This Employment
Agreement (this “Agreement”), made and entered as of
the 1st day of July, 2009, by and between Globecomm Systems Inc., a
Delaware corporation with principal offices located at 45 Oser
Avenue, Hauppauge, NY 11788 (the “Company”) and Keith
Hall (the “Executive”).
WHEREAS, the
Company has a need for the Executive’s personal services in a
senior executive capacity;
WHEREAS, the
Executive possesses the necessary strategic, financial, planning,
operational and managerial skills necessary to fulfill those
needs;
WHEREAS, the
Executive had been providing services to the Company as its Vice
President from August 12, 1996 to June 30, 2008 and as
Senior Vice President and General Manager, Globecomm Network
Services since June 30, 2008;
WHEREAS, the
Company desires to promote the Executive to the position of
President and Chief Operating Officer;
WHEREAS, the
Company desires to maintain the continuity of its management team
and provide the Executive with incentive to remain with the
Company; and
WHEREAS, the
Executive and the Company desire to enter into a new employment
agreement to fully recognize the contributions of Executive to the
Company and to assure continuous harmonious performance of the
affairs of the Company.
NOW, THEREFORE, in
consideration of the mutual promises, terms, provisions, and
conditions contained herein, the parties agree as
follows:
The Company hereby
agrees to promote and employ the Executive to serve in the role of
its President and Chief Operating Officer, subject to the
limitations set forth herein. As such, the Executive shall be
responsible for directing and managing the Company’s business
subject to the authority of the Chief Executive Officer of the
Company. The Executive accepts such employment upon the terms and
conditions set forth herein, and further agrees to perform to the
best of his abilities the duties generally associated with his
position, as well as such other duties commensurate with his
position as President and Chief Operating Officer, as may be
reasonably assigned by the Company. The Executive shall, at all
times during the Term (as defined below), report directly to the
Chief Executive Officer of the Company. The Executive shall perform
his duties diligently and faithfully and shall devote his full
business time and attention to such duties.
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2.
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Term of Employment and
Renewal .
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The term of
Executive’s employment under this Agreement will commence on
the date of this Agreement (the “Effective Date”).
Subject to the provisions of Section 10 of this
Agreement,
the term of
Executive’s employment hereunder shall be for an initial term
of three (3) years from the Effective Date (the “Initial
Term”). The Initial Term of this Agreement shall be
automatically extended for successive one (1) year periods
(each a “Renewal Period”) unless the Company or the
Executive gives written notice to the other at least ninety
(90) days prior to the expiration of the Initial Term, or a
Renewal Period, of such party’s election not to extend this
Agreement. References herein to the “Term” shall mean
the Initial Term as it may be so extended by one or more Renewal
Periods. The last day of the Term is the “Expiration
Date.”
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3.
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Compensation and Benefits
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(a)
Salary . Commencing on the Effective Date, the Company
agrees to pay the Executive a base salary at an annual rate of
Three Hundred Thousand Dollars ($300,000), payable in such
installments as is the policy of the Company (the
“Salary”), but no less frequently than monthly.
Thereafter, the Company shall determine appropriate increases to
Executive’s Salary but in no event shall diminish the amount
of Executive’s Salary below the initial rate, or below the
increased rates.
(b)
Bonus . The Executive shall be eligible to receive annual
bonuses at the discretion of the Company and according to
performance goals to be issued by the Company to the Executive at
the appropriate annual review cycle during the Term.
(c)
Benefits . The Executive shall be entitled to participate in
all employee benefit plans, without any payment or contribution by
the Executive or members of his family, which the Company provides
or may establish from time to time, for the benefit of its
employees, and without limitation shall also include the
following:
(i) Life
Insurance . A term life insurance policy in the amount of three
times the annual Base Salary, payable to the beneficiaries of
record designated by the Executive.
