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EXHIBIT 10.22
DATA SYSTEMS NETWORK CORPORATION
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement') dated as of this 20th day
of December, 1999, between Data Systems Network Corp., a Michigan corporation
(hereinafter referred to as the "Company"), and Garrett Denniston (hereinafter
referred to as the "Executive"):
WITNESSETH:
WHEREAS, the Executive is serving as Vice President of Sales of the
Company; and
WHEREAS, the Executive has extensive experience with respect to the
management and operations of the Company which it considers extremely valuable
to the continued prosperity of the Company; and
WHEREAS, the Company wishes to ensure that it will continue to have the
Executive available to perform for the Company, duties as Vice President of
Sales; and
WHEREAS, the Company and the Executive desire to set forth in this
Agreement the terms, conditions and obligations of the parties with respect to
such employment and this Agreement is intended by the parties to supersede all
previous agreements and understandings, whether written or oral, concerning such
employment.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants contained herein, the parties agree as follows:
1. EMPLOYMENT. The Company (or "Employer") shall continue to employ the
Executive upon the terms and conditions hereinafter set forth. The Executive
shall perform such duties and responsibilities for the Employer, which are
commensurate with his position as may be assigned him by the Company's President
and CEO. The Executive shall report to the President and CEO of the Company.
Incident to the performance of such duties, the Employer shall provide the
Executive with office space, facilities and secretarial assistance commensurate
with that currently being provided to the Executive.
2. TERM. Subject only to the provisions hereof set forth in Section 7,
the term of this Agreement (herein the "Term") shall be for a period beginning
on the date hereof and ending on December 20, 2003 or, if earlier, on the
Executive's 62nd birthday on which birthday this Agreement shall terminate
unless earlier terminated in accordance with the terms hereof,
3. COMPENSATION. During the Term, the Executive's salary shall be
payable at intervals not less often than semi-monthly. The Executive's salary
shall be established by either the Executive Committee of the Company, or in the
event the Executive is among the
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Company officers whose compensation is subject to review by the Compensation
and Stock Option Committee of the Board of Directors of the Company, by such
Committee (the applicable committee being referred to herein as the
"Committee") and all adjustments thereto, and all aspects of the Executive's
incentive or performance compensation shall be established by the Committee in
its sole discretion. In the event there is no Committee in existence at any
time, the term Committee shall be deemed to mean the Chief Executive Officer
of the Company. During the Term, the Executive shall also receive such
benefits and perquisites (the "Benefits") which are made available to
similarly positioned executives of the Employer including, without limitation,
incentive compensation, loans, awards, insurance, stock options, stock
purchase plans, benefits from qualified plans or non-qualified plans or other
benefit plans now or hereafter existing which are adopted by the Employer for
the benefit of its employees generally, and for the benefit of the Employer's
officers, all such Benefits to be provided in such amounts, as may be
determined from time to time by the Committee in its sole discretion.
4. EXTENT OF SERVICE. During the Term, the Executive shall devote his
full time, attention, and energy to the business of the Employer and the
Executive shall not be engaged in any other business activity pursued for
gain, profit, or other pecuniary advantage which activity in any way
interferes with the Executive's duties and responsibilities provided for
herein.
5. NON-COMPETITION AND NON-SOLICLTATION. The Executive agrees that:
(a) During the Term and for a period of one year thereafter
or during any Severance Period, if longer (the "Restricted Period'), the
Executive agrees that he will not (without the written consent of the Chairman
of the Board) engage directly or indirectly in any business within the United
States (financially as an investor or lender or as an employee, director,
officer, partner, independent contractor, consultant or owner or in any other
capacity calling for the rendition of personal services or acts of management,
operation or control) which is directly competitive with the business, at any
time during the Restricted Period, conducted by the Company or any Affiliates
as defined below. Notwithstanding the foregoing, the Executive shall be
entitled to own securities of any corporation conducting a business
competitive with the business of the Company or any of its subsidiaries or
Affiliates so long as the securities of such corporation are listed on a
national securities exchange and the securities owned directly or indirectly
by the Executive do not represent more than two percent (2%) of any class of
the outstanding securities of such company.
(b) During the Restricted Period, in addition to the
obligations pursuant to Subsection 5(a), the Executive agrees that neither he
nor any business in which he engages directly or indirectly will (i) directly
or indirectly induce any customers of the Company or of corporations or
businesses which directly or indirectly control or are controlled by or under
common control with the Company ("Affiliates") to patronize any business
similar to that of the Company, (ii) canvass, solicit or accept any similar
business from any customer of the Company or any Affiliates, (iii) directly or
indirectly request or advise any customer of the Company or Affiliates to
withdraw, curtail or cancel such customer's business with the
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Company or Affiliates, (iv) directly or indirectly disclose
to any other person, firm or corporation the names or addresses of any of the
customers of the Company or Affiliates, or (v) compete with the Company or
Affiliates in acquiring or merging with any other business or acquiring the
assets of such other business.
