Employment Agreement - CyberGuard Corp. and Patrick J. Clawson
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as
of January 18, 2001 by and between CyberGuard Corporation, a Florida corporation
(the "Company"), and Patrick J. Clawson (the "Employee").
WHEREAS, the Company, through its Board of Directors, desires to retain
the services of Employee, and Employee desires to be retained by the Company, on
the terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:
1. EMPLOYMENT. The Company hereby employs Employee, and Employee
hereby accepts employment, as President upon the terms of and subject to this
Agreement.
2. TERM. The term (the "Term") of this Agreement shall commence
on January 18, 2001, and shall continue until otherwise terminated in accordance
with the terms of this Agreement.
3. DUTIES. During his employment hereunder, Employee will serve
in such capacity and with such duties as shall be assigned from time to time by
the Chief Executive Officer of the Company. Employee shall diligently perform
his duties as President and shall devote the substantial portion of his business
time and effort to his employment with the Company and his duties hereunder.
During the Term, Employee shall not, directly or indirectly, alone or as a
member of a partnership, or as an officer, director, employee or agent of any
other person, firm or business organization engage in any other business
activities or pursuits requiring his personal service that materially conflict
with his duties hereunder or the diligent performance of such duties.
4. COMPENSATION.
a. SALARY. During his employment hereunder, Employee
shall be paid a salary of $150,000 per year, payable in equal
installments not less than monthly ("Base Salary"). The Employee's Base
Salary shall be reviewed at least annually by the Board of Directors or
any Committee of the Board delegated the authority to review executive
compensation.
b. OPTION AND BONUS. In addition to salary, Employee
shall be entitled to participate in the Company's Employee Stock Option
Plan ("Stock Option Plan"). In addition, Employee shall participate in
the management bonus program established by the Company with an initial
annual targeted bonus equal to 100% of Employee's Base Salary
(hereafter the "Management Bonus Program").
c. INSURANCE. During his employment hereunder, Employee
shall be entitled to participate in all such health, life, disability
and other insurance programs, if any, that
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the Company may offer to other key executive employees of the Company
from time to time.
d. OTHER BENEFITS. During his employment hereunder,
Employee shall be entitled to all such other benefits, if any, that the
Company may offer to other key executive employees of the Company from
time to time.
e. PAID-TIME-OFF. Employee shall be entitled to six
weeks' paid-time-off (in addition to holidays) in each calendar year
during the Term; however, Employee may take only two weeks'
paid-time-off leave within any calendar month. Except with respect to
paid-time-off time unused as the result of a request by the Company to
postpone the paid-time-off, any unused paid-time-off from one calendar
year shall not carry-over to any subsequent calendar year.
f. EXPENSE REIMBURSEMENT. Employee shall, upon
submission of appropriate supporting documentation, be entitled to
reimbursement of reasonable out-of-pocket expenses incurred in the
performance of his duties hereunder in accordance with policies
established by the Company. Such expenses shall include, without
limitation, reasonable entertainment expenses, gasoline and toll
expenses and cellular phone use charges, if such charges are directly
related to the business of the Company.
5. GROUNDS FOR TERMINATION. The Board of Directors of the Company
may terminate this Agreement for Cause. As used herein, "Cause" shall mean any
of the following: (i) an act of willful misconduct or gross negligence by
Employee in the performance of his material duties or obligations to the
Company; if such act is capable of cure, Employee shall be given written notice
and such act shall not be deemed a basis for Cause if cured within 60 days after
written notice is received by Employee specifying the alleged failure in
reasonable detail (and during such 60 day period, Employee shall continue to be
employed by the Company at full pay), or (ii) conviction of Employee of a felony
involving moral turpitude or (iii) a material act of dishonesty or breach of
trust on the part of Employee resulting or intended to result directly or
indirectly in personal gain or enrichment at the expense of the Company.
