Exhibit 10.1
▇▇▇▇▇ INC.
EXECUTIVE EMPLOYMENT AGREEMENT
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
CONTENTS
Section 1. Employment 1
Section 2. Employment Period 1
Section 3. Compensation 2
Section 4. Expenses 3
Section 5. Employment Terminations 3
Section 6. Change in Control 6
Section 7. Covenant Not to Compete 8
Section 8. Disclosure of Confidential Information 9
Section 9. Nonsolicitation 10
Section 10. Injunctive Relief and Additional Remedy;
Essential and Independent Covenants 11
Section 11. Arbitration 11
Section 12. Notices 12
Section 13. Successors 12
Section 14. Entire Agreement; Modification, Waiver, and Interpretation 12
Section 15. Severability 12
Section 16. Counterparts 12
Section 17. Headings 12
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT has been entered into this 24th day of
February, 2000, between ▇▇▇▇▇ Inc., a Delaware corporation (the "Company"), and
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the "Executive"). The Executive is employed as EXECUTIVE VICE
PRESIDENT AND CHIEF OPERATING OFFICER and will become PRESIDENT AND CHIEF
EXECUTIVE OFFICER upon the combination of the Company and the Fluid Power
Business of Danfoss A/S. The Company desires to assure the benefit of the
Executive's future services, and the Executive is willing to commit to render
such services, upon the terms and conditions set forth below.
It is therefore mutually agreed as follows:
1. EMPLOYMENT. The Company agrees to employ the Executive in an
executive capacity, and the Executive agrees to serve the Company, upon the
terms and conditions and for the period of employment hereinafter set forth.
Throughout the Employment Period (as hereinafter defined), unless otherwise
agreed in writing by the Executive and the Company, the Company shall neither
demote the Executive nor assign to the Executive any duties or responsibilities
that are inconsistent with his present position, duties, responsibilities, and
status. Executive may serve from time to time as a director of the Company
and/or as a director and/or officer of one or more subsidiaries of the Company.
Executive agrees to fulfill his duties as such director or officer without
additional compensation other than the compensation provided for in this
Agreement.
The Executive agrees, that during the Employment Period (as hereinafter
defined) he will devote substantially all of his business time, attention,
skill, and energy to the business of the Company, will use his best efforts to
promote the success of the Company's business and will cooperate fully with the
Board of Directors in the advancement of the best interests of the Company.
2. EMPLOYMENT PERIOD. The Initial Term of the Executive's employment
under this Agreement shall commence as of 1 January 2000 (the "Effective Date"),
and shall expire, subject to the earlier termination of the Executive's
employment as hereinafter provided, on 31 December 2001 (the "Initial Term").
The Initial Term of employment automatically shall be extended for one (1)
additional year at the end of the Initial Term, and then again after each
successive year thereafter (a "Successive Term"). The Initial Term and any
Successive Term are sometimes referred to in this Agreement as the "Employment
Period." However, either party may terminate this Agreement at the end of the
Initial Term or at the end of any Successive Term thereafter, by giving the
other party written notice of intent not to renew, delivered at least ninety
(90) calendar days prior to the end of such Initial Term or Successive Term.
In the event such notice of intent not to renew is properly delivered
by either party, this Agreement, along with all corresponding rights, duties,
and covenants, shall automatically expire
at the end of the Initial Term or Successive Term then in progress, with the
exception of the covenants provided in Sections 7, 8, and 9 herein (which shall
survive such expiration).
However, regardless of the above, if at any time during the term of
this Agreement, a Change in Control of the Company occurs, then this Agreement
shall become immediately irrevocable for the greater of two (2) years from the
date of the Change in Control or for the amount of time remaining in the term of
this Agreement.
3. COMPENSATION. Throughout the Employment Period, the Company shall
pay or provide the Executive with the following, and the Executive shall accept
the same, as compensation for the performance of his undertakings and the
services to be rendered by him under this Agreement:
(a) A base salary at a rate of not less than 300,000
US-Dollar per year payable not less often than in
monthly installments. The annual rate of base salary
shall be reviewed at least annually while this
Agreement is in force, to ascertain whether, in the
judgment of the Board of Directors of the Company
(the "Board") or the Board's designee (currently the
Compensation Committee), such base salary should be
increased. Such judgment shall be based on such
criteria as the Board may determine in its sole
discretion, which criteria may include, without
limitation, the performance of the Executive during
the year, survey data representing average base pay
for executives employed in similar positions in
comparable industries, and the rate of inflation. If
so increased, the annual base salary as stated above
shall, likewise, be increased for all purposes of
this Agreement.
