Employment Agreement - Computer Products & Services Inc. and John F. Moynahan
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made and entered into effective the 1St day of
January, 1996, by and between COMPUTER PRODUCTS & SERVICES, INC., a
corporation organized under the laws of the Commonwealth of Virginia
(hereinafter referred to as EMPLOYER), and JOHN F. MOYNAHAN (hereinafter
referred to as EMPLOYEE).
INTRODUCTION
A. EMPLOYER is engaged in the business of developing, manufacturing and
marketing computer products including hardware, software and services.
B. EMPLOYEE has been serving as the Vice President, Chief Financial Officer
and Treasurer of EMPLOYER since October 1, 1994.
C. EMPLOYER believes it essential to obtain during the term of this
Agreement the ongoing services of EMPLOYEE and EMPLOYEE has agreed to
continue his employment services during the term of this Agreement for
the benefit of EMPLOYER.
D. By entering into the Agreement hereinafter set forth, the parties hereto
desire to memorialize their full agreement with respect to the terms and
conditions of the management services to be provided by EMPLOYEE.
AGREEMENT
NOW, THEREFORE, for good and lawful consideration, the receipt of which is
hereby acknowledged, the parties hereto agree as follows.
1. Employment. EMPLOYER hereby employs EMPLOYEE and EMPLOYEE hereby
accepts such employment, to serve as and in the capacity of Vice
President of EMPLOYER upon and subject to the terms and conditions set
forth herein.
2. Term and Termination. The term of EMPLOYEE'S engagement shall be for a
period of three (3) years from January 1, 1996 and terminating December
31, 1998, unless sooner terminated in the manner provided herein. After
the initial three-year period, the Agreement shall automatically renew
for an additional three-year period on terms no less favorable to
EMPLOYEE than those set out in this Agreement, unless either party gives
the other party written notice of termination of this Agreement at least
sixty (60) days prior to the termination of the original term of this
Agreement. This Agreement may be terminated by (a) mutual consent, (b)
the material breach of this Agreement by EMPLOYEE that remains uncured
more than thirty (30) days after the receipt of notice from EMPLOYER of
such breach, or (c) the commission by EMPLOYEE of fraud,
misappropriation, embezzlement or the like.
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3. Duties; During the term of this Agreement, EMPLOYEE shall devote his
best efforts, time, attention and energy to the business and affairs of
EMPLOYER. When he is acting as Vice President, EMPLOYEE shall perform
all duties normally and properly incident to the office or positions
held by him and such further duties as may from time to time be assigned
to him by the Board of Directors of EMPLOYER. During the term of this
Agreement, EMPLOYEE shall not engage, directly or indirectly, in any
activities competitive with any business which is now or which hereafter
may be conducted by EMPLOYER. EMPLOYEE shall agree to serve on
EMPLOYER's Board of Directors subject to the vote and continued
confirmation of the shareholders of EMPLOYER. EMPLOYEE also agrees to
execute and be bound by EMPLOYER's Confidentiality and Nondisclosure
Agreements.
4. Consideration
a. As consideration and compensation for EMPLOYEE's services to be
performed hereunder, EMPLOYER shall pay to EMPLOYEE during each
year of the term of this Agreement an annual base compensation in
the sum of One Hundred Forty Thousand Dollars ($140,000) payable
in equal consecutive semi-monthly payments commencing January 1,
1996 and continuing thereafter on the first and fifteenth day of
each successive month during the term of this Agreement. This
base compensation will be increased to no less than One Hundred
Fifty Thousand Dollars ($150,000) on January 1, 1997, and
thereafter on each anniversary of this Agreement in an amount no
less than the increase in the U.S. Consumer Price Index for that
year.
b. As additional consideration for EMPLOYEE's services, EMPLOYER
agrees to pay EMPLOYEE an annual cash bonus as established by
EMPLOYER's Board of Directors based on EMPLOYEE's performance and
the financial performance of EMPLOYER, as determined in the sole
discretion of EMPLOYER's Board of Directors. The total cash bonus
paid hereunder will be supplemented by the grant of a fully
vested option with a ten (10) year life to purchase shares of
EMPLOYER's common stock at a price per share equal to the average
equivalent sales price per share of EMPLOYER's common stock
during the ninety (90) day period immediately preceding the
effective date of this Agreement. The number of EMPLOYER's shares
of common stock granted to EMPLOYEE as part of this option shall
be determined by dividing the cash bonus earned by the EMPLOYEE
by the per share stock option price. In this regard, in the event
of a reorganization, recapitalization, stock split, stock
dividend, combination of shares, merger, consolidation, rights
offering or any other change in the corporate structure or shares
of EMPLOYER, or any of its subsidiaries, the number and kind of
shares subject to this bonus and the price thereof shall be
proportionately adjusted so as to give EMPLOYEE the benefit of
his agreement to receive the stock at the stock sales price as
set forth above.
5. Expenses. EMPLOYER shall reimburse EMPLOYEE for all expenses reasonably
and necessarily incurred by him in the performance of his duties
hereunder, consistent with EMPLOYER's policies covering expense
reimbursement for senior executives of the EMPLOYER, as such policies
may be modified from time to time.
