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: January 20, 1999
(Date of earliest event reported)
TELEBYTE TECHNOLOGY, INC.
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(Exact name of Registrant as specified in charter)
Nevada 0-11883 2510138
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(State or other jurisdiction (Commission File No.) (IRS Employer Identification
of incorporation) Number)
270 Pulaski Road, Greenlawn, New York 11740
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (516) 423-3232
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Item 5. Other Events.
Joel A. Kramer, Chairman of the Board, President and Chief Executive
Officer of Telebyte Technology, Inc. (the "Company") has retired from the
Company and has resigned from those positions to pursue other interests.
However, Mr. Kramer will serve as a consultant to the Company through January
19, 2002 for an aggregate consideration of $165,000 plus reimbursement for
certain expenses. In connection with Mr. Kramer's retirement, the Company
purchased all of the shares of common stock of the Company owned by Mr. Kramer
and Mr. Kramer agreed to cancel options to purchase 10,000 shares of common
stock of the Company for an aggregate consideration of $1,075,190. In addition,
Mr. Kramer has agreed not to compete with the business of the Company until
January 19, 2003 and has released the Company from certain potential claims
relative to his previous employment and the Company transferred a life insurance
policy to Mr. Kramer, previously maintained for Mr. Kramer's benefit and having
a cash value of approximately $80,000.
Effective January 20, 1999 Dr. Kenneth S. Schneider was elected as Chairman
of the Board and Chief Executive Office and Michael Breneisen as President and
Chief Operating Officer of the Company. Dr. Schneider was a co-founder of the
Company and has served as a Senior Vice President, Secretary, Treasurer and
Director. Mr. Breneisen has served as Vice President and Chief Financial
Officer, he will also continue to serve as Chief Financial Officer.
Item 7. Exhibits.
10.1 Stock Purchase Agreement dated January 20, 1999 between the Company
and Joel A. Kramer.
10.2 Consulting Agreement dated January 20, 1999 between the Company and
Joel A. Kramer
10.3 Termination Agreement dated January 20, 1999 between the Company
and Joel A. Kramer
10.4 Agreement and Release between the Company and Joel A. Kramer
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
TELEBYTE TECHNOLOGY, INC.
Dated: January 27, 1999 By: /s/ Kenneth S. Schneider
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Kenneth S. Schneider
Chairman of the Board
STOCK PURCHASE AGREEMENT dated as of January 20, 1999 (the "Agree ment") by
and between JOEL A. KRAMER ("Seller") and TELEBYTE TECHNOLOGY, INC.
("Purchaser"). RECITALS :
Seller owns 262,635 Common Shares (the "Shares") of the Purchaser and
options (the "Options") to purchase 10,000 Common Shares of Purchaser (the
"Underlying Shares").
Upon the terms and conditions of this Agreement, (i) Seller desires to sell
to Purchaser, and Purchaser desires to purchase from Seller, the Shares and (ii)
Seller and Purchaser desire to cancel the Options.
NOW, THEREFORE, in consideration of the recitals and the respective
covenants, representations, warranties and agreements herein contained, the
parties hereto hereby agree as follows:
ARTICLE I
SALE AND PURCHASE
1.1 Sale And Purchase of Shares. At the Closing (as hereinafter defined), Seller
shall sell and deliver to the Purchaser, and the Purchaser shall purchase from
Seller, upon and subject to the terms and conditions of this Agreement, all of
Seller's right, title and interest in and to all of the Shares, free and clear
of any and all claims, liens, pledges, options, charges, restrictions, security
interests, encumbrances or other rights of third parties, whether voluntarily
incurred or arising by operation of law, and including, without limitation, any
agreement to give any of the foregoing in the future (collectively, "Liens").
1.2 Cancellation of Options. Subject to the terms and conditions of this
Agreement, at the Closing, Seller shall execute and deliver to Purchaser such
instruments, documents and agreements as contemplated by Sections 5.5 and 5.7
hereof to effect the cancellation and termination of the Options.
1.3 Purchase Price.
1.3.1 Purchase Price. Subject to the terms of this Agreement, the
purchase price for the Shares, cancellation of Options and Seller's restrictive
covenant contemplated by the Termination Agreement, as hereinafter defined shall
be an aggregate of One Million Seventy-Five Thousand One Hundred Ninety Dollars
($1,075,190) (the "Purchase Price").
1.3.2 Payment of Purchase Price. Subject to the terms and conditions of
this Agreement, at the Closing, Purchaser, as full payment of the Purchase
Price, will deliver to the Seller a bank or certified check in the amount of the
Purchase Price (the "Closing Payment").
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1.3.3 Allocation of Purchase Price. The Purchase Price shall be allocated
hereunder as follows:
Dollar Amount Allocation
$867,510 The Shares
$ 17,680 Cancellation of the Options
$190,000 The restrictive covenant
contemplated by the
Termination Agreement, as
hereinafter defined.
It is agreed that the apportionments set forth above were arrived at by arm's
length negotiation and properly reflect the respective fair market values of the
foregoing. Seller and Purchaser each hereby covenants and agrees that it will
not take a position on any income tax return, before any governmental agency
charged with the collection of any income tax, or in any judicial proceeding
that is in any way inconsistent with the terms of this Section 1.3.3.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller makes the following representations and warranties to
Purchaser:
2.1 Shares.
(a) Seller owns the Shares and Options free and clear of any and
all Liens.
(b) The Shares being sold and Options being cancelled pursuant to
this Agreement constitute all of the issued and outstanding shares and
options to purchase shares of Purchaser owned beneficially and of
record by Seller.
(c) The Seller is the sole record and beneficial owner of the
Shares and Options, the Seller has good and marketable title to the
Shares and Options and the absolute and unqualified right to sell,
transfer and deliver the Shares to the Purchaser and cancel the
Options; and the delivery of the Shares to the Purchaser pursuant to
the provisions hereof will transfer valid title thereto, free and
clear of any and all Liens.
(d) There are no subscriptions, options, warrants, rights or
calls or other commitments, understandings or agreements to which
Seller is a party or by which he is bound, or of which Seller is
aware, calling for the transfer, sale or other disposition of the
Shares or Options.
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(e) Giving effect to the transactions contemplated hereby (and
without giving such effect), to the best of Seller's knowledge,
Seller's spouse and children own in the aggregate, of record and
beneficially, no more than five (5%) percent of the Purchaser's issued
and outstanding shares of Common Stock.
(f) The Options have not been exercised, sold, transferred,
assigned or otherwise disposed of or cancelled.
(g) For purposes of this Agreement, beneficial ownership shall be
determined in accordance with Rule 13d-3 promulgated under the
Securities Exchange Act of 1934, as amended(the "Exchange Act").
2.2 Consents. No consents of governmental or other regulatory agencies and/or of
other parties are required to be received by or on the part of Seller to enable
Seller to enter into and carry out this Agreement and the transactions
contemplated hereby to be performed by Seller.
2.3 Authority; Binding Nature of Agreement. Seller has the power to enter into
this Agreement and to carry out his obligations hereunder. This Agreement
constitutes the valid and binding obligation of Seller and is enforceable in
accordance with its terms.
2.4 No Breach. Neither the execution and delivery of this Agreement nor
compliance by Seller with any of the provisions hereof nor the consummation of
the transactions contemplated hereby will:
(a) violate or result in the material breach or termination of,
or otherwise give any contracting party the right to terminate, or
declare a default under, the terms of any material contract to which
Seller is a party or by which he is bound;
(b) result in the creation of any Lien upon the Shares, Options
or Underlying Shares;
(c) violate any judgment, order, injunction, decree or award
against, or binding upon, Seller or upon the Shares, Options or
Underlying Shares; or
(d) violate any law or regulation of any jurisdiction relating to
Seller.
2.5 No Commitments or Liabilities. During the twelve month period ending on the
date hereof (and if the Closing occurs, on the Closing Date), Seller has not
entered into any transaction outside the ordinary course of business, consistent
with past practice , which is not reflected in the books and records of
Purchaser and which involves in excess of Twenty-Five Thousand ($25,000)
Dollars.
2.6 Litigation; Compliance with Law. There are no actions, suits,
proceedings or governmental investigations relating to Seller or any of Seller's
assets pending or, to the knowledge
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of Seller, threatened, or any order, injunction, award or decree outstanding,
against Seller or against or relating to any of Seller's assets; and there
exists no basis for any such action, suit, proceeding, governmental
investigation, order, injunction, award or decree which would have a material
adverse effect on Seller or Seller's ownership of the Shares, Options or
Underlying Shares.
2.7 Transactions With Affiliates. Except as set forth in Schedule 2.7 attached
hereto and made a part hereof, there is no loan, lease, contract, agreement,
commitment, understanding, obligation, payment or other transaction, verbal or
written, fulfilled or unfulfilled (collectively, "Agreements") between or among
Seller and/or Seller's spouse and/or any affiliate, as such term is defined
under the Securities Act of 1933, as amended (the "Securities Act") (together
with a Seller's spouse, in each case, an "Affiliate") on the one hand, and
Purchaser, on the other. Except for ownership of up to two (2%) percent of the
total outstanding capital stock of any entity the securities of which are listed
on a national securities exchange or quoted on the Nasdaq system, Seller does
not own, directly or indirectly, any interest in, or serve as an officer or
director of, or in any similar capacity for, any competitor, customer, provider
or supplier of or to the Purchaser or any organization which has an Agreement
with Purchaser.
2.8 Purchaser's Property. Schedule 2.8(a) attached hereto and made a part hereof
contains a true, accurate and complete description of all tangible and
intangible personal property owned, leased, licensed or loaned by, to or from
Purchaser (including, without limitation, keys, documents, Purchaser credit and
telephone calling cards, building or Purchaser identification cards, cellular
telephones, car service authorization and identification cards, computers and
related equipment, software, automobiles, stationary, business cards and all
other Information as defined in Section 12.3 hereof) and in the possession of
Seller or any Affiliate (collectively, "Purchaser's Property"). Schedule 2.8(b)
hereto lists certain property which the parties acknowledge does not belong to
Purchaser.
2.9 Brokers. Seller has not engaged, consented to, or authorized any broker,
finder, investment banker or other third party to act on its behalf, directly or
indirectly, as a broker or finder in connection with the transactions
contemplated by this Agreement.
2.10 Untrue or Omitted Facts. No representation, warranty or statement by Seller
in this Agreement contains any untrue statement of a material fact, or omits to
state a fact necessary in order to make such representations, warranties or
statements not materially misleading. Without limiting the generality of the
foregoing, there is no fact known to Seller that has had, or which may be
reasonably expected to have, a materially adverse effect on Seller and/or
Seller's ownership and/or transfer hereunder of the Shares and/or cancellation
of the Options that has not been disclosed in this Agreement.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser makes the following representations and warranties
to Seller:
3.1 Consents. No consents of governmental and other regulatory agencies and of
other third parties are required to be received by or on the part of Purchaser
to enable it to enter into and carry out this Agreement and the transactions
contemplated hereby.
