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Northeast Optic - VP Sales - Employment Agreement
Exhibit 10.32
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made this 4th day of May, 1998, by and among FiveCom, Inc., a Massachusetts corporation with its principal place of business in Waltham, Massachusetts (hereinafter referred to as the "Company"), and James Mack of Sudbury, Massachusetts (hereinafter referred to as the "Employee").
WHEREAS, the Company desires to employ the Employee; and
WHEREAS, the Employee desires to serve in the employ of the Company on a full-time basis for the period provided in this Employment Agreement (hereinafter referred to as the "Agreement") on the terms and conditions hereinafter set forth; and
WHEREAS, the Company and the Employee wish to set forth the terms and conditions under which such employment will occur.
NOW, THEREFORE, in consideration of the offer of employment by the Company and the acceptance of employment by the Employee, and the mutual promises and covenants contained herein, the Company and the Employee hereby agree as follows:
1. Term of Agreement.
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(a) Term. The term of this Agreement shall begin on April 30, 1998 (hereinafter referred to as the "Effective Date") and shall expire on April 30,
(b) Expiration. Notwithstanding anything to the contrary in this Section 1, except as to vested benefits, this Agreement and all obligations hereunder shall terminate on the earliest to occur of (i) the date of the Employee's death, (ii) 30
days after the Company gives notice to the Employee that the Company is terminating the Employee's employment for reason of Total Disability or Cause (as defined below); or (iii) the applicable term of the Agreement as specified in Section 1(a) above.
2. Definitions. The following terms shall have the meanings set forth below:
"Affiliate" means a person that directly or indirectly through one or more intermediaries controls, is controlled by, or is under common control with, the Company.
"Board" means the Board of Directors of the Company.
"Cause" means any of the following events or occurrences:
(i) Any act of material dishonesty taken by, or committed at the
direction of, the Employee.
(ii) Any illegal or unethical conduct which would impair the
business reputation of the Company.
(iii) Conviction of a felony.
(iv) The continued failure of the Employee to perform his
responsibilities and duties under this Agreement in a
satisfactory manner, 30 days after demand for performance
has been delivered in writing to the Employee specifying the
manner in which the Company believes that the Employee is
not performing.
"Constructive Discharge" means:
(i) any reduction in the Employee's annual base salary in effect
as of the Effective Date of this Agreement, or as the same
may be increased from time to time;
(ii) a substantial reduction in the nature or scope of the
Employee's responsibilities, duties or authority from those
described in Section 3(c) of this Agreement;
(iii) a material adverse change in the Employee's title or
position; or
(iv) relocation of the Employee's place of employment from the
Company's principal Employee offices to a place more than 50
miles from Waltham, Massachusetts without the Employee's
"Severance Benefits" means the benefits set forth in Section 5 of this Agreement.
"Total Disability" means the complete and permanent inability of the Employee to perform all of his duties under this Agreement on a full-time basis for a period of at least three consecutive months, as determined upon the basis of reasonable evidence, which may include independent medical reports and data.
3. Employment.
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(a) Position. The Company hereby agrees to employ the Employee in the capacity of Vice President - Sales, and the Employee hereby agrees to be so employed by the Company for the period beginning on the Effective Date and ending
on the date on which the Employee's employment is terminated in accordance with this Agreement (the "Employment Period").
(b) Performance. The Employee agrees that during the Employment Period he shall devote substantially all his business attention and time to the business and affairs of the Company, and use his best efforts to perform faithfully and efficiently the duties and responsibilities of the Employee under this Agreement. It is expressly understood that (i) the Employee may devote a reasonable amount of time to such industry associations and charitable and civic endeavors as shall not interfere with the services that the Employee is required to render under this Agreement, and (ii) the Employee may serve as a member of one or more boards of directors of companies that are not affiliated with the Company and do not compete with the Company or any of its Affiliates so long as such membership does not materially interfere with the Employee's duties hereunder.
(c) Job Duties. The following listing of job duties shall represent the Employee's primary responsibilities. Such responsibilities may be expanded or decreased as the business needs of the Company require. The Employee's primary job responsibilities shall include but not be limited to, development of the sales aspect of the Company's business including but not limited to opening new markets, public image, sales, marketing and customer relations.
4. Compensation and Benefits.
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(a) During the Employment Period, the Employee shall be compensated as follows:
(i) Salary. The Employee shall receive an annual base salary,
the amount of which shall be reviewed regularly and
determined from time to time, but which shall not be less
than $150,000. His salary shall be payable in accordance
with the Company's usual payroll practices.
(ii) Bonus. The Employee shall be eligible to receive an annual
bonus, which bonus shall be comprised of an earned incentive
based upon the achievement of sales targets established by
the Company and goals and awards determined by the Board of
Directors in its sole discretion, provided that, if the
Employee has achieved the sales targets and other goals
established for him by the Company and the Board of
Directors, then the sum of (A) the Employee's then current
annual base salary, plus (B) any bonuses awarded pursuant to
this Section 4(a)(ii), plus (C) the value of the portion of
the option described in Section 4(a)(vi) which becomes
exercisable in any given contract year shall not be less
than $300,000. For purposes of this Section 4(a)(ii), the
value of the portion of the option described in Section
4(a)(vi) which becomes exercisable in a given contract year
shall be the product of (X) the number of shares as to which
such option becomes
exercisable in such year and (Y) the difference between the
exercise price per share of such option and the fair market
value per share of the Company's Common Stock as of the end
of such year. For purposes of this Section 4(a)(ii), the
fair market value of a share of the Company's Common Stock
shall be equal to the last reported sales price for such
Common Stock on the Nasdaq National Market or other national
securities exchange on the day in question or, if the
Company's Common Stock is not then publicly traded, as
determined in good faith by the Board of Directors.
(iii) Participation in Salaried Employee Plans. The Employee
shall be entitled to participate in any and all plans and
programs maintained by the Company from time to time to
provide benefits for its salaried employees generally,
including without limitation any savings and investment,
stock option and stock purchase or group medical, dental,
life, accident or disability insurance plan or program,
subject to all eligibility requirements of general
applicability, to the extent that Employees are not excluded
from participation therein under the terms thereof or under
the terms of any Employee plan or program or any approval or
adoption thereof.
(iv) Other Fringe Benefits. The Employee shall be entitled to all
fringe benefits generally provided by the Company at any
time to its full-time salaried employees, including without
limitation three weeks annual paid vacation, holidays and
sick leave but excluding severance pay, in accordance with
generally applicable Company policies with respect to such
(v) The Company shall grant options to the Employee to purchase
shares of the Common Stock of the Company substantially on
the terms set forth on Exhibit A to this Agreement.
(b) Withholding. All compensation payable under this Section 4 shall be subject to normal payroll deductions for withholding income taxes, social security taxes and the like.
5. Severance Benefits. If the Employee's employment with the Company is terminated during the Employment Period either (i) by the Company for any reason other than death, Total Disability or Cause, or (ii) by the Employee within si...
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