6. Employment Benefits. During the term of this Agreement, EMPLOYEE shall
receive and be entitled
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to participate in all benefits customarily offered to or conferred upon
other executive officers and employees of EMPLOYER. EMPLOYEE will be
provided term life insurance coverage equal to five (5) times EMPLOYEE's
then current annual salary based on typical conditions for the issuance of
such policies.
7. Change in Control. A "change in control" of EMPLOYER for purposes of
this Agreement shall mean someone other than EDWARD NEWMAN serving as
EMPLOYER's Chairman of the Board of Directors, President and Chief
Executive Officer. However, in the event of a change of control,
EMPLOYEE, in his sole discretion, shall have the right to terminate this
Agreement and shall be entitled to severance pay equal to the greater of
the amount of compensation received by EMPLOYEE during the previous two
(2) calendar years of the term of this Agreement, pursuant to Section 4,
above, or two (2) times the amount of compensation due to EMPLOYEE
pursuant to Section 4, above, at the end of the then current fiscal
year. All unvested stock options held by EMPLOYEE at the time of such
change in control shall vest immediately.
8. Notices. All notices, requests and other communications hereunder shall
be in writing and shall be deemed to have been given only if mailed,
certified return receipt requested, or if sent by Federal Express or
other well recognized private courier ("Courier") or if personally
delivered to, or if sent by fax with the original thereof sent by
Courier to:
If to EMPLOYER: Computer Products & Services, Inc.
12701 Fair Lakes Circle, Suite550
Fairfax, VA 22033
Fax: (703) 631-7070
If to EMPLOYEE: John F. Moynahan
12302 Blair Ridge Road
Fairfax, VA 22033
Fax: (703)716-1074
All notices, requests and other communications shall be deemed received
on the date of acknowledgment or other evidence of actual receipt in the
case of certified mail, Courier delivery or personal delivery or, in the
case of fax delivery, upon the date of fax receipt provided that the
original is delivered within two (2) business days. Any party hereto may
designate different or additional parties for the receipt of notice,
pursuant to notice given in accordance with the foregoing.
9. Attorneys' Fees. In the event of default hereunder, the defaulting party
shall be liable to the nondefaulting party for all expenses and costs
incurred by the non-defaulting party in protecting or enforcing its
right hereunder including but not limited to reasonable attorneys' fees
and costs.
10. Subject Headings. The subject headings of the paragraphs of this
Agreement are included solely for the purposes of convenience and
reference only, and shall not be deemed to explain, modify, limit,
amplify or aid the meaning, construction or interpretation of any of the
provisions of this Agreement.
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11. Amendments. No supplement, modification or amendment of this Agreement
shall be binding or enforceable unless executed in writing by the
parties hereto.
12. Entire Agreement and Waiver. This Agreement contains the entire
agreement between the parties hereto concerning the subject matter
hereof and supersedes all prior and contemporaneous agreements,
arrangements, negotiations and understandings between the parties hereto
relating to the subject matter hereof There are no other understandings,
statements, promises or inducements, oral or otherwise, contrary to the
terms of this Agreement. No representations, warranties, covenants or
conditions, express or implied, whether by statute or otherwise, other
than as set forth herein, have been made by any party hereto. No waiver
of any term, provision or condition of this Agreement, whether by
conduct or otherwise, in any one or more instances, shall be deemed to
be, or shall constitute, a waiver of any other provision hereof, whether
or not similar, nor shall such waiver constitute a continuing waiver,
and no waiver shall be binding unless executed in writing by the party
making the waiver.
13. Parties In Interest. Nothing in this Agreement, whether express or
implied, is intended to confer upon any person other than the parties
hereto and their respective heirs, representatives, successors and
permitted assigns, any rights or remedies under or by reason of this
Agreement.
14. Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective heirs,
representatives, successors and permitted assigns.
15. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
16. Applicable Law. This Agreement shall be governed by and construed and
enforced in accordance with and shall be subject to the laws of the
Commonwealth of Virginia.
17. Further Documents. Each party agrees to execute and deliver, at any time
and from time to time, upon the request of the other party, such further
instruments or documents as may be necessary or appropriate to carry out
the provisions contained herein, and to take such other action as the
party may reasonably request to effectuate the provisions of this
Agreement.
18. Severability. Should any part, term or provision of this Agreement be
declared by a court of competent jurisdiction to be invalid, void or
unenforceable at law or in equity, it is the express intention of the
parties hereto that such part, term or provision shall be construed in
such manner as to provide for the enforcement thereof to the maximum
extent and in the broadest scope permitted under law and all remaining
parts, terms and provisions hereof shall remain in full force and effect
and shall in no way be invalidated, impaired or affected thereby.
19. Interpretations and Definitions. The parties agree that each party and
its counsel have reviewed and revised this Agreement and that any rule
of construction to the effect that ambiguities are to be resolved
against the drafting party shall not apply in the interpretation of this
Agreement.
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20. Miscellaneous. Time is hereby declared to be of the essence of each
provision of this Agreement. This Agreement sets forth the entire
understanding between the parties hereto with respect to all matters
referred to herein and the provisions hereof may not be changed,
modified or supplemented either wholly or in part except by written
instrument signed by each of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
as of the date set forth at the beginning hereof.
EMPLOYER: COMPUTER PRODUCTS & SERVICES, INC.,
a Virginia corporation
By:
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EMPLOYEE:
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JOHN F. MOYNAHAN
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