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EXHIBIT 10.25
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made and entered into as of April 16, 2004 (the
"Effective Date"), by and between KEITH GRABEL (the "Executive") and WESTWOOD
COMPUTER CORPORATION (the "Company").
WITNESSETH THAT:
WHEREAS, DARR Westwood Acquisition Corporation, a subsidiary of DARR
Westwood Technology Corporation (the "Parent"), was merged with and into the
Company with the Company as the surviving entity on April 16, 2004 (the
"Closing");
WHEREAS, Executive is a valued employee of the Company;
WHEREAS, the parties desire to enter into this Agreement pertaining
to the employment of the Executive by the Company;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth below, it is hereby covenanted and agreed by the Executive
and the Company as follows:
1. Performance of Services. The Executive's employment with the Company
shall be subject to the following:
(a) During the Agreement Term (as defined below), and subject to the
terms of this Agreement, the Executive shall be employed by the
Company and shall occupy the position of President of the Company.
The Executive agrees to serve in that position or in such other
offices or positions with the Company or a Subsidiary (as defined
below), as shall, from time to time, be determined by the Board of
Directors of the Company (the "Board").
(b) During the Agreement Term, while employed by the Company, the
Executive shall devote his full time, energies and talents to
serving as its President or such other position determined in
accordance with Paragraph (a) above. During the Agreement Term, the
Executive's main office shall be at the Company's headquarters.
(c) The Executive agrees to perform his duties hereunder faithfully and
efficiently subject to the directions of the Board. The Executive's
duties may include providing services for both the Company and the
Subsidiaries, as determined by the Board, provided, that the
Executive shall not, without his consent, be assigned tasks that
would be inconsistent with those of President or such other position
determined in accordance with Paragraph (a) above.
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(d) Notwithstanding the foregoing provisions of this Paragraph 1, during
the Agreement Term, the Executive may devote reasonable time to
activities other than those required under this Agreement, including
activities involving professional, charitable, community,
educational, religious and similar types of organizations, speaking
engagements, membership on the boards of directors of other
organizations, and similar types of activities, to the extent that
such other activities do not, in the judgment of the Board, conflict
with, inhibit or prohibit the performance of the Executive's duties
under this Agreement, or conflict in any material way with the
business of the Company or any Subsidiary; provided, however, that
the Executive shall not serve on the board of any business, or hold
any other position with any business, without the consent of the
Board. The Company acknowledges that Executive is a Manager and
Member of Westwood Property Holdings LLC, the Company's current
landlord, and the Executive shall be entitled to devote reasonable
time to the activities of Westwood Property Holdings LLC as may be
needed; provided, however, that such devotion of time shall not
hinder or interfere with the Executive's duties to the Company.
(e) Subject to the terms of this Agreement, the Executive shall not be
required to perform services under this Agreement during any period
that the Executive is Disabled. The Executive shall be considered
"Disabled" or under a "Disability" during any period in which a
physical or mental disability renders the Executive incapable, after
reasonable accommodation, of performing the duties under this
Agreement. In the event of a dispute as to whether the Executive is
Disabled, the Company may refer the same to a licensed practicing
physician of the Company's choice, and the Executive agrees to
submit to such tests and examinations as such physician shall deem
appropriate. At any time during the period in which the Executive is
Disabled, the Company may appoint a temporary replacement to assume
the Executive's responsibilities.
(f) The "Agreement Term" shall be the period beginning on April ___,
2004 (the "Employment Commencement Date") and ending on the fifth
anniversary of the Employment Commencement Date; subject, however,
to earlier termination as provided herein. The initial five (5) year
period of employment automatically shall be extended for one (1)
additional year at the end of the initial five (5) year term, and
again each successive year thereafter. However, such annual
extensions may cease by either party delivering written notice of
such cessation to the other party; provided that such notice is
delivered at least 60 days prior to the date on which extension is
otherwise to occur.
(g) For purposes of this Agreement, the term "Subsidiary" shall mean any
corporation, partnership, joint venture or other entity during any
period in which at least a fifty percent interest in such entity is
owned, directly or indirectly, by the Company (or a successor to the
Company).
