EX-10.11
Employment Agreement
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of January 17, 2000, by and
between TELETRAC, INC., a Delaware corporation (the "Company"), and ▇▇▇▇▇▇
Settlemayer (the "Employee").
W I T N E S S E T H:
WHEREAS, the Company desires to induce the Employee to enter
into employment with the Company commencing on January 17, 2000, (the "Effective
Date") for the period provided in this Agreement, and the Employee is willing to
accept such employment with the Company on a full-time basis, all in accordance
with the terms and conditions set forth below;
NOW, THEREFORE, for and in consideration of the premises
hereof and the mutual covenants contained herein, the parties hereto hereby
covenant and agree as follows:
1. Employment. (a) The Company hereby employs the Employee,
and the Employee hereby accepts such employment with the Company, for the period
set forth in Section 2 hereof, all upon the terms and conditions hereinafter set
forth.
(b) The Employee affirms and represents that he is under no
obligation to any former employer or other party which is in any way
inconsistent with, or which imposes any restriction upon, the Employee's
acceptance of employment hereunder with the Company, the employment of the
Employee by the Company, or the Employee's undertakings under this Agreement.
2. Term of Employment. Unless earlier terminated as
hereinafter provided, the term of the Employee's employment under this Agreement
shall initially be for a period beginning on the Effective Date and ending on
September 29, 2001. Thereafter, this Agreement will continue in full force and
effect from year to year unless terminated by either the Employee or the Company
by written notice given to the other not later than two months before the end of
the year of such termination. The period from the date hereof until the date the
Employee's employment hereunder is terminated (whether on September 29, 2001, or
earlier or later as provided herein) is hereinafter called the "Employment
Term."
3. Duties. The Employee shall be employed as the Vice
President of Sales for the Company, shall faithfully and competently perform
such duties as are specified in the Bylaws of the Company and shall also perform
and discharge such other executive employment duties and responsibilities
consistent with his position as the Board of Directors and the Chief Executive
Officer of the Company may from time to time reasonably prescribe. The Employee
shall perform his duties at such places and times as the Board of Directors of
the Company may reasonably prescribe; provided, however, that if compliance with
this requirement would require the Employee to relocate more than 40 miles from
his current home in the Placentia, California area, the Employee will only be
required to relocate on such terms and to such location as is mutually
acceptable to the Employee
and the Company. Except as may otherwise be approved in advance by the Board of
Directors of the Company, and except during vacation periods and reasonable
periods of absence due to sickness, personal injury or other disability,
personal affairs or non-profit public service activities, the Employee shall
devote his full time during normal business hours throughout the Employment Term
to the services required of him hereunder. The Employee shall render his
business services exclusively to the Company during the Employment Term and
shall use his best efforts, judgment and energy to improve and advance the
business and interests of the Company in a manner consistent with the duties of
his position.
4. Salary, Bonus and Stock Option. (a) Salary. As compensation
for the performance by the Employee of the services to be performed by the
Employee hereunder during the Employment Term, the Company shall pay the
Employee a base salary at the annual rate of one hundred seventy-four thousand
dollars ($174,000) (said amount, together with any increases thereto as provided
in this Section 4(a), being hereinafter referred to as "Salary"). Any Salary
payable hereunder shall be paid in regular intervals (but in no event less
frequently than monthly) in accordance with the Company's payroll practices from
time to time in effect. The Salary payable to the Employee pursuant to this
Section 4(a) may be increased as determined from time to time by the
Compensation Committee of the Board of Directors of the Company in its sole
discretion.
(b) Bonus. The Employee may be eligible to receive bonus
compensation from the Company from time to time in amount(s) that shall be
determined by the Compensation Committee of the Board of Directors of the
Company based on attainment of target performance objectives which shall be set
by the Compensation Committee of the Board of Directors of the Company.
Any bonus payable hereunder shall be paid as promptly as
practicable as determined by the Board of Directors in its sole discretion.
