Exhibit
10.14


 


OMTOOL,
LTD.


 


Personal
and Confidential


 


Via
Hand Delivery


 


Daniel Coccoluto


Omtool, Ltd.


8A Industrial Way


Salem, NH  03079


 


Re:  Change
of Control Severance Eligibility


 


Dear Dan:


 


In connection with your “at-will” employment with
Omtool, Ltd. (“Omtool” or the “Company”), Omtool agrees to provide you with
eligibility for the severance benefits set forth in this letter agreement (the
“Agreement”) if your employment is terminated under the circumstances described
below:


 


1.              At-Will Employment.  This Agreement is not a contract to employ
you for a definite time period, and is not intended to be and does not
constitute a contract or part of a contractual agreement for continued
employment, either express or implied, between the Company and you, it being
acknowledged that your employment is “at will” and that either you or Omtool
may terminate the employment relationship at any time, for any or no reason,
with or without “Cause” (as defined herein) and with or without prior notice.


 


2.              Notice of Termination and other
Matters.  Any termination
of your employment, whether by you or Omtool, will be communicated by written
notice (“Notice of Termination”) to the other party.  All notices provided for in this Agreement will be in writing and
will be effective when personally delivered (e.g., hand delivery or via
electronic mail, where applicable) or mailed by U.S. mail, postage prepaid,
addressed to Omtool, Ltd., 8A Industrial Way, Salem, NH 03079, and to you at
the address shown above or to such other address as either Omtool or you may
have furnished to the other in writing.


 


3.              Severance
Payments and Benefits Upon a Qualified Termination.


(a) Omtool will
provide you with the severance payments listed below only in the event of a
Qualified Termination and provided that you execute a separation agreement and
general release in a form acceptable to the Company, except that the release
will not effect your rights to indemnification, any rights under applicable
directors and officers liability insurance, or vested benefits (if any), and
provided that you continue to adhere to any post-termination obligations
including, but not limited to, any non-competition, non-disclosure and
non-solicitation covenants.  A
“Qualified Termination” means your employment is terminated by the Company
without “Cause” or by you for “Good Reason,” in either case only within the
first twelve months after a Change of Control of the Company.  A termination of your employment will not
constitute a “Qualified Termination” if your employment is terminated at any
time because (i) you die or


 

















 


become Disabled, (ii)
Omtool terminates you for “Cause,” (iii) you resign or retire without “Good
Reason”, or (iv) the Company files for bankruptcy.  In addition, a termination of your employment will not
constitute a “Qualified Termination” if you resign with “Good Reason” or you
are terminated without “Cause” before a Change of Control.


 


(b) If a Qualified Termination occurs, you will be
eligible to receive the following severance pay and benefits:


 


(i) Severance Pay.  Severance will be paid, in equal monthly
installments at your monthly base salary rate in effect immediately prior to
the Qualified Termination, for twelve months from the date of the Qualified
Termination.  The first severance payment
will be made upon the first regularly scheduled Company payday on or following
your execution of the release agreement referenced above, in accordance with
the Company’s normal payroll practices as established or modified from time to
time, and will be subject to all federal, state and/or local payroll and
withholding taxes.


 


(ii) Payment of COBRA
Premiums.  If you are eligible for
and elect to continue health and dental continuation coverage in accordance
with the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the
Company will pay your COBRA premium (equal to the amount it paid during your
employment) until the earlier of (x) 12 months from the date of the Qualified
Termination, or (y) the date on which you become ineligible to receive COBRA
coverage.  During the period in which
the Company is providing this benefit, you will be responsible for paying the
portion of the premiums required for active employees, which will be
automatically deducted from the severance payments referenced in Section
3(b)(i).  Thereafter, you will be
responsible for all COBRA payments.


 


(c) You will not
be entitled to any of the severance payments and/or benefits set forth above in
Sections 3(b)(i)-(ii) if your employment termination from Omtool is not a Qualified
Termination.  If your employment
termination is not a Qualified Termination, your employment and this Agreement
will automatically terminate and the Company will pay you (or in the case of
death, your designated beneficiary or, if no beneficiary has been designated by
you, your estate) your base salary earned but unpaid and vacation pay accrued
but unused as of the termination date, as well as any bonus and/or commission
payment, to the extent such payment is earned and due in accordance with any
such bonus and/or commission plan.