2. Compensation. Subject to the terms of this Agreement, during the
Agreement Term, while the Executive is employed by the Company, the Company
shall compensate the Executive for his services as follows:
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(a) The Executive shall receive, for each twelve (12) consecutive month
period beginning on the Effective Date and each anniversary thereof,
payable in regular installments in accordance with the Company's
usual payroll practices, an annual base salary as set forth on
Schedule 2(a) (the "Salary"). The Executive's Salary rate shall be
reviewed by the Board each year during the Agreement Term, while the
Executive is employed by the Company, to determine whether an
increase in the amount of Salary is appropriate. Any increase in the
amount of Salary shall be in the sole discretion of the Board. In no
event shall the Salary of the Executive be reduced to an amount that
is less than the amount specified in this Paragraph (a), or to an
amount that is less than the amount that the Executive was
previously receiving during the Agreement Term. In the event the
Employment Agreement by and between the Company and Mary Margaret
Grabel (the "M. Grabel Employment Agreement") is terminated, the
Executive's Salary beginning the first day of the month after such
termination shall be as set forth on Schedule 2(a)(1) and shall be
paid to the Executive on a pro rata basis for the number of months
remaining in the year of such termination.
(b) The Executive shall receive bonus payments in the amounts set forth
on Schedule 2(b), payable in quarterly installments during each
year.
(c) Except as otherwise specifically provided to the contrary in this
Agreement, the Executive shall be provided with the welfare benefits
and other fringe benefits to the same extent and on the same terms
and in any event no less than those benefits that are currently
provided by the Company to the Executive. The current benefits of
the Executive are set forth on Schedule 2(c). However, the Company
shall not be required to provide a benefit under this Paragraph (c)
if such benefit would duplicate (or otherwise be of the same type
as) a benefit specifically required to be provided under another
provision of this Agreement. The Executive shall complete all forms
and physical examinations, and otherwise take all other similar
actions to secure coverage and benefits described in this Paragraph
2, to the extent determined to be necessary or appropriate by the
Company.
(d) During any period while the Executive is Disabled and is otherwise
entitled to receive Salary and any bonus payments under this
Agreement:
(i) any such Salary to the Executive shall be reduced by the
amount of any benefits paid for the same period of time under
the Company-provided disability income replacement coverage;
and
(ii) any such bonus payments shall be payable in the event of
disability without any reduction.
All payments and benefits to the Executive under this Agreement shall be subject
to reduction for payroll and other applicable taxes.
(e) During the first year of the Agreement Term, the Executive, together
with Mary Margaret Grabel, shall be entitled to receive
reimbursement from the Company
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for the joint reasonable expenses incurred by the Executive and Mary
Margaret Grabel in providing the services hereunder and under the M.
Grabel Employment Agreement (including travel) (the "Expenses") up
to $75,000 per year combined without any approval on the part of the
Parent (the "Approved Expenses"). Any Expenses in excess of the
Approved Expenses must be approved in writing by the Parent, such
approval not to be unreasonably withheld. The amount of Approved
Expenses reimbursed by the Company for any years subsequent to the
first year of the Agreement Term may be adjusted upward as agreed
upon in writing by the Executive and the Parent, but in no event
shall such amount be less than $75,000.
3. Termination. The Executive's employment with the Company during the
Agreement Term may be terminated by the Company or the Executive without any
breach of this Agreement only under the circumstances described in Paragraphs
3(a) through 3(f):
(a) Death. The Executive's employment hereunder will terminate upon
death, but bonus payments, if any, will inure to the benefit of his
heirs and assigns for the full Agreement Term.
(b) Disability. During the Agreement Term, the Company may terminate the
Executive's employment if Executive is Disabled for longer than
twelve (12) consecutive months.
(c) Cause. The Company may terminate the Executive's employment
hereunder at any time for Cause. For purposes of this Agreement, the
term "Cause" shall mean:
(i) a willful act by the Executive against the interests of the
Company or which causes or is intended to cause harm to the
Company or its shareholders;
(ii) the Executive's conviction, or plea of no contest or guilty,
to a felony under the laws of the United States or any state
thereof or of a lesser offense involving dishonesty as such
dishonesty relates to the Company's assets or business or the
theft of Company property;
(iii) the Executive's insobriety or use of illegal drugs, chemicals
or controlled substances either (A) in the course of
performing Executive's duties and responsibilities under this
Agreement, or (B) otherwise affecting the ability of Executive
to perform the same; or
(iv) a material breach of the Agreement by the Executive which is
not cured by the Executive within twenty (20) days (where the
breach is curable) following written notice to the Executive
by the Company of the nature of the breach.