(c) Withholding, Etc. The payment of any Salary and bonus
hereunder shall be subject to applicable withholding and payroll taxes, and such
other deductions as may be required under the Company's employee benefit plans.
(d) Stock Option. (i) Effective the Effective Date, the
Company shall grant to the Employee a stock option, pursuant to the Teletrac,
Inc. and its Subsidiaries 1999 Stock Option and Restricted Stock Purchase Plan
(the "Stock Option Plan") to purchase 30,000 shares, subject to adjustment as
provided therein, of Common Stock, $.01 par value (the "Common Stock"), of the
Company. Such option is intended to the maximum extent permissible to qualify as
a "incentive stock option" within the meaning of Section 422(b) of the Internal
Revenue Code of 1986, as amended. Such option shall be at the purchase price and
subject to the other terms and conditions provided in stock option agreement
between the Company and the Employee substantially in the form attached hereto
as Exhibit A.
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(ii) The Employee shall be eligible to receive additional
incentive stock options and/or non-qualified stock options in accordance with
the Stock Option Plan to the extent and in the manner as determined by the
Compensation Committee of the Board of Directors.
5. Other Benefits. During the Employment Term, the Employee
shall:
(i) be eligible to participate in employee fringe benefits and
pension and/or profit sharing plans that may be provided by the Company for its
senior executive employees in accordance with the provisions of any such plans,
as the same may be in effect from time to time;
(ii) be eligible to participate in any medical and health
plans or other employee welfare benefit plans that may be provided by the
Company for its senior executive employees in accordance with the provisions of
any such plans, as the same may be in effect from time to time;
(iii) be entitled to three weeks' annual paid vacation;
(iv) be entitled to sick leave, sick pay and disability
benefits in accordance with any Company policy that may be applicable to senior
executive employees from time to time; and
(v) be entitled to reimbursement for all reasonable and
necessary out-of-pocket business expenses incurred by the Employee in the
performance of his duties hereunder in accordance with the Company's policies
applicable thereto.
6. Confidential Information. The Employee hereby covenants,
agrees and acknowledges as follows:
(a) The Employee has and will have access to and will
participate in the development of or be acquainted with confidential or
proprietary information and trade secrets related to the business of
the Company, its subsidiaries and affiliates (collectively, the
"Companies"), including but not limited to (i) business plans,
operating plans, marketing plans, financial reports, operating data,
budgets, wage and salary rates, pricing strategies and information,
terms of agreements with suppliers or customers and others, customer
lists, patents, devices, software programs, reports, correspondence,
tangible property and specifications owned by or used in the businesses
of one or more of the Companies, (ii) information pertaining to future
developments such as, but not limited to, research and development,
future marketing, distribution, delivery or merchandising plans or
ideas, and potential new business locations, and (iii) other tangible
and intangible property, which are used in the business and operations
of the Companies but not made publicly available. The information and
trade secrets relating to the business of the Companies described in
this paragraph (a) are hereinafter referred to collectively as the
"Confidential Information", provided that the term Confidential
Information shall not include any information (x) that is or becomes
generally publicly available (other than as a result of violation of
this Agreement by the Employee) or (y) that the Employee receives on a
non-confidential basis from a source
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(other than the Company, its affiliates or representatives) that is not
known by him to be bound by an obligation of secrecy or confidentiality
to the Companies or any of them.
(b) The Employee hereby assigns to the Company, in
consideration of his employment, all Confidential Information developed
by or otherwise in the possession of the Employee at any time during
the Employment Term, whether or not made or conceived during working
hours, alone or with others, which relates, directly or indirectly, to
businesses or proposed businesses of any of the Companies, and the
Employee agrees that all such Confidential Information shall be the
exclusive property of the Companies. Upon request of the Board of
Directors of the Company, the Employee shall execute and deliver to the
Companies any specific assignments or other documents appropriate to
vest title in such Confidential Information in the Companies or to
obtain for the Companies legal protection for such Confidential
Information.