(c) During the Restricted Period, in addition to the
obligations pursuant to Subsections 5(a) and 5(b), the Executive agrees that
neither he nor any business in which he engages directly or indirectly will, (i)
hire or attempt to hire any employee of the Company or its Affiliates nor, (ii)
directly or indirectly encourage any employee of the Company or its Affiliates
to terminate employment with the Company or its Affiliates. Notwithstanding the
foregoing, it shall not be deemed a violation of this subsection if a business,
which employs the Executive, hires or attempts to hire an employee of the
Company or its Affiliates and the Executive has no knowledge of, control over or
involvement with such solicitation.
(d) In the event that any of the provisions of this Section 5
should ever be deemed to exceed the time, geographic or occupational limitations
permitted by applicable laws, then such provisions shall be and are hereby
reformed to the maximum time, geographic or occupational limitations permitted
by law.
6. CONFIDENTIAL INFORMATION. The Executive acknowledges that in
his employment he is or will be making use of, acquiring or adding to the
Company's confidential information which includes, but is not limited to,
memoranda and other materials or records of a proprietary nature and records and
policy matters relating to finance, personnel, management and operations.
Therefore, in order to protect the Company's confidential information and to
protect other employees who depend on the Company for regular employment, the
Executive agrees that he will not in any way utilize any of said confidential
information except in connection with his employment by the Employer, and except
in connection with the business of the Company he will not copy, reproduce or
take with him the original or any copies of said confidential information and
will not disclose any of said confidential information to anyone.
7. TERMINATION.
(a) Death or Disability. If the Executive should become
physically or mentally disabled and unable to perform his duties hereunder for a
continuous period in excess of ninety (90) days (in the reasonable opinion of
the Committee), or if the Executive should die while an employee of the
Employer, this Agreement and the Executive's employment with the Employer shall
immediately terminate.
(b) Termination by the Employer for Cause. The following
events shall create in the Company a right to terminate the Executive's
employment under this Agreement prior to the expiration of the Term: (i) the
commission of fraud, embezzlement or theft by the Executive in connection with
the Executive's duties; (ii) the intentional wrongful damage to property of the
Company, and/or Affiliates by the Executive; (iii) the intentional wrongful
disclosure by the Executive of any secret process or confidential information of
the Company, and/or Affiliates; or (iv) the violation of the Executive's
non-disclosure, non-solicitation and non-competition covenants set forth in
Sections 5 and 6. In the event of such a Termination for
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cause pursuant to this Subsection, all of the obligations of the Company under
this Agreement shall immediately terminate.
(c) Other Termination by Employer. In the event the Company
shall elect to terminate the Executive's employment for any reason other than
those specified in Subsection 7(a) or 7(b), it shall provide written notice of
such termination to the Executive. In the event that there occurs without the
written consent of the Executive:
(i) a change in the Executive's title, a change in the
Executive's duties or responsibilities, a change in
the Executive's reporting relationships, or a change
in control of the Company (as defined below), any of
which results in or reflects a diminution of the
scope or importance of the Executive's position,
duties and responsibilities;
(ii) a reduction in the Executive's then current annual
base salary (other than as part of reductions in
annual base salary affecting the Employer's officers
generally);
(iii) a reduction in the level of benefits available or
awarded under employee and officer benefit plans and
programs, including, but not limited to annual and
long-term incentive and stock-based plans and
programs (other than as part of reductions in such
benefit plans or programs affecting the Employer's
officers generally); or
(iv) a relocation of Executive's primary employment
location to a location which is more than 50 miles
from his current location,
then, the Executive may deliver written notice of termination to the Company
within three months of such event (which shall be effective even if such three
months expire after the end of the Term). In either case and subject to the
execution and delivery by the Executive to the Company of the release described
in Section 9 hereof, the Company shall provide Executive with severance
compensation and benefits as follows:
(u) the Executive shall receive an amount equal to six month's
current base salary, payable at intervals not less frequently
than monthly over a period of months equal to the number of
months of severance pay (not less than six) provided for by
this subsection, (such period herein after referred to as the
"Severance Period");
(v) the Executive shall receive, with respect to any participation
rights in the Company's annual bonus or long-term incentive
plans, an award under any such plan, payable upon notice of
termination or, of exercise of any condition herein, an amount
equal to the pro-rated share earned during the months of
