Exhibit 10(ar)

EMPLOYMENT AND NON-COMPETE AGREEMENT

EMPLOYMENT AND NON-COMPETE AGREEMENT (“Agreement”) made and entered into as of
the 1st day of June, 2001 by and between RICHARDSON ELECTRONICS, LTD., a
Delaware corporation (“Company”), and Larry Blaney, an individual whose current
residence address is 3 Blackberry Ct., Aurora IL 60605 (“Employee”).

RECITALS

WHEREAS, The Company has employed Employee under an Employment and Non-Compete
Agreement dated as of March 1, 1998 which had an original Employment Term until
May 31, 2001; and

WHEREAS, the Company and the Employee desire to continue such employment on the
terms and conditions set forth in this new Employment and Non-Compete Agreement.

NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the parties hereto acknowledge and agree as follows:

ARTICLE ONE

NATURE AND TERM OF EMPLOYMENT

1.01    Employment. The Company hereby agrees to employ Employee and Employee
hereby accepts employment as Company’s Vice President and General Manager of its
Virtual Display Systems business unit (“VDS”) reporting to the Company’s
President, Bruce W. Johnson, or such other person as the Company may designate.

1.02    Term of Employment. Employee’s employment shall continue pursuant to
this Agreement commencing as of June 1, 2001 and shall continue thereafter on an
“at will” basis. In the event of termination the Company may assign such duties
or no duties to Employee as it, in its discretion, desires during any notice
period, if any. The Company may pay compensation in lieu of notice for the
required balance of notice period, if any. Employee will be employed on a full
time basis for the Company, and it is understood that the hours of work involved
may vary and be irregular and are those hours of work required to meet the
objectives of the employment. Employee acknowledges that this clause constitutes
agreement to work such hours where such agreement is required by law.

1.03    Duties. The duties of Employee at the commencement of his employment
hereunder in general shall be to devote, under the supervision and direction of
the Company’s President, 3 days a week to the sales management of the Company’s
Product Lines 201 and 202 and 2 days per week to the management of VDS until the
sales of VDS reach $2,000,000 per year at which point Employee will devote 2
days a week to the sales management of Product Lines 201 and 202 and 3 days a
week to the management of VDS, and when the sales of VDS reach $5,000,000 per
year Employee would cease responsibility for the sales management of Product
Lines 201 and 202 and devote his full time and attention to the management of
VDS. In his management of VDS, Employee shall:

(a)    have overall responsibility for the management and profitability of VDS;

(b)    submit an annual budget to the Company covering all phases of the
business operation of VDS;

(c)    upon acceptance of this budget by the Company, manage VDS to reach the
objectives of the budget;

 

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(d)    not make capital expenditure or lease commitments outside of budget
without prior approval of the Company’s President and the Company’s Vice
President of Finance;

(e)    not grant credit, enter into contracts or make inventory commitments
other than as permitted under the Company’s Corporate Guidelines; and

(f)    provide regular reporting to the Company on the progress of VDS either by
access through the Company computer system or by supplementary written reports
in the following areas:

 

  Monthly: sales statistics

 

  Quarterly: provide a review of progress to date comparing performance to
budget.

and have such other duties and responsibilities as shall be assigned to Employee
from time to time and follow the supervision and direction of the Company’s
President, or such other person or persons as the Company may from time to time
designate, in the performance of such duties. Employee will adhere to the
policies, rules, systems and procedures of the Company as shall be in force from
time to time, including, without limitation, the Company’s Code of Conduct. The
Company reserves the right to change the provisions of any of these policies at
any time.

Employee agrees to devote his full working time, attention and energies to the
diligent and satisfactory performance of his duties hereunder. During the term
of his employment and during any period during which Employee is receiving
payments pursuant to Article 2 and/or Section 5.04, Employee shall well and
faithfully serve the Company and agrees that he shall not, during such term, be
employed or engaged in any capacity, in promoting, undertaking or carrying on
any other business, or employment that in any way conflicts with the performance
of his obligations hereunder. Further, Employee will not, during term of his
employment or during any period during which Employee is receiving payments
pursuant to Article 2 and/or Section 5.04, engage in any activity, whether or
not such business activity is pursued for gain or any other pecuniary advantage,
which is intended or would reasonably be expected to have a material adverse
affect on the Company’s reputation, goodwill or business relationships or which
is intended or would reasonably be expected to result in material economic harm
to the Company.

