AMENDED AND RESTATED
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EMPLOYMENT AGREEMENT
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ AND TII INDUSTRIES, INC.
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AGREEMENT, dated as of the lst day of May 1997, by and between TII
INDUSTRIES, INC., a Delaware corporation, having a place of business at ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (hereinafter designated and referred to
as "Company"), and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ residing at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter designated and referred to as "Employee").
WHEREAS, the Company and the Employee entered into an Employment
Agreement, dated as of the 1st day of July, 1993, as extended, pursuant to which
Employee agreed to serve as the Vice President-Research & Development; and
WHEREAS, Employee is willing to continue such employment by the
Company, all in accordance with provisions hereinafter set forth;
NOW THEREFORE, in consideration of the promises and mutual covenants
herein contained, the parties hereto agree as follows:
1. Term: The term of this Agreement shall be for a period
of three (3) years commencing May 1, 1997 and automatically terminating on April
30, 2000 subject to earlier termination as provided herein or unless extended by
mutual consent of both parties in writing sixty (60) days prior to the end of
the term of this Agreement or any extension thereof, but nothing herein shall
require the Company to agree to any specific term or condition or to any
continuation of your employment beyond the end of the term of this Agreement.
2. Employment: Subject to the terms and conditions and for
the compensation hereinafter set forth, the Company employs the Employee for and
during the term of this Agreement. Employee is hereby employed by the Company in
charge of the Research and Development department with the title of Vice
President - Research & Development; his duties shall be determined by the
President and/or Board of Directors from time to time; and shall include
responsibility for the support and further development of the Company's core
products as well as the development and expansion of the Company's product lines
into new areas of endeavor in cooperation with, among others, the efforts of the
Company's Marketing and Sales, Manufacturing and Finance Departments under the
direction of the President, his designee and/or Board of Directors; Employee
shall also have the authority and responsibility for the staffing of the
Research and Development Department of the Company, with the advice and consent
of the President, and in accordance with the Company's established employment
guidelines and budgets; and the Employee does hereby accept such employment and
agrees to use his best efforts and to devote all his normal business time,
during the term of this Agreement, to the performance of his duties faithfully,
diligently and to the best of his abilities upon the conditions hereinafter set
forth. Employee shall report to the President or his designee, of the Company.
Employee's primary place of work shall be on Long Island, New York and Employee
agrees to spend such time, from time to time at the Company's other facilities
and visit customers, and vendors, and various industry associations as required
to fulfill his duties and responsibilities as contemplated herein.
3. Compensation: During the term of this Agreement, the
Company agrees to pay Employee, and Employee agrees to accept, annual salary of
One Hundred, Twenty-Nine Thousand, and Eighty dollars ($129,080.00) payable
every two weeks, less all applicable taxes,
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for all services rendered by Employee hereunder. Employee's annual salary shall
be reviewed at the end of each year of employment hereunder and shall receive an
increase not less than the percentage of increase of the Local Component of the
National Consumer Index issued by the United States Department of Labor unless
financial factors of the Company deem otherwise as determined by the President.
In addition, Employee shall be eligible to participate in the Company's
Executive Bonus Plan should the Company adopt one.
4. Expenses:
(A) The Company shall reimburse Employee for all
reasonable and actual business expenses incurred by him in connection with his
service to the Company, upon submission by him of appropriate vouchers and
expense account reports.
(B) The Company shall provide the Employee with an
allowance to reimburse him for the cost of maintaining a place of abode in the
Commonwealth of Puerto Rico, which allowance shall not exceed twenty percent of
the Employee's then salary computed in accordance with 3 above. Company
acknowledges that Employee is a resident of the State of New York and that
Employee shall not be required to change his residence. The Company and the
Employee both acknowledge that the discharge of the Employee's duties will
require his presence in the Commonwealth of Puerto Rico from time to time.
5. Company Car: The Company shall provide Employee with a
Company car for Employee's use for business purposes in accordance with standard
Company guidelines. This car shall be insured and registered with the Motor
Vehicle Department by the Company. Employee is responsible for maintenance,
gasoline, traffic violation fines etc. Repairs for other than routine
maintenance shall be the responsibility of the Company.
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6. Benefits: In addition to the salary to be paid to
Employee hereunder, the Company shall provide medical and dental insurance and
such other benefits, in accordance with the Company's Plan. The Employee shall
be entitled to annual vacation in accordance with the Company's policy.