3.2 Authority; Binding Nature of Agreement. Purchaser has the power to enter
into this Agreement and to carry out its obligations hereunder. This Agreement
constitutes the valid and binding obligation of Purchaser, has been duly
authorized by the Purchaser's Board of Directors (or a special committee thereof
empowered to act on behalf of the Board of Directors) and is enforceable in
accordance with its terms.
3.3 No Breach. Neither the execution and delivery of this Agreement nor
compliance by Purchaser with any of the provisions hereof nor the consummation
of the transactions contemplated hereby will:
(a) violate or result in the material breach or termination of, or
otherwise give any contracting party the right to terminate, or declare a
default under, the terms of any material contract to which Purchaser is a
party or by which it is bound;
(b) violate any judgment, order, injunction, decree or award against,
or binding upon, Purchaser; or
(c) violate any law or regulation of any jurisdiction relating to
Purchaser.
3.4 Brokers. Purchaser has not engaged, consented to, or authorized any broker,
finder, investment banker or other third party to act on its behalf, directly or
indirectly, as a broker or finder in connection with the transactions
contemplated by this Agreement.
3.5 Untrue or Omitted Facts. No representation, warranty or statement by
Purchaser in this Agreement contains any untrue statement of a material fact, or
omits to state a fact necessary in order to make such representations,
warranties or statements not materially misleading. Without limiting the
generality of the foregoing, there is no fact known to Purchaser that has had,
or which may be reasonably expected to have, a materially adverse effect on
Purchaser and/or Purchaser's purchase hereunder of the Shares that has not been
disclosed in this Agreement.
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ARTICLE IV
PRE-CLOSING COVENANTS
4.1 Seller Covenants. Seller hereby covenants that from and after the date
hereof and until the Closing or earlier termination of this Agreement:
(a) The Shares. Seller will not, without the prior written consent of
Purchaser: sell, deliver, exercise, cancel or otherwise transfer or agree
or commit to sell or deliver, exercise, cancel or otherwise transfer
(whether through the granting of options, warrants, commitments,
subscriptions, rights to purchase or otherwise) the Shares, Options and/or
Underlying Shares, as the case may be, or agree to do any of the foregoing.
(b) No Breach.
(i) Seller will (A) use his best efforts to assure that all of
his representations and warranties contained herein are true as of the
Closing as if repeated at and as of such time, that no breach or
default shall occur with respect to any of his covenants,
representations or warranties contained herein that has not been cured
by the Closing and that all conditions to Purchaser's obligation to
enter into and complete the Closing which are required or contemplated
to be satisfied by Seller are satisfied in a timely manner; (B) not
voluntarily take any action or do anything which will cause a breach
of or default respecting such covenants, representations or warranties
or would impede the satisfaction of such conditions; and (C) promptly
notify Purchaser of any event or fact which represents or is likely to
cause such a breach or default or result in such an impediment.
(ii) Without limiting the generality of the foregoing, Seller
agrees to use his best efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, all things reasonably
necessary, proper or advisable under applicable laws and regulations
to consummate and make effective the transactions contemplated by this
Agreement.
(c) Actions by Seller. Except for Agreements where the total aggregate
value of goods and services and/or payments to be made to or by Purchaser
are less than Twenty-Five Thousand ($25,000) Dollars (with respect to each
such agreement or series of related agreements) and which are in the
ordinary course of business consistent with past practice, Seller will not
without the prior written consent of Purchaser, enter into any Agreement
by, or on behalf of, Purchaser. In any event, Seller shall conduct himself
only in the ordinary course of business as President of Purchaser,
consistent with past practice.
(d) No Negotiations. Seller shall not, directly or indirectly, enter
into or conduct negotiations, or enter into any contract, commitment or
other agreement, for the sale or possible sale of any of the Shares or
Options or Underlying Shares.
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ARTICLE V
CONDITIONS PRECEDENT TO THE
OBLIGATION OF PURCHASER TO CLOSE
The obligation of Purchaser to consummate the transactions contemplated
hereby is subject to the fulfillment, prior to or at the Closing (except with
regard to the condition set forth in Section 5.8 hereof, which must be satisfied
within the time indicated therein), of each of the following conditions, any one
or more of which may be waived by Purchaser (except when the fulfillment of such
condition is a requirement of law):
5.1 Representations and Warranties. All representations and warranties of Seller
contained in this Agreement and in any written statement (including financial
statements), exhibit, certificate, schedule or other document delivered pursuant
hereto or in connection with the transactions contemplated hereby shall be true
and correct in all material respects as at the Closing Date, as if made at the
Closing and as of the Closing Date.
5.2 Covenants. Seller shall have performed and complied with all covenants and
agreements required by this Agreement to be performed or complied with by him
prior to or at the Closing.
5.3 Certificate. Purchaser shall have received a certificate, dated the Closing
Date, signed by the Seller, as to the satisfaction of the conditions contained
in Sections 5.1 and 5.2 hereof.
5.4 The Shares. Purchaser shall have received (i) a stock certificate or
certificates representing the Shares, duly endorsed in blank, or accompanied by
a stock power duly executed in blank, in either case with signatures medallion
guaranteed and all necessary transfer tax stamps affixed and cancelled and (ii)
such other documentation as may be required by the transfer agent of Purchaser
to give effect to the transfer (collectively, the "Certificate"). Seller agrees
to cure any deficiencies with respect to the endorsement of the certificates
representing the Shares and/or the execution of the stock powers and other
documents delivered in connection with the transfer.
5.5 Options. Purchaser shall have received the documents constituting the
Options marked "cancelled" by Seller.
5.6 Consulting Agreement. Seller shall have executed and tendered to Purchaser a
Consulting Agreement in, or substantially in, the form attached hereto as
Exhibit A (the "Consulting Agreement").
5.7 Termination Agreement. Seller shall have executed and tendered to Purchaser
a Termination Agreement (the "Termination Agreement") in, or substantially in,
the form attached hereto as Exhibit B.
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5.8 Release. Seller shall have executed and delivered, at least seven (7) days
prior to the Closing, an Agreement and Release in, or substantially in, the form
attached hereto as Exhibit C (which Seller hereby acknowledges, he had at least
twenty-one (21) days prior to the date hereof) and such release shall not have
been revoked by Seller and Purchaser shall have received documentation
satisfactory to it, in its sole and absolute discretion, which shall be final,
conclusive and binding, that such Agreement and Release has not been revoked
(collectively, the "Release Documents")
5.9 Fairness Opinion. Purchaser shall have received an opinion from a firm
satisfactory to it to the effect that the transactions contemplated hereby are
fair, from a financial viewpoint, to the shareholders of Purchaser.
5.10 Financing Contingency. Purchaser shall have obtained financing so that the
total aggregate amount of funds immediately available from Purchaser's lending
institution shall be not less than One Million Seven Hundred Fifty Thousand
($1,750,000) Dollars (of which One Million ($1,000,000) Dollars shall have been
funded on the Closing Date on account of the Purchase Price) upon terms
satisfactory to Purchaser, in Purchaser's sole and absolute discretion, which
shall be final, conclusive and binding.
5.11 Purchaser's Property. Seller and all Affiliates shall have returned to
Purchaser all Purchaser's Property. Seller shall have delivered a certificate
certifying same (the "Property Certificate").
5.12 Resignation of Robert Kramer. Purchaser shall have received the resignation
of Robert Kramer from all capacities with Purchaser, including without
limitation, as a Director of Purchaser, effective as of the Closing Date.
5.13 Form 4. Purchaser shall have received from Seller a duly executed Form 4
reflecting, among other things, the transactions contemplated hereby ("Seller's
Form 4").
5.14 No Actions. No action, suit, proceeding or investigation shall have been
instituted, and be continuing before a court or before or by a governmental or
other regulatory body or agency, or shall have been threatened and be
unresolved, to restrain or to prevent or to obtain any material amount of
damages in respect of, the carrying out of the transactions contemplated hereby.
5.15 Consents; Licenses and Permits. Seller and Purchaser, respectively, shall
have obtained all consents, licenses and permits of third parties, including,
without limitation, regulatory authorities, necessary for the performance by
each of them of all of their respective obligations under this Agreement,
including, without limitation, the transfer of the Shares as contemplated
hereby, and such other consents, if any, to prevent (i) the occurrence of a
breach under any agreement of Seller and Purchaser, respectively, with any
person, the termination of which would have a material adverse effect on
Purchaser's business or (ii) any liability or obligation of Purchaser becoming
due
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or being subject to becoming due with the passage of time or on notice as a
result of the performance of this Agreement, any other provision of this
Agreement to the contrary notwithstanding.
5.16 Nevada Statutes. This Agreement and acquisition of the Shares contemplated
hereby shall be in compliance with Chapter 78 of the Nevada Revised Statutes.
5.17 Actions. All actions necessary to authorize the execution, delivery and
performance of this Agreement by Seller and the consummation of the transactions
contemplated hereby shall have been duly and validly taken and Seller shall have
full power and right to consummate the transactions contemplated by this
Agreement.
ARTICLE VI
CONDITIONS PRECEDENT TO THE OBLIGATION OF
SELLER TO CLOSE
The obligation of Seller to consummate the transactions contemplated
hereby is subject to the fulfillment, prior to or at the Closing, of each of the
following conditions, any one or more of which may be waived by Seller (except
when the fulfillment of such condition is a requirement of law):
6.1 Representations and Warranties. All representations and warranties of
Purchaser contained in this Agreement, exhibit, certificate, schedule or other
document delivered pursuant hereto or in connection with the transactions
contemplated hereby shall be true and correct as at the Closing Date, as if made
at the Closing and as of the Closing Date.
6.2 Covenants. Purchaser shall have performed and complied with all covenants
and agreements required by this Agreement to be performed or complied with by it
prior to or at the Closing.
6.3 Certificate. Seller shall have received a certificate, dated the Closing
Date, signed by the Chief Financial Officer of Purchaser, as to the satisfaction
of the conditions contained in Sections 6.1 and 6.2 hereof.
6.4 Closing Payment. Purchaser shall have tendered the Closing Payment to
Seller.
6.5 Consulting Agreement. Purchaser shall have executed and tendered to Seller,
the Consulting Agreement.
6.6 Termination Agreement. Purchaser shall have executed and tendered to Seller
the Termination Agreement.
6.7 No Actions. No action, suit, proceeding, or investigation shall have been
instituted, and be continuing, before a court or by a governmental or other
regulatory body or agency, or have been
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threatened, and be unresolved, to restrain or prevent, or obtain any material
amount of damages in respect of, the carrying out of the transactions
contemplated hereby.
