Exhibit 10.4
EMPLOYMENT AND NONCOMPETITION
AGREEMENT
THIS EMPLOYMENT
AND NONCOMPETITION AGREEMENT (the “Agreement”) is made
and entered into as of January 2, 2008, by and among Avocent
Huntsville Corp., an Alabama corporation (“Employer”),
Avocent Corporation, a Delaware corporation, and
Kay E. Kienast (the “Employee”).
RECITALS
WHEREAS, Avocent
Corporation and its affiliates (collectively referred to in this
Agreement as “Avocent”) are engaged in the business of
designing, manufacturing, and
selling connectivity and centralized management of
information technology infrastructure solutions for enterprise data
centers, branch offices, and
small to medium size businesses worldwide;
WHEREAS, Employee,
Employer, and Avocent Corporation now wish to enter into this
Employment and Noncompetition Agreement, and Employee is willing to
accept employment as Avocent’s Executive Vice President
– Chief Marketing Officer on the terms and subject to the
conditions set forth in this Agreement.
AGREEMENT
THE PARTIES HERETO
AGREE AS FOLLOWS:
1.
DUTIES. During the term of this Agreement, the Employee agrees to
be employed by Employer and to serve Avocent as its Executive Vice
President – Chief Marketing Officer. The Employee shall
devote such of her business time, energy, and skill to the affairs
of Avocent and Employer as shall be necessary to perform the duties
of Chief Marketing Officer. The Employee shall report to the Chief
Executive Officer of Avocent Corporation and to the Board of
Directors of Avocent Corporation, and at all times during the term
of this Agreement, the Employee shall have powers and duties at
least commensurate with her position as Chief Marketing Officer of
Avocent Corporation.
2.
TERM OF EMPLOYMENT.
2.1
DEFINITIONS. For purposes of this Agreement the following terms
shall have the following meanings:
(a)
“TERMINATION FOR CAUSE” shall mean termination by the
Employer or Avocent Corporation of the Employee’s employment
with the Employer or Avocent by reason of the Employee’s
willful dishonesty towards, fraud upon, or deliberate injury or
attempted injury to, the Employer or Avocent or by reason of the
Employee’s willful material breach of this Agreement which
has resulted in material injury to the Employer or Avocent.
(b) “TERMINATIONS OTHER
THAN FOR CAUSE” shall mean termination by the Employer or
Avocent Corporation of the Employee’s employment with the
Employer or Avocent (other than in a Termination for Cause) and
shall include any constructive termination of the Employee’s
employment by reason of material breach of this Agreement by the
Employer or Avocent, such constructive termination to be effective
upon thirty (30) days written
1
notice from
the Employee to the Employer of such constructive termination;
provided , however , that the term “Termination
Other Than for Cause” shall not include Employer’s
termination of Employee if Employee has not commenced living (in
temporary accommodations) in the Huntsville, Alabama area by
January 14, 2008, and competed her physical relocation to the
Huntsville, Alabama area by May 31, 2008, and any such
termination of Employee by Employer shall be treated as a
“Voluntary Termination” by Employee under this
Agreement.
(c)
“VOLUNTARY TERMINATION” shall mean termination by the
Employee of the Employee’s employment with the Employer or
Avocent other than (i) constructive termination as described
in subsection 2.1(b), (ii) “Termination Upon a
Change in Control” as described in Section 2.1(e), and
(iii) termination by reason of the Employee’s disability
or death as described in Sections 2.5 and 2.6.
“Voluntary Termination” shall also include
Employer’s termination of Employee if Employee has not
commenced living (in temporary accommodations) in the Huntsville,
Alabama area by January 14, 2008, and competed her physical
relocation to the Huntsville, Alabama area by
May 31, 2008.
(d)
“TERMINATION UPON A CHANGE IN CONTROL” shall mean
(i) a termination by the Employee of the Employee’s
employment with the Employer or Avocent within six (6) months
following any “Change in Control” or (ii) any
termination by the Employer or Avocent Corporation of the
Employee’s employment with the Employer or Avocent (other
than a Termination for Cause) within eighteen (18) months following
any “Change in Control.”