(b) Participation in the Company's Bonus Plan as long as
such plan remains in effect, and participation in any
future incentive compensation or other bonus plan
(including annual and long-term incentive plans)
covering the Company's executive officers.
(c) Participation in the Company's employee benefit
plans, policies, practices, and arrangements in which
the Executive is presently eligible to participate or
plans and arrangements substituted therefore or in
addition thereto, including the savings plan,
retirement plan, supplemental retirement plans,
health and dental plan, disability plan, survivor
income and life insurance plan or other arrangement
(collectively, the "Benefit Plans").
(d) Paid vacations in accordance with the Company's
vacation policy as in effect from time to time, and
all paid holidays given by the Company to its
executive officers.
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(e) All fringe benefits and perquisites including without
limitation the use of an automobile and the payment
by the Company of initiation fees and dues for
country clubs, luncheon clubs, or similar facilities
in accordance with the Company's policy presently in
effect.
4. EXPENSES. During the Employment Period, the Company shall promptly
pay or reimburse the Executive for all reasonable expenses incurred by the
Executive in the performance of duties hereunder.
5. EMPLOYMENT TERMINATIONS.
(a) TERMINATION DUE TO RETIREMENT. In the event the
Executive's employment is terminated during the Employment Period by reason of
Retirement (as defined in the retirement benefit plan provided for in Section
3(c)), the Executive's benefits shall be determined in accordance with the
Company's Benefit Plans then in effect as of the date of Retirement.
Upon the effective date of such termination, the Company's
obligation to pay and provide to the Executive annual base salary, bonuses, and
benefits (as provided in Section 3 herein, respectively), shall immediately
expire, except to the extent such rights and benefits are vested pursuant to,
and in accordance with, the Benefit Plans.
In the event of termination of employment as provided for in
this Section 5(a), the provisions of Sections 7, 8, 9, 10, and 11 herein shall
survive such termination.
(b) TERMINATION DUE TO DEATH. In the event of the death of the
Executive during the Employment Period, or during any period of Disability
during which he is receiving compensation pursuant to Section 5(c) herein, the
Executive's estate, heirs, and beneficiaries shall be entitled to receive the
full amount of his base salary for the month in which death occurs, and all
other benefits available to them under the Company's Benefit Plans (including,
but not limited to, the Executive Life Insurance Program covering the Executive)
then in effect as of the date of death of the Executive.
(c) TERMINATION DUE TO DISABILITY. In the event that during
the Employment Period the Executive becomes Disabled (as defined in the
Company's governing long-term disability plan then in effect) and is, therefore,
unable to perform his duties herein, the Company shall have the right to
terminate the Executive's active employment as provided in this Agreement by
delivering written notice to the Executive at least thirty (30) calendar days
prior to the effective date of such termination.
A termination for Disability shall become effective upon the
end of the thirty (30) calendar day notice period. Upon such effective date, the
Company's obligation to pay and provide to the Executive annual base salary,
bonuses, and benefits (as provided in Section 3 herein), shall immediately
expire except to the extent such rights and benefits are vested pursuant
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to, and in accordance with, the Benefit Plans. Further, the Executive shall
receive all rights and benefits that he is vested in, pursuant to other plans
and programs of the Company, including, but not limited to, short- and long-term
disability benefits and retirement benefits as described in Section 3(c).
(d) VOLUNTARY TERMINATION BY THE EXECUTIVE WITHOUT GOOD
REASON. The Executive may terminate this Agreement at any time by giving the
Board of Directors of the Company written notice of intent to terminate,
delivered at least ninety (90) calendar days prior to the effective date of such
termination (such period not to include vacation). The termination automatically
shall become effective upon the expiration of the ninety (90) calendar days
notice period.
Upon the effective date of such termination, the Company shall
pay to the Executive his base salary through the effective date of termination,
plus all other rights and benefits to which the Executive has a vested right to
at that time including, but not limited to, accrued vacation pay. The Company
also shall provide to the Executive the retirement benefits, if any, set forth
in the Benefit Plans described in Section 3(c) herein. Further, in the event of
termination of employment as provided for in this Section 5(d), the provisions
of Sections 7, 8, 9, 10, and 11 herein shall survive such termination.