(ii) Disability
Insurance . Disability insurance providing the Executive with
monthly payments during the period of his disability (after
termination of his employment) in an amount equal to 1/12th of his
then applicable Salary immediately prior to his disability. If the
disability insurance policy should begin payment while the
Executive is still being compensated by the Company under the terms
of this Agreement, the Executive will reimburse the Company for all
portions of such payments which may cause his total compensation to
exceed the amounts otherwise payable to the Executive under the
terms of this Agreement.
(iii) Medical
Insurance . Medical insurance protection for the Executive and
his eligible dependents at least as favorable to the Executive and
his eligible dependents as the protection and plan being made
available to them on the date of this Agreement. In addition, if
not covered by the medical plan, the Company shall provide the
Executive with an annual physical checkup.
(iv)
Professional Services Allowance . The Company will pay up to
$2,500 per year for the Executive’s tax planning and
preparation and/or other financial planning services used by the
Executive.
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(v)
Automobile. If automobiles are then provided by the Company
to its senior executives, the Company will furnish the Executive,
on terms and conditions consistent with those provided to other
senior executives of the Company, with a Company-owned or leased
automobile of the make and model then authorized by the Company or
provide an allowance for that purpose.
(vi) Other
. The Executive shall be entitled to such other benefits not
duplicative of the foregoing, which the Board of Directors may now
or in the future make available to its senior
executives.
(d)
Vacation . The Executive shall also be entitled to paid
vacation days in accordance with the Company’s vacation
policy, which may be accrued to a maximum of
40 days.
(e)
Expenses . The Company shall pay or reimburse the Executive
for all reasonable out-of-pocket expenses actually incurred by him
during the Term in performing services hereunder, provided that the
Executive properly accounts for such expenses in accordance with
the Company’s policies.
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4.
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Confidentiality, Disclosure of
Information .
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(a) The
Executive recognizes and acknowledges that the Executive has had
and will have access to Confidential Information (as defined below)
relating to the business or interests of the Company or of persons
with whom the Company may have business relationships. Except as
permitted herein, the Executive will not during the Term, or at any
time thereafter, use, disclose or permit to be known by any other
person or entity, any Confidential Information of the Company
(except as required by applicable law or in connection with the
performance of the Executive’s duties and responsibilities
hereunder). The term “Confidential Information” means
information relating to the Company’s business affairs,
proprietary technology, trade secrets, patented processes, research
and development data, know-how, market studies and forecasts,
competitive analyses, pricing policies, employee lists, employment
agreements (other than this Agreement), personnel policies, the
substance of agreements with customers, suppliers and others,
marketing arrangements, customer lists, commercial arrangements, or
any other information relating to the Company’s business that
is not generally known to the public or to actual or potential
competitors of the Company (other than through a breach of this
Agreement). This obligation shall continue until such Confidential
Information becomes publicly available, other than pursuant to a
breach of this Section 4 by the Executive, regardless of
whether the Executive continues to be employed by the
Company.
(b) It is
further agreed and understood by and between the parties to this
Agreement that all “Company Materials,” which include,
but are not limited to, computers, computer software, computer
disks, tapes, printouts, source, HTML and other code, flowcharts,
schematics, designs, graphics, drawings, photographs, charts,
graphs, notebooks, customer lists, sound recordings, other tangible
or intangible manifestation of content, and all other documents
whether printed, typewritten, handwritten, electronic, or stored on
computer disks, tapes, hard drives, or any other tangible medium,
as well as samples, prototypes, models, products and the like,
shall be the exclusive property of the Company and, upon
termination of Executive’s employment with the Company,
and/or upon the request of the Company, all Company
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Materials,
including copies thereof, as well as all other Company property
then in the Executive’s possession or control, shall be
returned to and left with the Company.
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5.
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Inventions Discovered by
Executive .
