule 1 to this Agreement (the "Severance Payment"), payable in cash in one
lump sum within five business days after the date the Employee's employment is
terminated. Furthermore, all stock options granted under the 1997 Employee Stock
Option Plan that have not otherwise become vested, shall become vested as of the
closing date of a Transaction.
2. Definitions. The following capitalized terms used in this
Agreement shall, for purposes of this Agreement, have the meanings set forth
below.
"Cause" shall mean the occurrence of one or more of the following: (i)
Employee's refusal or failure to perform any of Employee's employment duties or
responsibilities or to follow any of the Company's lawful policies or
directives, which does not cease to the Company's satisfaction within ten days
after written notice thereof; (ii) Employee's willful misconduct; (iii)
Employee's failure to pass, or refusal to take, any drug test administered by
the Company; (iv) fraud, commission of a felony or a crime involving moral
turpitude, dishonesty or embezzlement by the Employee; (v) the Employee's
misappropriation for personal use of assets
or business opportunities of the Company; (vi) the Employee's engaging in
conduct that is materially injurious to the Company, whether monetary or
otherwise; or (vii) any event, condition or circumstance which, pursuant to
applicable law, renders the Employee unemployable by the Company in the position
and with the duties in effect as of the Effective Date.
"Restricted Period" shall mean the period of time after termination of
the Employee's employment with the Company identified on Schedule 1.
A "Transaction" shall mean and include (i) a sale of all or
substantially all of the Company's assets, (ii) a merger, recapitalization,
reorganization, sale of newly-issued Company securities, sale of outstanding
Company securities or other transaction, as a result of which the persons who
immediately prior to such transaction collectively owned the Company's
outstanding voting securities collectively own, immediately after consummation
of such transaction, less than 50% of the outstanding voting securities of the
Company or the surviving or resulting entity in such transaction, or which
results in the resignation or replacement of two or more of the Company's
directors or the addition of two or more directors, or (iii) any other
transaction which the Board of Directors of the Company shall determine to
constitute a Transaction for purposes of this Agreement.
3. Restrictive Covenants. The Employee acknowledges that in order
to assure the Company that it will retain the value of its business
relationships, it is reasonable that the Employee be limited in utilizing trade
secrets and other confidential information of the Company, Employee's special
knowledge of the business of the Company and Employee's relationships with
customers, suppliers and others having business relationships with the Company
in any manner or for any purpose other than the advancement of the interests of
the Company, as hereinafter provided. The Employee acknowledges that the Company
would not enter into this Agreement and provide the benefits provided for herein
without the covenants and agreements of the Employee set forth in this Section
3.
(a) Confidentiality. The Employee acknowledges that in the course of
the Employee's employment with the Company, Employee has had and is expected to
continue to have extensive contact with persons with which the Company has
business relationships (including customers and suppliers), and to have
knowledge of and access to trade secrets and other proprietary and confidential
information of the Company, including, without limitation, the identity of
persons with whom the Company has business relationships, technical information,
know-how, plans, specifications, and information relating to the financial
condition, results of operations, employees, products and services, sources,
leads or methods of obtaining new business, pricing formulae, methods or
procedures, cost of supplies or services and marketing strategies of the Company
or any other information relating to the Company that could reasonably be
regarded as confidential or proprietary or which is not in the public domain
(other than by reason of Employee's breach of the provisions of this section)
(collectively, the "Confidential Information"), and that such information, even
to the extent it may be developed or acquired by or through the efforts of the
Employee, constitutes valuable, special and unique assets of the Company
developed or acquired at great expense which are the exclusive property of the
Company. Accordingly, the Employee shall not at any time, either during the
time Employee is employed by the Company or thereafter, use or purport to
authorize any person to use, reveal, report, publish, transfer or otherwise
disclose to any person, corporation or other entity, any Confidential
Information without the prior consent of the Company, except for disclosures to
responsible officers of the Company and other responsible persons who are in a
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contractual or fiduciary relationship with the Company and who have a need for
such information for purposes in the best interests of the Company. Without
limiting the generality of the foregoing, the Employee shall not, directly or
indirectly, disclose or otherwise make known to any Person any information as to
the Company's employees and others providing services to the Company, including
with respect to their abilities, compensation, benefits and other terms of
employment or engagement. Upon the termination of the Employee's employment
with the Company, the Employee shall promptly deliver to the Company all files,
correspondence, manuals, notes, notebooks, computer diskettes, tapes, reports
and copies thereof, and all other materials relating to the Company's business,
including without limitation any materials incorporating Confidential
Information, which are in the possession or control of the Employee.
