EXHIBIT 10.3
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. SUCH PORTIONS ARE DESIGNATED "***".
SEPARATION AGREEMENT
Daisytek International Corporation ("Daisytek") and *** enter the
following agreement ("Agreement"), effective December 4, 2002 ("Effective
Date"), for the purpose of completely resolving any and all issues, disputes and
claims related to ***'s employment with Daisytek, the termination of ***'s
employment with Daisytek, and all other matters related in any way to, or
resulting in any way from, the relationship between *** and Daisytek.
1. PAYMENTS AND BENEFITS. As consideration to *** for ***'s promises,
releases and representations in this Agreement, Daisytek agrees to provide the
following payments and benefits to ***:
a. ***
b. ***
c. ***
d. ***
2. RESIGNATION BY ***. *** agrees to voluntarily resign ***'s
employment with Daisytek effective January 1, 2003, and Daisytek agrees to
accept ***'s resignation effective January 1, 2003. *** agrees that his decision
to resign his employment is purely voluntary, and that he has not been
discriminated or retaliated against during his employment with Daisytek.
3. RELEASE BY ***. In return for the payments, releases and other
consideration described herein, ***, for himself and his heirs and assigns,
hereby releases and waives all claims and causes of action of any and every sort
against Daisytek, its parents, subsidiaries, affiliates, partners, limited
partners, successors, shareholders, directors, officers, employees, agents,
attorneys and assigns, which *** has, has had, or may have in the future arising
in any way from any event, act or omission which occurred at any time from the
beginning of time to the Effective Date, including, but not limited to ***'s
employment with Daisytek, the termination of ***'s employment with Daisytek, and
all other matters related in any way to the relationship between *** and
Daisytek. This release includes, but is not limited to, claims in tort,
contract, under statute, in equity or otherwise, and claims for compensation,
severance, retaliation, bonuses, stock, stock options, performance incentives,
payments as the result of a sale merger or business combination, benefits,
vehicle payments or expenses, incidental and consequential damages, expense
reimbursement of any sort, injuries, or any other sort of damages or relief
whatsoever. This release also includes, but is not limited to, claims under the
Americans With Disabilities Act, Age Discrimination in Employment Act, Family
and Medical Leave Act, Title VII of the Civil Rights Act of 1964, the Fair Labor
Standards Act, the Texas Commission on Human Rights Act, the Texas Payday Act,
any workers' compensation statute, and any other federal, state or local act or
ordinance pertaining to employment. The intent of *** and Daisytek is that this
release will be interpreted in as broad a fashion as possible and that it is
intended to be a total and complete release of all claims of any sort
whatsoever.
4. ***
5. TRADE SECRETS/CONFIDENTIAL INFORMATION. *** acknowledges that
Daisytek's Confidential Information is uniquely valuable to Daisytek and agrees
that during ***'s lifetime, *** will not disclose Confidential Information to
any other person or entity without Daisytek's prior written consent and will not
duplicate, copy, disseminate or attempt to duplicate, copy or disseminate
Confidential Information or any part or portion of it or allow or permit any
person or entity within ***'s control to do so. "Confidential Information" as
used in this Agreement includes the following: all trade secrets of Daisytek and
any information or item that does not qualify under applicable law as a trade
secret but to which Daisytek limits access, to any extent, either internally or
externally. Confidential Information includes but is not limited to information
and items related to plans, strategies, inventions, devices, services, products,
processes, properties, assets, customers, customer lists, customer preferences,
markets, marketing strategies, rebate programs, incentive programs, promotions,
management, employees, technology, know-how, financial conditions or prospects,
employee compensation, fee information, cost information, pricing information,
business development plans and strategies, marketing plans and strategies,
instructional methodology and techniques, computer software, specifications and
code, sources of supply, products or services, designs, analyses, drawings,
photographs and reports, computer operating systems, applications and program
listings, flow charts, manuals, documentation, databases, accounting and
business methods, production procedures, or merchandising systems.
6. RETURN OF PROPERTY. On or before the Effective Date, *** will return
to Daisytek's counsel all property, tangible or intangible, that Daisytek
provided to *** during the course of or as the result of ***'s employment with
Daisytek, as well as all property, tangible or intangible, that *** developed or
produced as the result of or in the course of ***'s employment with Daisytek.
This includes, but is not limited to, all keys, computers, computer passwords,
equipment, and originals and all copies of computer discs, emails, schedules,
worksheets, spreadsheets, files or other stored information, documents, and
voice, video or data recordings of any sort that are within his possession or
control.
7. COVENANT NOT TO COMPETE.
a. *** agrees that for the *** period immediately following
the Effective Date or for *** from the date of any court order enforcing all or
part of this Agreement, whichever is later, *** will not in the ***, or ***,
(i) Either directly or indirectly, for ***'s own
behalf or on behalf of any other person or entity, engage in or carry on any
business or in any way become associated with any business that distributes or
provides corporate supplies, peripherals, professional tape products, office
products, customer care, logistics, distribution, fulfillment, or demand
generation services similar to those that Daisytek offered or planned to offer
while *** was employed by Daisytek ("Business of Daisytek");
(ii) Either directly or indirectly attempt in any
manner to solicit, from any person or entity that is or was a client of
Daisytek, business of the type performed or formerly performed by Daisytek for
such client or to persuade any such client to cease to do business or to reduce
the amount of business which any such client has customarily done with Daisytek
or contemplates doing with Daisytek (as used herein the noun "client" shall mean
anyone who is a client or customer, supplier, trading group, dealer, trader,
venture partner or sales representative or affiliate of any of the above who
purchases Daisytek product or services or otherwise does business with Daisytek
at any time during the *** period immediately preceding the Effective Date and
any prospective persons to whom Daisytek had made a formal presentation (or
similar offering of services) within a period of *** immediately preceding the
Effective Date);
(iii) Either directly or indirectly, for ***'s own
behalf or on behalf of any other person or entity, be or become an employee,
agent, consultant or representative of or become a director or officer of any
person, firm, corporation, association or other entity that is engaged in or
currently intends to become engaged in, or is carrying on any business that is
in direct or indirect competition with the Business of Daisytek; or
(iv) Either directly or indirectly be or become a
shareholder, joint venturer in or owner (in whole or in part) of or be a partner
of or associated with or have any proprietary or financial interest, in any
firm, corporation, joint venture, partnership or association or other entity
that is engaged
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in, or currently intends to become engaged in or is carrying on any business
that is in direct or indirect competition with the Business of Daisytek.