 


(d) If Omtool determines that you have materially breached the terms of
any non-competition or confidentiality provision contained in any employment,
consulting, advisory, non-disclosure, non-competition or other similar agreement
between you and Omtool, then you agree that Omtool, regardless of the manner of
your employment termination, can refuse to pay and/or cease paying and/or
performing all severance-related obligations under this Section 3 to the extent
permitted by applicable law.  The
cessation of these severance payments and benefits shall be in addition to, and
not as an alternative to, any other remedies at law or in equity available to
the Company, including the right to seek an injunction, which you shall not
oppose.


 


4.             Definitions.  For the purposes of this Agreement, the
terms listed below are defined as follows:


 


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(a) Disabled.  You are “Disabled” for the purposes of this
Agreement if you have been absent from the full-time performance of your duties
with Omtool for 180 days, whether or not consecutively, within a any
consecutive 12-month period, because of incapacity due to physical or mental
impairment that substantially limits a major life activity, and you fail to
resume performance of your essential job duties, with or without reasonable
accommodation (provided that any such accommodation does not cause the Company
an undue hardship).


 


(b) Cause.  “Cause,” which shall be determined by the
Company’s Board of Directors (the “Board”), shall mean: (i) your commission of
any act of gross negligence, dishonesty, insubordination or breach of fiduciary
duty which materially adversely affects the Company or its employees, (iv) your
material breach of any term of this Agreement or any other agreement with
Omtool, (v) your conviction of or plea of nolo contendere to (A) any felony or (B)
any misdemeanor involving fraud, deceit, moral turpitude or embezzlement, or
(vi) your disregard of or failure to follow the Company’s rules or policies in
any material respect, or your commission of any other action that may cause
material injuries to the Company, including your misappropriation of any money
or other assets or property (tangible or intangible) of the Company.


 


(c) Change of
Control.  A “Change of
Control” shall mean the occurrence of one of the following events during the
period in which you are eligible to receive the severance payments and other
benefits listed in Section 3: [(i) any transaction in which the Company is
to be consolidated with or acquired by another entity in a merger, tender offer
or other reorganization in which the holders of the outstanding voting stock of
the Company immediately preceding the consummation of such event, shall,
immediately following such event, hold, as a group, less than a majority of the
voting securities of the surviving or successor entity, or (ii)  the sale
of all or substantially all of the Company’s assets.  Notwithstanding the foregoing, the Board of Directors of the
Company may, prior to the closing of any transaction in which the Company is to
be consolidated with or acquired by another entity in a merger or other
reorganization, determine that such transaction constitutes a “Change of
Control” for the purposes of this Agreement.


 


(d) Good Reason.  A termination by you for “Good Reason” will
occur whenever any of the following circumstances have taken place: (i) your
position, duties and/or responsibilities are significantly and materially
diminished; (ii) your base salary is reduced, other than such reduction that is
part of a general reduction or other concessionary arrangement affecting all
executive corporate officers of Omtool and its successors; or (iii) Omtool or
any person in control of Omtool requires you to perform your duties principally
in a new location outside a radius of 30 miles from your business location at
the time of the Change of Control.


 


5.             Assignment.  Omtool may assign this Agreement, which will
inure to the benefit of and be enforceable by Omtool’s successors and
assigns.  You may not assign this
Agreement.  Notwithstanding the
forgoing, this Agreement will inure to and be binding upon the Company’s
successors.  The Company will require
any successor who effects an Acquisition to agree in writing to assume this
Agreement.


 


6.             Confidentiality.  The terms and conditions of this Agreement
are strictly confidential.  You shall
not discuss or reveal any information concerning this letter agreement to


 


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any past or present
Omtool employee or any third person or entity other than your counsel and
members of your immediate family.


 


7.               Miscellaneous.


 


(a) In the event
of any dispute, this Agreement will be construed as a whole, will be
interpreted in accordance with its fair meaning, and will not be construed
strictly for or against either you or the Company.  If one or more of the provisions contained in this Agreement
shall for any reason be held to be unenforceable at law, such provision or
provisions shall be construed by the appropriate judicial body by limiting or
reducing it or them, so as to be enforceable to the maximum extent compatible
with (i) the applicable law as it shall then appear and (ii) the parties’
intent.


 


(b) This Agreement
shall be deemed to be made and entered into in the State of New Hampshire.  This Agreement and any claims arising out of
this Agreement (or any other claims arising out of the relationship between the
parties) shall be governed by and construed in accordance with the laws of the
State of New Hampshire and shall in all respects be interpreted, enforced and
governed under the internal and domestic laws of such State, without giving
effect to the principles of conflicts of laws of such State.