For purposes of this Agreement, no act, or failure to act, on the
Executive's part shall be deemed "willful" unless done, or omitted to be done,
by the Executive not in good faith
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and without reasonable belief that the Executive's action or omission was in the
best interest of the Company. Cause shall not exist under this Section 3 unless
and until the Company has delivered to the Executive a copy of a resolution duly
adopted by a majority of the Board (absent the Executive) at a meeting of the
Board called and held for such purpose, or by written consent, finding that such
Cause exists in the good faith opinion of the Board. This Section 3 shall not
prevent the Executive from challenging in any arbitration proceeding the Board's
determination that Cause exists or that the Executive has failed to cure any act
(or failure to act), to the extent permitted by this Agreement that purportedly
formed the basis for the Board's determination. The Company must provide written
notice to the Executive that it is intending to terminate the Executive's
employment for Cause within one hundred and twenty (120) days after the Board
has actual knowledge of the occurrence of the event it believes constitutes
Cause.
(d) Termination for Good Reason. The Executive may terminate his
employment hereunder for Good Reason at any time during the
Agreement Term. For purposes of the Agreement, "Good Reason" shall
mean
(i) a material breach of the terms of this Agreement by the
Company,
(ii) the Company requiring the Executive to move his primary place
of employment more than thirty-five (35) miles from the then
current place of employment,
(iii) a material diminution of the Executive's responsibilities or
any material reduction in the general nature of the
Executive's duties or authority to a level inconsistent with
President, unless previously agreed to in writing by the
Executive,
(iv) the failure of the Executive to be elected to the Boards of
Directors of the Company and the Parent; or
(v) a Change of Control of the Company or the Parent.
provided that any of the foregoing is not cured by the Company
within twenty (20) days following receipt of written notice by the Executive to
the Company of the specific nature of the breach. No termination for Good Reason
shall be permitted unless the Company shall have first received written notice
from the Executive describing the basis of such termination for Good Reason. A
termination of the Executive's employment for Good Reason pursuant to this
Section shall be treated for purposes of this Agreement as a termination by the
Company without Cause and the provisions of this Section relating to the payment
of compensation and benefits shall apply. The term "Change of Control" means (i)
the acquisition by any person or group, or two or more such persons acting in
concert, of beneficial ownership of more than 51% of the outstanding common
stock of the Company or the Parent (excluding the common stock of the Company or
Parent owned by the Executive, Mary Margaret Grabel or their assigns); or (ii)
the sale of all or substantially all of the assets of the Company or the Parent.
The term Change of Control will expressly include, without limitation, any such
acquisition or sale that is structured as a merger, consolidation, joint
venture, tender offer, exchange offer, equity investment in the Company or the
Parent.
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The Executive's right to terminate employment pursuant to this
Paragraph (d) shall not be affected by incapacity due to physical or mental
illness.
(e) Voluntary Termination by Executive. The Executive shall provide the
Company thirty (30) days' advance written notice in the event the
Executive terminates his employment, other than for Good Reason (as
defined herein); provided that the Board may, in its sole
discretion, terminate the Executive's employment with the Company
prior to the expiration of the thirty-day notice period. In such
event and upon the expiration of such thirty day period (or such
shorter time as the Board in its sole discretion may determine), the
Executive's employment under this Agreement shall immediately and
automatically terminate.
(f) Termination by Company. The Company may terminate the Executive's
employment hereunder at any time for any reason, by giving the
Executive prior written Notice of Termination, which Notice of
Termination shall be effective immediately, or such later time as is
specified in such notice; provided, however that as a condition to
the Company's ability to terminate the Executive's employment under
this Paragraph 3(f): (i) all amounts due and owning under this
Agreement, including all bonus payments and salary payments shall
have been paid in full; (ii) all amounts due and owing under the
Subordinated Note in the amount of $750,000 made by Westwood
Acquisition Corporation in favor of Four Kings Management LLC shall
have been paid in full and (iii) all amounts due and owing under the
8% Junior Subordinated Note and the 5% Junior Subordinated Note made
by the Company in the favor of the Executive shall have been paid in
full. The Company shall not be required to specify a reason for the
termination under this Paragraph 3(f), provided that termination of
the Executive's employment by the Company shall be deemed to have
occurred under this Paragraph 3(f) only if it is not for reasons
described in Paragraph 3(b), 3(c), 3(d), or 3(e). Notwithstanding
the foregoing provisions of this Paragraph (f), if the Executive's
employment is terminated by the Company in accordance with this
Paragraph (f), and within a reasonable time period thereafter, it is
determined by the Board that circumstances existed which would have
constituted a basis for termination of the Executive's employment
for Cause in accordance with Paragraph 3(c), the Executive's
employment will be deemed to have been terminated for Cause in
accordance with Paragraph 3(c) (provided, however, that termination
for Cause shall not be determined to exist under this sentence
solely by reason of circumstances which could have been remedied if
notice had been given in accordance with Paragraph 3(c)).