6. TERMINATION BY EMPLOYEE. Employee may terminate this Agreement
with Good Reason. In the event of termination by Employee for Good Reason,
Employee shall be entitled to the benefits of Paragraph 7b. of this Agreement.
"Good Reason" means:
a. The Company materially breaches the provisions of
this Agreement (except those set forth in Paragraph 4a.) and Employee
provides at least 15 days' prior written notice to the Company of the
existence of such breach and his intention to terminate this Agreement
(no such termination shall be effective if such breach is cured during
such period); or
b. The Company fails to comply with the provisions of
Paragraph 4a. or to pay any amounts due under the Management Bonus
Program provisions of Paragraph 4b. for an uninterrupted 10 day period;
or
c. The Company requires Employee to work in a
non-supervisory or non-management position; or
d. The Company decreases Employee's compensation (salary
or percentage of bonus opportunity); or
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e. The Company materially reduces Employee's welfare
benefits, including without limitation: paid vacation; paid sick time;
paid legal and float holidays; medical, dental and cancer insurance,
hospital indemnity, Flexible Spending, Short- and Long-term Disability
insurance, Basic Group Term Life/Accidental Death & Dismemberment
insurance, Supplemental Life/AD&D insurance, Spouse Life/Spouse AD&D
insurance, Dependent Life insurance, Vision Plan, 401k plan, Employee
Assistance Program; education reimbursement program (collectively, the
"Benefits"); provided, however, that any change in Benefits that is
made by the Company that applies to its employees generally, shall not
be considered as giving rise to "Good Reason"; or
f. The Employee is required, without his prior written
consent, to relocate his office more than seventy-five miles from the
office Employee currently reports to.
7. PAYMENT AND OTHER PROVISIONS UPON TERMINATION.
a. In the event Employee's employment with the Company
(including its subsidiaries) is terminated by the Company for Cause as
provided in Paragraph 5 then, on or before Employee's last day of
employment with the Company, the provisions of this Paragraph 7a. shall
apply. These same provisions shall apply if Employee terminates his
employment without Good Reason as described in Paragraph 6.
i. SALARY, PERFORMANCE AWARD, AND BONUS
PAYMENTS. The Company shall pay in a lump sum to Employee at
the time of Employee's termination such amount of compensation
due Employee for services rendered to the Company, as well as
compensation for unused vacation time and earned bonus, as has
accrued but remains unpaid. Any and all other rights granted
to Employee under this Agreement shall terminate as of the
date of termination.
ii. NON-COMPETITION/NON-SOLICITATION PERIOD. The
provisions of Paragraphs 14 and 15 shall, at the option of the
Company in its sole discretion, continue to apply with respect
to Employee for a period of up to six months following the
date of termination, so long as the Company: (x) provides a
written notice to Employee within 5 business days after
Employee's termination that the Company wishes to exercise its
right to require that Employee not compete and not solicit in
accordance with Paragraphs 14 and 15 hereof; and (y) Company
thereafter pays to Employee in periodic installments, without
interest, in accordance with the regular salary payment
practices of the Company an amount equal to (.1) the amount of
Employee's annual Base Salary as in effect immediately prior
to Employee's date of termination, multiplied by (.2) the
number of months that the Company is requiring the
non-competition and non-solicitation covenants to remain in
place, divided by 12. The first such installment of Base
Salary and target bonus shall be paid on or before the
delivery of the notice described in the prior sentence of this
Paragraph 7a(ii). The non-competition and non-solicitation
provisions of this Agreement shall no longer apply to Employee
if the Company fails to pay the amounts required under this
Section 7a(ii) for an uninterrupted 10-day period and such
failure is not cured with 5 days after written notice of such
failure is delivered to the Company.
b. In the event Employee's employment with the Company
(including its subsidiaries) is terminated by the Company for any
reason other than for Cause as
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provided in Paragraph 5 and other than as a consequence of Employee's
death, disability, or normal retirement under the Company's retirement
plans and practices, then the following provisions apply. These same
provisions shall apply if Employee terminates his employment with Good
Reason as described in Paragraph 6. In addition to the amounts stated
below, Employee shall be paid any other amounts by the Company to which
he is entitled.