(e) TERMINATION FOR GOOD REASON. The Executive may terminate
this Agreement for Good Reason by giving the Board thirty (30) calendar days'
written notice of such intent to terminate which sets forth in reasonable detail
the facts and circumstances claimed to provide a basis for such termination.
Good Reason shall mean, without the Executive's prior written consent, the
occurrence of any one or more of the following:
(i) The assignment to the Executive of any
duties inconsistent in any respect with the
Executive's position (including status,
offices, titles, and reporting
requirements), authorities, duties, or other
responsibilities as contemplated by Section
1 of this Agreement, or any other action of
the Company which results in a diminishment
in such position, authority, duties, or
responsibilities, other than (A) an
insubstantial and inadvertent action which
is remedied by the Company within 30 days
after receipt of notice thereof given by the
Executive, or (B) Executive being removed as
a director of the Company and/or as a
director or officer of any subsidiary of the
Company.
(ii) The Company's requiring the Executive,
without the Executive's consent, to relocate
his principal residence at that time;
(iii) A material reduction or elimination of any
component of the Executive's compensation as
provided for in Section 3 herein; or
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(iv) A breach by the Company of any provision of
this Agreement which is not remedied by the
Company within 30 days after receipt of
notice thereof given by the Executive.
Upon the lapse of the thirty (30) calendar days' notice
period, the Good Reason termination shall take effect and the Executive's
obligation to serve the Company, and the Company's obligation to employ the
Executive, under the terms of this Agreement, shall terminate simultaneously,
and, (a) if such termination is prior to a Change in Control (as such term is
defined in Section 6(b) herein), then the Executive shall receive those benefits
similar to those had the Executive been terminated involuntarily by the Company
Without Cause, as provided in Section 5(f) herein, and (b) if such termination
is after a Change in Control, then the Executive shall receive those benefits as
provided in Section 6(a) herein.
The parties agree that, in such event, such payments and
benefits shall be deemed to constitute liquidated damages for the Company's
breach of this Agreement, and the Company agrees that the Executive shall not be
required to mitigate his damages (with the exception for participation in
Benefit Plans) by seeking other employment or otherwise.
In the event of termination of employment as provided for in
this Section 5(e), the provisions of Sections 7, 8, 9, 10, and 11 herein shall
survive such termination.
(f) INVOLUNTARY TERMINATION BY THE COMPANY WITHOUT CAUSE. The
Company may terminate the Executive's employment, as provided under this
Agreement, at any time, for any reason other than Death, Disability, Retirement,
or for Cause, by notifying the Executive in writing of the Company's intent to
terminate, at least thirty (30) calendar days prior to the effective date of
such termination. The termination automatically shall become effective upon the
expiration of the thirty (30) calendar day notice period; provided, however,
that the provisions of Sections 7, 8, 9, 10, and 11 herein shall survive such
termination.
For the greater of two (2) years or the remainder of the
Employment Period, the Company shall continue to make monthly payments to the
Executive equal to the Executive's then current annual base salary plus target
annual bonus divided by twelve (12). Further, during such period the Executive
shall continue to participate in all Benefit Plans (except retirement plans) of
the Company; provided, however, that such continued participation shall cease
upon the Executive becoming eligible for similar benefits from a subsequent
employer. Further, in the event the Executive violates any of the provisions of
Sections 7, 8, or 9, any such payments and benefits shall immediately cease.
The parties agree that, in such event, such payments and
benefits shall be deemed to constitute liquidated damages for the Company's
breach of this Agreement, and the Company agrees that Executive shall not be
required to mitigate his damages (with the exception for participation in
Benefit Plans) by seeking other employment or otherwise.
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(g) TERMINATION FOR CAUSE. Nothing in this Agreement shall be
construed to prevent the Board from terminating the Executive's employment under
this Agreement for "Cause". In the event the Board determines that Cause exists,
the Board shall deliver written notice to the Executive of the facts and
circumstances leading to the Board's determination. Upon receipt of this written
notification, all provisions of this Agreement shall terminate, except for the
provisions of Sections 7, 8, 9, 10, and 11 herein (which shall survive such
termination). The Company shall pay the Executive his base salary and accrued
vacation time through the date notice of a for Cause termination is delivered to
the Executive, plus all other benefits to which the Executive has a vested right
to at that time. The Company and the Executive thereafter shall have no further
obligations under this Agreement.
