<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of Report (Date of earliest event reported): August 30, 1996
ANDAL CORP.
(Exact name of registrant as specified in its charter)
New York 001-06856 13-2571394
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
200 Roundhill Drive, Rockaway, New Jersey 07866
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (201)625-3400
909 Third Avenue, New York NY 10022
(Former name or former address, if changed since last report.)
<PAGE>
Item 5. Other Events.
The Company's Chairman of the Board, Andrew J. Frankel, and
its President, Alan N. Cohen, have retired, but will continue to
serve as members of the Board of Directors. Peter D. Flood, the
President of Multi-Arc Inc., a majority-owned subsidiary, has
been elected Chairman of the Board and President of Andal Corp.
Mr. Flood, who is presently a director of Andal Corp., will
continue to serve as a director. In connection with these new
responsibilities, Andal has entered into an Employment Agreement
with Mr. Flood which is attached as an exhibit. In addition,
Walter N. Kreil, Jr., Vice President and Chief Financial Officer
of Multi-Arc Inc., has been elected Senior Vice-President and
Chief Financial Officer of Andal Corp. and has been elected as a
fifth member of Andal's Board of Directors.
Andal Corp. has agreed to issue 15,000 shares of its Common
Stock each to Mr. Frankel, Mr. Cohen and one other person in
final satisfaction of each of their share of the Fleet Assigned
Loan, as described in the Registrant's most recent Report on Form
10-K. At present, the unpaid Fleet Assigned Loan is $96,000 and
this amount is owed by Andal Corp. solely to Mr. Flood.
Andal Corp. has moved its executive headquarters from New
York City to Multi-Arc's facilities in Rockaway, New Jersey. To
facilitate this relocation, Messrs. Frankel and Cohen have
assumed the lease of Andal's New York City offices and further
agreed to reimburse Andal Corp. for certain other costs of
operation at the Company's New York office, including the salary
of Andal employees, arising in the future. In consideration of
this lease assumption and this reimbursement obligation, Andal
Corp. has issued 32,500 shares of its Common Stock each to Mr.
Frankel and Mr. Cohen.
Multi-Arc Inc. also completed a refinancing of indebtedness
to its principal bank lender. As a result of this refinancing,
Multi-Arc Inc. now has a $7,000,000 Term Loan and has
established a $1,500,000 Equipment Term Line and a $5,000,000
Revolving Facility Credit with its principal lender. These
credit facilities are subject to substantially the same covenants
as Multi-Arc's previous credit facilities.
2<PAGE>
Item 7. Financial Statements and Exhibits.
(a) Financial statements of business acquired.
None.
(b) Pro forma financial information.
None.
(c) Exhibits.
Exhibit 10(a) Retirement Agreement
Exhibit 10(b) Employment Agreement with Peter D. Flood
Exhibit 99 Press Release dated August 30, 1996
SIGNATURES
Pursuant to the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized officer.
ANDAL CORP.
WALTER N. KREIL, JR.
Date: September 16, 1996 By:___________________________
Walter N. Kreil, Jr.
Senior Vice President
3
Exhibit 99
FOR IMMEDIATE RELEASE
#96-04
CONTACT: Michael S. Huber
201-625-3400
ANDAL CORP. ANNOUNCES RETIREMENT OF CHAIRMAN AND PRESIDENT
AND MOVE OF HEADQUARTERS TO ROCKAWAY, NEW JERSEY
NEW YORK, NY, August 30, 1996 -- ANDAL CORP. (OTC-ADLN)
announced today that Andrew J. Frankel, its Chairman, and Alan N.
Cohen, its President, have retired from those offices effective
August 31, 1996 and that Peter D. Flood, President of its Multi-Arc
Inc. subsidiary, has been elected Chairman and President.