i. SALARY, PERFORMANCE AWARD, AND BONUS
PAYMENTS. On or before Employee's last day of employment with
the Company, the Company shall pay in a lump sum to Employee
as compensation for services rendered to the Company a cash
amount equal to one-half the amount of Employee's annual Base
Salary and the greater of (x) one-half the target bonus under
the Management Bonus Program as in effect immediately prior to
his date of termination or (y) the amount of the bonus under
the Management Bonus Program to which he is entitled but which
remains unpaid. At the election of the Company, the cash
amount referred to in this Paragraph 7b.i. may be paid to
Employee in periodic installments, without interest, in
accordance with the regular salary payment practices of the
Company, with the first such installment to be paid on or
before Employee's last day of employment with the Company, and
no interest shall be paid with respect to any amount not paid
on the Employee's date of termination.
ii. VESTING OF OPTIONS AND RIGHTS.
Notwithstanding the vesting period provided for in the Stock
Option Plan and any related stock option agreements between
the Company and Employee for stock options ("options") and
stock appreciation rights ("rights") granted Employee by the
Company, all options and stock appreciation rights that were
exercisable at the date of termination or within 12 months
thereafter shall be immediately exercisable upon termination
of employment. In addition, Employee will have the right to
exercise all such options and rights for the shorter of (a)
six months following his termination of employment or (b) with
respect to each option, the remainder of the period of
exercisability under the terms of the appropriate documents
that grant such options.
iii. BENEFIT PLAN COVERAGE. The Company shall
maintain in full force and effect for Employee and his
dependents for six months after the date of termination, all
life, health, accident, and disability benefit plans and other
similar employee benefit plans, programs and arrangements in
which Employee or his dependents were entitled to participate
immediately prior to the date of termination, in such amounts
as were in effect immediately prior to the date of
termination, provided that such continued participation is
possible under the general terms and provisions of such
benefit plans, programs and arrangements.
In the event that participation in any benefit plan, program
or arrangement described above is barred, or any such benefit
plan, program or arrangement is discontinued or the benefits
thereunder materially reduced, the Company shall arrange to
provide Employee and his dependents for six months after the
date of termination with benefits substantially similar to
those that they were entitled to receive under such benefit
plans, programs and arrangements immediately prior to the date
of termination. Notwithstanding any time period for continued
benefits stated in this Paragraph 7b.iii., all benefits in
this Paragraph 7b.iii. will terminate on the date that
Employee becomes an employee of another employer and eligible
to participate in the employee benefit plans of such other
employer. To the extent that Employee was required to
contribute amounts for the benefits described in this
Paragraph 7b.iii. prior to his termination, he shall continue
to contribute such amounts for such time as these benefits
continue in effect after termination.
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iv. OTHER COMPENSATION. Any awards previously
made to Employee under any of the Company's compensation plans
or programs and not previously paid shall immediately vest on
the date of his termination and shall be paid on that date and
included as compensation in the year paid.
v. SAVINGS AND OTHER PLANS. Except as otherwise
more specifically provided herein or under the terms of the
respective plans relating to termination of employment,
Employee's active participation in any applicable savings,
retirement, profit sharing or supplemental employee retirement
plans or any deferred compensation or similar plan of the
Company or any of its subsidiaries shall continue only through
the last day of his employment. All other provisions,
including any distribution and/or vested rights under such
plans, shall be governed by the terms of those respective
plans.
vi. NON-COMPETITION/NON-SOLICITATION PERIOD. The
provisions of Paragraphs 14 and 15 shall continue, beyond the
time periods set forth in such paragraphs, to apply with
respect to Employee for six (6) months following the date of
termination. The non-competition and non-solicitation
provisions of this Agreement shall no longer apply to Employee
if the Company fails to pay the amounts required under the
provisions of Paragraph 7b.i. for an uninterrupted 10-day
period and such failure is not cured within 5 days after
written notice of such failure is delivered to the Company.