(e)
“CHANGE IN CONTROL” shall mean, after the date of this
Agreement, any one of the following events:
(i)
Any person (other than Avocent Corporation) acquires beneficial
ownership of Employer’s or Avocent Corporation’s
securities and is or thereby becomes a beneficial owner of
securities entitling such person to exercise twenty-five percent
(25%) or more of the combined voting power of Employer’s or
Avocent Corporation’s then outstanding stock. For purposes of
this Agreement, “beneficial ownership” shall be
determined in accordance with Regulation 13D under the
Securities Exchange Act of 1934, or any similar successor
regulation or rule; and the term “person” shall include
any natural person, corporation, partnership, trust or association,
or any group or combination thereof, whose ownership of
Employer’s or Avocent Corporation’s securities would be
required to be reported under such Regulation 13D, or any
similar successor regulation or rule.
(ii)
Within any twenty-four (24) month period, the individuals who were
Directors of Avocent Corporation at the beginning of any such
period, together with any other Directors first elected as
directors of Avocent Corporation pursuant to nominations approved
or ratified by at least two-thirds (2/3) of the Directors in office
immediately prior to any such election, cease to constitute a
majority of the Board of Directors of Avocent Corporation.
(iii)
Avocent Corporation’s stockholders approve:
(1)
any consolidation or merger of Avocent Corporation in which Avocent
Corporation is not the continuing or surviving corporation or
pursuant to which shares of Avocent Corporation common stock would
be converted into cash, securities or other property, other than a
merger or consolidation of Avocent Corporation in which the holders
of
2
Avocent
Corporation’s common stock immediately prior to the merger or
consolidation have substantially the same proportionate ownership
and voting control of the surviving corporation immediately after
the merger or consolidation; or
(2)
any sale, lease, exchange, liquidation or other transfer (in one
transaction or a series of transactions) of all or substantially
all of the assets of Avocent Corporation.
Notwithstanding
subparagraphs (e)(iii)(1) and (e)(iii)(2) above, the
term “Change in Control” shall not include a
consolidation, merger, or other reorganization if upon consummation
of such transaction all of the outstanding voting stock of Avocent
Corporation is owned, directly or indirectly, by a holding company,
and the holders of Avocent Corporation’s common stock
immediately prior to the transaction have substantially the same
proportionate ownership and voting control of such holding company
after such transaction.
2.2
TERM. The term of employment of the Employee by the Employer under
this Agreement shall begin on the date of this Agreement, and end
when such employment is terminated under any of the provisions of
this Agreement.
2.3
TERMINATION FOR CAUSE. Termination For Cause may be effected by the
Employer at any time during the term of this Agreement and shall be
effected by thirty (30) days written notification to the Employee
from the Boards of Directors of Employer and Avocent Corporation
stating the reason for termination. Upon Termination For Cause, the
Employee immediately shall be paid all accrued salary, bonus
compensation to the extent earned, vested deferred compensation, if
any (other than pension plan or profit sharing plan benefits which
will be paid in accordance with the applicable plan), any benefits
under any plans of Employer or Avocent in which the Employee is a
participant to the full extent of the Employee’s rights under
such plans, accrued vacation pay and any appropriate business
expenses incurred by the Employee in connection with her duties
hereunder, all to the date of termination, but the Employee shall
not be paid any other compensation or reimbursement of any kind,
including without limitation, severance compensation.
2.4
TERMINATION OTHER THAN FOR CAUSE. Notwithstanding anything else in
this Agreement, the Employer may effect a Termination Other Than
For Cause at any time upon giving thirty (30) days written notice
to the Employee of such termination. Upon any Termination Other
Than For Cause, the Employee shall immediately be paid all accrued
salary, bonus compensation to the extent earned, vested deferred
compensation, if any (other than pension plan or profit sharing
plan benefits which will be paid in accordance with the applicable
plan), any benefits under any plans of Employer or Avocent in which
the Employee is a participant to the full extent of the
Employee’s rights under such plans, accrued vacation pay and
any appropriate business expenses incurred by the Employee in
connection with her duties hereunder, all to the date of
termination, and all severance compensation provided in
Section 4.2, but no other compensation or reimbursement of any
kind.