6.8 Consents; Licenses and Permits. Purchaser shall have obtained all consents,
licenses and permits of third parties, including, without limitation, regulatory
authorities, necessary for the performance by it of all of its obligations under
this Agreement.
6.9 Corporate Actions. All actions necessary to authorize the execution,
delivery and performance of this Agreement by Purchaser and the consummation of
the transactions contemplated hereby shall have been duly and validly taken and
Purchaser shall have full power and right to consummate the transactions
contemplated by this Agreement.
ARTICLE VII
CLOSING
7.1 Location. The closing (the "Closing") provided for herein shall take place
at the offices of Certilman Balin Adler & Hyman, LLP, 90 Merrick Avenue, East
Meadow, New York 11554 at 10:00 A.M. three (3) days following the satisfaction
of the conditions set forth in Articles V and VI hereof but not latter than
January 20, 1999, or on such date and at such place as may be mutually agreed to
by the parties. Such date is referred to in this Agreement as the "Closing
Date."
7.2 Items to be Delivered to Purchaser. At or prior to the Closing, Seller will
deliver or cause to be delivered to Purchaser:
(a) the certificate required by Section 5.3 hereof;
(b) the Certificate required by Section 5.4 hereof;
(c) the Options required by Section 5.5 hereof;
(d) the Consulting Agreement required by Section 5.6
hereof;
(e) the Termination Agreement required by Section 5.7
hereof;
(f) the Release Documents required by Section 5.8 hereof;
(g) Purchaser's Property and the Property Certificate
required by Section 5.11 hereof;
(h) Seller's Form 4 required by Section 5.13 hereof; and
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(i) such other certified resolutions, documents and
certificates as are required to be delivered to
Purchaser by or on behalf of Seller pursuant to the
provisions of this Agreement or which otherwise
confirm that all of the conditions precedent to the
obligation of Purchaser to close have been satisfied.
7.3 Items to be Delivered to Seller. At the Closing, Purchaser will deliver or
cause to be delivered to Seller:
(a) the certificate required by Section 6.3;
(b) the Closing Payment required by Section 6.4 hereof;
(c) the Consulting Agreement required by Section 6.5 hereof;
(d) the Termination Agreement required by Section 6.6 hereof;
(e) certified copies of all corporate action required by Section
6.9 hereof; and
(f) such other certified resolutions, documents and certificates
as are required to be delivered by Purchaser pursuant to the
provisions of this Agreement or otherwise confirm that all of the
conditions precedent to the obligation of Seller to close have
been satisfied.
ARTICLE VIII
RESTRICTIONS ON CERTAIN ACTIONS
BY SELLER
8.1 Restrictions on Purchases, Sales and Other Actions by Seller. Seller agrees
that he will not, and will not cause or permit any of his Affiliates directly or
indirectly, through one or more entities, without the prior written consent of
Purchaser, to:
(a) Acquisition and Voting Restrictions. Acquire, directly or
indirectly, by purchase or otherwise, the beneficial ownership of any voting
securities of Purchaser, or any options, rights or warrants to acquire any
voting securities of Purchaser or proxies to vote any voting securities of
Purchaser. Any voting securities of Purchaser owned by the Seller and his
Affiliates shall be voted as follows: any voting securities of Purchaser owned
by Seller and his Affiliates shall be voted in accordance with the
recommendation of the Board of Directors of Purchaser on all matters presented
to shareholders of Purchaser, and voting securities of Purchaser owned by Seller
and his Affiliates shall always be voted as present for purposes of obtaining a
quorum at any meeting of shareholders.
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(b) Option and Sales Restrictions. Grant any option or other
right to any Person, as such term is defined in Section 2(2) of the Securities
Act.
(c) Restrictions Upon Certain Actions.
(i) Solicit or encourage any Person, as such term is
defined in Section 2(2) of the Securities Act, to solicit
any proxies with respect to any voting securities of
Purchaser under any circumstances, or become a "participant"
in any "election contest" relating to the election of
Directors of Purchaser (as such terms are used in Rule
14a-11 of Regulation 14A under the Exchange Act), or seek to
advise or influence any person with respect to the voting of
any voting securities of Purchaser;
(ii) Act together with any other Person for the purpose
of acquiring, holding, voting or disposing of any voting
securities of Purchaser or any options or other rights to
acquire any such securities;
(iii) Solicit any person for the approval of, initiate
or propose one or more shareholder proposals with respect to
Purchaser, as described in Rule 14a-8 under the Exchange
Act;
(iv) Advise, encourage or assist any Person in the
acquisition of any voting securities of Purchaser or options
or rights to acquire any such securities; or
(v) Act alone or together with any Person to acquire,
or propose a business combination with, Purchaser, or to
control or influence the management, Board of Directors or
policies of Purchaser.
8.2 Termination of Restrictions. The restrictions set forth in Section 8.1 shall
terminate five (5) years from the Closing Date.
ARTICLE IX
POST-CLOSING MATTERS
9.1 Further Assurances. On and after the Closing Date, upon the request of
Purchaser, Seller shall take all such further actions and execute, acknowledge
and deliver all such further instruments and documents as may be necessary or
desirable to convey and transfer to, and vest in, Purchaser, and to protect
Purchaser's right, title and interest in and to, and enjoyment of, the Shares
intended to be assigned, transferred, conveyed and delivered pursuant to this
Agreement.
9.2 Section 16 Obligations. Seller shall file Seller's Form 4 on a timely basis
in accordance with applicable rules and regulations of the Securities and
Exchange Commission. Unless Seller notifies Purchaser otherwise in writing at
least ten (10) days prior to the date any filing other than
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Seller's Form 4 may be due, Seller hereby authorizes Purchaser to assume that no
filings are required to be made by Seller under Section 16 of the Exchange Act.
ARTICLE X
SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION
10.1 Survival. The parties agree that their respective representations and
warranties contained in this Agreement shall survive the Closing.
10.2 Indemnification.
10.2.1 General Indemnification Obligation of Seller. From and after the
Closing, Seller will reimburse, indemnify and hold harmless Purchaser and its
respective successors and assigns (an "Indemnified Purchaser Party") against and
in respect of:
(a) any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by any Indemnified Purchaser Party that
result from, relate to or arise out of any misrepresentation, breach of warranty
or nonfulfillment of any agreement or covenant on the part of Seller under this
Agreement, or from any misrepresentation in or omission from any certificate,
schedule, statement, document or instrument furnished to Purchaser pursuant
hereto; and
(b) any and all actions, suits, claims, proceedings,
investigations, demands, assessments, audits, fines, judgments, costs and other
expenses (including, without limitation, reasonable legal fees) incident to any
of the foregoing or to the enforcement of this Section 10.2.1.
10.2.2 General Indemnification Obligation of Purchaser. From and after
the Closing, Purchaser will reimburse, indemnify and hold harmless Seller and
its respective successors and assigns (an "Indemnified Seller Party") against
and in respect of:
(a) any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by any Indemnified Seller Party that
result from, relate to or arise out of any misrepresentation, breach of warranty
or nonfulfillment of any agreement or covenant on the part of Purchaser under
this Agreement, or from any misrepresentation in or omission from any
certificate, schedule, statement, document or instrument furnished to Seller
pursuant hereto; and
(b) any and all actions, suits, claims, proceedings,
investigations, demands, assessments, audits, fines, judgments, costs and other
expenses (including, without limitation, reasonable legal fees) incident to any
of the foregoing or to the enforcement of this Section 10.2.2.
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10.2.3 Method of Asserting Claims, Etc.
(a) In the event that any claim or demand for which Seller
would be liable to an Indemnified Purchaser Party hereunder is asserted against
or sought to be collected from an Indemnified Purchaser Party by a third party,
the Indemnified Purchaser Party shall notify Seller of such claim or demand,
specifying the nature of such claim or demand and the amount or the estimated
amount thereof to the extent then feasible (which estimate shall not be
conclusive of the final amount of such claim and demand) (the "Claim Notice").
Seller shall thereupon, at his sole cost and expense, defend the Indemnified
Purchaser Party against such claim or demand with counsel reasonably
satisfactory to Purchaser.
(b) Seller shall not, without the prior written consent of the
Indemnified Purchaser Party, consent to the entry of any judgment against the
Indemnified Purchaser Party or enter into any settlement or compromise which
does not include, as an unconditional term thereof (i.e., there being no
requirement that the Indemnified Purchaser Party pay any amount of money or give
any other consideration), the giving by the claimant or plaintiff to the
Indemnified Purchaser Party of a release, in form and substance reasonably
satisfactory to the Indemnified Purchaser Party, as the case may be, from all
liability in respect of such claim or litigation. If any Indemnified Purchaser
Party desires to participate in, but not control, any such defense or
settlement, it may do so at its sole cost and expense.
(c) In the event an Indemnified Purchaser Party should have a
claim against Seller hereunder that does not involve a claim or demand being
asserted against or sought to be collected from it by a third party, the
Indemnified Purchaser Party shall send a Claim Notice with respect to such claim
to Seller.
(d) All claims for indemnification by an Indemnified Seller
Party under this Agreement shall be asserted and resolved under the procedures
set forth hereinabove by substituting in the appropriate place "Indemnified
Seller Party" for "Indemnified Purchaser Party" and variations thereof and
"Purchaser" for "Seller".
10.3 Payment. Upon the determination of the liability under Section 10.2 hereof,
the Seller shall pay to Purchaser, within ten (10) days after such
determination, the amount of any claim for indemnification made hereunder.
10.4 Other Rights and Remedies Not Affected. The indemnification rights of the
parties under this Article X are independent of and in addition to such rights
and remedies as the parties may have at law or in equity or otherwise for any
misrepresentation, breach of warranty or failure to fulfill any agreement or
covenant hereunder on the part of any party hereto, including without limitation
the right to seek specific performance, rescission or restitution, none of which
rights or remedies shall be affected or diminished hereby.
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ARTICLE XI
TERMINATION AND WAIVER
11.1 Termination. Anything herein or elsewhere to the contrary notwithstanding,
this Agreement may be terminated and the transactions provided for herein
abandoned at any time prior to the Closing:
(a) By mutual consent of the Special Committee of the Board of
Directors of Purchaser, currently consisting of Jamil Sopher and Kenneth
Schneider, and Seller;
(b) By Purchaser if any of the conditions set forth in Article V
hereof shall not have been fulfilled on or prior to January 20, 1999 or
shall become incapable of fulfillment, in each case except as such shall
have been the result, directly or indirectly, of any action or inaction by
Purchaser or its officers and Directors (other than Joel Kramer and/or
Robert Kramer), and shall not have been waived; or
(c) By Seller, if any of the conditions set forth in Article VI hereof
shall not have been fulfilled on or prior to January 20, 1999 or shall have
become incapable of fulfillment, in each case except as such shall have
been the result, directly or indirectly, of any action or inaction by
Seller and shall not have been waived.