ARTICLE TWO

COMPENSATION AND BENEFITS

For all services to be rendered by him in any capacity hereunder (including as
an officer, director, committee member or otherwise of the Company or any parent
or subsidiary thereof or any division of any thereof) on behalf of the Company,
the Company agrees to pay Employee so long as he is employed hereunder, and the
Employee agrees to accept, the following compensation:

2.01    Base Salary. During the term of Employee’s employment hereunder, the
Company shall pay, or cause to be paid, to Employee an annual base salary (“Base
Salary”) of One Hundred Nine Thousand Five Hundred Dollars ($109,500), payable
in equal installments as are customary under Company’s payroll practices from
time to time. No additional compensation shall be payable to Employee by reason
of the number of hours worked or by reason of hours worked on Saturdays,
Sundays, holidays or otherwise. However, Employee shall not be required to work
on Saturdays, Sundays and holidays as a general practice but only occasionally
as may be required to meet the objectives of his employment. The Company may
review and adjust the Employee’s Base Salary from year to year, but during the
term of the Employee’s employment hereunder the Company may not decrease the
Employee’s Base Salary below the amount set forth in this Section 2.01 and it is
anticipated that Employee will receive a minimum cost of living increase.

2.02    Bonus. During the term of Employee’s employment hereunder, the Company
shall pay, or cause to be paid, to Employee a bonus (“Bonus”) commencing for the
period after June 1, 2001 computed

 

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annually for each fiscal year of the Company until the date on which Employee’s
employment with the Company is terminated in accordance with this Agreement, in
an amount equal to the amount which equals 25% of the cumulative net pre-tax
profits before provision for any Bonus for such period, if any, of VDS and after
a charge (computed on a fiscal quarterly basis) for the Company’s investment in
VDS as hereinafter provided. In making the computation the following shall be
taken into account:

(a)    The Company’s investment in the Virtual Displays Division which shall be
provided from time to time in accordance with the VDS budget as approved;

(b)    All additional investment in cash or in kind in the Virtual Displays
Division by the Company shall be added to its investment in the Division as and
when made from time to time, cash may be taken out and invested from time to
time at the discretion of the Company;

(c)    The Company shall be entitled to an annual pre-tax return on its
investment in VDS equal to its current cost of capital (at this time it is 8%)
on the amount so invested from time to time;

(d)    The Company shall maintain internal financial records which reflect VDS
as a discrete and separate business entity; and

(e)    VDS financial records referred to in (d) above shall include all direct
expenses of VDS except for the Bonus, appropriate charges for expenses of the
Company which are of a general nature and not directly chargeable to any one
business unit as set forth in the Business Plan for VDS approved for the year,
and taxes other than income tax, if any, computed as if VDS stood alone as a
separate entity not a part of the Company, and otherwise charges and
computations shall be made in accordance with accepted accounting practices as
generally applied by the Company and as reflected in the Pro Forma calculation
attached hereto as Exhibit A.