2.5
TERMINATION BY REASON OF DISABILITY. If, during the term of this
Agreement, the Employee, in the reasonable judgment of the Board of
Directors of Avocent Corporation, has failed to perform her duties
under this Agreement on account of illness or physical or mental
incapacity, and such illness or incapacity continues for a period
of more than six (6)
3
consecutive
months, the Employer shall have the right to terminate the
Employee’s employment hereunder by delivery of written notice
to the Employee at any time after such six month period and payment
to the Employee of all accrued salary, bonus compensation to the
extent earned, additional bonus compensation in an amount equal to
the average annual bonus earned by the Employee as an employee of
Avocent Corporation and its affiliates and predecessors in the two
(2) years immediately preceding the date of termination,
vested deferred compensation, if any (other than pension plan or
profit sharing plan benefits which will be paid in accordance with
the applicable plan), any benefits under any plans of Employer or
Avocent in which the Employee is a participant to the full extent
of the Employee’s rights under such plans (including having
the vesting of any awards granted to the Employee under any Avocent
stock option, restricted stock, performance share, or other equity
plans deemed and treated as fully earned and accelerated), accrued
vacation pay and any appropriate business expenses incurred by the
Employee in connection with her duties hereunder, all to the date
of termination, with the exception of medical and dental benefits
which shall continue for a period of twelve (12) months from the
date of such notice of termination, but the Employee shall not be
paid any other compensation or reimbursement of any kind, including
without limitation, severance compensation.
2.6
TERMINATION BY REASON OF DEATH. In the event of the
Employee’s death during the term of this Agreement, the
Employee’s employment shall be deemed to have terminated as
of the last day of the month during which her death occurs and the
Employer shall pay to her estate or such beneficiaries as the
Employee may from time to time designate all accrued salary, bonus
compensation to the extent earned, vested deferred compensation, if
any (other than pension plan or profit sharing plan benefits which
will be paid in accordance with the applicable plan), any benefits
under any plans of Employer or Avocent in which the Employee is a
participant to the full extent of the Employee’s rights under
such plans (including having the vesting of any awards granted to
the Employee under any Avocent stock option, restricted stock,
performance share, or other equity plans deemed and treated as
fully earned and accelerated), accrued vacation pay and any
appropriate business expenses incurred by the Employee in
connection with her duties hereunder, all to the date of
termination, but the Employee’s estate shall not be paid any
other compensation or reimbursement of any kind, including without
limitation, severance compensation.
2.7
VOLUNTARY TERMINATION. Notwithstanding anything else in this
Agreement, the Employee may effect a Voluntary Termination at any
time upon giving thirty (30) days written notice to the Employer of
such termination. In the event of a Voluntary Termination, the
Employer shall immediately pay all accrued salary, bonus
compensation to the extent earned, vested deferred compensation, if
any (other than pension plan or profit sharing plan benefits which
will be paid in accordance with the applicable plan), any benefits
under any plans of Employer or Avocent in which the Employee is a
participant to the full extent of the Employee’s rights under
such plans, accrued vacation pay and any appropriate business
expenses incurred by the Employee in connection with her duties
hereunder, all to the date of termination, but no other
compensation or reimbursement of any kind, including without
limitation, severance compensation.
2.8
TERMINATION UPON A CHANGE IN CONTROL. In the event of a Termination
Upon a Change in Control, the Employee shall immediately be paid
all accrued salary, bonus compensation to the extent earned, vested
deferred compensation, if any (other than pension plan or profit
sharing plan benefits which will be paid in accordance with the
applicable plan), any benefits under any plans of Employer or
Avocent in which the Employee is a participant to the full extent
of the Employee’s rights under such plans (including having
the vesting of any awards
4
granted to the
Employee under any Avocent stock option, restricted stock,
performance share, or other equity plans deemed and treated as
fully earned and ac
|
