Document:

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                                                                   EXHIBIT 10.40

                              EMPLOYMENT AGREEMENT

         This Employment Agreement (this "Agreement") is made and entered into
as of the 20th day of March, 2000, by and between Mobility Electronics, Inc., a
Delaware corporation ("Employer"), and Don Johnson ("Employee").

                              W I T N E S S E T H:

         WHEREAS, Employer desires to employ Employee as provided herein, and
Employee desires to accept such employment; and

         WHEREAS, Employee shall, as an employee of Employer, have access to
confidential information with respect to Employer and its affiliates;

         NOW THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:

         1. Employment. Employer hereby employs Employee and Employee hereby
accepts employment with Employer upon the terms and conditions hereinafter set
forth.

         2. Duties. Subject to the power of the Board of Directors of Employer
(the "Board") to elect and remove officers, Employee shall serve Employer as
Executive Vice President, Worldwide Sales, Marketing and Operations of Employer,
and shall perform, faithfully and diligently, the services and functions
relating to such office or otherwise reasonably incident to such office as may
be designated from time to time by the Board, the Chief Executive Officer or the
President of Employer. As such, Employee shall report directly to the President
of Employer. Employee shall be based in Scottsdale, Arizona, but shall have
duties and responsibilities at and/or with respect to each location at which
Employer or any of its subsidiaries conducts the Business (as hereinafter
defined) and shall travel as reasonably required by his duties under this
Agreement. Employee shall devote his full time, attention, energies and business
efforts to his duties hereunder and to the promotion of the business and
interests of Employer and its subsidiaries as is customary for an Executive Vice
President of a company of like-size in a comparable business.

         3. Term. The term of this Agreement shall commence as of April 1, 2000,
and shall continue, unless earlier terminated pursuant to Section 7 below, for a
period of three (3) years thereafter (the "Initial Term"); provided, however,
that the term of this Agreement shall thereafter be renewed on a year-to-year
basis thereafter (each, a "Renewal Term"), unless either party gives written
notice to the other party, at least ninety (90) days prior to the end of the
then current term, of such party's desire to terminate this Agreement at the end
of the then current term. The Initial Term and any Renewal Term(s) are sometimes
collectively referred to herein as the "Term".

         4. Compensation. As compensation for his services rendered under this
Agreement, during the Term Employee shall be entitled to receive the following:

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                  (a) Salary. Employee shall be paid a salary as provided in
         Exhibit A (the "Salary").

                  (b) Bonus. Employee shall also be entitled to receive bonuses
         as provided in Exhibit A.

                  (c) Stock Options. As of the date hereof, Employer shall
         execute and deliver to Employee a Stock Option Agreement, the form of
         which is attached hereto as Exhibit B.

                  (d) Benefits. Employee shall also be entitled to receive such
         group benefits as Employer may provide to its other employees at
         comparable salaries and responsibilities to those of Employee.

                  (e) Expenses. Employer shall reimburse Employee for the
         expenses identified on Exhibit A and for all reasonable out-of-pocket
         travel and other expenses incurred by Employee in rendering services
         required under this Agreement upon submission of a detailed statement
         and reasonable documentation.

         5. Confidentiality.

                  (a) Acknowledgment of Proprietary Interest. Employee
         recognizes the proprietary interest of Employer and its affiliates in
         any Trade Secrets (as hereinafter defined) of Employer and its
         affiliates. Employee acknowledges and agrees that any and all Trade
         Secrets currently known by Employee or learned by Employee during the
         course of his engagement by Employer or otherwise, whether developed by
         Employee alone or in conjunction with others or otherwise, shall be and
         are the property of Employer and its affiliates. Employee further
         acknowledges and understands that his disclosure of any Trade Secrets
         may result in irreparable injury and damage to Employer and its
         affiliates. As used herein, "Trade Secrets" means all confidential and
         proprietary information of Employer and its affiliates, now owned or
         hereafter acquired, including, without limitation, information derived
         from reports, investigations, experiments, research, work in progress,
         drawing, designs, plans, proposals, codes, marketing and sales
         programs, client lists, client mailing lists, financial projections,
         cost summaries, pricing formula, and all other concepts, ideas,
         materials, or information prepared or performed for or by Employer or
         its affiliates and information related to the business, products or
         sales of Employer or its affiliates, or any of their respective
         customers, other than information which is otherwise publicly
         available.