Nothing in this Section will prevent *** from owning less than five percent (5%)
of the stock of any publicly traded corporation as long as *** is not a
participant in the management or affairs of the corporation in a manner that
would otherwise violate any prohibition contained in this Section.
b. It is understood and agreed that the scope of the covenants
contained in this Section are reasonable as to time, area and scope of activity
restrained and are necessary to protect Daisytek's legitimate business
interests. Specifically, *** has considered the covenants in light of the
benefits *** will obtain by means of this Agreement and has concluded that the
covenants leave *** with a reasonable number and variety of permitted avenues
for engaging in employment in a number of locations and a number of occupations
during the period of restriction.
c. If the restrictions contained in this Section regarding
time, geography, or scope of activity are determined by a court to be
unenforceable, Daisytek and *** agree that said court may substitute a provision
it believes to be enforceable for the one it believes to be unenforceable, and
this Agreement may be enforced as amended.
8. NON-DISPARAGEMENT. *** and Daisytek agree not to make any negative
or disparaging remarks of any sort regarding one another.
9. RESPONSIBILITY FOR TAXES. *** assumes responsibility for all taxes,
if any, due by him on or as a result of any payment made to him under this
Agreement, with the sole exception of any mandatory payroll withholding and
employer contribution required by local, state or federal law. Daisytek makes no
representations of any kind relating to the taxability or non-taxability of any
payments made or consideration given under this Agreement. *** acknowledges that
he should seek independent advice regarding the taxability of the payments made
hereunder, to the extent he desires such advice. *** also acknowledges that a
report of the payments herein may or may not be made by Daisytek or Daisytek's
representatives to the Internal Revenue Service depending upon applicable tax
laws. *** acknowledges that he must pay all of his own legal or tax advice fees,
taxes and COBRA continuation premiums out of the proceeds of the consideration
described in this Agreement.
10. COOPERATION WITH DAISYTEK'S AUDIT COMMITTEE. *** agrees that he has
been given a full and fair opportunity to express concerns about Daisytek's
alleged practices and financial and accounting improprieties to Daisytek's Audit
Committee. *** further agrees that he has done so and that he has no material
concerns that he has not brought to the attention of the Audit Committee. ***
agrees to continue to make himself reasonably available to confer with, report
to, and/or assist Daisytek's Audit Committee with regard to the Audit
Committee's investigation of any practices or alleged improprieties of Daisytek.
If *** fails to do so, in addition to all other remedies that Daisytek may have
for ***'s breach of this Agreement, Daisytek may cancel all remaining payments
due to *** by Daisytek under this Agreement.
11. CONFIDENTIALITY. Maney agrees to keep amounts, terms and conditions
of this Agreement strictly confidential. Except as required by law or legal
process issued by a court or government agency with competent jurisdiction, ***
agrees that he shall not disclose the amounts, terms and conditions of this
Agreement to any person or entity except for his attorneys or tax advisors, and
spouse. *** additionally agrees that he will inform his attorneys, tax advisors,
and spouse that the amounts, terms and conditions of this Agreement are to be
kept strictly confidential, and that they are bound to this confidentiality
provisions as ***'s agents.
12. DUTY TO REPORT. *** and Daisytek agree that notwithstanding the
provisions regarding nondisparagement and confidentiality contained in
paragraphs 7 and 10 of this Agreement, *** may report facts known by him about
Daisytek which he has a duty to report by law or public policy to any
governmental entity or agency.
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13. REAPPLICATION FOR EMPLOYMENT. *** agrees that he shall neither seek
nor accept reemployment with or through Daisytek, whether such employment be
directly with Daisytek or a parent, subsidiary or affiliate of Daisytek.
14. SEVERABILITY. If any provision of this Agreement is declared to be
illegal, invalid or unenforceable, such provision(s) will be severed from this
Agreement and this Agreement shall be construed as if such illegal, invalid or
unenforceable provision was never part of this Agreement. Any such illegal,
invalid or unenforceable provision will not affect the validity or the
enforceability of this Agreement or its remaining provisions.
15. GOVERNING LAW/LEGAL FEES AND COSTS. This Agreement is made under,
and will be construed in accordance with the laws of the State of Texas. In the
event that any legal action is necessary to enforce this Agreement, the
prevailing party will be entitled to recover his, its reasonable attorneys' fees
and costs.
IN WITNESS WHEREOF, the undersigned have entered into this Agreement as
of the date first written above.
DAISYTEK INTERNATIONAL CORPORATION ***
By:
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Its /s/ President/CEO By: /s/ ***
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Date: Date: /s/ 12/4/02
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