If Employee shall be employed for only a portion of a fiscal year the Bonus for
that year shall be reduced ratably for the portion of the year not employed. The
chief financial officer of the Company shall make and deliver to Employee a
computation of the Bonus amount, if any, for each fiscal year, or portion
thereof, of the Company after June 1, 2000, within 120 days after the end of
each fiscal year of the Company’s hereafter. Employee shall have fourteen
(14) days after receipt of the computation to notify the Company in writing of
any disagreement with the computation by specifying the particulars of such
disagreement. If notice of disagreement is not received by the Company within
such period, such computation shall be, in all respects, final and binding upon
the Company and the Employee. If notice of disagreement is received in a timely
manner the parties shall seek to resolve the disagreement through discussion. If
so resolved, the computation resulting from such resolution shall be in all
respects final and binding upon the Company and the Employee. If the parties are
unable to resolve the disagreement by discussion, either party by written notice
to the other given not sooner than seven (7) days after the Employee’s notice of
disagreement, may submit the disagreement to the firm of independent public
accountant’s then acting as the Company’s auditor. The decision of such audit
firm shall be final and binding upon the Company and the Employee. The costs,
expenses and fees of such audit firm in connection with resolving a disagreement
shall be borne by the parties in proportion to the allowance of the amount in
dispute by the audit firm, e.g. if the Employee is claiming an additional
$10,000 of Bonus and the audit firm determines Employee is entitled to an
additional $1,000, then the Employee will pay 90% and the Company 10% of the
audit firm’s costs, expenses and fees for such determination.

2.03    Supplemental Bonus. During the term of the Employee’s employment
hereunder while he manages the Company’s Product Lines 201 and 202, the Employee
shall receive a supplemental bonus for his activities in managing Product Lines
201 and 202 (“Supplemental Bonus”) as a participant in the Company’s Annual RSM
Incentive Plan. Employee’s Supplemental Bonus shall be determined and paid
strictly in accordance with the Annual Incentive Plan. The Employee’s “target
bonus percentage” for the purpose of the Annual Incentive Plan shall be 50% of
his Base Salary. Presently the Company pays (and Employee will receive)
Supplemental Bonus earned under the Annual Incentive Plan on a quarterly basis
with payments

 

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made on the first regular payroll payment date after it publishes its quarterly
earnings for the general public.

2.04    Payment of Bonus. The Company shall pay to the Employee his Bonus for a
fiscal year within 30 days after the amount is computed and finalized as
provided above in 2.02; provided, however, that upon written notice to the
Company from Employee during the 10 day period after the amount is computed and
finalized as provided above in 2.02, subject to the other provisions of this
Agreement (including, without limitation, those relating to termination of
employment), Employee may elect to receive such Bonus in cash or may defer
receipt thereof, in whole or in part, to a later date. If payment is deferred
such amount shall be deemed a reduction in the investment required by the
Company in VDS for purposes of computing future cumulative net pre-tax profits
of VDS until withdrawn.

2.05    Special Bonus. In the event the Company should spin off VDS as a
separate corporate entity, or sell substantially all of the assets and business
of VDS as a going business, then, in such event Employee shall be entitled to,
and the Company shall pay Employee, a special bonus in an amount equal to 35% of
the amount by which the value of the consideration received by the Company in
such transaction exceeds the amount of the investment of the Company in VDS
immediately prior to the transaction, less Bonuses paid to date that were not
charged against the VDS investment. Such special bonus shall be payable in cash
or in kind, in whole or in part, at the discretion of the Company. In the event
of Employee’s death prior to a Special Bonus becoming due under this paragraph,
then, in such event, the Company shall, within 12 months of Employee’s death,
pay to Employee’s spouse surviving him an amount equal to 35% of the net book
value of VDS as reflected by the Company’s records in accordance with the terms
of this Agreement. Any dispute with respect thereto shall be resolved in the
same manner as disputes under 2.02 hereof. In the event that the Company should
spin off VDS as a separate corporate entity, or sell substantially all of the
assets and business of VDS as a going business before payment under the
foregoing sentence is made to Employee’s surviving spouse, then, in such event
Employee’s surviving spouse shall receive the amount Employee would have
received under this 2.05 less any payments previously made to her under this
2.05.

2.06    Other Benefits. Employee will be entitled to participate in those
benefit plans made available from time to time by the Company to executive level
employees (“Other Benefits”). Information describing the current insurance
programs, holiday and vacation entitlement, and other benefits has been provided
to Employee. The Company reserves the right to change the provisions of or
eliminate any of these benefits and plans, at any time and from time to time. It
is only intended that Employee shall be entitled to participate in any such plan
offered for which he may qualify under the terms of any such plan as it may from
time to time exist, in accordance with the terms thereof and subject to
discretion of the Company reserved in any such plan.