"Cause" shall be determined by the Board in the exercise of
good faith and reasonable judgment, and shall mean (i) willful misconduct or
fraud; (ii) conviction of a felony; (iii) consistent gross neglect of duties or
wanton negligence by the Executive in the performance of his duties hereunder;
(iv) the material breach by the Executive of the terms of this Agreement; or (v)
other misconduct of such magnitude that the continued employment of the
Executive may reasonably be expected to adversely affect the business or
properties of the Company.
6. CHANGE IN CONTROL.
(a) EMPLOYMENT TERMINATIONS AFTER A CHANGE IN CONTROL. During
the term of this Agreement, in the event the Executive's employment with the
Company is terminated within two years following a Change in Control (as such
term is defined in Section 6(b) herein), unless such termination is (i) by the
Company for Cause (as provided in Section 5(g) herein), (ii) by reason of Death,
Disability, or Retirement, or (iii) by the Executive without Good Reason (as
such term is defined in Section 5(e) herein), then in lieu of all other benefits
provided to the Executive under the provisions of this Agreement, the Company
shall pay to the Executive and provide him with the following:
(i) A lump-sum cash amount equal to the
Executive's unpaid base salary, accrued
vacation pay, unreimbursed business
expenses, and all other items earned by and
owed to the Executive through and including
the date of termination (in full
satisfaction for these amounts owed to the
Executive).
(ii) A lump-sum cash amount equal to the
Executive's then current annual target bonus
opportunity, established under the annual
incentive plan for the bonus plan year in
which the Executive's termination occurs,
multiplied by a fraction, the numerator of
which is the number of full completed days
in the bonus plan year through the effective
date of termination, and the denominator of
which is 365 or, if greater, the full bonus
earned at that time based on the level of
goal achievement. This payment will be in
lieu of
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any other payment to be made to the
Executive under the annual bonus plan for
the respective plan year.
(iii) A lump-sum cash amount equal to the
Executive's then current annual base salary
and target annual bonus opportunity
multiplied by three (3).
(iv) A lump-sum cash amount equal to 15 percent
of the Executive's then current base salary
in lieu of health, dental, long-term
disability, and life insurance continuation.
The Executive's participation in these and
all other such benefits including bonus,
savings and retirement plans shall cease
upon the termination of Executive's
employment with the Company.
The parties agree that, in the event of such termination, such
payment and benefits (including an Excise Tax Payment provided in Section 6(c)
herein) shall be deemed to constitute liquidated damages for the Company's
breach of this Agreement, and the Company agrees that the Executive shall not be
required to mitigate his damages by seeking other employment or otherwise.
The parties also agree that, in the event of a termination of
employment that obligates the Company to make the payments set forth in this
Section 6(a), the provisions of Sections 7, 8, 9, 10 and 11 herein shall survive
such termination.
(b) DEFINITION OF "CHANGE IN CONTROL." "Change in Control" of
the Company means, and shall be deemed to have occurred upon any of the
following events taking place after the combination of the Company and the fluid
power business of Danfoss A/S:
(i) Any person (other than those persons in
control of the Company as of the date
immediately following the date upon which
the combination of the Company and the Fluid
Power Business of Danfoss A/S is completed,
or other than a trustee or other fiduciary
holding securities under an employee benefit
plan of the Company, or a corporation owned
directly or indirectly by the stockholders
of the Company in substantially the same
proportions as their ownership of stock of
the Company) becomes the beneficial owner,
directly or indirectly, of securities of the
Company representing thirty percent (30%) or
more of the combined voting power of the
Company's then outstanding securities; or
(ii) During any period of two (2) consecutive
years (not including any period prior to the
Effective Date of the combination of the
Company and the Fluid Power Business of
Danfoss A/S), individuals who at the
beginning of such period constitute the
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Board (and any new Director, whose election
by the Company's stockholders was approved
by a vote of at least two-thirds (2/3) of
the Directors then still in office who
either were Directors at the beginning of
the period or whose election or nomination
for election was so approved), cease for any
reason to constitute a majority thereof; or
(iii) The stockholders of the Company approve: (A)
a plan of complete liquidation of the
Company; or (B) an agreement for the sale or
disposition of all or substantially all the
Company's assets; or (C) a merger,
consolidation, or reorganization of the
Company with or involving any other
corporation, other than a merger,
consolidation, or reorganization that would
result in the voting securities of the
Company outstanding immediately prior
thereto continuing to represent (either by
remaining outstanding or by being converted
into voting securities of the surviving
entity) at least fifty percent (50%) of the
combined voting power of the voting
securities of the Company (or such surviving
entity) outstanding immediately after such
merger, consolidation, or reorganization.