                  (b) Covenant Not-to-Divulge Trade Secrets. Employee
         acknowledges and agrees that Employer and its affiliates are entitled
         to prevent the disclosure of Trade Secrets. As a portion of the
         consideration for the employment of Employee and for the compensation
         being paid to Employee by Employer, Employee agrees at all times during
         the Term and for a period of five (5) years thereafter to hold in
         strict confidence and not to intentionally disclose (except for such
         disclosures as are required by law, in which case, Employee agrees to
         give Employer notice thereof prior to making any such disclosure) or
         allow to be disclosed to any person, firm or corporation, other than to

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         persons engaged by Employer and its affiliates to further the business
         of Employer and its affiliates, and not to use except in the pursuit of
         the business of Employer and its affiliates, the Trade Secrets, without
         the prior written consent of Employer, including Trade Secrets
         developed by Employee.

                  (c) Return of Materials at Termination. In the event of any
         termination or cessation of his employment with Employer for any reason
         whatsoever, Employee will promptly deliver to Employer all documents,
         data and other information pertaining to Trade Secrets. Employee shall
         not take any documents or other information, of whatever type and in
         whatever form, or any reproduction or excerpt thereof, containing or
         pertaining to any Trade Secrets.

                  (d) Competition During and After Employment. Employee agrees
         that during the Term and for a period of one year thereafter, neither
         Employee, nor any of his affiliates, will directly or indirectly act as
         an investor, principal, member, partner, officer, director, employee,
         consultant, shareholder, lender, or agent of any entity which is
         engaged in any business which is in competition with the business
         conducted by Employer and its subsidiaries during the Term (the
         "Business") within the World; provided, however, that: (i) this Section
         5(d) shall not prohibit Employee or any of his affiliates from
         purchasing or holding an aggregate equity interest of not more than 1%
         in any business in competition with the Business being conducted by
         Employer and its subsidiaries; (ii) this Section 5(d) shall not apply
         if a termination occurs pursuant to subpart (e) of the first paragraph
         of Section 7 below; (iii) this Section 5(d) shall not apply if a
         termination of Employee's employment occurs and the conditions of
         Section 8(a) below have been satisfied; or (iv) following any
         termination of this Agreement, Employee may work with any personal
         computer company in a capacity which is not competitive with the
         Business.

         6. Prohibition on Disparaging Remarks. Employee shall, from the date of
this Agreement forward, refrain from making disparaging, negative or other
similar remarks concerning Employer or any of its affiliates to any third party.
Similarly, Employer and its affiliates shall from the date of this Agreement
forward, refrain from making disparaging, negative or other similar remarks
concerning Employee to any third party.

         7. Termination. This Agreement and the employment relationship created
hereby shall terminate upon the occurrence of any of the following events (each,
a "Termination Event"):

                  (a) The expiration of the Term as set forth in Section 3
         above;

                  (b) The death of Employee;

                  (c) The Disability (as hereinafter defined) of Employee;

                  (d) Written notice to Employee from Employer of termination
         for Just Cause (as hereinafter defined);

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                  (e) Written notice to Employee from Employer of termination
         for any reason other than Just Cause;

                  (f) Written notice to Employer from Employee of termination
         for any reason other than Constructive Termination (as hereinafter
         defined); or

                  (g) Written notice to Employer from Employee of termination
         for Constructive Termination.

         In the event of the termination of Employee's employment pursuant to
(a), (b), (c), (d) or (f) above, then Employee shall be entitled to only the
compensation earned by Employee as of, and payable for the period prior to, the
date of such Termination Event. In the event of the termination of Employee's
employment pursuant to (e) or (g) above, then Employee shall be entitled to
continue to receive the Salary for a period of six (6) months following the date
of termination. Notwithstanding anything to the contrary in this Agreement, the
provisions of Sections 5 and 6 above shall survive any termination, for whatever
reason, of Employee's employment under this Agreement.

         For purposes of this Section 7 the following terms of the following
meanings:

                  "Constructive Termination" shall mean: (a) a material
         reduction in Employee's duties and responsibilities without Employee's
         consent; (b) if Employee is terminated as the Executive Vice President,
         Worldwide Sales, Marketing and Operations of Employer; (c) any breach
         by Employer of any of the material terms of, or the failure to perform
         any material covenant contained in, this Agreement and following
         written notice thereof from Employee to Employer, Employer does not
         cure such breach or failure within fifteen (15) days thereafter;
         provided, however, that Employer will not be entitled to cure any such
         breach or failure more than one time in any consecutive three month
         period; (d) a required relocation by Employee from the Phoenix, Arizona
         metroplex; or (e) a reduction in Employee's Salary without Employee's
         prior written consent.