2.07    Withholding. All salary, bonus and other payments described in this
Agreement shall be subject to withholding for national, federal, provincial,
state or local taxes, amounts withheld under applicable benefit policies or
programs, and any other amounts that may be required to be withheld by law,
judicial order or otherwise.

ARTICLE THREE

CONFIDENTIAL INFORMATION AND COMPANY PROPERTY

3.01    Definition of Confidential Information. For the purposes of this
Agreement, the term “Confidential Information” shall mean information about
certain matters which are confidential to the Company which information is the
exclusive property of the Company, including without limiting the generality of
the foregoing:

(i)    information concerning product design and data sources;

(ii)    names and addresses, buying habits and preferences of present and
prospective clients or customers of the Company;

 

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(iii)    pricing and sales policies, techniques and concepts; and

(iv)    trade secrets.

The Confidential Information shall not include any materials or information of
the types specified above to the extent that such materials or information are
publicly known or generally utilized by others engaged in the same business or
activities in the course of which the Company utilized, developed or otherwise
acquired such information or materials and which Employee has gathered or
obtained (other than on behalf of the Company) after termination of his
employment with the Company from such other public sources by his own
expenditure of significant time, effort and money after termination of his
employment with the Company. Failure to mark any of the Confidential Information
as confidential shall not affect its status as part of the Confidential
Information under the terms of this Agreement; provided that the foregoing shall
not be deemed to preclude the use by Employee of public information of such
nature within the general knowledge of Employee, either prior to or after
termination of his employment with the Company.

3.02    Non-Disclosure of Confidential Information. Employee acknowledges that
such information as referred to in 3.01 above could be used to the detriment of
the Company. Accordingly, Employee undertakes to treat confidentially all such
Confidential Information and agrees not to disclose same to any third party
either during his employment, except as may be necessary to perform his duties
to the Company hereunder, or after termination of his employment, except with
the advance written permission of the President of the Company or his designate.

3.03.    Ownership of Confidential Information. Employee acknowledges and agrees
that all items of any and every nature or kind created, developed or produced by
the Employee heretofore or hereafter pursuant to this Agreement, or in
connection with his prior employment or relationship with Eternal Graphics, or
furnished to the Employee by Eternal Graphics, the Company or any subsidiary,
affiliated, associated and parent companies of Eternal Graphics or the Company
or their customers or clients, including without limitation, all work in
progress, equipment, samples, lists, books, records, business cards, reports,
files, manuals, and customer lists and data and other Confidential Information
shall remain and be considered the exclusive property of the Company, at all
times, and shall be immediately returned to the Company, together with all
copies thereof or notes with respect thereto in whatever form (including,
without limitation, electronic) existing, in good condition upon request by the
Company or immediately upon termination, however caused, of services pursuant to
this Agreement.

3.04.    Application. The Employee agrees that this Article Three applies in
regard to confidential information of clients and customers of the Company and
Eternal Graphics and subsidiary, affiliated, associated and parent companies of
the Company and Eternal Graphics and their clients and customers.

ARTICLE FOUR

NON-COMPETE AND NON-SOLICITATION COVENANTS

4.01    Covenant Not To Compete Employee covenants and agrees that he shall not,
during the term of the Employee’s employment with the Company and for a period
of one (1) year after termination of Employee’s employment with the Company for
any or no reason, alone or in conjunction with any other corporation, firm,
partnership, person, venture or other entity, directly or indirectly, engage in
the design, manufacture, sale or distribution of any products of the type
designed, manufactured, sold or distributed by the Company during the period
beginning twelve months prior to the date of termination of his employment with
the Company, in any geographic area in which the Company was engaged in such
business during such period.