Mr. Flood will also continue to serve as a Director of Andal. In
addition, Walter N. Kreil, Jr., Vice President and Chief
Financial Officer of multi-Arc, was elected Senior Vice President
and Chief Financial Officer of Andal and was elected Senior Vice
President and Chief Financial Officer of Andal and was elected to
Andal's Board of Directors. In connection with the aforesaid
personnel changes, the headquarters of Andal will be moved to the
Multi-Arc facility in Rockaway, New Jersey.
Messrs. Frankel and Cohen will continue as Directors of
Andal. In connection with termination of their employment,
Messrs. Frankel and Cohen have assumed the lease on Andal's New
York City office and certain other costs of the operation of the
New York office; and Andal has agreed to issue 32,500 shares of
its common stock to each of Mr. Frankel and Mr. Cohen.
Andal, through its majority-owned subsidiary, Multi-Arc, is
engaged in surface enhancement as a leading provider of thin-film
metal coating services and systems.
*****
Exhibit 10(a)
RETIREMENT AGREEMENT
This Retirement Agreement entered into this 31st day of
August, 1996 by and between Andal Corp., a New York corporation,
having offices at 909 Third Avenue, New York, New York 10022
("Andal"); Andrew J. Frankel ("AJF") and Alan N. Cohen ("ANC").
WHEREAS, AJF is Chairman of the Board and Chief Executive
Officer of Andal, and ANC is the President of Andal and AJF and
ANC wish to resign their positions and retire as officers of
Andal upon execution of this Agreement;
WHEREAS, the principal executive offices of Andal are
presently located at 909 Third Avenue, New York, New York 10022
and Andal leases such space under a lease (the "Lease") expiring
on September 29, 1998 (the "New York Premises");
WHEREAS, Andal intends, upon the resignation of AJF and ANC,
to transfer its principal executive offices to the principal
executive offices of its subsidiary in New Jersey, Multi-Arc
Inc., and will no further need the New York Premises;
WHEREAS, the termination of the Lease of the New York
Premises prior to its expiration and the payment of severance to
the employees who are working there will constitute a substantial
economic burden to Andal, and Andal desires to provide reasonable
transition arrangements for its employees based in New York; and
WHEREAS, AJF and ANC are willing, upon their retirement, to
maintain offices at the New York Premises and are willing to
retain the existing support staff in a manner which will result
in the least disruption to the staff in their employment;
NOW, THEREFORE, the parties hereto agree as follows:
1. New York Premises. Andal agrees to continue to
make all payments falling due under the Lease and to pay all
utilities and other office expenses associated with the New York
Premises until the expiration of the Lease on September 29, 1998.
2. New York Employees. Until the presently scheduled
expiration of the Lease without any renewals or extensions, Andal
agrees to pay salaries of the existing employees, except AJF and
ANC, in New York (the "New York Employees"), and as may come due
in the ordinary course of business and maintain the existing
level of benefits presently paid to such New York Employees,
excepting health insurance (which is subject to Section 4), and
will allow AJF and ANC to direct the New York Employees as if
they were employees of AJF and ANC in any line of business not
competitive with Andal and its subsidiaries as AJF and ANC shall,
in their discretion, determine. It is expected that Michael
Huber will join Multi-Arc and
<PAGE>
payment of his salary, benefits and all related costs of
employment are not covered by this Agreement. Andal agrees that
all outstanding stock options granted to the New York Employees
shall, notwithstanding anything to the contrary set forth in any
of the instruments granting such options, immediately vest and be
exercisable on September 30, 1998. Andal shall prepare and
execute all necessary documents and make all necessary filings in
order to effectuate the terms of the preceding sentence. Andal
hereby agrees that the New York Employees shall be third party
beneficiaries of Andal's obligations with respect to such
options.
3. Reimbursement. AJF and ANC, jointly and not
severally, shall reimburse Andal monthly for its actual out-of-pocket
costs of paying the salaries of the New York Employees
(including all taxes imposed upon Andal associated with such
employment) and the actual out-of-pocket costs of all employee
benefits (except health insurance) and shall also reimburse Andal
for all of its payments under the Lease accruing after August 31,
1996 and all utility payments, office expenses and any other
payments made by Andal to maintain the New York Premises after
August 31, 1996 until the Lease expiration.