7. Extent of Service: The Employee during the term of this
Agreement shall devote his full normal business time, attention and energy and
render his best efforts and skill to the business of the Company.
8. Restrictive Covenant: (A) Employee acknowledges that (i)
the business in which the Company is engaged is intensely competitive and that
his employment by the Company will require that he have access to and knowledge
of confidential information of the Company, including, but not limited to,
certain of the Company's confidential plans for the creation, acquisition or
disposition of products, expansion plans, product development plans, methods of
pricing, special customer requirements for service, information on methods of
servicing the customer, operational information such as formulas, financial
status, and plans and personnel information and trade secrets, which are of
vital importance to the success of the Company's business; (ii) the direct or
indirect disclosure of any such confidential information to existing or
potential competitors of the Company would place the Company at a competitive
disadvantage and would cause damage, financial and otherwise, to the Company's
business; and (iii) by his training, experience and expertise, some of his
services to the Company will be special and unique. (B) Employee agrees that
during the term of this Agreement, he will not directly or indirectly become
affiliated as an officer, director, employee or consultant or as a substantial
security holder with any other company or entity whose business is directly
competitive with any
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business then being conducted by the Company or its subsidiaries. For the
purpose hereof, "substantial security holder" shall mean ownership, directly or
indirectly, of more than 5% of any class of securities of a company or
partnership interest in any partnership.
9. Discoveries, etc.:
[A] The Company shall be the owner, without further
compensation, of all rights of every kind in and with respect to any reports,
materials, inventions, processes, discoveries, improvements, modifications,
know-how or trade secrets hereafter made, prepared, invented, discovered,
acquired, suggested or reduced to practice (hereinafter designated and referred
to as "Property Rights") by Employee in connection with Employee's performance
of his duties pursuant to this Agreement, and the Company shall be entitled to
utilize and dispose of such in such manner as it may determine.
[B] The Employee agrees to and shall promptly disclose
to the President all Property Rights (whether or not patentable) made,
discovered or conceived of by him, alone or with others, at any time during his
employment with the Company, whether on the Company's or his own time and
irrespective of whether on or off the Company's premises, provided only that
such Property Rights (1) relate to or are useful in any phase of the business in
which the Company may be engaged during the period of employment, or (2) relate
to any subject matter or problems within the scope of Employee's employment, or
(3) relate to or involve the use of any data or information of which the
Employee has been or may become informed by reason of employment with the
Company. The Employee hereby appoints the Company as Employee's attorney-in-fact
to execute in accordance with the laws of any country patent applications,
assignments or other documents considered necessary or desirable by the Company.
Any such
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Property Rights will be the sole and exclusive property of the Company, and
Employee will execute any assignments requested by the Company of his right,
title or interest in any such Property Rights without further demand or
consideration and in addition, the Employee will also provide the Company with
any other instruments or documents requested by the Company, at the Company's
expense, as may be necessary or desirable in applying for and obtaining patents
with respect thereto in the United States and all foreign countries. The
Employee also agrees to cooperate with the Company in the prosecution or defense
of any patent claims or litigation or proceedings involving inventions, trade
secrets, trademarks, services marks, secret processes, discoveries or
improvements, during his employment by the Company. Employee's cooperation after
his employment is subject to his availability and the Company agrees to
reimburse Employee for loss of income and expenses incurred in connection
therewith. Said cooperation shall not be withheld by Employee.
10. Confidential Information: Employee recognizes and
acknowledges that the Company, through the expenditure of considerable time and
money, will acquire, has developed and will continue to develop in the future,
information, skills, confidential information, know-how, formulae, technical
expertise and methods relating to or forming part of the Company's services and
products and conduct of its business, and that the same are confidential and
proprietary, and are "trade secrets" of the Company. Employee understands and
agrees that such trade secrets may give the Company a significant competitive
advantage. Employee further recognizes that the success of the Company depends
on keeping confidential both the trade secrets already developed or to be
acquired and any future developments of trade secrets. Employee understands that
in his capacity with the Company he will be entrusted with knowledge
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of such trade secrets and, in recognition of the importance thereof and in
consideration of his employment by the Company hereunder, agrees that he will
not, without the consent of the President in writing, make any disclosure of
trade secrets now or hereafter possessed by the Company to any person,
partnership, corporation or entity either during or after the term hereunder,
except to such employees of the Company or its subsidiaries or affiliates, if
any, as may be necessary in the regular course of business and except as may be
required pursuant to any court order, judgment or decision from any court of
competent jurisdiction. The provisions of this Section shall continue in full
force and effect notwithstanding any termination of this Agreement.