If this Agreement is terminated as described above, this Agreement
shall be of no further force and effect, without any liability or obligation on
the part of any of the parties except for any liability which may arise pursuant
to Sections 12.3 hereof or as a result of a party's willful failure to
consummate the transactions contemplated hereby.
11.2 Waiver. Any condition to the performance of the parties which legally may
be waived on or prior to the Closing Date may be waived at any time by the party
entitled to the benefit thereof by action taken or authorized by an instrument
in writing executed by the relevant party or parties. The failure of any party
at any time or times to require performance of any provision hereof shall in no
manner affect the right of such party at a later time to enforce the same. No
waiver by any party of the breach of any term, covenant, representation or
warranty contained in this Agreement as a condition to such party's obligations
hereunder shall release or affect any liability resulting from such breach, and
no waiver of any nature, whether by conduct or otherwise, in any one or more
instances, shall be deemed to be or construed as a further or continuing waiver
of any such condition or of any breach of any other term, covenant,
representation or warranty of this Agreement.
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ARTICLE XII
MISCELLANEOUS PROVISIONS
12.1 Sales, Transfer and Documentary Taxes. Seller shall pay all federal, state
and local sales, documentary and other transfer taxes, if any, due as a result
of the purchase and sale of the Shares in accordance herewith.
12.2 Expenses. Each of the parties shall bear its or his own expenses in
connection herewith.
12.3 Confidential Information. Seller hereby agrees that he and his Affiliates
and representatives at all times hereafter will hold in a fiduciary capacity and
in strict confidence all information, data and documents received from Purchaser
(collectively, "Information") and will not, without the consent of Purchaser,
use or disclose, directly or indirectly, the Information in any manner
whatsoever, in whole or in part. Notwithstanding the foregoing, the obligations
under this Section 12.3 to maintain such confidentiality shall not apply to any
Information (a) that is in the public domain at the time furnished by the
disclosing party, (b) that becomes in the public domain thereafter through any
means other than as a result of any act of the receiving party or of its agents,
officers, directors or shareholders which constitutes a breach of this
Agreement, or (c) that is required by applicable law to be disclosed.
12.4 Equitable Relief. The parties agree that the remedy at law in any breach or
threatened breach of the provisions of Article IV or Section 12.3 will be
inadequate and the aggrieved party shall be entitled to injunctive relief to
compel the breaching party to perform or refrain from action required or
prohibited thereunder.
12.5 Publicity. Seller hereby agrees that no publicity, release or other public
announcement concerning the transactions contemplated by this Agreement shall be
issued by him without the advance approval of both the form and substance of the
same by the Purchaser and its counsel, which shall be final, conclusive and
binding. Seller further agrees that the terms of this Agreement shall not be
divulged by Seller, unless such terms have been publicly released in accordance
with the provisions hereof. Purchaser shall provide Seller with any release or
filing disclosing this transaction and Seller shall have a reasonable
opportunity to comment thereon prior to dissemination.
12.6 Entire Agreement. This Agreement, including the schedules and exhibits
attached hereto, which are a part hereof, constitutes the entire agreement of
the parties with respect to the subject matter hereof. The representations,
warranties, covenants and agreements set forth in this Agreement and in the
schedules or exhibits delivered pursuant hereto constitute all the
representations, warranties, covenants and agreements of the parties and upon
which the parties have relied, shall not be deemed waived or otherwise affected
by any investigation made by any party hereto and, except as may be specifically
provided herein, no change, modification, amendment, addition or termination of
this Agreement or any part thereof shall be valid unless in writing and signed
by or on behalf of the party to be charged therewith.
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12.7 Notices. Any and all notices or other communications or deliveries required
or permitted to be given or made pursuant to any of the provisions of this
Agreement shall be deemed to have been duly given or made for all purposes when
hand delivered or sent by certified or registered mail, return receipt requested
and postage prepaid, overnight mail, nationally recognized overnight courier, or
telecopier as follows:
If to Purchaser at:
Telebyte Technology, Inc.
270 Pulaski Road
Greenlawn, New York 11740
Telecopier Number: (516) 385-8184
With a copy to:
Certilman Balin Adler & Hyman, LLP
90 Merrick Avenue
East Meadow, New York 11554
Attention: Steven J. Kuperschmid, Esq.
Telecopier Number: (516) 296-7111
If to Seller, at:
Joel A. Kramer
4 Sycamore Drive
Woodbury, New York 11797
Telecopier Number: (516) 367-7296
With a copy to:
Rivkin Radler & Kremer
EAB Plaza
Uniondale, New York 11556-0111
Attention: Barry R. Shapiro, Esq.
Telecopier Number: (516) 357-3333
or at such other address as any party may specify by notice given to the other
party in accordance with this Section 12.7. No amendment, modification, consent,
notice, waiver or other communication required or permitted to be given by
Purchaser hereunder shall be effective or binding upon Purchaser if executed on
behalf of Purchaser only by Seller and/or Robert Kramer.
12.8 Choice of Law; Severability. This Agreement shall be governed by, and
interpreted and construed in accordance with, the laws of the State of New York,
excluding choice of law principles thereof. In the event any clause, section or
part of this Agreement shall be held or declared to be void, illegal or invalid
for any reason, all other clauses, sections or parts of this Agreement which
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can be effected without such void, illegal or invalid clause, section or part
shall nevertheless continue in full force and effect.
12.9 Successors and Assigns; No Assignment. This Agreement shall be binding upon
and inure to the benefit of the parties and their respective successors and
assigns; provided, however, that neither party may assign any of its rights or
delegate any of its duties under this Agreement without the prior written
consent of the other.
12.10 Headings. The headings or captions under sections of this Agreement are
for convenience and reference only and do not in any way modify, interpret or
construe the intent of the parties or affect any of the provisions of this
Agreement.
WITNESS the execution of this Agreement as of the date first
above written.
/s/ Joel A. Kramer
----------------------------
Joel A. Kramer, Individually
TELEBYTE TECHNOLOGY, INC.
By: /s/ Kenneth S. Schneider
Name: Kenneth S. Schneider
(Please Print)
Title: Senior Vice President
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Exhibit 10.2
CONSULTING AGREEMENT dated as of January 20, l999 (the "Agreement")
between TELEBYTE TECHNOLOGY, INC., a Nevada corporation (the "Company"), with an
office and principal place of business located at 270 Pulaski Road, Greenlawn,
New York 11740, and JOEL A. KRAMER (the "Consultant"), an individual residing at
4 Sycamore Drive, Woodbury, New York 11797.
WHEREAS, the Company desires to retain the Consultant to
perform consulting services and the Consultant is willing to perform such
services, upon the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto agree as follows:
l. Retention; Duties.
(a) Subject to the terms and conditions set forth herein, the
Company hereby retains the Consultant, and the Consultant hereby accepts such
retention, to provide consulting services to the Company in the orderly
transition of management functions from Consultant to such personnel of the
Company as the Company may request from time to time during the Term (as
hereinafter defined) of this Agreement. Without limiting the generality of the
foregoing, at the Company's request pursuant to the terms hereof, (i) the
Consultant shall provide consulting services hereunder to the Company in the
areas of management, administration, engineering, sales and marketing, as may be
required by the Company and which shall be consistent with the Consultant's
position, experience and abilities; and (ii) the Consultant shall educate
management of the Company in all areas of responsibility of, and with regard to
all tasks performed by, the Consultant in all capacities for the Company prior
to the date hereof.
(b) In the fulfillment of his duties hereunder, the Consultant
shall devote to the Company all of his working time until a date which is three
(3) months from the date hereof (the "Full-Time Date") (unless this Agreement is
sooner terminated in accordance with the provisions hereof). Such full-time
services (i) shall be performed from the Consultant's residence and Consultant
shall, at Consultant's expense, communicate with the Company via telephone,
facsimile, email, or other means of electronic communication (collectively,
"Electronic Means") as determined by the Company; or (ii) shall at the Company's
request be performed at the Company's facilities in Greenlawn, New York.
Following the Full-Time Date, until the end of the Term (unless this Agreement
is sooner terminated in accordance with the provisions hereof), Consultant's
services shall be performed as needed by the Company, and Consultant may provide
such services, at Consultant's expense, by Electronic Means, as determined by
the Company; provided, however, that the Company may in its sole discretion,
which shall be final, conclusive and binding, determine that the Consultant's
services in one or more particular instances must be rendered in person by the
Consultant at the Company's Greenlawn location (whether in connection with a
meeting of the Board of Directors or otherwise).
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(c) Without limiting the generality of any other provision
hereof, (i) following the Full-Time Date and during the balance of the first
Contract Year, as hereinafter defined, the Consultant shall provide a minimum of
eighty (80) hours of service to the Company; and (ii) during each of the second
Contract Year and third Contract Year, the Consultant shall provide a minimum of
two hundred forty (240) hours of service to the Company (with regard to each of
the balance of the first Contract Year following the Full-Time Date, the second
Contract Year and third Contract Year, the "Base Hours"). Any services performed
hereunder by the Consultant in excess of the Base Hours, with respect to any
period, shall be at the mutual agreement of the Company and the Consultant. The
Consultant shall keep accurate time records of all services performed hereunder
and furnish same to the Company on a monthly basis or more frequently as the
Company may request from time to time.
(d) It is specifically agreed by the Company and the
Consultant that, in the performance of the consulting services during the Term,
the Consultant shall (i) receive from the Company reasonable advance notice of
the times when the Consultant's services will be needed, with due regard for his
other personal commitments which may conflict with the Company's request for
services (provided same do not prevent the Consultant from performing his duties
hereunder); (ii) report to and be responsible only to the President or Board of
Directors of the Company or such other officers of the Company as are designated
to the Consultant by the President or Board of Directors; and (iii) receive such
support from the officers of the Company as may be reasonably necessary to
enable the Consultant to carry out his services pursuant to this Agreement. In
addition, it is specifically agreed that, subject to Subsections 3(e) through
3(i), inclusive, hereof, the Consultant shall be entitled to be paid the amounts
and receive the benefits provided for pursuant to this Agreement notwithstanding
the fact that the Company may not choose to utilize his services; provided,
however, that the foregoing shall in no way limit the Company's ability to
terminate this Agreement as provided herein nor impose any liability on the
Company not expressly provided for herein.
(e) The Consultant agrees to perform all services hereunder in
a timely and efficient manner.
2. Term and Termination.
(a) The term of this Agreement (the "Term") shall commence as
of the date hereof and continue for a period of three (3) years (unless sooner
terminated in accordance with the provisions hereof). Each successive twelve
(12) month period following the date hereof shall be referred to hereinafter as
a "Contract Year".
(b) The Company may terminate this Agreement prior to the
expiration of the Term upon sixty (60) days' prior written notice to the
Consultant, delivered via Federal Express or other nationally recognized
overnight courier. Such termination will be effective at the conclusion of said
sixty (60) day period.