(c) The Employee shall not disclose, use or make known for his
or another's benefit any Confidential Information or use such
Confidential Information in any way except in the best interests of the
Companies in the performance of the Employee's duties under this
Agreement. The Employee may disclose Confidential Information when
required by applicable law or judicial process, but only after notice
to the Company of the Employee's intention to do so and opportunity for
the Company to challenge or limit the scope of the disclosure.
(d) The Employee acknowledges and agrees that a remedy at law
for any breach or threatened breach of the provisions of this Section 6
would be inadequate and, therefore, agrees that the Companies shall be
entitled to injunctive relief in addition to any other available rights
and remedies in case of any such breach or threatened breach; provided,
however, that nothing contained herein shall be construed as
prohibiting the Companies from pursuing any other rights and remedies
available for any such breach or threatened breach.
(e) The Employee agrees that upon termination of his
employment by the Company for any reason, the Employee shall forthwith
return to the Company all Confidential Information, documents,
correspondence, notebooks, reports, computer programs and all other
materials and copies thereof (including computer discs and other
electronic media) relating in any way to the business of the Companies
in any way developed or obtained by the Employee during the period of
his employment with the Company.
(f) The obligations of the Employee under this Section 6
shall, except as otherwise provided herein, survive the termination of
the Employment Term and the expiration or termination of this Agreement
and shall terminate three years after the termination of the Employment
Term.
(g) Without limiting the generality of Section 10 hereof, the
Employee hereby expressly agrees that the foregoing provisions of this
Section 6 shall be binding upon the Employee's heirs, successors and
legal representatives.
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7. Termination. (a) The Employee's employment hereunder shall
be terminated upon the occurrence of any of the following:
(i) death of the Employee;
(ii) termination of the Employee's employment hereunder by the
Employee at any time for "good reason" (as defined below);
(iii) termination of the Employee's employment hereunder by
the Employee at any time for any reason whatsoever (including, without
limitation, resignation or retirement), other than "good reason" as
contemplated by clause (ii) above;
(iv) termination of the Employee's employment hereunder by the
Company because of the Employee's inability to perform his duties on
account of disability or incapacity for a period of one hundred eighty
(180) or more days, whether or not consecutive, within any period of
twelve (12) consecutive months;
(v) termination of the Employee's employment hereunder by the
Company at any time "for cause" (as defined below), such termination to
take effect immediately upon written notice from the Company to the
Employee; and
(vi) termination of the Employee's employment hereunder by the
Company at any time, other than (x) termination by reason of disability
or incapacity as contemplated by clause (iv) above or (y) termination
by the Company "for cause" as contemplated by clause (v) above.
(b) In the event that the Employee's employment is terminated
pursuant to clause (i), (ii), (iv) or (vi) of Section 7(a) above, and in the
event of a Change in Control (as defined below) the Company shall pay to the
Employee, as severance pay or liquidated damages or both, during the
twelve-month period immediately following such termination, the amount of Salary
that the Employee would have otherwise been entitled to receive during such
twelve-month period had the Employee's employment not been so terminated;
provided, however, that no such payment shall be due in the event such
termination occurs as a result of a notice of termination given by the Company
or by the Employee in connection with a failure to renew this Agreement as
provided in Section 2.
(c) Notwithstanding anything to the contrary expressed or
implied herein, except as required by applicable law and except as set forth in
Section 7(b) above, the Company (and its affiliates) shall not be obligated to
make any payments to the Employee or on his behalf of whatever kind or nature by
reason of the Employee's cessation of employment (including, without limitation,
by reason of termination of the Employee's employment by the Company for
"cause"), other than (i) such amounts, if any, of his Salary as shall have
accrued and bonus as shall have been determined to be due by the Board of
Directors and, in each case, remained unpaid as of the date of said cessation
and (ii) such other amounts, if any, which may be then otherwise payable to the
Employee from the
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Company's benefits plans or reimbursement policies. The termination of this
Agreement shall not relieve the Employee of any liability for any willful breach
hereof.