(b) Restriction on Competition. During the Employee's employment
with the Company and for the duration of the Restricted Period, the Employee
shall not, and shall not permit any persons subject to Employee's direction or
control (including Employee's affiliates) to, directly or indirectly, whether
alone or in association with others, as principal, officer, agent, employee,
director or stockholder of any corporation, partnership, association or other
entity, or through the investment of capital, lending of money or property,
rendering of services or otherwise, engage in, influence, control, have an
interest in or otherwise become actively involved with any business that
competes with the Company or any of its affiliates. The Employee acknowledges
that the business of the Company is national and international in scope, as its
current and anticipated customers and suppliers are located throughout the
United States and abroad, and that it is therefore reasonable that the
restrictions set forth in this Section 3(b) not be limited to any specified
geographic area.
(c) Nonsolicitation. During the Employee's employment with the
Company and for the duration of the Restricted Period, the Employee shall not,
and shall not permit any persons subject to Employee's direction or control
(including Employee's affiliates) to, directly or indirectly, on their own
behalf or on behalf of any other person (except the Company or its affiliates),
(i) call upon, accept business from, or solicit the business of any person who
is, or who had been at any time during the preceding twelve months, a customer
of the Company or any of its affiliates, (ii) otherwise divert or attempt to
divert any business from the Company or any of its affiliates, (iii) interfere
with the business relationships between the Company and any of its affiliates,
on the one hand, and any of their respective customers, suppliers or others with
whom they have business relationships, on the other hand, or (iv) recruit or
otherwise solicit or induce, or enter into or participate in any plan or
arrangement to cause, any person who is an employee of, or otherwise performing
services for, the Company or any of its affiliates to terminate his or her
employment or other relationship with the Company or such affiliate, or hire any
person who has left the employ of the Company or an affiliate during the
preceding twelve months.
(d) Nondisparagement. The Employee shall not at any time, either
during the time Employee is employed by the Company or thereafter, directly or
indirectly, engage in any conduct or make any statement, whether in commercial
or noncommercial speech, disparaging or criticizing in any way the Company or
its affiliates, or any products or services offered by any of them, nor shall
the Employee engage in any other conduct or make any other statement that could
reasonably be expected to impair the goodwill of any of them, the reputation of
any products of the Company or its affiliates or the marketing of such products,
in each case
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except as may be required by law, and then only after consultation with the
Company to the extent possible.
(e) Exception. The ownership or control by the Employee or
Employee's affiliates, as a passive investor, of up to two percent of the
outstanding voting securities or securities of any class of a company with a
class of securities registered under the Securities Exchange Act of 1934, as
amended, shall not be deemed to be a violation of the provisions of this Section
3.
4. Remedies. The Employee agrees that the restrictions set forth in
Section 3, including the length of the Restricted Period, the geographic area
covered and the scope of activities proscribed, are reasonable for the purposes
of protecting the value of the business and goodwill of the Company. The
Employee acknowledges that compliance with the restrictions set forth in Section
3 will not prevent Employee from earning a livelihood, and that in the event of
a breach by the Employee of any of the provisions of Section 3, monetary damages
would not provide an adequate remedy to the Company. Accordingly, the Employee
agrees that, in addition to any other remedies available to the Company, the
Company shall be entitled to seek injunctive and other equitable relief to
secure the enforcement of these provisions, and shall be entitled to receive
reimbursement from the Employee for attorneys' fees and expenses incurred by it
in enforcing these provisions. In addition to its other rights and remedies
hereunder, the Company shall have the right to require the Employee to account
for and pay over to it all compensation, profits, money, accruals and other
benefits derived or received, directly or indirectly, by the Employee from any
breach of the provisions of Section 3, and may set off any such amounts due it
from the Employee against any amounts otherwise due Employee from the Company.