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(c) The Company may terminate this Agreement prior to the
expiration of the Term after having established the Consultant's "Disability"
(as defined below), by giving the Consultant written notice of its intention to
terminate this Agreement due to such Disability delivered via Federal Express or
other nationally recognized overnight courier. The date of Disability shall be
the day on which the Company gives such notice. For purposes of this Agreement,
"Disability" means the Consultant's inability to perform substantially his
duties and responsibilities to the Company by reason of a physical or mental
incapacity or infirmity (i) for a continuous period of one hundred and twenty
(120) days; or (ii) for a cumulative period of one hundred and twenty (120) days
in any twelve month period; or (iii) at such earlier time as the Consultant
submits medical evidence satisfactory to the Company that the Consultant has a
physical or mental incapacity or infirmity that will likely prevent the
Consultant from substantially performing his duties and responsibilities for one
hundred and twenty (120) days or longer. In the event of any disagreement
between the Consultant and the Company as to whether the Consultant is
physically or mentally incapacitated so as to constitute a Disability hereunder,
the question of such incapacity shall be submitted to an impartial and reputable
physician selected by mutual agreement of the Company and the Consultant, or,
failing such agreement, selected by two physicians (one of whom shall have been
selected by the Company, and the other by the Consultant), and the determination
of the question of such incapacity by such physician(s) shall be final and
binding upon the Company and the Consultant. The Company shall pay the fees and
expenses of such physician, and the Consultant shall submit to any medical
examinations reasonably necessary to enable such physician to make a
determination as to whether the Consultant's incapacity constitutes a Disability
hereunder.
(d) The Company shall have the right to terminate this
Agreement for "Cause". For purposes of this Agreement, "Cause" shall include,
but not be limited to: (i) the willful and continued failure by the Consultant
to perform substantially his duties to the Company (other than any such failure
resulting from his Disability) within a reasonable period of time after a
written demand for substantial performance is delivered to the Consultant by the
Company, which demand identifies the manner in which the Company believes that
the Consultant has not substantially performed his duties; (ii) the grossly
negligent performance by the Consultant of his duties to the Company, if such
grossly negligent performance is determined by the Company to have had or to be
reasonably likely to have a material adverse effect on the business, assets,
prospects or financial condition of the Company; (iii) breach by the Consultant
of Section 5 hereof; (iv) the Consultant's commission of any act in the
performance of his duties constituting common law fraud or a felony; (v)any
misrepresentation or breach of any representation made by the Consultant
hereunder and/or under that certain Stock Purchase Agreement dated January 20,
1999 by and between the Company and the Consultant (the "Stock Purchase
Agreement") and/or any and all instruments, documents and agreements executed
and delivered by or on behalf of the Consultant pursuant thereto (collectively,
the "Related Documents") which results in a material adverse effect on the
Company, its business, operations and/or financial condition; (vi) the
Consultant's engaging in misconduct which is materially injurious to the
Company, its business, operations and/or financial condition; or (vii) breach of
any covenant or agreement by the Consultant under the Stock Purchase Agreement
and/or Related Documents which results in a material adverse effect on the
Company, its business,
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operations and/or financial condition. Following any notice and opportunity to
cure contemplated by this Section 2(d) above, the Company may terminate this
Agreement for Cause by giving one (1) day's prior written notice to the
Consultant in accordance with Section 7 hereof.
(e) This Agreement shall terminate automatically as of the
date of the Consultant's death.
(f) The Consultant may terminate this Agreement prior to the
expiration of the Term upon sixty (60) days' prior written notice to the
Company, delivered via Federal Express or other nationally recognized overnight
courier. Such termination will be effective at the conclusion of said sixty (60)
day period.
3. Compensation.
Subject to the provisions of Subsections 3(e) through 3(i),
inclusive, hereof:
(a) (i) In consideration of the services to be rendered by the
Consultant during the first Contract Year, the Company shall pay to the
Consultant a fee at the annual rate of Eighty- Five Thousand ($85,000) Dollars,
to be payable as follows: Forty Seven Five Hundred Thousand ($47,500) Dollars on
the date hereof and Thirty Seven Thousand Five Hundred ($37,500) Dollars on a
date six (6) months from the date hereof; (ii) in consideration of the services
to be rendered by the Consultant during each of the second and third Contract
Years, the Company shall pay to the Consultant a fee at the annual rate of Forty
Thousand ($40,000) Dollars, payable on the first and second anniversary hereof;
and (iii) during each of the first, second and third Contract Years, the
Consultant shall be paid at the rate of One Hundred Twenty-Five ($125.00)
Dollars per hour for each hour of service performed at the Company's written
request over the Base Hours for each such year, payable monthly.
(b) The Company shall, for a period of eighteen (18) months
following the date hereof, pay, or at the Company's option, reimburse the
Consultant for the Consultant's portion of COBRA payments (the "COBRA
Payments").
(c) The Company shall during the Term, at its own cost and
expense, continue to pay the premiums on the present term life insurance policy
on the life of the Consultant with a death benefit in the amount of $316,589,
payable to such beneficiary or beneficiaries as the Consultant may designate. In
the event the present term life insurance is terminated, and such termination is
due to a default by the Company under such policy or is otherwise the fault of
the Company, the Company shall obtain an equivalent life insurance policy and
maintain such life insurance policy for the period required herein. In the event
the present term life insurance is terminated, and such termination is not the
result of any action or inaction by the Company, the Company shall purchase such
term life insurance as shall be available at a cost equivalent to the premium
being paid for the present term life insurance, and maintain the same for the
period required herein.
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(d) Except during the period commencing on the date hereof and
ending on the Full-Time Date, during which the Company shall only be obligated
to, at the Company's option, pay directly or reimburse Consultant for all
reasonable and necessary expenses and disbursement incurred by the Consultant
that are approved in writing in advance by the Chief Financial Officer of the
Company, including, without limitation, such expenses and disbursements for
food, lodging and transportation on such occasions as he is required to perform
any of his duties under this Agreement away from the Company's facilities in
Greenlawn, New York and from his primary place of residence, during the Term
hereof (unless this Agreement is sooner terminated) the Company shall, at the
Company's option, pay directly or reimburse the Consultant for all reasonable
and necessary expenses and disbursements incurred by the Consultant that are
approved in writing in advance by the Chief Financial Officer of the Company,
including, without limitation, such expenses and disbursements for food, lodging
and transportation, on such occasions as he is required to perform any of his
duties under this Agreement away from his primary place of residence. For such
purposes, the Consultant shall submit to the Company, within thirty (30) days
after such expenses are incurred, reports of such expenses and other
disbursements.
(e) If this Agreement is terminated by the Company pursuant to
Section 2(b) hereof, then the Company shall continue (i) to pay to the
Consultant in the manner provided herein, all fees provided in Section 3(a) for
the remainder of the three (3) year period of the Term, (ii) to provide the
benefits set forth in Section 3(b) hereof as contemplated by such Section, and
(iii) to provide the life insurance set forth in Section 3(c) for the remainder
of the three (3) year period of the Term, subject to the death of the
Consultant.
(f) If this Agreement is terminated by the Company pursuant to
Section 2(c) hereof, then all fees provided in Section 3(a) shall cease but the
Company shall continue (i) to provide the benefits set forth in Section 3(b)
hereof as contemplated by such Section and (ii) to provide the life insurance
set forth in Section 3(c) for the remainder of the three (3) year period of the
Term, subject to the death of the Consultant.
(g) If this Agreement is terminated by the Company pursuant to
Section 2(d) hereof, then, effective as of the date on which this Agreement
shall terminate, all payments under Section 3(a) and all benefits under Sections
3(b) and (c) shall terminate.
(h) If this Agreement shall terminate pursuant to Section 2(e)
hereof, then, effective as of the last day of the month in which the date of
termination shall occur, all fees provided in Section 3(a) shall cease but all
benefits under Section 3(b) shall be provided as contemplated by such Section to
the Consultant's spouse. In addition, if this Agreement shall terminate pursuant
to Section 2(b) or (c) and the Consultant shall thereafter die, then all
benefits pursuant to Section 3(b) shall continue to be provided as contemplated
by such Section to the Consultant's spouse.
(i) Notwithstanding anything contained herein, if this
Agreement is terminated by the Consultant pursuant to Section 2(f) hereof, then,
as of the date of termination contemplated
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by such Section, all fees provided for in Section 3(a) shall cease and all
benefits provided for in Section 3(b) and 3(c) shall cease.
4. Independent Contractor.
The relationship created hereunder is that of the Consultant
acting as an independent contractor. It is expressly acknowledged and agreed
that the Consultant shall have no authority to bind the Company (which term as
used herein and hereinafter shall be deemed to include the Company and its
subsidiaries) to any agreement or obligation with any third party. Consultant
shall be responsible for any and all withholding or other taxes payable to any
governmental authority relating to said services, and Consultant hereby agrees
to indemnify and hold the Company harmless from any obligations with respect to
same; accordingly, amounts payable pursuant to Section 3 (a) hereof shall be
paid without deduction for withholding or other taxes.
5. Non-Disclosure of Confidential Information; Restrictive
Covenants.
(a) (i) The Consultant acknowledges and agrees that it is the
policy of the Company to maintain as secret and confidential all valuable
information, not otherwise available to the general public, heretofore or
hereafter acquired, developed or used by the Company relating to its business,
operations, employees and customers which may give the Company a competitive
advantage in its industry (all such information is hereinafter referred to as
"Confidential Information"). The parties recognize that, by reason of his past
and contemplated duties, the Consultant has acquired and may continue to acquire
Confidential Information. The Consultant recognizes that all such Confidential
Information is the property of the Company and is of great value to the Company.
Excluded from the term Confidential Information is information which is or
becomes generally available to the public other than as a result of a disclosure
by the Consultant or breach of an agreement of confidence. In consideration of
the Company's entering into this Agreement, the Consultant agrees that:
(A) he shall never, directly or indirectly, use, publish, disseminate
or otherwise disclose any Confidential Information obtained during his
previous employment or during his contemplated engagement by the Company
pursuant hereto, without the prior written consent of the Company's Board
of Directors; and
(B) during the term of his engagement by the Company pursuant hereto,
he shall exercise all due and diligent precautions to protect the integrity
of any of the Company's documents embodying Confidential Information and,
upon termination of his engagement, he shall return all such documents (and
copies thereof) in his possession or control.