c. The provisions of this Paragraph 7 shall apply if
Employee's employment is terminated prior to or more than one year after the
occurrence of a Change of Control (as defined in Paragraph 8c.). From the
occurrence of any Change of Control until the first anniversary of such Change
of Control, the provisions of Paragraph 8 shall apply in place of this Paragraph
7, except that in the event that Employee's employment is terminated by Employee
after a Change of Control without Good Reason, then the provisions of Paragraph
8 shall not apply and the provisions of Paragraph 7a. shall apply. Termination
upon death, disability and retirement are covered by Paragraphs 9, 10, and 11,
respectively.
8. PAYMENT AND OTHER PROVISIONS AFTER CHANGE OF CONTROL.
a. SALARY, PERFORMANCE AWARD, AND BONUS PAYMENTS. In the
event Employee's employment with the Company is terminated within one
year following the occurrence of a Change of Control (other than as a
consequence of his death or disability, or of his normal retirement
under the Company's retirement plans and practices) either (i) by the
Company for any reason whatsoever or (ii) by Employee with Good Reason
as provided in Paragraph 6, then Employee shall be entitled to receive
from the Company, the following:
i. BASE SALARY. An amount equal to one-half the
Employee's annual Base Salary as in effect at the date of
termination shall be paid on the date of termination;
ii. TARGET BONUS. An amount equal to one-half
the Employee's target bonus under the Management Bonus Program
for the fiscal year in which the date of termination occurs
shall be paid on the date of termination; and
iii. OTHER BENEFITS. All benefits under
Paragraphs 7b.i, 7.b.ii., 7b.iii., 7b.iv. and 7b.v. shall be
extended to Employee as described in such paragraphs except
that all options and rights shall be immediately exercisable
and the period for exercise of
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options and rights described in the last sentence of Paragraph
7b.ii and benefit plan coverage as described in Paragraph
7.b.iii shall be one half year.
b. NON-COMPETITION/NON-SOLICITATION PERIOD. In the event
of a termination under the circumstances described in Paragraph 8a.,
the provisions of Paragraphs 14 and 15 shall be without force and
effect and shall not apply to Employee.
c. For purposes of this Agreement, the term "Change of
Control" shall mean:
i. The acquisition, other than from the
Company, by any individual, entity or group (within the
meaning of ss. 13(d)(3) or ss. 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) of
beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) (any of the foregoing
described in this Paragraph hereafter a "Person") of 30% or
more of either (a) the then outstanding shares of Capital
Stock of the Company (the "Outstanding Capital Stock") or (b)
the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the
election of directors (the "Voting Securities"), provided,
however, that any acquisition by (x) the Company or any of its
subsidiaries, or any employee benefit plan (or related trust)
sponsored or maintained by the Company or any of its
subsidiaries or (y) any Person that is eligible, pursuant to
Rule 13d-1(b) under the Exchange Act, to file a statement on
Schedule 13G with respect to its beneficial ownership of
Voting Securities, whether or not such Person shall have filed
a statement on Schedule 13G, unless such Person shall have
filed a statement on Schedule 13D with respect to beneficial
ownership of 30% or more of the Voting Securities or (z) any
corporation with respect to which, following such acquisition,
more than 60% of, respectively, the then outstanding shares of
common stock of such corporation and the combined voting power
of the then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Capital
Stock and Voting Securities immediately prior to such
acquisition in substantially the same proportion as their
ownership, immediately prior to such acquisition, of the
Outstanding Capital Stock and Voting Securities, as the case
may be, shall not constitute a Change of Control; or
ii. Individuals who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for any
reason to constitute at least a majority of the Board,
provided that any individual becoming a director subsequent to
the date hereof whose election or nomination for election by
the Company's shareholders, was approved by a vote of at least
a majority of the directors then comprising the Incumbent
Board shall be considered as though such individual were a
member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of
office is in connection with an actual or threatened election
contest relating to the election of the Directors of the
Company (as such terms are used in Rule 14a-11 of Regulation
14A, or any successor section, promulgated under the Exchange
Act); or
iii. Approval by the shareholders of the Company