However, in no event shall a "Change in Control" be deemed to
have occurred, with respect to the Executive, if the Executive
is part of a purchasing group which consummates the Change in
Control transaction. The Executive shall be deemed "part of a
purchasing group" for purposes of the preceding sentence if
the Executive is an equity participant in the purchasing
company or group (except for (i) passive ownership of less
than one percent (1%) of the stock of the purchasing company;
or (ii) ownership of equity participation in the purchasing
company or group which is otherwise not significant as
determined prior to the Change in Control by a majority of the
nonemployee continuing Directors).
(c) EXCISE TAX PAYMENT. In the event that any portion of the
severance benefits or any other payment under this Agreement or under any other
agreement with or plan of the Company (in the aggregate "Total Payments") would
constitute an "Excess Parachute Payment," such that an "Excise Tax" is due, the
Company shall provide to the Employee, in cash, an additional payment in an
amount equal to the excise tax divided by 0.329 to offset the excise tax and the
Employee's state and federal income and employment taxes on this excise tax
payment. This payment shall be made as soon as possible following the date of
the Employee's qualifying termination, but in no event later than thirty (30)
calendar days of such date.
For purposes of this Agreement, the terms "Excise Tax" and
"Excess Parachute Payment" shall have the meanings assigned to such terms in
Sections 280G and 4999 of the Internal Revenue Code of 1986, as amended.
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(d) SUBSEQUENT RECALCULATION. In the event the Internal
Revenue Service subsequently adjusts the excise tax computation herein
described, the Company shall reimburse the Executive for the full amount of any
underpaid excise tax, and any related interest and/or penalties due to the
Internal Revenue Service.
7. COVENANT NOT TO COMPETE. Without the consent of the Company, the
Executive shall not, directly or indirectly, anywhere in the world, at any time
during the Employment Period and for a period of two (2) years following the
termination of Executive's employment with the Company for any reason, be
associated or in any way connected as an owner, investor, partner, director,
officer, employee, agent, or consultant with any business entity directly
engaged in the manufacture and/or sale of products competitive with any material
product or product lines of the Company or any of its subsidiaries; provided,
however, that the Executive shall not be deemed to have breached this
undertaking if his sole relation with such entity consists of his holding,
directly or indirectly, an equity interest in such entity not greater than two
percent (2%) of such entity's outstanding equity interest, and the class of
equity in which the Executive holds an interest is listed and traded on a
broadly recognized national or regional securities exchange. For purposes
hereof, the term "material product or product line of the Company" shall mean
any product or product line of the Company or any of its subsidiaries, the gross
sales of which during any calendar year during the five (5) year period
preceding the Executive's undertaking such employment were at least $10 million.
The Executive acknowledges that: (a) the services to be performed by
him under this Agreement are of a special, unique, unusual, extraordinary, and
intellectual character; (b) the business of the Company and its subsidiaries is
worldwide in scope and its products are marketed throughout the world; (c) the
Company and its subsidiaries compete with other businesses that are or could be
located in any part of the world; and (d) the provisions of this Section 7 are
reasonable and necessary to protect the Company's business.
If any covenant in this Section 7 is held to be unreasonable,
arbitrary, or against public policy, such covenant will be considered to be
divisible with respect to scope, time, and geographic area, and such lesser
scope, time, or geographic area, or all of them, as a court of competent
jurisdiction may determine to be reasonable, not arbitrary, and not against
public policy, will be effective, binding, and enforceable against the
Executive.
The period of time applicable to any covenant in this Section 7 will be
extended by the duration of any violation by the Executive of such covenant.
The Executive will, while the covenants under this Section 7 are in
effect, give notice to the Company, within ten days after accepting any other
employment, of the identity of the Executive's employer. The Company may notify
such employer that the Executive is bound by this Agreement and, at the
Company's election, furnish such employer with a copy of this Agreement or
relevant portions thereof.