4.02    Covenant Not To Solicit Customers or Suppliers. During the term of
Employee’s employment with the Company and for a period of one (1) year after
termination of Employee’s employment with the Company for any or no reason,
Employee will not, on behalf of himself or on behalf of another person,

 

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corporation, partnership or entity, canvas, call upon, solicit, entice,
persuade, or induce any individual or entity which was or is a client, customer
or supplier, or prospective client, customer or supplier, of the Company upon
whom Employee called or whose account he supervised on behalf of the Company,
during the last twelve (12) months of Employee’s employment with the Company,
for the following:

(a)    except on behalf of the Company, to purchase (with respect to clients or
customers) or sell (with respect to suppliers) Competing Products, or

(b)    to request or advise any such client, customer or supplier to withdraw,
curtail or cancel its business with the Company, and

Employee shall not approach, respond to, or otherwise deal with any such client,
customer or supplier for such purpose or authorize or knowingly cooperate with
the taking of any such actions by any other individual or entity.

“Competing Products” as used in this Article means products or services which
are similar to, compete with, or can be used for the same purposes as products
or services sold or offered for sale by the Company or which were in development
by the Company within the last twelve (12) months of Employee’s employment with
the Company.

4.03    Covenant Not to Solicit Employees. During the term of Employee’s
employment with the Company and for a period of one (1) year after termination
of Employee’s employment with the Company for any or no reason, Employee will
not, for any reason, employ, solicit or endeavor to entice away from the Company
(whether for his own benefit or on behalf of another person or entity) any
employees of the Company who have had access to Confidential Information to work
for any competitor of the Company, nor will Employee otherwise attempt to
interfere (to the Company’s detriment) in the relationship between the Company
and any such employees.

4.04    Independent Obligations. Each obligation of each subparagraph and
provision of this Article shall be independent of any obligation under any other
subparagraph or provision hereof.

ARTICLE FIVE

TERMINATION

5.01    Termination of Employee for Cause. The Company shall have the right to
terminate Employee’s employment at any time for “cause.” Prior to such
termination, the Company shall provide Employee with written notification of any
and all allegations constituting “cause” and the Employee shall be given five
(5) working days after receipt of such written notification to respond to those
allegations in writing. Upon receipt of the Employee’s response, the Company
shall meet with the Employee to discuss the allegations.

For purposes hereof, “cause” shall mean (i) an act or acts of personal
dishonesty taken by the Employee and intended to result in personal enrichment
of the Employee, (ii) material violations by the Employee of the Employee’s
obligations or duties under, or any terms of, this Agreement, which are not
remedied in a reasonable period (not to exceed ten (10) days) after receipt of
written notice thereof from the Company, (iii) any violation by the Employee of
any of the provisions of Articles Three, or Four or Section 7.07 or the last
paragraph of Section 1.03, or (iii) Employee being charged, indicted or
convicted (by trial, guilty or no contest plea or otherwise) of (a) a felony,
(b) any other crime involving moral turpitude, or (c) any violation of law which
would impair the ability of the Company or any affiliate to obtain any license
or authority to do any business deemed necessary or desirable for the conduct of
its actual or proposed business. Notwithstanding the foregoing Employee being
charged, indicted or convicted of a felony or other crime under the Internal
Revenue Code with respect to tax obligations for any period prior to the date
hereof shall not be “cause” unless the same prevents him from carrying out his
duties and obligations under this Agreement. Additionally,

 

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if the Employee is named, charged or indicted in any civil or criminal action
that has been brought against the Company and not against the Employee
individually and/or for alleged acts committed by Employee at the direction or
advice of Company such action against the Employee shall not constitute “cause.”

5.02    Termination of Employee Because of Employee’s Disability, Injury or
Illness. The Company shall have the right to terminate Employee’s employment if
Employee is unable to perform the duties assigned to him by the Company because
of Employee’s disability, injury or illness, provided however, such inability
must have existed for a total of 180 consecutive days before such termination
can be made effective.

5.03    Termination as a Result of Employee’s Death. The obligations of the
Company to Employee pursuant to this Agreement shall automatically terminate
upon Employee’s death, except as provided in 2.05.