If the Employee breaches the covenant set forth in Section 3, the running of the
Restricted Period shall be tolled for so long as such breach continues. It is
the desire and intent of the parties that the provisions of Sections 3 and 4 be
enforced in full; however, if any court of competent jurisdiction shall at any
time determine that, but for the provisions of this paragraph, any part of this
Agreement relating to the time period, scope of activities or geographic area of
restrictions is invalid or unenforceable, the maximum time period, scope of
activities or geographic area, as the case may be, shall be reduced to the
maximum which such court deems enforceable with respect only to the jurisdiction
in which such adjudication is made. If any other part of this Agreement is
determined by such a court to be invalid or unenforceable, the invalid or
unenforceable provisions shall be deemed amended (with respect only to the
jurisdiction in which such adjudication is made) in such manner as to render
them enforceable and to effectuate as nearly as possible the original intentions
and agreement of the parties.
5. Termination of this Agreement. This Agreement shall terminate on
October 1, 2001, if a Transaction has not occurred by such date; provided that
the Company may extend this Agreement in its sole discretion by written notice
to the Employee. For purposes of this Section 5 only (and not for purposes of
determining whether the Severance Payment has become payable), a Transaction
shall be deemed to have occurred if the closing of the Transaction has occurred
or if the material agreements pursuant to which the Transaction is to occur have
been executed and delivered by the parties to the Transaction.
6. No Alteration of Employment Terms or Status. Except as expressly
provided in this Agreement, nothing herein shall alter in any way any of the
terms of employment of the Employee, including without limitation the Employee's
rights with respect to any stock options
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Employee may have been granted under the Company's 1997 Stock Option Plan.
Nothing in this Agreement shall be deemed to expressly or impliedly alter the
employment relationship between the Employee and the Company, which shall remain
an "at will" employment relationship.
7. Miscellaneous.
(a) Definition of Terms. The term "affiliate," when used in this
Agreement with respect to any person, means any person that, directly or
indirectly, controls, is controlled by or is under common control with such
person, and with respect to any natural person, includes the members of such
person's immediate family (spouse, children and parents). The term "person,"
when used in this Agreement, means any natural person or entity with legal
status.
(b) Entire Agreement. This Agreement sets forth the entire
understanding of the parties with respect to the subject matter hereof and
merges and supersedes any prior or contemporaneous agreements between the
parties pertaining thereto, including without limitation any prior agreements,
arrangements, understandings or commitments of any nature whatsoever relating to
severance payments or other compensation in connection with termination of
Employee's employment.
(c) Amendment. This Agreement may not be amended except by an
instrument in writing signed by the parties hereto.
(d) Waiver. No waiver by any party of any of its rights under
this Agreement shall be effective unless in writing and signed by the party
against which the same is sought to be enforced. No such waiver by any party of
its rights under any provision of this Agreement shall constitute a waiver of
such party's rights under such provisions at any other time or a waiver of such
party's rights under any other provision of this Agreement. No failure by any
party hereto to take any action against any breach of this Agreement or default
by another party shall constitute a waiver of the former party's right to
enforce any provision of this Agreement or to take action against such breach or
default or any subsequent breach or default by such other party.
(e) Successors and Assigns. The Employee shall not have the
right to assign Employee's rights or obligations hereunder. The Company shall
not have the right to assign its rights or obligations under this Agreement
without the prior written consent of the Employee, provided that this Agreement
may be assigned by the Company without the consent of the Employee to another
corporation under common control with the Company, and upon the sale of all or
substantially all of the assets, business and goodwill of the Company to another
company, or upon the merger or consolidation of the Company with another
company, this Agreement may be assigned by the Company to the purchaser of such
assets and shall inure to the benefit of, and be binding upon, both the Employee
and the company purchasing such assets, business and goodwill, or surviving such
merger or consolidation, as the case may be, in the same manner and to the same
extent as though such other company were the Company. Subject to the foregoing,
this Agreement shall inure to the benefit of, and be binding upon, the parties
hereto and their legal representatives, heirs, successors and permitted assigns.
Except as otherwise specifically provided herein, the rights and obligations of
the parties under this Agreement shall be unaffected by a change in control of
the Company.
