DATA SYSTEMS NETWORK CORPORATION
EMPLOYMENT AGREEMENT
In order to ensure continuity and a smooth transition after the merger
with XxxXxxxxxx.xxx, the Board of Directors resolved that Xxxxxxx X. Xxxxxxx be
given a one year employment agreement.
As a result, this EMPLOYMENT AGREEMENT (this "Agreement') dated as of
this 26th day of June 2000 between Data Systems Network Corp., a Michigan
corporation (hereinafter referred to as the "Company"), and Xxxxxxx X. Xxxxxxx
(hereinafter referred to as the "Executive"):
WITNESSETH:
WHEREAS, the Executive is serving as President and CEO of the Company;
and
WHEREAS, the Executive has extensive experience with respect to the
management and operations of the Company which it considers extremely valuable
to the continued prosperity of the Company or its successors; and
WHEREAS, the Company wishes to ensure that it will continue to have the
Executive available to perform for the Company, duties as requested; 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.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants contained herein, the parties agree as follows:
1. EMPLOYMENT. The Company (or "Employer") shall continue to employ the
Executive upon the terms and conditions hereinafter set forth. The Executive
shall perform such duties and responsibilities for the Employer, which are
commensurate with his position as may be assigned him. Incident to the
performance of such duties, the Employer shall provide the Executive with office
space, facilities and secretarial assistance commensurate with that currently
being provided to the Executive.
2. TERM. Subject only 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 closing date of the merger with XxxXxxxxxx.xxx and ending on the first
anniversary of such closing, unless earlier terminated in accordance with the
terms hereof,
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3. COMPENSATION. During the Term, the Executive's salary shall be
payable at intervals not less often than semi-monthly. The Executive's salary
shall be twenty thousand dollars per month ($20,000). During the Term, the
Executive shall also receive such benefits (the "Benefits") including,
medical, dental, term life, short term and long term disability. Some of these
benefits require the Executive to contribute a portion of the premiums.
4. EXTENT OF SERVICE. During the Term, the Executive shall devote his
full time, attention, and energy to the business of the Employer and the
Executive shall not be engaged in any other business activity pursued for
gain, profit, or other pecuniary advantage which activity in any way
interferes with the Executive's duties and responsibilities provided for
herein.
5. NON-COMPETITION AND NON-SOLICLTATION. The Executive agrees that:
(a) During the Term and for a period of one year thereafter
(the "Restricted Period'), the Executive agrees that he will not (without the
written consent of the Chairman of the Board) engage directly or indirectly 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 directly
competitive with the business, at any time during the Restricted Period,
conducted by the Company or any Affiliates as defined below. 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 subsidiaries or Affiliates so long as the securities of such
corporation are listed on a national securities exchange 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 directly or indirectly will (i) directly
or indirectly 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 Affiliates, (iii) directly or
indirectly request or advise any customer of the Company or Affiliates to
withdraw, curtail or cancel such customer's business with the Company or
Affiliates, (iv) directly or indirectly disclose to any other person, firm or
corporation the names or addresses of any of the customers of the Company or
Affiliates, or (v) compete with the Company or Affiliates in acquiring or
merging with any other business or acquiring the assets of such other
business.
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(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 engages directly or indirectly will, (i)
hire or attempt to hire any employee of the Company or its Affiliates nor, (ii)
directly or indirectly encourage any employee of the Company or its Affiliates
to terminate employment with the Company or its Affiliates. 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 its Affiliates and the Executive has no knowledge of, 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 Employer, 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.
7. TERMINATION.
(A) DEATH OR DISABILITY. If the Executive should become physically or mentally
disabled and unable to perform his duties hereunder for a continuous period in
excess of ninety (90) days (in the reasonable opinion of the Committee), or if
the Executive should die while an employee of the Employer, this Agreement and
the Executive's employment with the Employer shall immediately terminate. If
Executive should die during the Employment Period, any remaining payments
described in "3." above, shall be made to Executive's surviving spouse or, if
none, to his estate.
(B) TERMINATION BY THE EMPLOYER 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 intentional wrongful damage to property of the
Company, and/or Affiliates by the Executive; (iii) the intentional wrongful
disclosure by the Executive of any secret process or confidential information of
the Company, and/or Affiliates; or (iv) the violation of the Executive's
non-disclosure, non-solicitation and non-competition covenants set forth in
Sections 5 and 6. 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.
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(D) VOLUNTARY TERMINATION. If during the Term the Executive
should voluntarily terminate his employment with the Employer for any reason,
including retirement, the obligations of the Employer and 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, except that in
the case of retirement on or after age 62, the Company will recommend to the
Compensation and Stock Option Committee of the Board of Directors of the Company
that the exercisability of Executive's outstanding stock options be accelerated.
9. NOTICES. Any notice required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been given when
deposited in the U.S. mail in a registered, postage prepaid envelope addressed:
If to the Executive, at his address set forth below, and if to the Company, c/o
the Board of Directors, Data Systems Network Corporation, 00000 Xxxx Xxxxxx Xxxx
Xxxx, Xxxxx 000, Xxxxxxxxxx Xxxxx, Xxxxxxxx, 00000.
11. ASSIGNMENT. The Executive may not assign his obligations hereunder.
The rights of the Executive and the rights and obligations of the Company
hereunder shall inure to the benefit of and shall be binding upon their
respective heirs, personal representatives, successors and assigns.
12. MISCELLANEOUS.
(a) This Agreement shall be subject to and governed by the laws of the
State of Michigan.
(b) Failure to insist upon strict compliance with any provisions hereof
shall not be deemed a waiver of such provisions or any other provision
hereof.
(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 hereof shall not
affect the validity or enforceability of any other provision.
(e) This Agreement shall supersede any and all prior employment agreements
or understandings, written or oral, with the Executive.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
ATA SYSTEMS NETWORK CORPORATION
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Xxxxxxx Xxxxxx
Chief Financial Officer
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Xxxxxxx X. Xxxxxxx
0000 Xxxx Xxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