5.04    Termination of Employee for any Other Reason. The Company shall have the
right to terminate Employee’s employment at any time at will for any reason upon
written notice to Employee. If Employee’s employment is terminated by the
Company (including a termination following the sale of the business or assets of
the VDS or Data Display Group, unless Employee continues in the employ of the
purchaser thereof in which event Employee is not entitled to any payment other
than what is provided for in Section 5.05 below) other than the reasons set
forth in Sections 5.01, 5.02 or 5.03 above, the Company shall continue to pay to
Employee his then current Base Salary for one year and his Bonus and
Supplemental Bonus, if any, prorated and accrued to the date of termination. In
the event of termination under Section 5.01, 5.02 or 5.03 the Company shall pay
to Employee his then current Base Salary and his Bonus and Supplemental Bonus,
if any, prorated and accrued to the date of termination. Further, in any of case
of termination under Sections 5.01, 5.02, 5.03 or 5.04 Employee shall not be
entitled to receive, unless otherwise required by law, any Other Benefits after
the date of termination.

5.05    Termination by Employee. Subject to the provisions of Articles Three and
Four above and Section 7.07 and the last paragraph of Section 1.03, Employee may
terminate his employment with the Company at any time, by written notice to the
Company. If Employee’s employment is so terminated, the Company shall be
obligated to continue to pay to Employee his then current Base Salary and Other
Benefits accrued up to and including the date on which Employee’s employment is
so terminated, however, Employee and the Company acknowledge and agree to the
fullest extent permitted by law, that Employee shall forfeit, and the Company
shall not be responsible to pay or fund, directly or indirectly, any accrued but
unpaid Bonus, Supplemental Bonus or award (howsoever described); accumulated but
unpaid sick leave; accumulated but unpaid vacation time; deferred compensation;
severance pay or benefits; any and all benefits which are accrued but not vested
under any pension, profit sharing or other qualified retirement plan and all
service credits under each such plan (subject to any reinstatement of such
credits upon future reemployment with the Company in accordance with federal
law); and right to post-employment coverage under any health, insurance or other
welfare benefit plan, except rights arising under Title X of COBRA or any
similar federal or state law; or any Other Benefits, if any, provided to
Employee under any policy, program or plan of the Company not specifically
described above, after the date of termination to which Employee might otherwise
be entitled under this Agreement but for his resignation. Notwithstanding the
foregoing, if the Employee terminates his employment for “Good Reason,” he shall
be entitled to all of the benefits contained in Section 5.04 above as if he had
been terminated without cause. Good Reason means Company breaches its
obligations hereunder in any material respect and fails to cure such breach
within 30 days after written notice of such breach from Employee.

ARTICLE SIX

REMEDIES

6.01    Employee acknowledges that the restrictions contained in this Agreement
will not prevent him from obtaining such other gainful employment he may desire
to obtain or cause him any undue hardship and are reasonable and necessary in
order to protect the legitimate interests of the Company and that violation
thereof would result in irreparable injury to the Company. Employee therefore
acknowledges and agrees that

 

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in the event of a breach or threatened breach by Employee of the provisions of
Article Three or of Article Four, Section 7.07 or the last paragraph of
Section 1.03, the Company shall be entitled to an injunction restraining
Employee from such breach or threatened breach. Nothing herein shall be
construed as prohibiting or limiting the Company from pursuing any other
remedies available to the Company for such breach or threatened breach, the
rights hereinabove mentioned being in addition to and not in substitution of
such other rights and remedies. The period of restriction specified in Article
Four shall abate during the time of any violation thereof, and the portion of
such period remaining at the commencement of the violation shall not begin to
run until the violation is cured.

6.02    Survival. The provisions of this Article Six and of Articles Three and
Four and Section 7.07 and the last paragraph of Section 1.03 shall survive the
termination or expiration of this Agreement.

ARTICLE SEVEN

MISCELLANEOUS

7.01    Entire Agreement. This Agreement contains the entire agreement between
the parties with respect to the subject matter hereof and shall be binding upon
and inure to the benefit of the parties hereto and the Company’s subsidiaries,
and the Company’s and its subsidiaries’ successors and assigns. Any modification
to this Agreement must be in writing, signed by the parties hereto. This
Agreement will survive any change to remuneration whether or not it complies
with this requirement.