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8. DISCLOSURE OF CONFIDENTIAL INFORMATION. Without the consent of the
Company, the Executive shall not disclose to any other person Confidential
Information (as defined below) concerning the Company or any of its subsidiaries
or the Company's or any of its subsidiaries' trade secrets of which the
Executive has gained knowledge during his employment with the Company. Any trade
secrets of the Company or any of its subsidiaries will be entitled to all of the
protections and benefits under the Iowa Code Annotated Section 550.1 through
550.8 and any other applicable law. If any information that the Company deems to
be a trade secret is found by a court of competent jurisdiction not to be a
trade secret for purposes of this Agreement, such information will,
nevertheless, be considered Confidential Information for purposes of this
Agreement. The Executive hereby waives any requirement that the Company submit
proof of the economic value of any trade secret or post a bond or other
security. None of the foregoing obligations and restrictions apply to any part
of the Confidential Information that the Executive demonstrates was or became
generally available to the public other than as a result of a disclosure by the
Executive.
The Executive will not remove from the premises of the Company or any
of its subsidiaries (except to the extent such removal is for purposes of the
performance of the Executive's duties at home or while traveling, or except as
otherwise specifically authorized by the Company), any document, record,
notebook, plan, model, component, device, or computer software or code, whether
embodied in a disk or in any other form, that contains Confidential Information
(collectively, the "Proprietary Items"). The Executive recognizes that, as
between the Company and the Executive, all of the Proprietary Items, whether or
not developed by the Executive, are the exclusive property of the Company or its
subsidiaries, as the case may be. Upon termination of this Agreement by either
party, or upon the request of the Company during the Employment Period, the
Executive will return to the Company all of the Proprietary Items in the
Executive's possession or subject to the Executive's control, and the Executive
shall not retain any copies, abstracts, sketches, or other physical embodiment
of any of the Proprietary Items.
For purposes of this Agreement, Confidential Information shall include
any and all information concerning the business and affairs of the employer,
including, without limitation, product specifications, data, know-how, formulae,
compositions, processes, designs, sketches, photographs, graphs, drawings,
samples, inventions and ideas, past, current, and planned research and
development, current and planned distribution methods and processes, customer
lists, current and anticipated customer requirements, price lists, market
studies, business plans, computer software and programs (including object code
and source code), computer software and database technologies, systems,
structures, and architectures (and related formulae, compositions, processes,
improvements, devices, know-how, inventions, discoveries, concepts, ideas,
designs, methods and information), historical financial statements, financial
projections and budgets, historical and projected sales, capital spending
budgets and plans, the names and backgrounds of key personnel, agents, personnel
training and techniques and materials, insurance products, premium structures,
information relating to suppliers and supplies, sales and marketing information
and strategy, notes, analysis, compilations, studies, summaries, and other
material prepared by or for the Company or any of its subsidiaries containing or
based, in whole or in
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part, on any information included in the foregoing, and any information, however
documented, that is a trade secret within the meaning of the Iowa Code Annotated
Section 550.1 through 550.8.
9. NONSOLICITATION. Without the written consent of the Company, the
Executive shall not at any time during the Employment Period and for a period of
two (2) years following the termination of Executive's employment with the
Company for any reason (a) employ or retain or arrange to have any other person,
firm, or other entity employ or retain or otherwise participate in the
employment or retention of any person who is an employee or consultant of the
Company or its subsidiaries; or (b) solicit orders as a customer or arrange to
have any other person, firm, or other entity (where such entity is directly
engaged in the manufacture and/or sale of products competitive with any material
product or product lines of the Company or any of its subsidiaries) solicit
orders as a customer or otherwise participate in such solicitation of any entity
that was a customer of the Company or any of its subsidiaries during the time of
the Executive's employment, whether or not the Executive had personal contact
with such person.
10. INJUNCTIVE RELIEF AND ADDITIONAL REMEDY; ESSENTIAL AND INDEPENDENT
COVENANTS.
(a) The Executive acknowledges that the injury that would be
suffered by the Company as a result of a breach of the provisions of
this Agreement (including any provision of Sections 7, 8, and 9) would
be irreparable and that an award of monetary damages to the Company for
such a breach would be an inadequate remedy. Consequently, the Company
will have the right, in addition to any other rights it may have, to
obtain injunctive relief to restrain any breach or threatened breach or
otherwise to specifically enforce any provision of this Agreement, and
the employer will not be obligated to post bond or other security in
seeking such relief. Without limiting the Company's rights under this
Section 10 or any other remedies of the Company, if the Executive
breaches any of the provisions of Sections 7, 8, or 9, the Company will
have the right to cease making any payments otherwise due to the
Executive under this Agreement.