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(f) Additional Acts. The Employee and the Company shall execute,
acknowledge and deliver and file, or cause to be executed, acknowledged and
delivered and filed, any and all further instruments, agreements or documents as
may be necessary or expedient in order to consummate the transactions provided
for in this Agreement and do any and all further acts and things as may be
necessary or expedient in order to carry out the purpose and intent of this
Agreement.
(g) Communications. All notices, requests, demands and other
communications under this Agreement shall be in writing and shall be deemed to
have been given at the time personally delivered, on the business day following
the day such communication is sent by national overnight delivery service, on
acknowledgment of receipt of a facsimile of such communication, or five days
after being deposited in the United States mail enclosed in a registered or
certified postage prepaid envelope, return receipt requested, and addressed to
the recipient at the address set forth beneath the recipient's signature to this
Agreement, or sent to such other address as a party may specify by notice to the
other party; provided, however, that any notice of change of address shall be
effective only upon receipt.
(h) Severability. If any provision of this Agreement is held to be
invalid or unenforceable by a court of competent jurisdiction, such invalidity
or unenforceability shall not affect the validity and enforceability of the
other provisions of this Agreement and the provision held to be invalid or
unenforceable shall be enforced as nearly as possible according to its original
terms and intent to eliminate such invalidity or unenforceability.
(i) Withholding Taxes. The Company may withhold from amounts payable
under this Agreement such federal, state and local taxes as are required to be
withheld pursuant to any applicable law or regulation and the Company shall be
authorized to take such action as may be necessary in the opinion of the
Company's counsel to satisfy all obligations for the payment of such taxes.
(j) Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Florida applicable to agreements made and to be performed entirely in such
state, without regard to the conflict of laws principles of such state.
(k) Confidentiality. The Employee shall not disclose the existence
of this Agreement or any of the terms or conditions hereof to any person without
the prior written consent of the Company, except for disclosures to such of
Employee's personal advisors or representatives who have a need to know such
information in connection with the performance of their services to the
Employee.
(l) Headings. The section and other headings contained in this
Agreement are for reference purposes only and shall not affect the meaning or
interpretation of any provisions of this Agreement.
(m) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
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(n) Litigation; Prevailing Party. If any litigation is instituted
regarding this Agreement, the prevailing party shall be entitled to receive from
the non-prevailing party, and the non-prevailing party shall pay, all reasonable
fees and expenses of counsel for the prevailing party.
(o) Waiver of Jury Trial. Each party hereto knowingly, irrevocably
and voluntarily waives its right to a trial by jury in any litigation which may
arise under or involving this Agreement.
(p) Venue; Jurisdiction. If any litigation is to be instituted
regarding this Agreement, it shall be instituted in the state and federal courts
located in Brevard County, Florida, and each party irrevocably consents and
submits to the personal jurisdiction of such courts in any such litigation, and
waives any objection to the laying of venue in such courts. Service of process
in any such litigation shall be effective as to any party if given to such party
by registered or certified mail, return receipt requested, or by any other means
of mail that requires a signed receipt, postage prepaid, mailed to such party as
provided in Section 7(g).
(q) Remedies Cumulative. No remedy made available by any of the
provisions of this Agreement is intended to be exclusive of any other remedy,
and each and every remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law or in equity.
IN WITNESS WHEREOF, the parties hereto have each duly executed this
Agreement as of the date set forth above.
RELM WIRELESS CORPORATION
By: /s/ Xxxxxx X. X. Xxxxxxx
--------------------------------
Xxxxxx X. X. Xxxxxxx
Chairman of The Board of Directors
0000 Xxxxxxxxxx Xxxxx
Xxxx Xxxxxxxxx, Xxxxxxx 00000
EMPLOYEE:
/s/ Xxxxx X. Xxxxxx
-------------------------------
Xxxxx X. Xxxxxx
000 Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx Xxxxx, Xxxxxxx 00000
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Schedule 1
Employee: Xxxxx X. Xxxxxx
Position/Title: President & Chief Executive Officer
Annual Compensation: $203,000
Severance Percentage: 100%
Restricted Period: One Year
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