(ii) In the event that the Consultant is requested or required
(by oral questions, interrogatories, requests for information or
document, subpoena or similar processes) by a court of competent
jurisdiction or by a government agency to disclose any of the
Confidential Information, it is agreed that the Consultant will (i)
promptly notify the Company in writing of the existence, terms and
circumstances surrounding any such request and cooperate with the
Company
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so that the Company may, in addition to any other rights or remedies it may
have, seek an appropriate protective order; and (ii) consult with the Company on
the advisability of taking steps to resist or narrow the request. If, in the
absence of a protective order or the receipt of a waiver hereunder, the
Consultant is nonetheless, in the opinion of counsel, reasonably acceptable to
the Company, legally required to disclose the Confidential Information, the
Consultant shall furnish only that portion of the Confidential Information as
the Consultant is advised by such legal counsel is legally required to be
disclosed in order to prevent the Consultant from being held liable for contempt
or other censure or penalty.
(b) The services of the Consultant are unique and extraordinary and
essential to the business of the Company, especially since the Consultant has
had and may in the future have access to the Company's customer lists, trade
secrets and other privileged and Confidential Information essential to the
Company's business. Therefore, the Consultant agrees that, unless the Company is
in breach of its obligations under Section 3 of this Agreement which breach is
not remedied by the Company within thirty (30) days of the Company's receipt of
written notice thereof from the Consultant, for a period of four (4) years from
the date of this Agreement (and regardless of any termination or expiration of
this Agreement), the Consultant will not at any time, without the prior written
approval of the Company, directly or indirectly, anywhere throughout the world,
whether individually or as a principal, officer, employee, partner, director,
shareholder, member, manager, agent of or consultant for any entity, except as
expressly provided below, (i) engage or participate in a business which is
similar to or competitive with, directly or indirectly, that of the Company, and
shall not make any investments in any such similar or competitive entity (except
that the foregoing shall not prohibit the Consultant from acquiring up to two
(2%) percent of the outstanding capital stock of any such entity if the
securities of such entity are listed on a national securities exchange or quoted
on the Nasdaq system); (ii) except for Robert Kramer, cause or seek to persuade
any director, officer, employee, customer, account, agent or supplier of the
Company to discontinue the status, employment or relationship of such person or
entity with the Company, or (including, without limitation, Robert Kramer) to
become employed in any activity similar to or competitive with the activities of
the Company; (iii) cause or seek to persuade any prospective customer or account
of the Company (which during the Term was actively being solicited by the
Company) to determine not to enter into a business relationship with Company;
(iv) except for Robert Kramer, hire or retain any director, officer or employee
of the Company; or (v) solicit or cause or authorize to be solicited, for or on
behalf of himself or any third party, any business which is competitive,
directly or indirectly, with the Company from (a) others who are, or were within
one (l) year prior to the date of the expiration of the Term, customers or
accounts of the Company, or (b) any prospective customer or account of the
Company which at the date of such expiration was then actively being solicited
by the Company.
(c) Notwithstanding the foregoing, the Consultant shall not be deemed to be
in breach of any of the foregoing provisions of Section 5(b) hereof:
(i) by engaging in the design, manufacturing, promotion and/or sale
(even to customers of the Company) of data communications products which
exclusively employ wireless communications as the transmission medium for
transmitting information bearing
7
<PAGE>
signals between two or more communications products; and/or
(ii) by engaging in the design, manufacturing, promotion and/or sale
(even to customers of the Company) of data communications products which
employ plastic fiber optic cables (where both core and cladding is plastic)
as the transmission medium for transmitting information bearing signals
between two or more communications products; provided (A) such products do
not provide "acceptable" performance when used with glass fiber optic
cables as the transmission medium for transmitting information bearing
signals between two or more communications products, (B) such products are
manufactured from designs which conform to the restrictions on designs,
stated above, with regards to performance on glass fiber optic cables as
the transmission medium for transmitting information bearing signals
between two or more communications products, (C) such products are not
promoted as devices to be used with glass fiber optic cables as the
transmission medium for transmitting information bearing signals between
two or more communications products, and (D) such products are not sold to
any customer on the basis that the Consultant has communicated to the
customer, in any oral, verbal, written or other manner, that the products
can be used with glass fiber optic cables as the transmission medium for
transmitting information bearing signals between two or more communications
products.
(iii) For purposes of Section 5(c)(ii) hereof the term "acceptable"
shall mean that the device is capable of the delivery of data over a length
of 500 meters or more of multimode 62.5/125 glass fiber optic cables
transmission medium at a Bit Error Rate of 1 bit in 1,000,000 or less (Bit
Error Rate being measured by the transmission of pseudorandom data known as
the "511" test without the benefit of forward error correcting coding).
(iv) It is understood that if the Consultant is in compliance with the
above, then the Consultant will not be held responsible by the Company for
the use by any customer of such products with glass fiber optic cables as
the transmission medium for transmitting information bearing signals
between two or more communications products; provided that the Consultant
does not give post-sale support to enable the customer to use such products
with glass fiber optic cables as the transmission medium for transmitting
information bearing signals between two or more communications products.
(v) For purposes of Section 5(c)(iv) hereof, the term "post-sale
support" shall mean any oral, verbal, written communications or assistance
in any manner rendered by the Consultant to the customer.
(d) The Consultant agrees to promptly disclose in writing to
the Board of Directors of the Company all ideas, processes, methods, devices,
business concepts, inventions, improvements, discoveries, know-how and other
creative achievements (hereinafter referred to collectively as "discoveries"),
whether or not the same or any part thereof is capable of being patented,
trademarked, copyrighted, or otherwise protected, which the Consultant during
the Term conceives, makes, develops, acquires or reduces to practice, whether
acting alone or with others and which are used by the Company, or arise out of
or in connection with the services rendered by the Consultant pursuant to the
terms hereof. The Consultant hereby transfers and assigns to the
8
<PAGE>
Company all right, title, and interest in and to such discoveries (whether
conceived, made, developed, acquired or reduced to practice on or prior to the
date hereof or hereafter), including any and all domestic and foreign copyrights
and patent and trademark rights therein and any renewals thereof. On request of
the Company, the Consultant will, without any additional compensation, from time
to time during, and after the expiration or termination of, the Term, execute
such further instruments (including, without limitation, applications for
copyrights, letters patent, trademarks and assignments thereof) and do all such
other acts and things as may be deemed necessary or desirable by the Company to
protect and/or enforce its rights in respect of such discoveries. All expenses
of filing or prosecuting any patent, trademark or copyright application shall be
borne by the Company, but the Consultant shall cooperate in filing and/or
prosecuting any such application.
(e) The provisions of this Section 5 shall survive the
expiration or termination of this Agreement.
6. Specific Performance; Injunctive Relief.
If the Consultant commits a breach of any of the provisions of
Section 5, the Company shall have the right and remedy to have the provisions of
this Agreement specifically enforced by any court of competent jurisdiction, it
being acknowledged and agreed to by the Consultant that any such breach will
cause irreparable injury to the Company and that money damages will not provide
an adequate remedy to the Company. Such right and remedy shall be in addition
to, and not in lieu of, any other rights and remedies available to the Company
at law or in equity, including temporary and/or permanent injunctive or
mandatory relief.
7. Notices.
Except as specifically otherwise provided herein, any notice,
request, instruction or other document to be given under this Agreement shall be
in writing and delivered personally, or sent by facsimile transmission,
overnight courier or registered or certified mail, postage prepaid, addressed to
the Company at the address set forth above, Attention: President (with a copy to
Certilman Balin Adler & Hyman, LLP, 90 Merrick Avenue, East Meadow, New York
11554, Attention: Steven J. Kuperschmid, Esq., Telecopier Number (516)
296-7111), and to the Consultant at the address set forth above (with a copy to
Rivkin Radler & Kremer, EAB Plaza, Uniondale, New York 11556, Attention: Barry
R. Shapiro, Esq., Telecopier Number (516) 357-3333) or to such other address as
either party may hereafter designate in writing to the other party in accordance
with the provisions hereof. Notices shall be deemed to have been given on the
date of mailing, transmission or delivery to an overnight courier, except
notices of change of address, which shall be deemed to have been given when
received.
9
<PAGE>
8. Assignment; Benefit.
The rights and obligations set forth in this Agreement shall
not be assigned or delegated without the written consent of the other party.
This Agreement shall be binding upon and shall inure to the benefit of the
Company and the Consultant and their respective successors and permitted
assigns.
9. Right of Offset.
Notwithstanding any and all other rights that the Company may
have against any other person, firm or corporation, the Company shall have the
right to setoff the unpaid amount of any claim it may have against the
Consultant against any amounts owed by it (but not against payments for benefits
under Section 3(b) or 3(c)) under this Agreement, the Stock Purchase Agreement
and/or the Related Documents. Further, pending final determination of any
claims, demands or disputes, the Company shall have the right to withhold from
any amounts due pursuant to this Agreement, the Stock Purchase Agreement and/or
Related Documents, the amount of such claims, demands and/or disputes.
10. Amendment and Entire Agreement.
This Agreement contains the entire understanding between the
Company and the Consultant with respect to the subject matter hereof and can be
modified only by an instrument in writing, signed by the party against whom the
enforcement of any modification is sought.
11. Severability.
In the event of the invalidity or unenforceability of any one
or more provisions of this Agreement, such invalidity or unenforceability shall
not affect the validity or enforceability of the other provisions hereof and
such other provisions shall be deemed to remain in full force and effect.
12. Governing Law.
This Agreement shall be construed and governed in accordance
with the laws of the State of New York, excluding the choice of law principles
thereof.
13. Jurisdiction and Venue.
(a) In the event that the courts of any one or more
jurisdiction, county, province or governmental entity etc. (collectively
"Jurisdictions") shall hold such covenants wholly unenforceable by reason of the
breadth of their scope or otherwise, it is the intention of the parties hereto
that such determination not bar or in any way affect the Company's right to the
relief provided above in the courts of any other jurisdiction as to breaches of
such covenants as they relate to each Jurisdiction being, for this purpose,
severable into diverse and independent covenants.
10
<PAGE>
(b) The Consultant hereby irrevocably consents and submits to
the jurisdiction of all federal and state courts within the State of New York in
connection with any matter relating to this Agreement. Except as otherwise
provided in Section 13(a), the Company and the Consultant hereby agree that any
claim or suit between them involving this Agreement shall be brought in and
decided by the State or federal courts located in either Nassau or Suffolk
County, New York, and the Consultant hereby irrevocably waives, to the fullest
extent possible, the defense of forum non conveniens in the maintenance of any
such claim or suit brought in any such jurisdiction.
l4. Execution in Counterparts.
This Agreement may be executed in counterparts, each of which
shall be deemed to be an original, but both of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the day and year first above written.
TELEBYTE TECHNOLOGY, INC.
By: /s/ Kenneth S. Schneider
-------------------------------
Name: Kenneth S. Schneider
(Please print)
Title: Senior Vice President
/s/ Joel A. Kramer
-------------------------------
Joel A. Kramer, Individually
Exhibit 10.3
TELEBYTE TECHNOLOGY, INC.