of a reorganization, merger or consolidation (a "Business
Combination"), in each case, with respect to which all or
substantially all holders of the Outstanding Capital Stock and
Voting Securities immediately prior to such Business
Combination do not, following such Business Combination,
beneficially own, directly or indirectly, more than 60% of,
respectively, the then outstanding shares of common stock and
the combined voting power of the then outstanding voting
securities entitled to vote generally in the
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election of directors, as the case may be, of the corporation
resulting from Business Combination; or
iv. (a) a complete liquidation or dissolution of
the Company or (b) a sale or other disposition of all or
substantially all of the assets of the Company other than to a
corporation with respect to which, following such sale or
disposition, more than 60% of, respectively, the then
outstanding shares of common stock and the combined voting
power of the then outstanding voting securities entitled to
vote generally in the election of directors is then owned
beneficially, directly or indirectly, by all or substantially
all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Capital Stock and
Voting Securities immediately prior to such sale or
disposition in substantially the same proportion as their
ownership of the Outstanding Capital Stock and Voting
Securities, as the case may be, immediately prior to such sale
or disposition.
9. TERMINATION BY REASON OF DEATH. If Employee shall die while
employed by the Company both prior to termination of employment and during the
effective Term of this Agreement, all Employee's rights under this Agreement
shall terminate with the payment of such amounts of annual Base Salary as have
accrued but remain unpaid and a prorated amount of targeted bonus under the
Company's Management Bonus Program through the month in which his death occurs,
plus three additional months of the fixed salary and targeted bonus. All
benefits under 7b.ii., 7b.iv and 7b.v. shall be extended to Employee's estate as
described in such paragraphs. In addition, Employee's eligible dependents shall
receive continued benefit plan coverage under Paragraph 7b.iii. for three months
from the date of Employee's death.
10. TERMINATION BY DISABILITY. Employee's employment hereunder may
be terminated by the Company or by the Employee for "disability" (as defined
below). In such event, all Employee's rights under this Agreement shall
terminate with the payment of such amounts of annual Base Salary as have accrued
but remain unpaid as of thirtieth (30th) day after such notice is given except
that all benefits under Paragraphs 7b.ii, 7b.iii, 7b.iv. and 7b.v. shall be
extended to Employee as described in such paragraphs. In addition, the
non-competition and non-solicitation provisions of Paragraphs 14 and 15 shall
continue to apply to Employee for a period of one year from the date of
termination.
For purposes of this Agreement, "disability" is defined to mean that, as a
result of Employee's incapacity due to physical or mental illness:
a. Employee shall have been absent from his duties as an
officer of the Company on a substantially full-time basis for six (6)
consecutive months; and
b. Within thirty (30) days after the Company notifies
Employee in writing that it intends to replace him, Employee shall not
have returned to the performance of his duties as an officer of the
Company on a full-time basis.
11. RETIREMENT. Retirement by Employee, whether occurring as a
result of a voluntary termination by Employee or an involuntary termination as
the result of reaching the age retirement as set forth in the Company's
retirement policies, shall be treated as a voluntary termination without Good
Reason and the provisions of Paragraph 7a. shall apply. If during the Term or
any extension thereof, the Company adopts a retirement plan with respect to
executive officers of the Company, Employee shall have the right to participate
in such policy and the provisions of such policy shall supersede the provisions
of the preceding sentence.
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12. INDEMNIFICATION. If litigation shall be brought, in the event
of breach or to enforce or interpret any provision contained herein,
the non-prevailing party shall indemnify the prevailing party for
reasonable attorney's fees (including those for negotiations, trial and
appeals) and disbursements incurred by the prevailing party in such
litigation, and hereby agrees to pay prejudgment interest on any money
judgment obtained by the prevailing party calculated at the generally
prevailing NationsBank of Florida, N.A. base rate of interest charged
to its commercial customers in effect from time to time from the date
that payment(s) to him should have been made under this Agreement.