7.02    Severability. In the event that any provision(s) of this agreement or
part(s) thereof is held to be unenforceable in any jurisdiction, such decision
shall not affect any of the remaining provisions or parts thereof and such
remaining provisions and parts thereof shall remain in full force and effect.

7.03    Notices. Any notice required or permitted to be given to the Employee
shall be sufficiently given if delivered to the Employee personally, or if
mailed by registered mail to the Employee’s last address as set out on Company’s
employment records or to such other address as provided by notice in accordance
with this 7.03. Any notice required or permitted to be given to the Company
shall be sufficiently given if mailed, by registered mail to the address of the
principal place of business of the Company or to such other address as provided
by notice in accordance with this 7.03. Any notice given by mail shall be deemed
to have been given forty-eight (48) hours after the time it is posted.

7.04    Waiver. Failure by any party to claim any breach or violation of any
provision of this Agreement shall not constitute a precedent or be construed as
a waiver of any subsequent breaches hereof.

7.05    Continuing Obligation. The obligations, duties and liabilities of
Employee pursuant to Articles Three and Four and Section 7.07 of this Agreement
are continuing, absolute and unconditional and shall remain in full force and
effect as provided herein and survive the termination of this Agreement.

7.06    No Conflicting Obligations or Use. The Company does not desire to
acquire from Employee any secret or confidential know-how or information which
he may have acquired from others nor does it wish to cause a breach of any non
compete or similar agreement to which Employee may be subject. Employee
represents and warrants that (i) other than for this Agreement, he is not
subject to or bound by any confidentiality agreement or non disclosure or non
compete agreement or any other agreement having a similar intent, effect or
purpose, and (ii) he is free to use and divulge to the Company, without any
obligation to or violation of any right of others, any and all information,
data, plans, ideas, concepts, practices or techniques which he will use,
describe, demonstrate, divulge, or in any other manner make known to the Company
during the performance of services hereunder.

7.07    Reputation. Employee agrees that he will at no time engage in conduct
which libels, slanders, destroys or is intended to or can reasonably be expected
to diminish the reputation or goodwill of the Company, its parents or
subsidiaries, or their respective shareholders, directors, officers, employees,
or agents or the products sold by the Company or any of its parents or
subsidiaries. Employee shall not be in violation of this obligation if his
statements are truthful. This obligation shall survive the termination of this
Agreement.

 

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7.08    Captions. The captions of this Agreement are inserted for convenience
only and are not to be construed as forming a part of this Agreement.

7.09    Assignment. Employee and the Company acknowledge and agree that the
covenants, terms and provisions contained in this Agreement constitute a
personal employment contract and the rights and obligations of the parties
thereunder cannot be transferred, sold, assigned, pledged or hypothecated,
excepting that the rights and obligations of the Company under this Agreement
may be assigned or transferred pursuant to a sale of the VDS business, merger,
consolidation, share exchange, sale of substantially all of the Company’s VDS
assets, or spin off of the VDS business to a separate corporate entity or other
reorganization, or through liquidation, dissolution or otherwise, whether or not
the Company is the continuing entity, provided that the assignee, or transferee
is the successor to all or substantially all of the VDS assets of the Company
and such assignee or transferee assumes the rights and duties of the Company, if
any, as contained in this Agreement, either contractually or as a matter of law.

7.10    Independent Legal Advice. The Employee acknowledges that he has had the
opportunity to obtain independent legal advice with respect to the execution of
this Agreement, and that he has read, understands and agrees with all of the
terms and conditions contained herein.

IN WITNESS WHEREOF, the parties have duly executed this agreement as of the 1st
day of June, 2001 in LaFox, Illinois

 

Richardson Electronics, Ltd.

/s/    Edward J. Richardson

            (signature )

/s/    Edward J. Richardson

            (print name)

Employee

/s/ Larry R. Blaney

(signature)

Larry Blaney

(print name)

 

9