(d) No interest shall accrue on or be paid with respect to any
portion of any payments hereunder.
(e) For purposes of this Agreement, the following definitions
shall apply:
(i) The term "good reason" shall mean only the following: (1)
material default by the Company in the performance of its obligations
hereunder, or (2) material diminishment of the duties, position or
responsibilities of the Employee hereunder (provided that, in either
such case, the Employee shall have provided the Board of Directors of
the Company with written notice of such default or other event and a
reasonable opportunity to discuss the matter with the Employee,
followed by a notice that the Employee adheres to his position and a
reasonable opportunity to cure);
(ii) The term "cause" shall mean only the following: (1)
conviction of the Employee of having committed a felony, (2) acts of
dishonesty or moral turpitude by the Employee that are materially
detrimental to the Company and/or its affiliates, (3) acts or omissions
by the Employee that the Employee knew were likely to materially damage
the business of the Company and/or any affiliate of the Company whose
business, operations, assets or properties are material to the Company,
(4) gross negligence by the Employee in the performance of, or willful
disregard by the Employee of, his obligations hereunder, or willful and
material breach by the Employee of the terms hereof or (5) failure by
the Employee to obey the reasonable and lawful orders of the Board of
Directors or Chief Executive Officer that are consistent with the
provisions of this Agreement (provided that, in the event such failure
shall not also constitute "cause" under any of clauses (1) through (4)
above, the Employee shall have received written notice of such failure
and a reasonable opportunity to discuss the matter with the Board of
Directors, followed by a notice that the Board of Directors adheres to
its position and a reasonable opportunity to comply with such orders).
It is understood and agreed that the performance of the Company,
whether financial, operational or otherwise, shall not (in the absence
of "cause" as provided in clause (1) through (5) above) constitute
"cause."
(iii) "Change of Control" shall mean the acquisition of (a)
beneficial ownership of more than 50% of the voting equity securities
of the Company or any successor to the Company (by merger or otherwise)
or (b) all or substantially all the assets of the Company, by any
person or entity (including, without limitation, any group within the
meaning of Section 13(d)(3) of the Securities Exchange Act, as
amended).
8. Non-Assignability. (a) Neither this Agreement nor any right
or interest hereunder shall be assignable by the Employee or his beneficiaries
or legal representatives without the Company's prior written consent; provided,
however, that nothing in this Section 8(a) shall
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preclude the Employee from designating a beneficiary to receive any benefit
payable hereunder upon his death or incapacity.
(b) Except as required by law, no right to receive payments
under this Agreement shall be subject to anticipation, commutation, alienation,
sale, assignment, encumbrance, charge, pledge, or hypothecation or to exclusion,
attachment, levy or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to effect any such action shall be null, void
and of no effect.
9. Competition, etc. (a)During the Employment Term and during
the two-year period following the end of the Employment Term for any reason
whatsoever, provided that payments, if any, required pursuant to Section 7(b)
hereof are made in full and in a timely fashion:
(i) the Employee will not directly or indirectly (as a
director, officer, employee, manager, consultant, independent
contractor, advisor or otherwise) engage in competition with, or own
any interest in, perform any services for, participate in or be
connected with any business or organization which engages in
competition with the Company or any of its affiliates in any State
where any business shall be carried on (or formally contemplated to be
carried on) by the Company or any of its affiliates during the
Employment Term or as of the end of the Employment Term, as the case
may be, provided, however, that the provisions of this Section 9(a)(i)
shall not be deemed to prohibit (A) the Employee's ownership of not
more than five percent (5%) of the total shares of all classes of stock
outstanding of any publicly held company, or ownership, whether through
direct or indirect stock holdings or otherwise, of one percent (1%) or
more of any other business or (B) non-profit public service activities,
as contemplated by Section 3 hereof; and
(ii) the Employee will not directly or indirectly induce or
attempt to induce any employee of the Company or any affiliate of the
Company to leave the employ of the Company or such affiliate, or in any
way interfere with the relationship between the Company or any such
affiliate and any employee thereof.