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The Executive
shall promptly disclose to the Company any invention, improvement,
discovery, process, formula, or method or other intellectual
property, whether or not patentable or copyrightable (collectively,
“Inventions”), conceived or first reduced to practice
by the Executive, either alone or jointly with others, while
performing services hereunder (or, if based on any Confidential
Information, at any time during or after the Term), (a) which
pertain to any line of business activity of the Company, whether
then conducted or then being actively planned by the Company, with
which the Executive was or is involved, (b) which is developed
using time, material or facilities of the Company, whether or not
during working hours or on the Company premises, or (c) which
directly relates to any of the Executive’s work during the
Term, whether or not during normal working hours. The Executive
hereby assigns to the Company all of the Executive’s right,
title and interest in and to any such Inventions. During and after
the Term, the Executive shall execute any documents necessary to
perfect the assignment of such Inventions to the Company and to
enable the Company to apply for, obtain and enforce patents,
trademarks and copyrights in any and all countries on such
Inventions, including, without limitation, the execution of any
instruments and the giving of evidence and testimony, without
further compensation beyond the Executive’s agreed
compensation during the course of the Executive’s employment.
Without limiting the foregoing, the Executive further acknowledges
that all original works of authorship by the Executive, whether
created alone or jointly with others, related to the
Executive’s employment with the Company and which are
protectable by copyright, are “works made for hire”
within the meaning of the United States Copyright Act, 17 U.S.C.
(Section) 101, as amended, and the copyright of which shall be
owned solely, completely and exclusively by the Company. If any
Invention is considered to be work not included in the categories
of work covered by the United States Copyright Act, 17 U.S.C.
(Section) 101, as amended, such work is hereby assigned or
transferred completely and exclusively to the Company. The
Executive hereby irrevocably designates counsel to the Company as
the Executive’s agent and attorney-in-fact to do all lawful
acts necessary to apply for and obtain patents and copyrights and
to enforce the Company’s rights under this Section. This
Section 5 shall survive the termination of this Agreement. Any
assignment of copyright hereunder includes all rights of paternity,
integrity, disclosure and withdrawal and any other rights that may
be known as or referred to as “moral rights”
(collectively “Moral Rights”). To the extent such Moral
Rights cannot be assigned under applicable law and to the extent
the following is allowed by the laws in the various countries where
Moral Rights exist, the Executive hereby waives such Moral Rights
and consents to any action of the Company that would violate such
Moral Rights in the absence of such consent. The Executive agrees
to confirm any such waivers and consents from time to time as
requested by the Company.
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6.
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Non-Competition and
Non-Solicitation .
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The Executive
acknowledges that the Company has invested substantial time, money
and resources in the development and retention of its Inventions,
Confidential Information (including trade secrets), customers,
accounts and business partners, and further acknowledges that
during the course of the Executive’s employment with the
Company the Executive has had and will
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have access to
the Company’s Inventions and Confidential Information
(including trade secrets), and will be introduced to existing and
prospective customers, accounts and business partners of the
Company. The Executive acknowledges and agrees that any and all
“goodwill” associated with any existing or prospective
customer, account or business partner belongs exclusively to the
Company, including, but not limited to, any goodwill created as a
result of direct or indirect contacts or relationships between the
Executive and any existing or prospective customers, accounts or
business partners. Additionally, the parties acknowledge and agree
that Executive possesses skills that are special, unique or
extraordinary and that the value of the Company depends upon his
use of such skills on its behalf.
In recognition of
this, the Executive covenants and agrees that:
(a) During
the Term, and for a period of one (1) year thereafter, the
Executive may not, without the prior written consent of the
Company’s board of directors (the “Board”),
(whether as an employee, agent, servant, owner, partner,
consultant, independent contractor, representative, stockholder or
in any other capacity whatsoever) participate in any business that
offers products or services competitive in any way to those offered
by the Company or that were under active development by the Company
during the Term, provided that nothing herein shall prohibit the
Executive from owning securities of corporations which are listed
on a national securities exchange or traded in the national
over-the-counter market in an amount which shall not exceed 3% of
the outstanding shares of an such corporation.
