Audiovox 2011 Annual Report Download - page 409

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THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of February 3, 2011, by and between KLIPSCH
GROUP, INC., an Indiana corporation, and FRED FARRAR, an individual (the “Executive”).
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WHEREAS, Audiovox Corporation (“Audiovox”) intends to purchase all of the issued and outstanding shares of Klipsch Group, Inc.
(referred to herein as “KGI” or “Employer”) pursuant to a Share Purchase Agreement and;
WHEREAS, Executive is employed by the Employer and wishes to continue uninterrupted service and to continue employment by the
Employer following the closing of the share purchase by Soundtech LLC, the subsidiary of Audiovox on the terms and conditions set out herein and;
WHEREAS, in addition to the consideration set forth in this agreement, Audiovox, through its subsidiary, will also be purchasing
Executives shares in KGI for a considerable sum and;
WHEREAS, Audiovox would not purchase all the shares of KGI and in particular the shares owned by Executive unless Executive enters
this agreement and thereby agrees to abide with its terms.
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This Agreement is conditioned on the successful completion of the share purchase by Audiovox through its subsidiary of all of the issued
and outstanding shares by KGI. In the event the share acquisition is not accomplished, this Agreement shall for all purposes be null and void. This
Agreement shall not commence until the signing of this Agreement and the successful completion of the share purchase by Audiovox through its
subsidiary.
Subject to the foregoing paragraph, the parties, intending to be legally bound, agree as follows:
 
For the purposes of this Agreement, the following terms have the meanings specified or referred to in this § 1.
means a corporation or other entity controlling, controlled by or under common control with the Employer.
has the meaning set forth in the preamble.
 the sole owner of Soundtech LLC, which is the sole shareholder of the Employer.
has the meaning set forth in § 3(a).
has the meaning set forth in § 3(c).
means the Board of Directors of the Employer.
means the (i) the speaker and sound business, and (ii) any other consumer electronics business as engaged in from time to time
by the Employer and its Affiliates.
means: (i) the Executive's continued willful failure to perform in a material respect (other than any such failure resulting from
incapacity due to Disability) the explicitly stated duties to be performed by the Executive under this Agreement for a period of 10 days following
delivery of written notice to the Executive from the Chief Executive Officer of Audiovox specifying in reasonable detail key elements of such
failure; (ii) the appropriation (or attempted appropriation) of a material business opportunity of the Employer or Audiovox or their Affiliates,
including attempting to secure or securing any personal profit in connection with any transaction entered into on behalf of the Employer or Audiovox
or any Affiliate; (iii) the willful disclosure by the Executive of Confidential Information of the Employer or Audiovox or any of their Affiliates,
other than in the ordinary course of business in connection with the performance of the Executive's duties in accordance with this Agreement; (iv)
the misappropriation (or attempted misappropriation) of any of the Employer's or Audiovox's or any of their Affiliates funds or property; or (v) the
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