 


(c) No waiver by
either party of any breach by you of any provision hereof shall be deemed to be
a waiver of any later or other breach thereof or as a waiver of any other
provision of this Agreement.  This
Agreement may not be waived, amended, discharged or terminated orally or by any
course of dealing between the parties, but only by an instrument in writing
signed by you and either the Company’s Chief Executive Officer or a designated
member of the Company’s Board of Directors.


 


(d) You must
execute a legally enforceable separation agreement and general release in a
form acceptable to Omtool prior to the receipt of any payments or other
benefits set forth above.


 


(e) This Agreement
is the exclusive agreement with respect to the severance payments and benefits
payable to you in the event of a termination of your employment.  All prior negotiations and agreements
regarding severance benefits, whether oral or written, express or implied, are
hereby superseded and cancelled.


 


(f)
As a condition to this Agreement you agree to enter into and execute a
non-competition and non-solicitation agreement with the Company in the form
attached as Exhibit A.


 


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If
this letter sets forth our agreement, kindly sign and return to Omtool the
enclosed copy of this letter.


 


	
   

  	
  Sincerely,

  
	
   

  	
   

  
	
   

  	
  OMTOOL, LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert L. Voelk

  	
   

  
	
   

  	
   

  	
  Robert L. Voelk

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  Accepted and agreed to
  this 29 day of August, 2003

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  /s/
  Daniel A. Coccoluto

  	
   

  	
   

  
	
  Signature

  	
   

  
						



 


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Exhibit A


 


NONCOMPETITION
AND NONSOLICITATION AGREEMENT


 


In consideration and as a condition of my employment
and/or continued employment by Omtool, Ltd. and/or any of its subsidiaries,
subdivisions or affiliates (the “Company”), I hereby agree with the Company as
follows:


 


1.  Best
Efforts.  During the period of my
employment by the Company, I shall devote my full time and best efforts to the
business of the Company and I shall neither pursue any business opportunity
outside the Company nor take any position with any organization other than the
Company without the approval of the Company’s President and/or the Board of
Directors; provided, however, that I may participate in professional, civic,
social and/or charitable activities that do not adversely affect my ability to
carry out my responsibilities to the Company.


 


2.  Noncompetition.  During the period of my employment by the
Company and for one year thereafter (the “Term”), and regardless of the reasons
for my termination, I shall not, in any geographic area in which the Company
currently does business or is anticipating or planning to do business, directly
or indirectly, alone or as a consultant, partner, officer, director, employee,
joint venturer, lender or stockholder of any entity, (a) accept employment with
any business that competes (whether directly or indirectly) with the products
or services being created, developed, manufactured, marketed, distributed or
sold by the Company, or (b) engage in any business or activity that competes
(whether directly or indirectly) with the products or services being created,
developed, manufactured, marketed, distributed or sold by the Company.


 


3.  Nonsolicitation
of Customers.  During the Term, and
regardless of the reasons for my termination, I shall not, directly or
indirectly, alone or as a consultant, partner, officer, director, employee,
joint venturer, lender or stockholder of any entity, contact, solicit or do
business in any competitive capacity (i.e., in any capacity that directly or
indirectly competes with any of the products or services being created,
developed, manufactured, marketed, distributed or sold by the Company) with any
customer of the Company or any potential customer of the Company (i) with whom
I have had contact, or (ii) about whom I obtained or became familiar with
through Confidential Information (as defined in Paragraph 5) during the course
of my employment with the Company.


 


4.  Nonsolicitation
of Employees.  During the Term, and
regardless of the reasons for my termination, I shall not, directly or
indirectly, alone or as a consultant, partner, officer, director, employee,
joint venturer, lender or stockholder of any entity, employ, attempt to employ
or knowingly permit any company or business organization by which I am employed
or which is directly or indirectly controlled by me to employ, any Company
employee, agent, representative or consultant, or any such person whose
employment or consultancy with the Company has terminated within six months
(either before or after) of my departure from the Company, or in any manner
seek to solicit or induce any employee, agent, representative or consultant to
leave his or her employment with the Company, or assist in the recruitment or
hiring of any such person.