11. Irreparable Harm: Employee agrees that any breach or
threatened breach by Employee of provisions set forth in Sections eight (8),
nine (9) and ten (10) of this Agreement, would cause the Company irreparable
harm and the Company may obtain injunctive relief against such actual or
threatened conduct and without the necessity of a bond. The Company agrees that
any breach or threatened breach by the Company of Sections eight (8), nine (9)
and ten (10) of this Agreement that would cause the Employee irreparable harm,
the Employee may obtain injunctive relief against such actual or threatened
conduct and without the necessity of a bond.
12. Return of Company Property: Employee agrees that
following the termination of his employment for any reason, he shall return all
property of the Company which is then in or thereafter comes into his
possession, including, but not limited to, documents, contracts, agreements,
plans, photographs, books, notes, electronically stored data and all copies of
the foregoing as well as any other materials or equipment supplied by the
Company to the Employee.
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13. Termination:
[A] Death: In the event of the Employee's death during
the term of his employment, this Agreement shall automatically terminate on the
date of death, and Employee's estate shall be entitled to payment of Employee's
salary until date of death. All other benefits and compensation described herein
shall terminate on the date of death unless otherwise stipulated in the
appropriate Company plan.
[B] Disability: In the event the Employee, by reason of
physical or mental incapacity, shall be disabled for a period of at least two
(2) consecutive months or three months in the aggregate in any twelve (12) month
period of this Agreement or any extension hereof, the Company shall have the
option at any time thereafter, to terminate Employee's employment and to
terminate this Agreement. Such termination to be effective ten (10) days after
the Company gives written notice of such termination to the Employee, and all
obligations of the Company hereunder shall cease upon the date of such
termination unless otherwise stipulated in the appropriate Company plan.
"Incapacity" as used herein shall mean the inability of the Employee to perform
his normal duties.
[C] Company's Rights To Terminate This Agreement:
[a] The Company shall have the right, before
the expiration of the term of this Agreement, to terminate this Agreement and to
discharge Employee for cause (hereinafter "Cause"), and all compensation to
Employee shall cease to accrue upon discharge of the Employee for Cause. For the
purposes of this Agreement, the term "Cause" shall mean the Employee's (i)
violation of the Company's written policy or specific written directions of the
President or his designee, and/or Board of Directors, which directions are
consistent with
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normally acceptable business practices or the failure to observe, or the failure
or refusal to perform any obligations required to be performed in accordance
with this Agreement or provided that the violation can be cured (ii) admission
or conviction of a serious crime involving moral turpitude or (iii) if the
President determines that employee has committed a demonstrable act (or
omission) of malfeasance seriously detrimental to this Company (which shall not
include any exercise of business judgment in good faith).
[b] If the Company, elects to terminate
Employee's employment for Cause, the Company shall first give Employee written
notice and a period of ten (10) days to cure such Cause, and if such Cause is
not cured in said ten (10) days, such termination shall be effective five (5)
days after the Company gives written notice of such failure to cure to the
Employee. In the event of a termination of the Employee's employment for Cause
in accordance with the provisions of Section 13 [C], the Company shall have no
further obligation to the Employee, except for the payment of salary through the
date of such termination from employment.
[c] Notwithstanding anything in this
Agreement to the contrary, the Company may terminate the Employee's employment
for reasons other than Cause.
[D] Employee's Right To Terminate This Agreement:
[a] If the Company, elects to reduce in rank
or authority the Employee's duties under this Agreement, without the mutual
agreement of the Employee, the Employee shall first give Company written notice
and a period of ten (10) days to cure same, and if same is not cured in said ten
(10) days Employee may terminate this Agreement effective five (5) days after
the Employee gives written notice of such failure to cure.