270 Pulaski Road
Greenlawn, New York 11740
January 20, 1999
Mr. Joel Kramer
4 Sycamore Drive
Woodbury, New York 11797
Re: Termination Agreement
Dear Joel:
This agreement (this "Termination Agreement") shall confirm the
understanding between Telebyte Technology, Inc. (the "Company") and Joel A.
Kramer (the "Employee") with respect to the termination of the Employee's
employment with the Company. Both the Company and the Employee acknowledge and
agree that all rights and obligations of the parties hereunder shall be governed
by and subject to the following terms and conditions. This Termination Agreement
is being executed and delivered by the Employee pursuant to the terms of that
certain Stock Purchase Agreement dated January 20, 1999 by and between the
Company and the Employee (the "Stock Purchase Agreement").
<PAGE>
1. Employment Termination. (a) The parties acknowledge and agree that,
effective immediately (the "Termination Date"), the Employee's employment with
the Company is hereby terminated in all capacities whatsoever. Accordingly,
those agreements more fully described on Schedule 1 attached hereto and made a
part hereof (collectively, the "Employment Agreements"), and any and all
obligations of the Company to the Employee or for the Employee's benefit
incurred prior to the date hereof, are hereby terminated and of no further force
or effect, and neither the Employee nor the Company shall have any further
liability or obligation thereunder. Without limiting the generality of the
foregoing, the parties acknowledge and agree that the foregoing does not affect
that certain Consulting Agreement of even date between the Company and the
Employee (the "Consulting Agreement). Notwithstanding the foregoing, the Company
is not, in any respect, released by the Employee for any liability or obligation
to the Employee arising out of (i) any right of the Employee pursuant to the
Company's By-Laws, Certificate of Incorporation or law, to be indemnified for
his conduct as an officer, director or employee of the Company, (ii) any claim
of the Employee arising out of the Employee's enforcement of his rights under
the Stock Purchase Agreement, Consulting Agreement, this Termination Agreement
and/or Agreement and Release contemplated to be entered into pursuant to the
Stock Purchase Agreement, or (iii) any benefit plan maintained by the Company
for its employees generally pursuant to which the Employee accrued benefits
prior to the date of the Consulting Agreement. Notwithstanding the foregoing,
the Employee is not released by theCompany for any liability or obligation to
the Company arising out of the Stock Purchase Agreement, the Consulting
Agreement, this Termination Agreement and/or Agreement and Release
<PAGE>
(b) Upon the execution of this Termination Agreement, the
Company will transfer ownership of deferred compensation insurance policy to the
Employee, free and clear of all liens and encumbrances, and the Employee shall
assume, and hereby does assume, all obligations arising from or in connection
with such policy accruing and/or payable on and after the date hereof.
2. Resignation. By executing this Termination Agreement, effective
immediately, the Employee voluntarily and irrevocably resigns from all
capacities and positions with the Company, including but not limited to the
office of President and as a Director. The Employee understands and agrees that,
from and after the date hereof, except as expressly provided herein, the Company
shall have no obligation to the Employee, whether for compensation, payments,
benefits or otherwise, arising under or relating to the Employee's employment
with the Company, the termination thereof, the Employment Agreements, or
otherwise.
3. Accrued Vacation. Expense Reimbursement. The Employee acknowledges and
agrees that the Employee has been paid for all accrued vacation time through the
Termination Date and has been reimbursed for all costs and expenses that the
Employee incurred at any time on behalf of the Company.
4. Release Agreement. The Employee acknowledges that the Employee has, at
least seven (7) days prior to the date hereof, executed and delivered to the
Company an Agreement and Release (the "Release Agreement"). The Employee hereby
acknowledges and confirms the representations, covenants and agreements made by
the Employee in the Release Agreement, which Release Agreement is incorporated
herein by reference in its entirety.
5. Return of Property. Concurrently with the execution of this Termination
Agreement, the Employee is returning (or has returned) to the Company all
Company Property, as such term is defined in the Stock Purchase Agreement, in
the Employee's possession. The Employee acknowledges and agrees that the
Employee will be responsible for promptly reimbursing the Company for any
charges and expenses that were not directly related to the Company's business
and which were incurred by the Employee during the fifteen (15) days prior to
the date hereof arising out of the use of any of the aforementioned property and
which are discovered by the Company after the date hereof.
6. Confidential Information. (a) (i) The Employee acknowledges and agrees
that it is the policy of the Company to maintain as secret and confidential all
valuable information, not otherwise available to the general public, heretofore
or hereafter acquired, developed or used by the Company relating to its
business, operations, employees and customers which may give the Company a
competitive advantage in its industry (all such information is referred to
herein as "Confidential Information"). Excluded from the term Confidential
Information is information which
<PAGE>
is or becomes generally available to the public other than as a result of a
disclosure by the Employee or breach of an agreement of confidence. The Employee
recognizes that, by reason of the Employee's employment with the Company, the
Employee has acquired Confidential Information. The Employee further
acknowledges that such Confidential Information is the property of the Company
and is of great value to the Company. The Employee confirms that it is necessary
to protect the Company's goodwill, and, accordingly, hereby agrees that the
Employee will not, directly or indirectly, at any time, use, publish,
disseminate or otherwise disclose any Confidential Information. In furtherance
of the foregoing, the Employee expressly waives and renounces any claims, and
hereby assigns and transfers to the Company, free and clear of any and all liens
or encumbrances, any and all of the Employee's right, title and interest, if
any, in and to any and all Confidential Information, and the Employee hereby
represents and warrants to the Company that the Employee has full legal right
and capacity to effectuate such assignment and transfer.
(ii) In the event that the Employee is requested or required (by oral
questions, interrogatories, requests for information or document, subpoena or
similar processes) by a court of competent jurisdiction or by a government
agency to disclose any of the Confidential Information, it is agreed that the
Employee will (i) promptly notify the Company in writing of the existence, terms
and circumstances surrounding any such request and cooperate with the Company so
that the Company may, in addition to any other rights or remedies it may have,
seek an appropriate protective order; and (ii) consult with the Company on the
advisability of taking steps to resist or narrow the request. If, in the absence
of a protective order or the receipt of a waiver hereunder, the Employee is
nonetheless, in the opinion of counsel, reasonably acceptable to the Company,
legally required to disclose the Confidential Information, the Employee shall
furnish only that portion of the Confidential Information as the Employee is
advised by such legal counsel is legally required to be disclosed in order to
prevent the Employee from being held liable for contempt or other censure or
penalty.
(b) The Employee acknowledges and agrees further that the
terms and conditions of this Termination Agreement constitute Confidential
Information, and, therefore, the Employee shall not disclose any of such terms
and conditions to any third party absent the prior written consent of the
Company [except with regard to the Employee's spouse, immediate family or
professional advisors (who the Employee shall advise of this agreement of
confidence and who, prior to any such disclosure, shall agree to be bound by the
terms hereof)]; provided, however, that the foregoing shall not restrict the
Employee from advising any future employer of the Employee that the Employee is
subject to certain restrictive covenants as set forth in Paragraph 7 hereof.
<PAGE>
7. Restrictive Covenants. (a) Unless the Company is in breach of its
obligations under Section 3 of the Consulting Agreement which breach is not
remedied by the Company within thirty (30) days of the Company's receipt of
written notice thereof from the Employee hereunder, during the four (4) year
period commencing with the date hereof, the Employee will not at any time,
without the prior written approval of the Company, directly or indirectly,
anywhere throughout the world, whether individually or as a principal, officer,
employee, partner, director, shareholder, member, manager, agent of or
consultant for any entity, except as expressly provided below (i) engage or
participate in a business which is similar to or competitive with, directly or
indirectly, that of the Company, and shall not make any investments in any such
similar or competitive entity (except that the foregoing shall not prohibit the
Employee from acquiring up to two (2%) percent of the outstanding capital stock
of any such entity if the securities of such entity are listed on a national
securities exchange or quoted on the Nasdaq system); (ii) except for Robert
Kramer, cause or seek to persuade any director, officer, employee, customer,
account, agent or supplier of the Company to discontinue the status, employment
or relationship of such person or entity with the Company, or (including,
without limitation, Robert Kramer) to become employed in any activity similar to
or competitive with the activities of the Company; (iii) cause or seek to
persuade any prospective customer or account of the Company (which during the
year prior to the date hereof was actively being solicited by the Company) to
determine not to enter into a business relationship with Company; (iv) except
for Robert Kramer, hire or retain any director, officer or employee of the
Company; or (v) solicit or cause or authorize to be solicited, for or on behalf
of himself or any third party, any business which is competitive, directly or
indirectly, with the Company from (a) others who are, or were within one (l)
year prior to the date hereof, customers or accounts of the Company, or (b) any
prospective customer or account of the Company which was then actively being
solicited by the Company.
(b) Notwithstanding the foregoing, the Employee shall not be
deemed to be in breach of any of the foregoing provisions of Section 7(a)
hereof:
<PAGE>
(i) by engaging in the design, manufacturing, promotion and/or sale
(even to customers of the Company) of data communications products
which exclusively employ wireless communications as the transmission
medium for transmitting information bearing signals between two or
more communications products; and/or
(ii) by engaging in the design, manufacturing, promotion and/or sale
(even to customers of the Company) of data communications products
which employ plastic fiber optic cables (where both core and cladding
is plastic) as the transmission medium for transmitting information
bearing signals between two or more communications products; provided
(A) such products do not provide "acceptable" performance when used
with glass fiber optic cables as the transmission medium for
transmitting information bearing signals between two or more
communications products, (B) such products are manufactured from
designs which conform to the restrictions on designs, stated above,
with regards to performance on glass fiber optic cables as the
transmission medium for transmitting information bearing signals
between two or more communications products, (C) such products are not
promoted as devices to be used with glass fiber optic cables as the
transmission medium for transmitting information bearing signals
between two or more communications products, and (D) such products are
not sold to any customer on the basis that the Employee has
communicated to the customer, in any oral, verbal, written or other
manner, that the products can be used with glass fiber optic cables as
the transmission medium for transmitting information bearing signals
between two or more communications products.
(iii) For purposes of Section 7(b)(ii) hereof the term "acceptable"
shall mean that the device is capable of the delivery of data over a
length of 500 meters or more of multimode 62.5/125 glass fiber optic
cables transmission medium at a Bit Error Rate of 1 bit in
<PAGE>
1,000,000 or less (Bit Error Rate being measured by the transmission
of pseudorandom data known as the "511" test without the benefit of
forward error correcting coding).
(iv) It is understood that, if the Employee is in compliance with the
above, then the Employee will not be held responsible by the Company
for the use by any customer of such products with glass fiber optic
cables as the transmission medium for transmitting information bearing
signals between two or more communications products; provided that the
Employee does not give post-sale support to enable the customer to use
such products with glass fiber optic cables as the transmission medium
for transmitting information bearing signals between two or more
communications products.