13. (Omitted Intentionally)
14. NON-COMPETITION.
a. At all times during Employee's employment hereunder,
and for such additional periods as may otherwise be set forth in this
Agreement in reference to this Paragraph 14, Employee shall not,
directly or indirectly, engage in any business, enterprise or
employment, whether as owner, operator, shareholder, director, partner,
creditor, consultant, agent or any capacity whatsoever that
manufactures products designed to compete directly with products of the
Company or markets such products anywhere in the world where the
Company (i) is engaged in business or (ii) has evidenced an intention
of engaging in business. Employee acknowledges that he has read the
foregoing and agrees that the nature of the geographical restrictions
are reasonable given the international nature of the Company's
business.
In the event that these geographical or temporal restrictions are
judicially determined to be unreasonable, the parties agree that these
restrictions shall be judicially reformed to the maximum restrictions
which are reasonable.
b. Notwithstanding the provisions of the preceding
Paragraph 14a., Employee may accept employment with a company that
would be deemed to be a competitor of the Company as described in the
previous sentence ("Competitor"), so long as (i) the Competitor has had
annual revenues of at least $1 billion in each of the prior two fiscal
years, (ii) the Competitor's revenues for products and maintenance in
direct competition with the Company does not exceed 50% of its total
revenues and (iii) Employee's responsibilities are solely for divisions
or subsidiaries of the Competitor that do not compete with the Company.
15. NON-SOLICITATION OF EMPLOYEES AND CUSTOMERS. At all times
during Employee's employment hereunder, or for such additional periods as may
otherwise be set forth in this Agreement in reference to this Paragraph 15,
Employee shall not, directly or indirectly, for himself or for any other person,
firm, corporation, partnership, association or other entity (a) attempt to
employ, employ or enter into any contractual arrangement with any employee or
former employee of the Company, its affiliates, subsidiaries or predecessors in
interest, unless such employee or former employee has not been employed by the
Company, its affiliates, subsidiaries or predecessors in interest during the
twelve months prior to Employee's attempt to employ him, or (b) call on or
solicit any of the actual or targeted prospective customers of the Company or
its affiliates, subsidiaries or predecessors in interest with respect to any
matters related to or competitive with the business of the Company.
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16. CONFIDENTIALITY.
a. NONDISCLOSURE. Employee acknowledges and agrees that
the Confidential Information (as defined below) is a valuable, special
and unique asset of the Company's business. Accordingly, except in
connection with the performance of his duties hereunder, Employee shall
not at any time during or subsequent to the term of his employment
hereunder disclose, directly or indirectly, to any person, firm,
corporation, partnership, association or other entity any proprietary
or confidential information relating to the Company or any information
concerning the Company's financial condition or prospects, the
Company's customers, the design, development, manufacture, marketing or
sale of the Company's products or the Company's methods of operating
its business (collectively "Confidential Information"). Confidential
Information shall not include information which, at the time of
disclosure, is known or available to the general public by publication
or otherwise through no act or failure to act on the part of Employee.
b. RETURN OF CONFIDENTIAL INFORMATION. Upon termination
of Employee's employment, for whatever reason and whether voluntary or
involuntary, or at any time at the request of the Company, Employee
shall promptly return all Confidential Information in the possession or
under the control of Employee to the Company and shall not retain any
copies or other reproductions or extracts thereof. Employee shall at
any time at the request of the Company destroy or have destroyed all
memoranda, notes, reports, and documents, whether in "hard copy" form
or as stored on magnetic or other media, and all copies and other
reproductions and extracts thereof, prepared by Employee and shall
provide the Company with a certificate that the foregoing materials
have in fact been returned or destroyed.
c. BOOKS AND RECORDS. All books, records and accounts
whether prepared by Employee or otherwise coming into Employee's
possession, shall be the exclusive property of the Company and shall be
returned immediately to the Company upon termination of Employee's
employment hereunder or upon the Company's request at any time.