(g) Notice of Termination. Any termination of the Executive's employment
by the Company or the Executive (other than a termination pursuant
to Paragraphs 3(a) or (b)) must be communicated by a written Notice
of Termination to the other party hereto. For purposes of this
Agreement, a "Notice of Termination" means a dated notice which
indicates the Date of Termination (not earlier than the date on
which the notice is provided), and which indicates the specific
termination provision in this Agreement relied on and which sets
forth in reasonable detail the
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facts and circumstances, if any, claimed to provide a basis for
termination of the Executive's employment under the provision so
indicated.
(h) Date of Termination. "Date of Termination" means the last day the
Executive is employed by the Company, provided that the Executive's
employment is terminated in accordance with the foregoing provisions
of this Paragraph 3.
(i) Effect of Termination. If, on the Date of Termination, the Executive
is a member of the Board of the Company or a member of the Board of
Directors or Board of Members of any of the Subsidiaries, or holds
any other position with the Company and the Subsidiaries, the
Executive shall resign from all such positions as of the Date of
Termination.
4. Rights Upon Termination. The Executive's right to payment and
benefits under this Agreement for periods after the Date of Termination shall be
determined in accordance with the following provisions of this Paragraph 4:
(a) If the Executive's Date of Termination occurs during the Agreement
Term for any reason, other than for a Company termination under
Section 3(f), the Company shall pay to the Executive (subject to the
limitations in subsection (c) below):
(i) The Executive's Salary for the period ending on the
Executive's Date of Termination.
(ii) A pro rata portion of the amount as set forth on Schedule
4(a)(ii) for the year of the Executive's Date of Termination
based on the number of remaining months in such year and the
amount set forth on Schedule 4(a)(ii) for each subsequent year
payable in equal quarterly installments during each subsequent
year.
(iii) Payment for accrued vacation days, as determined in accordance
with Company policy as in effect from time to time.
(iv) Any bonus payments as proscribed by this Agreement in
accordance with the provisions of Paragraph 2(b) above.
(v) Any other payments or benefits to be provided to the Executive
by the Company pursuant to any employee benefit plans or
arrangements adopted by the Company, to the extent such
amounts are due from the Company.
Except as may otherwise be expressly provided to the contrary in
this Agreement, nothing in this Agreement shall be construed as requiring the
Executive to be treated as employed by the Company for purposes of any employee
benefit plan or arrangement following the date of the Executive's Date of
Termination.
(b) If the Executive's Date of Termination occurs during the Agreement
Term under circumstances described in any subsection of Paragraph 3
(other than as set forth
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in subsection (c) below) then the Executive or his estate will
receive all payments in accordance with Paragraph 4(a).
(c) Notwithstanding anything herein to the contrary, if the Executive
voluntarily terminates as a result of a resignation pursuant to
Paragraph 3(e), the Executive shall be limited to receiving only
that Salary that is earned and unpaid for the period ending on the
Date of Termination and shall, as of the Date of Termination,
forfeit any right to receive bonus payments, if any, regardless of
whether any such bonus payments have accrued but were not yet paid.
(d) If the Executive is terminated by the Company pursuant to Section
3(f), the Executive shall be entitled to:
(i) The Executive's Salary for the period ending on the
Executive's Date of Termination.
(ii) The Executive's salary, as set forth on Schedule 2(a), for the
balance of the Agreement Term, payable immediately upon
termination.
(iii) Payment for accrued vacation days, as determined in accordance
with Company policy as in effect from time to time.
(iv) Any bonus payments as proscribed by this Agreement, payable
immediately upon termination without regard to the timing of
payments on Schedule 2(b).
(v) Any other payments or benefits to be provided to the Executive
by the Company pursuant to any employee benefit plans or
arrangements adopted by the Company, to the extent such
amounts are due from the Company.
(vi) All amounts due and owing under the Subordinated Note in the
amount of $750,000 made by Westwood Acquisition Corporation in
favor of Four Kings Management LLC.