4. Health Insurance. Andal agrees to maintain, at its
own expense, a health insurance policy uniformly applicable to
all of its New York Employees, providing benefits consistent with
the benefits presently available to the employees of Andal.
5. Issuance of Common Stock. Andal shall issue 32,500
shares of its restricted common stock each to AJF and ANC or in
such names as they shall direct. Both AJF and ANC understand
that these shares of stock will not have been issued pursuant to
a registration statement and cannot be sold or otherwise
transferred without a registration statement being effective with
respect to such shares unless sold pursuant to an exemption from
the requirement of registration. The shares will bear legend to
this effect. At the request of either AJF or ANC, Andal will use
its best efforts to register these shares for public sale in
connection with other registration and public offering of its
shares.
6. Special treatment of Mary Lou Holcombe. After
termination of the Lease, Andal shall continue to provide Mary
Lou Holcombe until age 65 with health insurance coverage
providing benefits consistent with the benefits presently
available to the principal executive employees of Andal.
7. Post Retirement Benefits of AJF and ANC. During
the remainder of their lives, Andal will provide to AJF and ANC
life insurance in the face amounts
2<PAGE>
presently provided (including those policies listed on Schedule
A hereto) and health insurance providing benefits consistent
with the benefits presently available to the principal executive
employees of Andal. Andal will also continue to pay costs of
letter of credit guarantees (in the amount of $829,869.88)
presently in effect until September 29, 1998, at which time Andal
will use its best efforts to replace the letters of credit with
other security. Thereafter, AJF and ANC will not be obligated to
renew their guarantees. So long as such letter of credit
guarantees are in effect, Andal shall pay an aggregate
guarantors' fee of 2% of the undrawn amount of such letters of
credit per annum to the guarantors in such proportions as AJF and
ANC shall direct.
8. Deferred Compensation. Andal acknowledges that as
of August 31, 1996 it owes as deferred compensation $288,935.40
to AJF and $288,935.40 to ANC. Within ten (10) days from the
date hereof, Andal shall pay AJF and ANC $150,000 each of such
amounts owing, and shall pay the balance in monthly installments
of $10,000 to each of AJF and ANC. Notwithstanding the
foregoing, (a) in the event that Andal receives additional cash
proceeds from the sale of real property assets or claims related
to real property, such cash proceeds shall be applied pro rata to
reduce the outstanding amount of the deferred compensation and
(b) in the event that AJF and ANC do not reimburse Andal as
required under paragraph 3 above, Andal may apply any or all
amounts due as deferred compensation as an offset to their
reimbursement obligation.
9. First Refusal. If at any time prior to December
31, 1997 any offer shall be made to AJF and/or ANC by a third
party to purchase or to tender for purchase all or a major
portion of their shares of common stock in Andal, and as a result
of such purchase there would be a significant likelihood of a
change in control of Andal, then AJF and/or ANC before accepting
such offer or making such tender shall first offer their shares
of common stock for sale to Andal at the same price and on the
same terms offered for a period of 30 days and if Andal shall
accept this offer (which acceptance may not be a partial
acceptance), Andal shall purchase the shares for cash within a
period of not more than 90 days. AJF and ANC agree that if at
any time prior to December 31, 1997 an offer to purchase or
otherwise acquire Andal, through merger, consolidation, sale of
assets or otherwise, is presented to the Board of Directors of
Andal, neither AJF nor ANC will vote in favor of any such offer
if Andal, within thirty (30) days of a request from AJF and ANC,
purchases all of the shares of Andal owned by AJF and ANC for
cash consideration equivalent to that which they would have
received if Andal were acquired.