(b) For purposes of this Section 9, a person or entity
(including, without limitation, the Employee) shall be deemed to be a competitor
of the Company or any of its affiliates, or a person or entity (including,
without limitation, the Employee) shall be deemed to be engaging in competition
with the Company or any of its affiliates, if such person or entity in any way
conducts, operates, carries out or engages in (i) the business of vehicle
location and fleet management services or related services and supplies, or (ii)
such other business or businesses as the Company may conduct in the future in
such geographical area or areas as such business or businesses are conducted.
(c) For purposes of this Section 9, no company or entity that
may be deemed to be an affiliate of the Company solely by reason of its being
controlled by, or under common control with, any of the Investors or their
respective affiliates other than the Company, will be deemed to be an affiliate
of the Company.
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(d) In connection with the foregoing provisions of this
Section 9, the Employee represents that his experience, capabilities and
circumstances are such that such provisions will not prevent him from earning a
livelihood. The Employee further agrees that the limitations set forth in this
Section 9 (including, without limitation, time and territorial limitations) are
reasonable and properly required for the adequate protection of the businesses
of the Company and its affiliates. It is understood and agreed that the
covenants made by the Employee in this Section 9 (and in Section 6 hereof) shall
survive the expiration or termination of this Agreement, except as otherwise
expressly provided herein.
(e) The Employee acknowledges and agrees that a remedy at law
for any breach or threatened breach of the provisions of this Section 9 would be
inadequate and, therefore, agrees that the Company and any of its affiliates
shall be entitled to injunctive relief in addition to any other available rights
and remedies in cases of any such breach or threatened breach; provided,
however, that nothing contained herein shall be construed as prohibiting the
Company or any of its affiliates from pursuing any other rights and remedies
available for any such breach or threatened breach.
10. Binding Effect. Without limiting or diminishing the effect
of Section 8 hereof, this Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective heirs, successors, legal
representatives and assigns.
11. Notices. Any notice required or permitted to be given
under this Agreement shall be sufficient if in writing and either delivered in
person or sent by first class certified or registered mail, postage prepaid, if
to the Company, at the Company's principal place of business, and if to the
Employee, at his home address most recently filed with the Company, or to such
other address or addresses as either party shall have designated in writing to
the other party hereto.
12. Law Governing. This Agreement shall be governed by and
construed in accordance with the laws of the State of California.
13. Severability. The Employee agrees that in the event that
any court of competent jurisdiction shall finally hold that any provision of
Section 6 or 9 hereof is void or constitutes an unreasonable restriction against
the Employee, the provisions of such Section 6 or 9 shall not be rendered void
but shall apply with respect to such extent as such court may judicially
determine constitutes a reasonable restriction under the circumstances. If any
part of this Agreement other than Section 6 or 9 is held by a court of competent
jurisdiction to be invalid, illegible or incapable of being enforced in whole or
in part by reason of any rule of law or public policy, such part shall be deemed
to be severed from the remainder of this Agreement for the purpose only of the
particular legal proceedings in question and all other covenants and provisions
of this Agreement shall in every other respect continue in full force and effect
and no covenant or provision shall be deemed dependent upon any other covenant
or provision.
14. Waiver. Failure to insist upon strict compliance with any
of the terms, covenants or conditions hereof shall not be deemed a waiver of
such term, covenant or condition, nor shall any waiver or relinquishment of any
right or power hereunder at any one or more times be deemed a waiver or
relinquishment of such right or power at any other time or times.
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15. Entire Agreement; Modifications. This Agreement
constitutes the entire and final expression of the agreement of the parties with
respect to the subject matter hereof and supersedes all prior agreements, oral
and written, between the parties hereto with respect to the subject matter
hereof. This Agreement may be modified or amended only by an instrument in
writing signed by both parties hereto.
16. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and the Employee have duly
executed and delivered this Agreement as of the day and year first above
written.
TELETRAC, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Executive Officer
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
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