(vii) All amounts due and owing under the 8% Junior Subordinated
Note and the 5% Junior Subordinated Note made by the Company
in the favor of the Executive.
5. Duties on Termination. Subject to the terms and conditions of this
Agreement, during the period beginning on the date of delivery of a Notice of
Termination, and ending on the Date of Termination, the Executive shall continue
to perform his duties as set forth in this Agreement, and shall also perform
such services for the Company as are necessary and appropriate for a smooth
transition to the Executive's successor, if any. Notwithstanding the foregoing
provisions of this Paragraph 5, the Company may suspend the Executive from
performing his duties under this Agreement following the delivery of a Notice of
Termination providing for the Executive's resignation, or delivery by the
Company of a Notice of Termination providing for the Executive's termination of
employment for any reason; provided, however, that during the period of
suspension (which shall end on the Date of Termination), the
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Executive shall continue to be treated as employed by the Company for other
purposes, and his rights to compensation or benefits shall not be reduced by
reason of the suspension.
6. Mitigation and Set-Off. The Executive shall not be required to
mitigate the amount of any payment provided for in this Agreement by seeking
other employment or otherwise. The Company shall be entitled to set off against
amounts payable to the Executive any amounts owed to the Company by the
Executive, but the Company shall not be entitled to set off against the amounts
payable to the Executive under this Agreement any amounts earned by the
Executive in other employment after termination of employment with the Company,
or any amounts which might have been earned by the Executive in other employment
had such other employment been sought.
7. Noncompetition.
(a) While the Executive is employed by the Company, and for the later of
(i) a period of two (2) years after the Executive terminates by
resigning pursuant to Section 3(e), (ii) a period of one (1) year
after the Company terminates the Executive pursuant to Section 3(f),
or (iii) a period of five (5) years after the Effective Date:
(i) The Executive shall not, without the express written consent
of the Board, be employed by, serve as a consultant to, or
otherwise assist or directly or indirectly provide services to
a Competitor (defined below) if: (A) such services are to be
provided with respect to any location in which the Company or
a Subsidiary did business during the twelve (12) month period
prior to the Date of Termination, or with respect to any
location in which the Company or a Subsidiary had devoted
material resources to doing business during the twelve (12)
month period prior to the Date of Termination; or (B) the
trade secrets, confidential information, or proprietary
information (including, without limitation, confidential or
proprietary methods) of the Company and the Subsidiaries to
which the Executive had access could reasonably be expected to
benefit the Competitor if the Competitor were to obtain access
to such secrets or information.
(ii) The Executive shall not, without the express written consent
of the Board, directly or indirectly own an equity interest in
any Competitor (other than ownership of 5% or less of the
outstanding stock of any corporation listed on a national
stock exchange or included in the NASDAQ System).
(b) While the Executive is employed by the Company, and for the later of
(i) a period of three (3) years after termination of the Executive's
employment with the Company for any reason, (ii) a period of one (1)
year after the Company terminates the Executive pursuant to Section
3(f), or (iii) a period of five (5) years after the Effective Date:
(i) The Executive shall not, without the express written consent
of the Board, solicit or attempt to solicit any party who is
then or, during the twelve (12) month period prior to such
solicitation or attempt by the Executive was (or
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was solicited to become), a customer or supplier of the
Company or a Subsidiary, or a user of the services provided by
the Company or a Subsidiary, provided that the restriction in
this Paragraph (ii) shall not apply to any activity on behalf
of a business that is not a Competitor.
(ii) The Executive shall not, without the express written consent
of the Board, solicit, entice, persuade, induce or hire any
individual who is employed by the Company or any Subsidiary
(or was so employed within 90 days prior to the Executive's
action) to terminate or refrain from renewing or extending
such employment or to become employed by or enter into
contractual relations with any other individual or entity
other than the Company or any Subsidiary, and the Executive
shall not approach any such employee for any such purpose or
authorize or knowingly cooperate with the taking of any such
actions by any other individual or entity.
(c) The term "Competitor" means any enterprise (including a person,
entity, firm or business, whether or not incorporated) during any
period in which it is materially competitive in any way with any
business in which the Company or any of the Subsidiaries was engaged
during the twelve (12) month period prior to the Executive's Date of
Termination.