(b) During
the Term, and for a period of one (1) year thereafter, the
Executive may not entice, solicit or encourage any Company employee
to leave the employ of the Company or any independent contractor to
sever its engagement with the Company, absent prior written consent
to do so from the Board.
(c) During
the Term, and for a period of one (1) year thereafter, the
Executive may not, directly or indirectly, entice, solicit or
encourage any customer, prospective customer, vendor, strategic
partner or business associate of the Company to cease doing
business with the Company, reduce its relationship with the Company
or refrain from establishing or expanding a relationship with the
Company.
The Executive
hereby agrees that during the Term, and at all times thereafter,
the Executive will not make any statement that is disparaging about
the Company, any of its officers, directors, or stockholders,
including, but not limited to, any statement that disparages the
products, services, finances, financial condition, capabilities or
other aspect of the business of the Company. The Executive further
agrees that during the same period the Executive will not engage in
any conduct that is intended to inflict harm upon the professional
or personal reputation of the Company or any of its officers,
directors, stockholders or employees.
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8.
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Provisions Necessary and
Reasonable .
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(a) The
Executive agrees that (i) the provisions of Sections 4,
5, 6 and 7 of this Agreement are necessary and reasonable to
protect the Company’s Confidential Information, Inventions,
and goodwill; (ii) the specific temporal, geographic and
substantive provisions set
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forth in
Section 6 of this Agreement are reasonable and necessary to
protect the Company’s business interests in part because the
Company’s business is international in scope; and
(iii) in the event of any breach of any of the covenants set
forth herein, the Company would suffer substantial irreparable harm
and would not have an adequate remedy at law for such breach. In
recognition of the foregoing, the Executive agrees that in the
event of a breach or threatened breach of any of these covenants,
in addition to such other remedies as the Company may have at law,
without posting any bond or security, the Company shall be entitled
to seek and obtain equitable relief, in the form of specific
performance, and/or temporary, preliminary or permanent injunctive
relief, or any other equitable remedy which then may be available.
The seeking of such injunction or order shall not affect the
Company’s right to seek and obtain damages or other equitable
relief on account of any such actual or threatened
breach.
(b) If any of
the covenants contained in Sections 4, 5, 6 and 7 hereof, or
any part thereof, are hereafter construed to be invalid or
unenforceable, the same shall not affect the remainder of the
covenant or covenants, which shall be given full effect without
regard to the invalid portions.
(c) If any of
the covenants contained in Sections 4, 5, 6 and 7 hereof, or
any part thereof, are held to be unenforceable by a court of
competent jurisdiction because of the temporal or geographic scope
of such provision or the area covered thereby, the parties agree
that the court making such determination shall have the power to
reduce the duration and/or geographic area of such provision and,
in its reduced form, such provision shall be
enforceable.
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9.
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Representations Regarding Prior Work
and Legal Obligations .
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(a) The
Executive represents that the Executive has no agreement or other
legal obligation with any prior employer, or any other person or
entity, that restricts the Executive’s ability to accept
employment with, or to perform any function for, the
Company.
(b) The
Executive has been advised by the Company that at no time should
the Executive divulge to or use for the benefit of the Company any
trade secret or confidential or proprietary information of any
previous employer. The Executive expressly acknowledges that the
Executive has not divulged or used any such information for the
benefit of the Company.
(c) The
Executive acknowledges that the Executive has not and will not
misappropriate any Invention that the Executive played any part in
creating while working for any former employer.
(d) The
Executive acknowledges that the Company is basing important
business decisions on these representations, and affirms that all
of the statements included herein are true.
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10.
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Termination and Severance
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Notwithstanding
the provisions of Section 2 of this Agreement, the
Executive’s employment hereunder may terminate under the
following circumstances:
(a)
Termination by the Company for Cause . The Company may
terminate this Agreement for Cause at any time, upon written notice
to the Executive setting forth in reasonable
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