(b) The covenants by the Executive in Sections 7, 8, and 9 are
essential elements of this Agreement, and without the Executive's
agreement to comply with such covenants, the Company would not have
entered into this Agreement with the Executive. The Company and the
Executive have independently consulted their respective counsel and
have been advised in all respects concerning the reasonableness and
propriety of such covenants (including, without limitation, the time
period of restriction and the geographical area of restriction set
forth in Section 7), with specific regard to the nature of the business
conducted by the Company and its subsidiaries. The Executive's
covenants in Sections 7, 8, and 9 are independent covenants and the
existence of any claim by the Executive against the Company under this
Agreement or otherwise, will not excuse the Executive's breach of any
covenant in Sections 7, 8, or 9.
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If the Executive's employment hereunder expires or is terminated, this
Agreement will continue in full force and effect as is necessary or appropriate
to enforce the covenants and agreements of the Executive in Sections 7, 8, 9,
10, and 11.
11. ARBITRATION. All disputes, including, without limitation,
discrimination claims of all types and claims of sexual harassment, arising
under this Agreement between the Company and Executive, other than those
disputes relating to Executive's alleged violations of Sections 7, 8, and 9
herein, which cannot otherwise be resolved amicably, shall be submitted to
binding arbitration by the American Arbitration Association ("AAA") in Des
Moines, Iowa, pursuant to the rules and procedures of the AAA. The fee and
expense of the arbitrators shall be split equally between the Company and
Executive. The decision of the arbitrator shall be final and binding and there
shall be no appeal from any award rendered. In any judicial enforcement
proceeding, the losing party shall reimburse the prevailing party for its
reasonable costs and attorney's fees for enforcing its rights under this
Agreement, in addition to any damages or other relief granted. This Section 11
does not apply to any action by the Company to enforce Section 7, 8, or 9 of
this Agreement and does not in any way restrict the Company's rights under
Section 10(a) of this Agreement.
12. NOTICES. Notices given pursuant to this Agreement shall be in
writing and shall be deemed given when received and if mailed shall be mailed by
United States registered or certified mail, return receipt requested, addressee
only, postage prepaid if to the Company, to the Board of Directors of ▇▇▇▇▇
Inc., Attention Chairman, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, U.S.A., or if
to the Executive, at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or to
such other address as either party may have previously designated by notice to
the other party given in the foregoing manner.
13. SUCCESSORS. This Agreement may not be assigned by the Company, and
the obligations of the Company provided for in this Agreement shall be binding
legal obligations of any successor to the Company by purchase, merger,
consolidation, or otherwise. This Agreement may not be assigned by the Executive
during his life, and upon his death will be binding upon and inure to the
benefit of his heirs, legatees, and the legal representatives of his estate.
14. ENTIRE AGREEMENT; MODIFICATION, WAIVER, AND INTERPRETATION. This
Agreement contains the entire agreement between the parties with respect to the
subject matter of this Agreement and supersedes all prior agreements and
understandings, oral or written, between the parties hereto with respect to the
subject matter of this Agreement. No provision of this Agreement may be
modified, waived, or discharged unless such waiver, modification, or discharge
is agreed to in a writing signed by the Executive and an appropriate officer of
the Company empowered to sign same by the Board. No waiver by either party at
any time of any breach by the other party of, or compliance with, any condition
or provision of this Agreement to be performed by the other party shall be
deemed a waiver of similar or dissimilar provisions or conditions at the same
time or at any prior or subsequent time. This Agreement shall be deemed to have
been executed in Ames, Iowa and the validity, interpretation, construction, and
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performance of this Agreement shall be governed by the laws of the State of Iowa
without regard to conflicts of laws principles.
15. SEVERABILITY. If any provision of this Agreement is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
16. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
17. HEADINGS. The headings contained herein are for reference purposes
only and shall not in any way affect the meaning or interpretation of any
provision of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the day and year first written above.
THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE
ENFORCED BY THE PARTIES.
▇▇▇▇▇ INC.
By: /s/ ▇. ▇. ▇▇▇▇▇▇▇
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▇. ▇. ▇▇▇▇▇▇▇, Chairman and CEO
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(print name and title of Officer)
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------
Executive
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