 


5.  Nondisclosure.  I shall not at any time, whether during or
after the termination of my employment, reveal to any person or entity any
Confidential Information except to employees of the Company who need to know
such Confidential Information for the purposes of their 


 

















 


employment, or as otherwise authorized by the Company in writing.  The term “Confidential Information” shall
include, without limitation, any information concerning the organization,
business or finances of the Company or of any third party, which the Company is
under an obligation to keep confidential or that is maintained by the Company
as confidential.  Such Confidential
Information shall include, but is not limited to, trade secrets or confidential
information respecting inventions, products, designs, methods, know-how,
techniques, systems, processes, engineering data, software programs, software
code, works of authorship, customer lists, customer information, marketing or
sales information, personnel information, financial information, pricing
information, business plans, projects, plans and proposals.  I shall keep confidential all matters
entrusted to me and shall not use or attempt to use any Confidential
Information except as may be required in the ordinary course of performing my
duties as an employee of the Company, nor shall I use any Confidential
Information in any manner which may injure or cause loss or may be calculated
to injure or cause loss to the Company, whether directly or indirectly.


 


6.  Company
Property.  I agree that during my
employment I shall not make, use or permit to be used any Company Property
otherwise than for the benefit of the Company. 
The term “Company Property” shall include all notes, memoranda, reports,
lists, records, files, drawings, sketches, specifications, designs, software
programs, software code, data, computers, cellular telephones, pagers, credit
and/or calling cards, keys, access cards, documentation or other materials of
any nature and in any form, whether written, printed, electronic or in digital
format or otherwise, relating to any matter within the scope of the business of
the Company or concerning any of its dealings or affairs and any other Company
property in my possession, custody or control. 
I understand that de minimis use of a Company cellular
telephone, pager, credit and/or calling card will not violate this Section,
provided that I timely reimburse the Company for any personal use in accordance
with Company policy.  I further agree
that I shall not, after the termination of my employment, use or permit others
to use any such Company Property.  I
acknowledge and agree that all Company Property shall be and remain the sole
and exclusive property of the Company. 
Immediately upon the termination of my employment I shall deliver all
Company Property in my possession, and all copies thereof, to the Company.


 


7.  Assignment
of Developments.


 


(a) If at any time or times during my employment, I shall (either alone
or with others) make, conceive, create, discover, invent or reduce to practice any
Development that (i) relates to the business of the Company or any
customer of or supplier to the Company or any of the products or services being
developed, manufactured or sold by the Company or which may be used in relation
therewith; or (ii) results from tasks assigned to me by the Company; or
(iii) results from the use of premises or personal property (whether
tangible or intangible) owned, leased or contracted for by the Company, then
all such Developments and the benefits thereof are and shall immediately become
the sole and absolute property of the Company and its assigns, as works made
for hire or otherwise.  The term
“Development” shall mean any invention, modification, discovery, design,
development, improvement, process, software program, work of authorship,
documentation, formula, data, technique, know-how, trade secret or intellectual
property right whatsoever or any interest therein (whether or not patentable or
registrable under copyright, trademark or similar statutes (including, but not limited
to, the Semiconductor Chip Protection Act) or subject to analogous
protection).  I shall promptly disclose
to the Company (or any persons designated by it) each such Development.  I hereby assign all rights (including, but 


 


2

















 


not limited to, rights to inventions, patentable
subject matter, copyrights and trademarks) I may have or may acquire in the
Developments and all benefits and/or rights resulting therefrom to the Company
and its assigns without further compensation and shall communicate, without
cost or delay, and without disclosing to others the same, all available
information relating thereto (with all necessary plans and models) to the
Company.


 


(b) Excluded Developments.  I represent that the Developments identified
in the Appendix, if any, attached hereto comprise all the Developments that I
have made or conceived prior to my employment by the Company, which
Developments are excluded from this Agreement. 
I understand that it is only necessary to list the title of such
Developments and the purpose thereof but not details of the Development
itself.  IF THERE ARE ANY SUCH
DEVELOPMENTS TO BE EXCLUDED, THE UNDERSIGNED SHOULD INITIAL HERE; OTHERWISE IT
WILL BE DEEMED THAT THERE ARE NO SUCH EXCLUSIONS.       .


 


8.  Further
Assurances.  I shall, during my
employment and at any time thereafter, at the request and cost of the Company,
promptly sign, execute, make and do all such deeds, documents, acts and things
as the Company and its duly authorized officers may reasonably require:


 


(a) to apply for, obtain,
register and vest in the name of the Company alone (unless the Company
otherwise directs) patents, copyrights, trademarks or other analogous
protection in any country throughout the world relating to a Development of the
Company and when so obtained or vested to renew and restore the same; and


 


(b) to assist in the
defense of any judicial, opposition or other proceedings in respect of such
applications and any judicial, opposition or other proceeding, petition or
application for revocation of any such patent, copyright, trademark or other
analogous protection.