17. INJUNCTION/SPECIFIC PERFORMANCE SETOFF. Employee acknowledges
that a breach of any of the provisions of Paragraphs 14, 15 or 16 hereof would
result in immediate and irreparable injury to the Company which cannot be
adequately or reasonably compensated at law. Therefore, Employee agrees that the
Company shall be entitled, if any such breach shall occur or be threatened or
attempted, to a decree of specific performance and to a temporary and permanent
injunction, without the posting of a bond, enjoining and restraining such breach
by Employee or his agents, either directly or indirectly, and that such right to
injunction shall be cumulative to whatever other remedies for actual damages to
which the Company is entitled. Employee further agrees that the Company may set
off against or recoup from any amounts due under this Agreement to the extent of
any losses incurred by the Company as a result of any breach by Employee of the
provisions of Paragraphs 14, 15 or 16 hereof.
18. SEVERABILITY. Any provision in this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective only to the extent of such prohibition or unenforceability
without invalidating or affecting the remaining provisions hereof, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
19. SUCCESSORS. This Agreement shall be binding upon Employee and
inure to his and his estate's benefit, and shall be binding upon and inure to
the benefit of the Company and any permitted successor of the Company. Neither
this Agreement nor any rights arising hereunder may be assigned or pledged by:
Employee or anyone claiming through
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Employee; or by the Company, except to any corporation which is the successor in
interest to the Company by reason of a merger, consolidation or sale of
substantially all of the assets of the Company.
The foregoing sentence shall not be deemed to have any effect upon the rights of
Employee upon a Change of Control.
20. CONTROLLING LAW. This Agreement shall in all respects be
governed by, and construed in accordance with, the laws of the State of Florida.
21. NOTICES. Any notice required or permitted to be given
hereunder shall be written and sent by registered or certified mail,
telecommunicated or hand delivered at the address set forth herein or to any
other address of which notice is given:
To the Company: CyberGuard Corporation
2000 West Commercial Boulevard
Fort Lauderdale, Florida 33309
Attention: Chief Executive Officer
To Employee: Patrick J. Clawson
[at such address as appears in the records of the
Company as being the last-known address of the
Employee]
22. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties hereto on the subject matter hereof and may not be
modified without the written agreement of both parties hereto.
23. WAIVER. A waiver by any party of any of the terms and
conditions hereof shall not be construed as a general waiver by such party.
24. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed an original and both of which together shall
constitute a single agreement.
25. INTERPRETATION. In the event of a conflict between the
provisions of this Agreement and any other agreement or document defining rights
and duties of Employee or the Company upon Employee's termination, the rights
and duties set forth in this Agreement shall control.
26. CERTAIN LIMITATIONS ON REMEDIES. Paragraph 7b. provides that
certain payments and other benefits shall be received by Employee upon the
termination of Employee by the Company other than for Cause and states that
these same provisions shall apply if Employee terminates his employment for Good
Reason. It is the intention of this Agreement that if the Company terminates
Employee other than for Cause (and other than as a consequence of Employee's
death, disability or normal retirement) or if Employee terminates his employment
with Good Reason, then the payments and other benefits set forth in Paragraph
7b. shall constitute the sole and exclusive remedies of Employee with respect to
the subject matter of this Agreement.
27. SURVIVAL. Notwithstanding the provisions of Paragraph 2, the
provisions of Paragraphs 14, 15, and 16 shall survive the expiration or early
termination of this Agreement.
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IN WITNESS WHEREOF, this Employment Agreement has been executed by the
parties as of the date first above written.
COMPANY:
CYBERGUARD CORPORATION
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By: Scott J. Hammack
Its: Chief Executive Officer
EMPLOYEE:
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Patrick J. Clawson
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