(d) Notwithstanding anything in this Section 7 to the contrary, if this
Agreement is terminated by either party delivering notice of
cessation in accordance with Section 1(f) at the end of the initial
five year term or any successive term, the Executive's obligations
under paragraphs (a) and (b) of this Section 7 shall continue for
one year after the end of such term.
Nothing in this Paragraph 7, Paragraph 8, or Paragraph 9 shall be
construed as limiting the Executive's duty of loyalty to the Company, or any
other duty otherwise owed to the Company, while the Executive is employed by the
Company.
8. Non-Disparagement. The Executive and the Company agree that each
will not make any false, defamatory or disparaging statements about the other,
the Subsidiaries, or the officers or directors of the Company or the
Subsidiaries that are reasonably likely to cause material damage to the
Executive, the Company, the Subsidiaries, or the officers or directors of the
Company or the Subsidiaries.
9. Confidential Information. The Executive agrees that, during the
Agreement Term, and at all times thereafter:
(a) The Executive agrees to keep secret all Confidential Information and
Intellectual Property which may be obtained during the period of
employment by the Company and that the Executive shall not reveal or
disclose it, directly or indirectly, except with the Company's prior
written consent. The Executive shall not make use of the
Confidential Information or Intellectual Property for the
Executive's own purposes or for the benefit of anyone other than the
Company and shall protect it against disclosure, misuse, espionage,
loss and theft.
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(b) The Executive acknowledges and agrees that all Intellectual Property
is and shall be owned by the Company. The Executive hereby assigns
and shall assign to all ownership rights possessed in any
Intellectual Property contributed, conceived or made by the
Executive (whether alone or jointly with others) while employed by
the Company, whether or not during work hours. The Executive shall
promptly and fully disclose to the Company in writing all such
Intellectual Property after such contribution, conception or other
development. The Executive agrees to fully cooperate with the
Company, at the Company's expense, in securing, enforcing and
otherwise protecting throughout the world the Company's interests in
such Intellectual Property, including, without limitation, by
signing all documents reasonably requested by the Company.
(c) Immediately following the Date of Termination, the Executive agrees
to promptly deliver to the Company all memoranda, notes, manuals,
lab notebooks, computer diskettes, passwords, encryption keys,
electronic mail and other written or electronic records (and all
copies thereof) constituting or relating to Confidential Information
or Intellectual Property that the Executive may then possess or have
control over. If the Company requests, the Executive shall provide
written certification that all such materials have been returned .
(d) For purposes of this Agreement, the following terms shall be defined
as set forth below:
(i) "Employer Confidential Information" shall mean all
information, in any form or medium, that relates to the
business, marketing, costs, prices, products, processes,
services, methods, computer programs and systems, personnel,
customers, research or development of the Company and all
other information related to the Company and the Subsidiaries
which is not readily available to the public.
(ii) "Confidential Information" shall mean all information, in any
form or medium, that relates to the business, marketing,
costs, prices, products, processes, services, methods,
computer programs and systems, personnel, customers, research
or development of the Company and the Subsidiaries and all
other information related to the Company and the Subsidiaries
which is not readily available to the public.
(iii) "Intellectual Property" shall mean, with respect to the
following which are created or existing during the period of
the Executive's employment by the Company, any: (A) idea,
know-how, invention, discovery, design, development, software,
device, technique, method or process (whether or not
patentable or reduced to practice or including Confidential
Information) and related patents and patent applications and
reissues, re-examinations, renewals, continuations-in-part,
continuations, and divisions thereof; (B) copyrightable and
mask work (whether or not including Confidential Information)
and related registrations and applications for registration;
(C) trademarks, trade secrets and other proprietary rights;
and
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(D) improvements, updates and modifications of the foregoing
made from time to time.
10. Assistance with Claims. The Executive agrees that, for the period
beginning on the Employment Commencement Date, and continuing for a reasonable
period after the Executive's Date of Termination, the Executive will assist the
Company and the Subsidiaries in defense of any claims that may be made against
the Company and the Subsidiaries, and will assist the Company and the
Subsidiaries in the prosecution of any claims that may be made by the Company or
the Subsidiaries, to the extent that such claims may relate to services
performed by the Executive for the Company and the Subsidiaries. The Executive
agrees to promptly inform the Company upon becoming aware of any lawsuits
involving such claims that may be filed against the Company or any Subsidiary.