3<PAGE>
10. Miscellaneous. This Agreement constitutes the
entire agreement between the parties hereto relating to the
subject matter hereof. Should any dispute arise under the terms
of this Agreement, the parties shall give notice thereof to the
other parties at the addresses set forth at the head of this
Agreement or at such other address as each party shall be advised
of in writing in accordance with the notice provisions of this
Agreement. Should any dispute arise pursuant to this Agreement,
the parties agree that the dispute shall be resolved by
arbitration before the American Arbitration Association in New
York in accordance to the rules of that organization. In
connection with all actions that may be brought in connection
with the resolution of disputes under this Agreement, each party
agrees to accept service by certified mail, return receipt
requested, and waives trial by jury. This Agreement shall be
governed by the laws of the State of New York.
IN WITNESS WHEREOF, the undersigned have signed or caused
their duly authorized corporate officer to sign this Agreement as
of the date written above:
ANDAL CORP.
ANDREW J. FRANKEL
By:__________________________________________
Andrew J. Frankel, Chairman of the Board
ANDREW J. FRANKEL
________________________________________
Andrew J. Frankel
Andrew J. Frankel
ALAN N. COHEN
________________________________________
Alan N. Cohen
4<PAGE>
Exhibit 10(b)
EMPLOYMENT AGREEMENT
AGREEMENT, dated as of the 31st of August, 1996, between
Andal Corp. (the "Company"), a New York corporation, and Peter D.
Flood (the "Executive").
W I T N E S S E T H:
WHEREAS, the Company desires to employ the Executive on the
terms and conditions set forth in this Agreement and the Executive
is willing to accept employment with the Company on such
terms and conditions; now, therefore,
IN CONSIDERATION of the premises and the mutual covenants
herein contained, the parties hereto hereby agree as follows:
SECTION 1. TERM OF EMPLOYMENT.
The Company will employ the Executive, and the Executive
hereby accepts employment by the Company, on the terms and
conditions contained in this Agreement for the period commencing
upon the date of this Agreement and ending September 30, 2001
(the "Initial Term"). The term of the Executive's employment
under this Agreement (the "Term") will continue thereafter year
to year (each extended year-term, an "Extended Term"), unless
either party gives to the other notice at least ninety (90) days
prior to end of the Initial Term (or, if this Agreement is
extended past the Initial Term, the end of any Extended Term) of
such party's intention to terminate this Agreement as of the end
of such Term or Extended Term.
<PAGE>
In no event will any Extended Term extend beyond the end of the
year next following the Executive's 70th birthday (such September
30, 2013 being referred to in Section 5.1 as the "Retirement
Date").
SECTION 2. DUTIES.
2.1 During the Term, the Executive shall serve as the
Company's Chief Executive Officer, with such additions to the
scope of the duties of his employment within the Company's field
of operations or those of the Company's subsidiaries or affiliated
corporations as the Board of Directors of the Company shall
determine.
2.2 If elected by the Board, the Executive agrees to serve
as Chairman of the Board of Directors of the Company and as
President of Andal.
2.3 The Executive shall devote his time, energy and skill
during regular business hours to the affairs of the Company and
its subsidiaries and affiliated corporations and to the promotion
of their interests, provided that the Executive may serve as a
director of such business and not-for-profit corporations as the
Board of Directors shall consider not materially adverse to the
interests of the Company.
SECTION 3. CURRENT COMPENSATION.
3.1 Signing Bonus. Upon signing the Agreement, the Company
shall become immediately obligated to pay to the Executive a
bonus of $250,000 of which $50,000 (each payment, a "Bonus
Payment," and collectively, the "Bonus Payments") shall be paid
within ninety days of the date of this Agreement and the remainder as soon
2<PAGE>
as possible thereafter. The Company may defer such payment until
such time as the Board of Directors determines that the Company's
cash flow is sufficient to make such payment.
3.2 Base Compensation. During the Term, the Company shall
cause its principal subsidiary, Multi-Arc Inc. ("MAI"), to pay
the Executive a base salary of $250,000 per year, payable in
equal installments in accordance with the Company's normal
practices for payment of executives. It is understood that the
aforementioned Base Salary of $250,000 is a minimum annual Base
Salary and is subject to such additional compensation and increases
as the Board of Directors, in its sole discretion, may
award; provided, however, that nothing contained herein shall be
deemed to create any obligation on the part of the Board of
Directors to exercise its discretion in favor of any such increase
in Base Salary or to constitute a representation that any
such increase will be awarded.