 


If the Company is unable, after reasonable effort, to
secure my signature as required by this paragraph on any application for
patent, copyright, trademark or other analogous registration or other documents
regarding any legal protection relating to a Development, whether because of my
physical or mental incapacity or for any other reason whatsoever, I hereby
irrevocably designate and appoint the Company and its duly authorized officers
and agents as my agent and attorney-in-fact, to act for and in my behalf and
stead to execute and file any such application or applications or other
documents and to do all other lawfully permitted acts to further the
prosecution and issuance of  patent,
copyright or trademark registrations or any other legal protection thereon with
the same legal force and effect as if executed by me.


 


9.  Employment
At Will.  I understand that neither
this Agreement nor any other document I have signed regarding my employment
with the Company constitutes an express or implied employment contract and that
my employment with the Company is on an “at-will” basis.  Accordingly, I understand that either the
Company or I may terminate my employment at any time, for any or no reason,
with or without prior notice.


 


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10.  Representations.


 


(a) I represent that my employment with the Company and my performance
of all of the terms of this Agreement do not and will not breach any agreement
to keep in confidence proprietary information acquired by me in confidence or
in trust prior to my employment by the Company, nor will it violate any
nonsolicitation and/or noncompetition agreements entered into prior to my
employment with the Company.  I have not
entered into, and I shall not enter into, any agreement either written or oral
in conflict herewith.


 


(b) I further agree that any breach of this Agreement by me will cause
irreparable damage to the Company and that in the event of such breach the
Company shall have, in addition to any and all remedies of law, the right to an
injunction, specific performance or other equitable relief to prevent the
violation of my obligations hereunder.


 


11.  Waiver;
Amendments.  Any waiver by the
Company of a breach of any provision of this Agreement shall not operate or be
construed as a waiver of any subsequent breach of such provision or any other
provision hereof.  In addition, any
amendment to or modification of this Agreement or any waiver of any provision
hereof must be in writing and signed by the Company’s President or, if
applicable, a member of the Board of Directors.


 


12.  Severability.  I agree that each provision and the subparts
of each provision herein shall be treated as separate and independent clauses,
and the unenforceability of any one clause shall in no way impair the enforce­ability
of any of the other clauses of the Agreement. 
Moreover, if one or more of the provisions contained in this Agreement
shall for any reason be held to be excessively broad as to scope, activity,
subject or otherwise so as to be unenforceable at law, such provision or
provisions shall be construed by the appropriate judicial body by limiting or
reducing it or them, so as to be enforceable to the maximum extent compatible
with the applicable law as it shall then appear.  I hereby further agree that the language of all parts of this
Agreement shall in all cases be construed as a whole according to its fair
meaning and not strictly for or against either of the parties.


 


13.  Survival.  This Agreement shall be effective as of the
date entered below.  My obligations
under this Agreement shall survive the termination of my employment regardless
of the manner of such termination and shall be binding upon my heirs,
executors, administrators and legal representatives.


 


14.  Assignment.  The Company shall have the right to assign
this Agreement to its successors and assigns, and all covenants and agreements
hereunder shall inure to the benefit of and be enforceable by said successors
or assigns.  I will not assign this
Agreement.


 


15.  Governing
Law; Forum Selection Clause.  This
Agreement shall be governed by and construed in accordance with the laws of the
State of New Hampshire and shall in all respects be interpreted, enforced and
governed under the internal and domestic laws of the State of New Hampshire,
without giving effect to the principles of conflicts of laws of such
State.  Any claims or legal actions by
one party against the other arising out of this Agreement shall be governed by
the laws of the State of New Hampshire and shall be commenced and maintained in
any state or federal court located in New Hampshire, and I hereby submit to the
jurisdiction and venue of any such court.


 


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16.           Entire
Agreement.  This Agreement sets
forth the complete, sole and entire agreement between the parties with respect
to my noncompetition and nonsolicitation obligations and supersedes any and all
other agreements, negotiations, discussions, proposals, or understandings,
whether oral or written, previously entered into, discussed or considered by
the parties.  This Agreement does not
supercede the Severance Agreement between the Company and me of even date
herewith.


 


IN WITNESS HEREOF, the undersigned has executed this
Agreement as a sealed instrument as of the date first written below.


 


 


	
   

  	
  Signature:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
				



 


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APPENDIX
– TITLE/PURPOSE OF DEVELOPMENTS


 


The
following is a complete list of all Developments and the purpose of those
Developments:


 


 


	
   

  	
   

  	
   

  	
  No
  Developments

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  See
  Below

  



 


 


Developments
and purpose:


 


	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  



 


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