The Company agrees to provide legal counsel to the Executive in connection with
such assistance (to the extent legally permitted), and to reimburse the
Executive for all of the Executive's reasonable out-of-pocket expenses
associated with such assistance, including travel expenses. For periods after
the Executive's employment with the Company terminates, the Company agrees to
provide reasonable compensation to the Executive for such assistance. The
Executive also agrees to promptly inform the Company upon being asked to assist
in any investigation of the Company or the Subsidiaries (or their actions) that
may relate to services performed by the Executive for the Company or the
Subsidiaries, regardless of whether a lawsuit has then been filed against the
Company or the Subsidiaries with respect to such investigation.
11. Equitable Remedies. The Executive acknowledges that the Company
would be irreparably injured by a violation of Paragraph 7, Paragraph 8 or
Paragraph 9, and therefore, agrees that the Company, in addition to any other
remedies available to it for such breach or threatened breach, shall be entitled
to a preliminary injunction, temporary restraining order, or other equivalent
relief, restraining the Executive from any actual or threatened breach of
Paragraph 7, Paragraph 8, or Paragraph 9. The Company acknowledges that the
Executive would be irreparably injured by a violation of Paragraph 8, and the
Company agrees that the Executive, in addition to any other remedies available
to the Executive for such breach or threatened breach, shall be entitled to a
preliminary injunction, temporary restraining order, or other equivalent relief,
restraining the Company from any actual or threatened breach of Paragraph 8. If
a bond is required to be posted in order for the Company to secure an injunction
or other equitable remedy, the parties agree that said bond need not be more
than a nominal sum.
12. Deferred Compensation Agreement. As of the Effective Date, the
Deferred Compensation Agreement by and between Westwood Computer Corporation,
Inc. and Keith Grabel, dated June 25, 2001 (the "Deferred Compensation
Agreement"), shall be terminated and have no further force and effect. The
Executive acknowledges and agrees that he is not owed or entitled to any wages,
payments, bonuses, benefits, pay in lieu of notice, salary continuation or
severance, compensation, or any other remuneration of whatever kind arising from
or relating to the Deferred Compensation Agreement.
13. Nonalienation. The interests of the Executive under this Agreement
are not subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment, or garnishment by creditors of the
Executive or the Executive's beneficiary.
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14. Amendment. This Agreement may be amended or cancelled only by mutual
agreement of the parties in writing. So long as the Executive lives, no person,
other than the parties hereto, shall have any rights under or interest in this
Agreement or the subject matter hereof.
15. Applicable Law. The provisions of this Agreement shall be construed
in accordance with the laws of the State of New Jersey, without regard to the
conflict of law provisions of any state.
16. Severability. The invalidity or unenforceability of any provision of
this Agreement will not affect the validity or enforceability of any other
provision of this Agreement, and this Agreement will be construed as if such
invalid or unenforceable provision were omitted (but only to the extent that
such provision cannot be appropriately reformed or modified).
17. Waiver of Breach. No waiver by any party hereto of a breach of any
provision of this Agreement by any other party, or of compliance with any
condition or provision of this Agreement to be performed by such other party,
will operate or be construed as a waiver of any subsequent breach by such other
party of any similar or dissimilar provisions and conditions at the same or any
prior or subsequent time. The failure of any party hereto to take any action by
reason of such breach will not deprive such party of the right to take action at
any time while such breach continues.
18. Successors. This Agreement shall be binding upon, and inure to the
benefit of, the Company and its successors and assigns and upon any person
acquiring, whether by merger, consolidation, purchase of assets or otherwise,
all or substantially all of the Company's assets and business, and the successor
shall be substituted for the Company under this Agreement.
19. Notices. Notices and all other communications provided for in this
Agreement shall be in writing and shall be delivered personally or sent by
registered or certified mail, return receipt requested, postage prepaid, or sent
by facsimile or prepaid overnight courier to the parties at the addresses set
forth below (or such other addresses as shall be specified by the parties by
like notice). Such notices, demands, claims and other communications shall be
deemed given:
(a) in the case of delivery by overnight service with guaranteed next
day delivery, the next day or the day designated for delivery;
(b) in the case of certified or registered U.S. mail, five days after
deposit in the U.S. mail; or
(c) in the case of facsimile, the date upon which the transmitting party
received confirmation of receipt by facsimile, telephone or
otherwise;
provided, however, that in no event shall any such communications be deemed to
be given later than the date they are actually received. Communications that are
to be delivered by the U.S. mail or by overnight service or two-day delivery
service are to be delivered to the addresses set forth below:
to the Company:
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Westwood Computer Corporation
11 Diamond Road
Springfield, NJ 07081
or to the Executive:
at address in Company's records.