3.3 Incentive Compensation. (i) With respect to each
quarter ending December 31, March 31, June 30 and September 30
during the Term (four consecutive quarters, beginning on October
1 and ending on September 30, an "Employment Term Year"), the
first quarter year beginning October 1, 1996, the Company shall
cause MAI to pay to the Executive additional compensation in cash
in an amount equal to the sum of 5.0% of Net Income (as defined
in subsection (ii) below) of MAI, payable not later than ninety
days after the end of each quarter.
(ii) "Net Income" for any fiscal quarter of MAI
shall mean the consolidated net income (or loss) before provision
for federal, state or local income
3<PAGE>
taxes (but after any provision for franchise taxes other than
franchise taxes relating to income) of MAI during such quarter
determined in accordance with generally accepted accounting
principles applied on a consistent basis; provided, however, that
in calculating Net Income, accounts payable as Incentive Compensation
pursuant to this Section 3.3. shall be disregarded (and
accordingly, the amounts thereof shall not be deducted). In
addition, in calculating Net Income, the aggregate amounts of all
net losses, if any, from all prior quarters during the same
Employment Term Year shall be deducted. If at the end of any
such Employment Term Year the Company has experienced a net loss
for such year, the aggregate amount of any Incentive Compensation
paid to the Executive pursuant to this Section 3.3 during such
year shall be deducted from, and only to the extent of, future
Incentive Compensation payments.
(iii) If the Executive is employed under this
Agreement during any quarter year for less than three months, by
reason of termination pursuant to any provision of Section 5
hereof other than termination for cause, the Company shall pay to
the Executive (or, in the event of his death, to his estate)
Incentive Compensation for the quarter year during which such
termination occurs and the succeeding two quarter years.
3.4 Stock Rights.
a. On the date of this Agreement, Andal shall cause
7,500 shares of its restricted common stock to be issued to the
Executive without any required payment therefor. Executive
agrees that such shares are being acquired for investment
4<PAGE>
purposes only and not for distribution. With the issuance of
these shares, the Phantom Stock Right provision of the Executive's
Employment Agreement dated January 1, 1991 and subsequently amended
will be canceled.
b. The term "Common Stock" as used in this Section 3.4
means the shares of the common stock of Andal Corp., as constituted
on the date of this Agreement and any other shares into
which such common stock shall thereafter be changed by reason of
recapitalization, merger, consolidation, split-up, combination,
exchange of shares or the like.
3.5 Reimbursement for Expenses. During the Term, the
Company will further reimburse the Executive for all documented
expenses properly incurred by the Executive in the performance of
the Executive's duties under this Agreement. In addition, the
Company shall pay to the Executive a monthly car allowance of not
more than $500 per month in lieu of providing a company-leased
automobile.
3.6 Other Benefits. In addition to the benefits specified
in Sections 3.1 through 3.5, during the Term the Executive will
be entitled to participate in any present and future life,
disability or health insurance, pension or retirement plan,
adopted by the Company for the general and overall benefit of
principal executives of the Company. The Board of Directors may,
in its absolute discretion determine to provide greater or
different benefits than required hereby to the Executive.
Executive acknowledges that his incentive compensation and other
entitlements hereunder shall be in lieu of any right he might
otherwise have to participate in any profit-sharing or employee
stock membership plan or other compensation or incentive plan of
the
5<PAGE>
Company or MAI. Notwithstanding the foregoing, in the event the
Company adopts a new stock option plan, Executive will be a
participant subject to the discretion of the Board of Directors.
SECTION 4. NONASSIGNABILITY OF BENEFITS.