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[E] Severance: In the event the Employee's employment
hereunder shall be terminated by the Company for other than Cause, death or
disability, or by the Employee pursuant to Section 13 [D] hereof, (1) the
Employee shall thereupon receive as severance pay in a lump sum the amount of
Compensation pursuant to Section 3 hereof and bonuses pursuant to the Company's
executive bonus incentive plan, if any, which the Employee would have received
for the remaining term of this Agreement (including any extension of the
Agreement mutually agreed upon by the parties), provided, however, that in no
event shall such lump sum payment be less than six months Compensation and
bonus; and (2) the Employee's (and his dependents') participation in any
medical, dental and other insurance plans shall be continued, or equivalent
benefits provided to him or them by the Company, at no cost to him or them, for
a period of one year from the termination; and (3) any options granted to the
Employee which have not, by the terms of the options, vested shall be deemed to
have vested at the termination of employment, and shall thereafter be
exercisable for the maximum period of time allowed for exercise thereof under
the terms of the applicable Company stock option plan(s), provided that such
period shall not be less than 90 days following such termination. An election by
the Employee to terminate his employment under the provisions of Section 13 [D]
shall not be deemed a voluntary termination of employment of the Employee for
the purpose of interrupting the provisions of any of the Company's employee
benefits plans, programs or policies.
14. Waiver: Any waiver by either party of a breach of any
provision of this Agreement shall not operate as or be construed as a waiver of
any other breach or default hereof.
15. Arbitration: Any controversy or claim arising out of or
relating to this Agreement or the breach thereof, shall be settled by
arbitration to be held in New York City, New
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York, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association effective January 1, 1993. Judgment upon the award
rendered by the arbitrators may be entered in any Court having jurisdiction
thereof.
16. Governing Law: The validity of this Agreement or of any
of the provisions hereof shall be determined under and according to the laws of
the State of New York, and this Agreement and its provisions shall be construed
according to the laws of the State of New York, without reference to its choice
of law rules.
17. Notice: Any notice required to be given pursuant to the
provisions of this Agreement shall be in writing and by facsimile or registered
or certified mail or equivalent (i.e. Federal Express) and mailed to the
following addresses:
Company: TII Industries, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
President
Employee: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
18. Assignment: The Employee's assignment of this Agreement
or any interest herein, or any monies due or to become due by reason of the
terms hereof, without the prior written consent of the Company shall be void.
This Agreement shall be assignable and binding to a corporation or other
business entity that succeeds to all or substantially all of the business of the
Company through merger, consolidation, corporate reorganization or by
acquisition of all or substantially all of the assets of the Company and which
assumes Company's obligations under this Agreement.
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19. Miscellaneous: This Agreement contains the entire
understanding between the parties hereto and supersedes all other oral and
written agreements or understandings between them. No modification or addition
hereto or waiver or cancellation of any provision shall be valid except by a
writing signed by the party to be charged therewith.
20. Obligations of a Continuing Nature: It is expressly
understood and agreed that the covenants, agreements and restrictions undertaken
by or imposed on either party hereunder, which are stated to exist or continue
after termination of Employee's employment with the Company, shall exist and
continue on both parties irrespective of the method or circumstances of such
termination from employment or termination of this Agreement.
21. Severability: Employee agrees that if any of the
covenants, agreements or restrictions on the part of Employee are held to be
invalid by any court of competent jurisdiction, such holding will not invalidate
any of the other covenants, agreements and/or restrictions herein contained and
such invalid provisions shall be severable so that the invalidity of any such
provision shall not invalidate any others. Moreover, if any one or more of the
provisions contained in this Agreement shall be held to be excessively broad as
to duration, activity or subject, such provisions shall be construed by limiting
and reducing them so as to be enforceable to the maximum extent allowed by
applicable law.
22. Representation: Employee represents and warrants that he
has the legal right to enter into this Agreement and to perform all of the
duties and obligations on his part to be performed hereunder in accordance with
its terms and that he is not a party to any agreement or understanding, written
or oral, which prevents him from entering into this Agreement or performing all
of his duties and obligations hereunder. In the event of a breach of such
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representation or warranty on his part or if there is any other legal impediment
which prevents him from entering into this Agreement or performing all of his
duties and obligations hereunder, the Company shall have the right to terminate
this Agreement in accordance with Section 13[C][a]. Without limiting the
foregoing, Employee represents and warrants that he is not a party to any
agreement which prohibits or limits his ability (i)to fulfill his duties and
responsibilities contemplated herein including his ability to develop products
which may compete with any entity or (ii) to accept employment with the Company.
23. Descriptive Headings. The paragraphs headings contained
herein are for reference purposes only and shall not in anyway affect the
meaning or interpretation of this Agreement.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the day and year first above written.
TII INDUSTRIES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
President
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
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Employee
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