All notices to the Company shall be directed to the attention of
Secretary of the Company, with a copy to the Board of Directors of the Company.
Each party, by written notice furnished to the other party, may modify the
applicable delivery address, except that notice of change of address shall be
effective only upon receipt.
20. Arbitration of All Disputes. Any controversy or claim arising out of
or relating to this Agreement (or the breach thereof) shall be settled by final,
binding and non-appealable arbitration by three arbitrators. Except as otherwise
expressly provided in this Paragraph 20, the arbitration shall be conducted in
accordance with the rules of the American Arbitration Association (the
"Association") then in effect. One of the arbitrators shall be appointed by the
Company, one shall be appointed by the Executive, and the third shall be
appointed by the first two arbitrators. If the first two arbitrators cannot
agree on the third arbitrator within 30 days of the appointment of the second
arbitrator, then the third arbitrator shall be appointed by the Association.
This Paragraph 20 shall not be construed to limit the Company's right to obtain
relief under Paragraph 11 with respect to any matter or controversy subject to
Paragraph 11, and, pending a final determination by the arbitrator with respect
to any such matter or controversy, the Company shall be entitled to obtain any
such relief by direct application to state, federal, or other applicable court,
without being required to first arbitrate such matter or controversy. The losing
party shall bear all expenses of the arbitrator incurred in any arbitration
hereunder and shall reimburse the prevailing party for any related reasonable
legal fees and expenses directly attributable to such arbitration; provided that
such legal fees are calculated on an hourly, and not on a contingency fee,
basis.
21. Survival of Agreement. Except as otherwise expressly provided in
this Agreement, the rights and obligations of the parties to this Agreement
shall survive the termination of the Executive's employment with the Company.
22. Entire Agreement. Except as otherwise indicated herein, this
Agreement, including any Exhibit(s) attached hereto, constitutes the entire
agreement between the parties concerning the subject matter hereof and
supersedes all prior and contemporaneous agreements, if any, between the parties
relating to the subject matter hereof; provided, however, that nothing in this
Agreement shall be construed to limit any policy or agreement that is otherwise
applicable relating to confidentiality, rights to inventions, copyrightable
material, business and/or technical information, trade secrets, solicitation of
employees, interference with relationships with other businesses, competition,
and other similar policies or agreement for the protection of the business and
operations of the Company and the Subsidiaries.
[Signatures appear on the following page]
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<Page>
IN WITNESS THEREOF, the Executive has hereunto set his hand, and the
Company has caused these presents to be executed in its name and on its behalf,
all as of the Effective Date.
KEITH GRABEL
/s/ Keith Grabel
---------------------------------------
WESTWOOD COMPUTER CORPORATION
/s/ Mary Margaret Grabel
---------------------------------------
By:
----------------------------------
Its:
----------------------------------
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Schedule 2(a)
Salary
Year 1 $250,000
Year 2 $275,000
Year 3 $300,000
Year 4 $325,000
Year 5 $350,000
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Schedule 2(a)(1)
Salary After Mary Margaret Grabel Termination
Year 1 $500,000
Year 2 $550,000
Year 3 $600,000
Year 4 $650,000
Year 5 $700,000
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Schedule 2(b)
Bonus Payments
Year 1 $375,000
Year 2 $400,000
Year 3 $440,000
Year 4 $400,000
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Schedule 2(c)
Benefits
1. Full time use of Company leased vehicle of choice, Currently BMW X5
2. Company pays insurance and maintenance on vehicle
3. Reimbursements for all travel and other expenses as per company policy
4. Use of Company American Express Card for Company related expenses
5. All American Express Award points flow to Keith Grabel's account
6. First Class Air travel, it is understood that whenever possible Award
points will be used for upgrade to First Class
7. Control and use of Company's Jet's Football package
8. Control and use of Company's Yankee's Baseball package
9. Membership to Fox Hollow Country Club and payment of all golf and related
activities
10. Company Health and Medical plan
11. Three weeks vacation, Company approved holidays and 5 days personal time
12. Benefits available generally to senior level executives of Company
13. Access to 401k plan or any other Executive deferred compensation plan
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Schedule 4(a)(ii)
Termination Salary
Year 1 $150,000
Year 2 $200,000
Year 3 $250,000
Year 4 $300,000
Year 5 $350,000
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