No benefit under this Agreement shall be subject in any
manner to anticipation, alienation, sale, transfer or assignment
by the Executive, his beneficiaries or his estate, nor shall any
benefit in any manner be liable for or subject to attachments or
legal process for or against the Executive, his beneficiaries or
his estate.
SECTION 5. TERMINATION OF AGREEMENT.
5.1 Termination Generally. The Term, and all liabilities
and obligations of the Company to the Executive under this
Agreement, shall cease and terminate upon the earliest of the
events specified below, provided that such termination shall not
affect the right of the Executive or his estate or beneficiaries
to receive any salary or bonus accrued but unpaid, and shall not
affect any vested rights which the Executive may have at the time
of his death pursuant to any insurance or other death benefit
plans or any other plans, policies or arrangements of the Company
or any of its subsidiaries or affiliated corporations. The dates
and events upon which such termination shall occur are:
(a) the disability of the Executive; or
(b) the death of the Executive, subject to
Section 5.3; or
6<PAGE>
(c) the occurrence of the Retirement Date described in
Section 1.0; or
(d) termination for cause as described in Section 5.2
For purposes of this Agreement, "disability" shall mean the
inability of the Executive to perform his duties hereunder for a
period of six (6) consecutive calendar months, or an aggregate of
eight (8) calendar months in any twelve (12) month-period, by
virtue of illness or physical or mental incapacity or disability
(from any cause or causes whatsoever) in substantially the manner
and to the extent required hereunder, as determined by the Board
of Directors of the Company in its reasonable discretion.
5.2 Termination for Cause. The Company may terminate
Executive's employment, immediately and without notice, for
cause, in which event after the date of termination no further
Base Compensation or Incentive Compensation shall be payable to
Executive. The term "cause" shall mean (i) a material breach by
Executive of the provisions of Sections 6, 7, 8 or 9 of this
Agreement, (ii) repeated acts of dishonesty, (iii) breach of
trust or other action by which Executive obtains personal gain at
the expense of or to the detriment of the Company, (iv) repeated
failure to perform customary duties of his position following
notice from the Board (with Executive not participating or voting
if Executive is a director) or (v) conviction of Executive of any
felony or any other crime relating to the performance of his
duties.
5.3 Death or Disability. If the Executive dies or is
disabled during the Term, the Executive's estate or the Executive,
as the case may be, shall be entitled to
7<PAGE>
receive the base compensation provided in Section 3.2 for the
calendar quarter during which death or disability occurs and the
succeeding two calendar quarters.
SECTION 6. ASSIGNMENT AND DISCLOSURE OF INVENTIONS.
6.1 For purposes of this Agreement, the term "Restricted
Inventions" means all inventions, discoveries, improvements or
modifications to inventions or discoveries, whether patentable or
not, which are conceived of, reduced to practice, or both conceived
of and reduced to practice, by the Executive at any time
during the Restricted Period and which are used or useful by the
Company in any of its lines of business.
6.2 The Executive will disclose any Restricted Invention
promptly to the Company and the Executive hereby assigns the
Company all rights to any Restricted Invention. The Executive
will sign all documents necessary for the Company to apply for
and obtain domestic and foreign patents for Restricted Inven-
tions. The obligations of the Executive to sign such documents
will continue beyond the Restricted Period with respect to
Restricted Inventions, discoveries and improvements, whether
patentable or not, conceived or made by the Executive during the
Restricted Period.
SECTION 7. AVOIDANCE OF CONFLICT OF INTEREST.
While employed by the Company, Executive will not engage in
any other business activity which conflicts with Executive's
duties to the Company. Under no circumstances will Executive be
employed by, be a consultant to or otherwise act on
8<PAGE>
behalf of any competitor or have any financial interest in any
competitor of the Company; provided, however, that this Agreement
does not prohibit investment of a reasonable part of Executive's
assets in the stock or securities of any competitor whose stock
or securities are publicly traded.
SECTION 8. CONFIDENTIALITY.