employment calculated by dividing the total annual award by
twelve (12) multiplied by the number of full and partial
months employed, less any amounts already paid for and during
the current year to date. In the event that termination occurs
after
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there has been a change in control, as defined by a change in
the Chief Executive Officer, a change in two-thirds or more of
the Company's Board of Directors, or, a change of more than
thirty percent (30%) of the total shares outstanding, an
amount equal to the annual award as if all pre-requisite
conditions have been met, and as if the total annual award
were earned in full with out any deductions for any amounts
previously paid, shall be paid to the Executive;
(w) with respect to the Executive's stock options, the Company
will recommend to the Compensation and Stock Option Committee
of the Board of Directors of the Company that the
exercisability of the Executive's outstanding stock options be
accelerated, such options shall remain exercisable during the
Severance Period (unless they shall expire earlier by their
terms) and such options shall otherwise be treated in
accordance with the terms of their respective grants;
(x) the Executive's medical, dental and/or other Benefits shall be
continued on the same basis as offered to active salaried
employees for the Severance Period or until such earlier time
as the Executive becomes employed and eligible for such
benefits under a plan of the new employer; and continuation
coverage under COBRA shall commence at the end of the
Severance Period;
(y) all other Benefits shall be paid or continued only to the
extent the terms thereof provide for payment or continuation
following the termination of employment.
The foregoing shall be in lieu of all salary, bonuses or incentive or
performance based compensation for the remainder of the Term. If Executive
should die during the Severance Period, any remaining severance payments
described in (u) and (v) above, shall be made to Executive's surviving spouse
or, if none, to his estate.
(d) Voluntary Termination. If during the Term the Executive
should voluntarily terminate his employment with the Employer for any reason,
including retirement, other than as described in Subsection 7(c) hereof, the
obligations of the Employer and the Company under this Agreement shall terminate
forthwith, other than obligations to (i) pay the Executive's base salary to the
date of termination, (ii) pay all incentive compensation earned by the Executive
for performance periods which are completed prior to the date of termination, at
such times and on the same basis amounts as such incentive compensation becomes
payable to other executives of the Employer and (iii) pay or make available to
the Executive all Benefits which by their terms or under applicable law survive
the voluntary termination of the Executive's employment; and the Executive shall
remain bound by his non-disclosure, non-solicitation and non-competition
covenants set forth in Sections 5 and 6 hereof. The exercisability of the
Executive's outstanding stock options shall be treated in accordance with the
terms of their respective grants or awards, except that in the case of
retirement on or after age 62, the Company will recommend to the Compensation
and Stock Option Committee of the Board of Directors of the Company that the
exercisability of Executive's outstanding stock options be accelerated.
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9. GENERAL RELEASE AND COOPERATION AGREEMENT. Notwithstanding anything
in Subsection 7(c) to the contrary and in consideration therefor, severance
benefits thereunder shall only become payable by the Company if the Executive
executes and delivers to the Company a General Release and Cooperation Agreement
on or after the date of written notice of termination of the Executive's
employment and in substantially the form attached as Exhibit A hereto.
10. NOTICES. Any notice required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been given when
deposited in the U.S. mail in a registered, postage prepaid envelope addressed:
If to the Executive, at his address set forth below, and if to the Company, c/o
Chairman of the Board, Data Systems Network Corporation, 34705 West Twelve Mile
Road, Suite 300, Farmington Hills, Michigan, 48333.
11. ASSIGNMENT. The Executive may not assign his obligations hereunder.
The rights of the Executive and the rights and obligations of the Company
hereunder shall inure to the benefit of and shall be binding upon their
respective heirs, personal representatives, successors and assigns.
12. MISCELLANEOUS.
(a) This Agreement shall be subject to and governed by the laws of the
State of Michigan.
(b) Failure to insist upon strict compliance with any provisions hereof
shall not be deemed a waiver of such provisions or any other provision
hereof.
(c) This Agreement may not be modified except by an agreement in writing
executed by the parties hereto.
(d) The invalidity or unenforceability of any provision hereof shall not
affect the validity or enforceability of any other provision.
(e) This Agreement shall supersede any and all prior employment agreements
or understandings, written or oral, with the Executive.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
DATA SYSTEMS NETWORK
CORPORATION
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Michael W. Grieves,
Chairman, President and CEO
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Garrett Denniston
20 Russett Road
Sandy Hook, CT 06482