(v) For purposes of Section 7(b)(iv) hereof, the term "post-sale
support" shall mean any oral, verbal, written communications or
assistance in any manner rendered by the Employee to the customer.
<PAGE>
8. Nondisparagement. The Company and the Employee, respectively, agree that
neither shall make any statement, written or oral, to any officer, director,
employee, consultant, agent, independent contractor, client, or potential client
or customer of the other, or other person or entity, or otherwise in general to
the public or business community, or take any action, directly or indirectly,
that disparages or is likely to diminish the reputation of the other, or with
respect to the Company, any officer, director, employee, consultant, agent or
independent contractor of the Company, or which would adversely affect (i) the
ability of any of the foregoing to obtain financing or otherwise enter into or
consummate any business transaction, or (ii) the goodwill, business or
reputation of any of the foregoing.
9. Governing Law. This Termination Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without
reference to its conflicts of law rules or principles.
10. Jurisdiction and Venue.
(a) In the event that the courts of any one or more jurisdiction,
county,province or governmental entity etc. (collectively "Jurisdictions") shall
hold such covenants wholly unenforceable by reason of the breadth of their scope
or otherwise, it is the intention of the parties hereto that such determination
not bar or in any way affect the Company's right to the relief provided above in
the courts of any other jurisdiction as to breaches of such covenants as they
relate to each Jurisdiction being, for this purpose, severable into diverse and
independent covenants.
(b) The Employee hereby irrevocably consents and submits to
the jurisdiction of all federal and state courts within the State of New York in
connection with any matter relating to this Termination Agreement. Except as
otherwise provided in Section 10(a), the Company and the Employee hereby agree
that any claim or suit between them involving this Termination Agreement shall
be brought in and decided by the State or federal courts located in either
Nassau or Suffolk County, New York, and the Employee hereby irrevocably waives,
to the fullest extent possible, the
<PAGE>
defense of forum non conveniens in the maintenance of any such claim or suit
brought in any such jurisdiction.
11. Entire Agreement. This Termination Agreement contains the full and
complete understanding and agreement of the parties hereto with respect to the
subject matter contained herein and supersedes all prior or contemporaneous
written or oral understandings or agreements with respect to the subject matter
hereof. No modification of this Termination Agreement shall be binding unless
made in writing and signed by the party hereto sought to be charged.
12. Binding Effect. This Termination Agreement shall be binding upon, and
shall inure to the benefit of, the parties hereto and their respective
successors, assigns and legal representatives.
13. Equitable Relief; Breach. The Employee acknowledges and agrees that, in
the event the Employee shall violate or threaten to violate any of the
restrictions of Paragraphs 6, 7 or 8 hereof, the Company will be without an
adequate remedy at law and will therefore be entitled to enforce such
restrictions by temporary or permanent injunctive or mandatory relief in any
court of competent jurisdiction without the necessity of proving damages and
without prejudice to any other remedies which it may have at law or in equity,
it being understood that such remedy shall be in addition to any other remedies
which the Company may have at law or in equity.
14. Waiver; Severability. The waiver by either party of a breach of any
provision of this Termination Agreement shall not operate or be construed as a
waiver of any subsequent breach. If any provision, or part thereof, of this
Termination Agreement shall be held to be invalid or unenforceable, such
invalidity or unenforceability shall attach only to such provision and not in
any way affect or render invalid or unenforceable any other provisions of this
Termination Agreement, and this Termination Agreement shall be carried out as if
such invalid or unenforceable provision, or part thereof, had been reformed, and
any court of competent jurisdiction is authorized to so reform such invalid or
unenforceable provision, so that it would be valid, legal and enforceable to the
fullest extent permitted by applicable law.
15. Notices; Deliveries. Any notice, delivery or other communication
required or permitted hereunder shall be sufficiently given if delivered by hand
or sent by certified mail, return receipt requested, facsimile transmission or
overnight mail or nationally recognized overnight courier, addressed as follows:
If to the Company:
270 Pulaski Road
Greenlawn, New York 11740
Attention: President
Telecopier Number: (516) 385-8184
<PAGE>
with a copy to:
Certilman Balin Adler & Hyman, LLP
90 Merrick Avenue
East Meadow, New York 11554
Attention: Steven J. Kuperschmid, Esq.
Telecopier Number: (516) 296-7111
If to the Employee:
4 Sycamore Drive
Woodbury, New York 11797
Telecopier Number: (516) 367-7296
with a copy to:
Rivkin Radler & Kremer
EAB Plaza
Uniondale, New York 11556-0111
Attention: Barry R. Shapiro, Esq.
Telecopier Number: (516) 357-3333
or such other address as shall be furnished in writing by either such party, and
any notice, delivery or communication given pursuant to the provisions hereof
shall be deemed to have been given as of the date delivered or so mailed or
transmitted.
16. Counterparts; Headings. This Termination Agreement may be executed in
counterparts, each of which shall be an original, but all of which taken
together shall constitute one agreement. The headings contained in this
Termination Agreement are solely for the convenience of the parties, and are not
intended to and do not limit, construe or modify any of the terms and conditions
hereof.
17. Legal Counsel. The Employee acknowledges and agrees that the Employee
has been given an opportunity and has been encouraged by the Company to have
counsel of the Employee's choice review this Termination Agreement, and that the
Employee has read and understands this Termination Agreement and has signed it
freely and voluntarily.
<PAGE>
If this Termination Agreement correctly sets forth our agreement with
respect to the subject matter contained herein, please so indicate by signing
where indicated below and returning it to the Company at the address set forth
above.
Very truly yours,
TELEBYTE TECHNOLOGY, INC.
By:/s/ Kenneth S. Schneider
--------------------------
Kenneth Schneider, Vice-President
ACKNOWLEDGED AND AGREED:
/s/ Joel A. Kramer
- ----------------------------
Joel A. Kramer, Individually
<PAGE>
Exhibit 10.4
AGREEMENT AND RELEASE (this "Agreement") made and entered into by and
between Telebyte Technology, Inc., a Nevada corporation (the "Company"), and
Joel A. Kramer ("Employee").
IT IS HEREBY AGREED THAT:
1. In consideration of the Company executing and delivering to the
Employee that certain Stock Purchase Agreement contemplated to be executed and
delivered by the Company and Employee and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged by the Employee,
Employee hereby releases and forever discharges the Company, its parent,
subsidiaries, affiliates, related companies, controlling shareholders,
directors, officers, employees, agents, attorneys, successors, and assigns
(collectively, the "Releasees") from all liabilities, causes of action, suits,
claims, damages and demands whatsoever, whether known or unknown, at law or in
equity, whether statutory or common law, whether federal, state, local, or
otherwise, related to, or arising out of, any aspect of his employment with the
Company, or the termination of such employment, including, but not limited to,
any claims of employment discrimination on any basis which he (including his
heirs, executors, administrators, successors, and assigns) has asserted or could
have asserted to the date of his execution of this Agreement. Notwithstanding
the forgoing, the Company is not in any respect released by the Employee for any
liability or obligation to the Employee arising out of (i) any right of the
Employee pursuant to the Company's By-Laws, Certificate of Incorporation or law
to be indemnified for his conduct as an officer, director or employee of the
Company, or (ii) any claim of the Employee arising out of the Employee's
enforcement of his rights under the Stock Purchase Agreement or the Consulting
Agreement or Termination Agreement contemplated to be entered into pursuant to
the Stock Purchase Agreement, or (iii) any benefit plan maintained by the
Company for its employees generally pursuant to which Employee accrued benefits
prior to the date of the Consulting Agreement.
2. Employee understands that once this Agreement becomes effective, he
waives and releases, to the extent consistent with applicable law, any rights or
claims he may have under the numerous laws and regulations regulating
employment, whether federal, state, local or otherwise, including, but not
limited to, the Age Discrimination in Employment Act of 1967, as amended, Title
VII of the Civil Rights Act of 1964, as amended, the Americans with Disabilities
Act, Section 1981 (42 U.S.C. ss. 1981) of the Civil Rights Act of 1966, the Fair
Labor Standards Act, the Equal Pay Act, the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), the Family and Medical Leave Act, and the New
York State Human Rights Law.
3. This Agreement shall not in any way be construed as an admission by
the Releasees of any liability, or of any wrongful, discriminatory, or unlawful
acts whatsoever against Employee or any other person, and the Releasees
specifically disclaims any liability to or wrongful, discriminatory, or unlawful
acts against Employee or any other person, on the part of the Releasees.
4. Except for the purpose of seeking enforcement of the terms of this
Agreement,
<PAGE>
Employee agrees that to the extent consistent with applicable law, he will not
file or cause to have filed or instituted any civil action, complaint, charge or
other proceeding of any nature or description against the Releasees before any
judicial, administrative, arbitral or other forum based upon or arising out of
any claims, whether asserted or unasserted, that he may have as of the date of
this Agreement and which are the subject of this release. In addition, in the
event that such an action is brought, Employee expressly waives, to the extent
consistent with applicable law, any claim to any form of monetary or other
damages, or other form of recovery or relief, in connection with such action or
in connection with any action brought by a third party on his behalf.
5. Employee acknowledges that he has received a copy of this Agreement,
that the Company advised the Employee to consult an attorney regarding this
Agreement, and that he has done so, or declined to do so. Employee further
acknowledges that he has had no less than twenty-one (21) days in which to
consider, execute, and return this Agreement.
6. This Agreement will not become effective until seven (7) days after
the date Employee signs this Agreement below, and Employee may revoke this
Agreement within seven (7) days after the date this Agreement is signed by the
Employee, provided that such revocation is in writing signed and delivered to
the Company.
7. Employee further acknowledges, represents, and warrants that he has
carefully read this Agreement; that he fully understands the terms, conditions,
significance and consequences of this Agreement; and that the Employee has
executed this Agreement knowingly and voluntarily, and of his own free will.
TELEBYTE TECHNOLOGY, INC.
By: /s/ Kenneth S. Schneider Dated: January 20, 1999
-------------------------------------
Kenneth S. Schneider
/s/ Joel A. Kramer Dated: January 20, 1999
- -----------------------------------------
Joel A. Kramer, Individually
(Acknowledgment continued on following page)
2
<PAGE>
STATE OF )
) ss.:
COUNTY OF )
On ______________, 1999, before me, personally came,
_________________ to me known, and known to me to be the individual described
in, and who executed the foregoing Agreement and General Release, and duly
acknowledged to me that he executed same.
------------------------
Notary Public
STATE OF )
) ss:
COUNTY OF )
On_______________, 1999, before me personally came
_____________________ to me known, who, by me duly sworn, did depose and say
that deponent is the __________________ of Telebyte Technology, Inc. the
corporation described in, and which executed the forgoing Agreement and General
Release, and that deponent signed deponent's name by order of the Board of
Directors of such corporation.
--------------------------
Notary Public
3
<PAGE>