8.1 Executive recognizes and acknowledges that the systems
and software which the Company owns, plans or develops, or
acquires from third parties, whether for its own use or for use
by its clients, are developed as a result of an expenditure of
time and expense, are confidential in nature and are the trade
secrets, proprietary to and the property of the Company. Executive
further recognizes and acknowledges that in order to enable
the Company to perform services for its clients, such clients may
furnish to the Company confidential information concerning their
business affairs, property, methods of operation, lists of
customers and customer information or other data and that the
good will afforded to the Company depends upon, among other
things, the Company and its Executives keeping such services and
information confidential.
8.2 For the purposes of this Agreement, a "Trade Secret"
is any scientific or technical information, design, process,
procedure, formula or improvement that is valuable and not
generally known to competitors of the Company including but not
limited to computer software programs. Examples are the specialized
information and technology relating to the Company's business.
"Confidential Information" is any data
9<PAGE>
or information, other than Trade Secrets, that is competitively
sensitive, and not generally known to the public, including but
not limited to the Company's customer lists, prospect lists,
trading manuals, product development plans, marketing strategies
and internal performance statistics.
8.3 Executive shall not, for the duration of this Agreement,
nor any time thereafter, without the prior written consent
of the Company, disclose any trade secret or confidential information
of the Company or its clients to its clients or any third
parties, or, permit or cause any person or organization:
(a) to copy or duplicate any physical form of the
Company's secrets or confidential information to or from any
medium except for archival, security or other regular business
purposes; or
(b) create or recreate, or attempt to create or
recreate, the source programs, object code or any other aspect of
the Trade Secrets or Confidential Information of the Company, in
all or in part; or
(c) to place such trade secrets into the public
domain.
8.4 Executive shall limit access to all media containing
the Company's and or its clients' Trade Secrets or Confidential
Information to its employees and agents necessary to permit
Executive to perform tasks require pursuant to this Agreement.
Executive further agrees to store all media and documentation
upon which the Company's and or its clients' trade secrets and
confidential information are recorded in a secure place, except
when being used, and will exercise all other reasonable precautions
to prevent unauthorized access, whether direct or indirect.
Executive shall
10<PAGE>
not disclose, transfer, use, copy or allow access to any such
trade secrets or confidential information to any employees or
third parties.
8.5 Upon the request of the Company and, in any event, upon
the termination of Executive's employment, Executive will leave
with the Company and or its clients' all computer programs,
documentations, code, memoranda, notes, records, drawings,
manuals, flow charts, or other documents pertaining to the
Company's business or Executive's employment (including all
copies thereof). Executive will also leave with the Company and
or its clients all materials involving any Trade Secrets or
Confidential Information of the Company or the Company's clients.
8.6 During the course of employment, Executive agrees to
treat all Trade Secrets and Confidential Information of the
Company and its clients as confidential and to take all necessary
precautions against disclosure of such information to third
parties during and after the term of this Agreement.
SECTION 9. RESTRICTIONS ON COMPETITION AND SOLICITATION.
9.1 Executive recognizes that the scope of the Company's
business is international in scope and not just limited to any
single state or region of the United States. Executive covenants
and agrees that from the date hereof and for a period of two (2)
years after termination of this Agreement, he will not engage in
any business, whether as officer, director, consultant, partner,
guarantor, principal, agent, employee, advisor or in any other
manner, which competes with the business of the Company as it is
engaged in at the time of the termination of this Agreement,
unless at the time
11<PAGE>
of such termination or thereafter during the non-competition
period the Company ceases to be engaged in such activity.
9.2 Executive further agrees that, during the term of this
Agreement, and for a period of two (2) years thereafter, Executive
shall not attempt to sell any competing goods or services to
any client to whom the Company introduces Executive, nor shall
Executive do any work for or contract with any client or customer
to whom the Company introduces Executive.
9.3 During employment with the Company, and for a period of
2 years thereafter, Executive will not solicit, entice or persuade
any other Executive of the Company or the Company's clients
to leave the services of their Company for any reason.
9.4 Executive agrees that the foregoing restrictions are
fair and reasonable considering the scope of Executive's employ-
ment, salary and benefits provided by the Company and Executive
further agrees that such restrictions will not unduly restrict or
prohibit Executive from obtaining gainful employment in his or
her chosen profession.
9.5 The Company recognizes that the scope of this Section 9
may prevent Executive from obtaining comparable employment during
the two (2) year period and, therefore, agrees to pay to Executive
during such two (2) year period the Base Compensation
reduced by any earned income from other sources received by
Executive.
12<PAGE>
SECTION 10. INJUNCTIVE RELIEF.
Executive acknowledges that disclosure of any Trade Secrets
or disclosure of any Confidential Information or any breach of
any restrictive agreements contained herein will give rise to
irreparable injury to Employer or clients of the Company. The
damage done to the Company will be difficult to ascertain and the
Company will be inadequately compensated in damages. Accordingly,
the Company may seek and obtain injunctive relief against
the breach or threatened breach of the foregoing undertakings, in
addition to any other legal remedies which may be available. The
Executive further acknowledges and agrees that covenants contained
herein are necessary for the protection of the Company's
legitimate business interests and are reasonable in scope and
content.
SECTION 11. SEVERABILITY.
If any provision of this Agreement shall, for any reason, be
adjudged by any court of competent jurisdiction to be invalid or
unenforceable, such judgment shall not affect, impair or invalidate
the remainder of this Agreement but shall be confined in its
operation to the provision of this Agreement directly involved in
the controversy in which such judgment shall have been rendered.
13<PAGE>
SECTION 12. SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon and inure to the
benefit of the Company, its successors and assigns and shall be
binding upon and inure to the benefit of the Executive and his
heirs, executors, administrators, legal representatives and
assigns.
SECTION 13. NOTICES.
All notices, requests, demands and other communications
hereunder must be in writing and shall be deemed to have been
duly given if mailed by first class certified mail, return
receipt requested, postage prepaid, addressed as follows:
(a) to the Executive:
Peter D. Flood
12 Washington Valley Road
Morristown, New Jersey 07930
(b) to the Company:
Chief Financial Officer
Multi-Arc Inc.
200 Roundhill Drive
Rockaway, NJ 07866
Either party by notice in writing mailed to the other as here-
under provided may change the address to which future notices to
such party shall be mailed.
SECTION 14. OTHER MATTERS.
Andal acknowledges that upon reduction of the total Fleet
Assigned debt to $1,500,000 owed to all holders thereof, the
Executive and Andal agree that in all events $96,000 shall be
owed by Andal to the Executive which shall be paid, together
14<PAGE>
with interest at the rate of 8% per annum, as soon as the cash
flow of Andal, in the reasonable discretion of the Board of
Directors, shall permit, but not later than thirty (30) days
after the Executive's termination of employment. In the event
that the cash flow of Andal prohibits payment of any amounts due
Executive under this Section 14 or under Section 3 hereof, Andal
agrees to use commercially reasonable efforts to obtain the cash
necessary to satisfy such obligations.
SECTION 15. MISCELLANEOUS.
This Agreement shall be construed and enforced in accordance
with, and governed by, the laws of the State of New Jersey,
without reference to principles of conflicts of law. This
Agreement embodies the entire agreement and understanding between
the Company and the Executive and supersedes all prior agreements
and understandings relating to the subject matter hereof. This
Agreement may not be modified or amended or any term or provision
thereof waived or discharged except in writing signed by the
party against whom such amendment, modification, waiver or
discharge is sought to be enforced. The headings of this Agreement
are for the purpose of reference only and shall not limit or
otherwise affect the meaning thereof.
15<PAGE>
IN WITNESS WHEREOF, the parties
hereto have executed and delivered this Agreement as of the day and year
first above written.
ANDAL CORP.
ANDREW J. FRANKEL
By:______________________________________
Andrew J. Frankel, Chairman of the Board
PETER D. FLOOD
______________________________________
Peter D. Flood
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