                  "Disability" of Employee shall mean his inability, because of
         mental or physical illness or incapacity, to perform his duties under
         this Agreement for a continuous period of 90 consecutive days or for
         any 120 days out of a 360-day period. In the event of any disagreement
         between Employer and Employee regarding the existence or non-existence
         of any such disability, upon written request from either party to the
         other, Employer and Employee or his legal guardian or duly authorized
         attorney-in-fact (if he is not legally competent) shall each designate
         one Arizona licensed physician and the two physicians so designated
         shall designate a third. All three physicians so appointed shall
         personally examine Employee, and the decision of a majority of such
         panel of physicians shall determine whether such disability exists.
         Employee hereby authorizes the disclosure and release to Employer of
         such determination and all supporting medical records, and both parties
         hereby agree to be bound by such determination.

                  "Just Cause" shall mean: (a) the commission by Employee of any
         act involving moral turpitude or the commission by Employee of any act
         or the suffering by Employee of any occurrence or state of facts, which
         renders Employee incapable of performing his

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         duties under this Agreement (other than Disability), or adversely
         affects or could be expected to adversely affect Employer's business
         reputation; (b) Employee's being convicted of a felony; (c) any breach
         by Employee of any of the material terms of, or the failure to perform
         any material covenant contained in, this Agreement and following
         written notice thereof from Employer to Employee, Employee does not
         cure such breach or failure within fifteen (15) days thereafter;
         provided, however, that Employee will not be entitled to cure any
         breach or failure under this subclause (c) more than one time in any
         consecutive six month period; (d) the violation by Employee of
         reasonable and appropriate instructions or policies established by
         Employer or the Chief Executive Officer or President of Employer which
         have been communicated to Employee with respect to the operation of
         Employer's businesses and affairs or Employee's failure to carry out
         the reasonable instructions of the Board or the Chief Executive Officer
         or President of Employer and following written notice thereof to
         Employee, Employee does not cure any such violation or failure within
         fifteen (15) days thereafter; provided, however, that Employee will not
         be entitled to cure any violation or failure under this subclause (d)
         more than one time in any consecutive six month period; or (e) the
         commission by Employee of any act or the existence of any state of
         facts which would legally justify an employer in terminating a contract
         of employment.

         8. Change in Control.

                  (a) Termination Payment. Notwithstanding anything to the
         contrary contained in Section 7 above, if Employee's employment with
         Employer is terminated by: (i) Employer by reason of subpart (e) of the
         first paragraph of Section 7 above; or (ii) Employee by reason of
         subpart (g) of the first paragraph of Section 7 above, and, in either
         case, such termination occurred within two (2) years following a Change
         In Control (as defined in subparagraph (b) below), then, in either
         event, Employee shall be entitled to receive a lump-sum payment equal
         to the Employee's then current Salary for the remainder of the then
         applicable Term.

                  (b) Change In Control. A "Change In Control" will be deemed to
         have occurred for purposes hereof: (i) upon the consolidation or merger
         of Employer with or into another corporation or business entity
         pursuant to which immediately following such merger or consolidation,
         Employer's stockholders fail to hold at least a majority of the voting
         stock of the surviving entity or its ultimate parent corporation; (ii)
         upon the sale or other transfer in a single transaction or a series of
         related transactions of all or substantially all of the assets of
         Employer, except to a subsidiary of Employer; or (iii) upon the
         acquisition of beneficial ownership, directly or indirectly, by any
         person (as such term is used in Sections 13(d) and 14(d)(2) of the
         Securities Exchange Act of 1934, as amended) of securities of Employer
         representing more than fifty percent (50%) of the combined voting power
         of Employer's then outstanding voting securities.

         9. Remedies. Employee recognizes and acknowledges that in the event of
any default in, or breach of any of, the terms, conditions or provisions of this
Agreement (either actual or threatened) by Employee, Employer's and its
affiliates remedies at law shall be inadequate. Accordingly, Employee agrees
that in such event, Employer and its affiliates shall have the right of specific
performance and/or injunctive relief in addition to any and all other

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remedies and rights at law, in equity or provided herein, and such rights and
remedies shall be cumulative.

         10. Acknowledgments. Employee acknowledges and recognizes that the
enforcement of any of the provisions set forth in Section 5 and 6 above by
Employer and its affiliates will not interfere with Employee's ability to pursue
a proper livelihood. Employee recognizes and agrees that the enforcement of this
Agreement is necessary to ensure the preservation and continuity of the business
and good will of Employer and its affiliates.

         11. Notices. Any notices, consents, demands, requests, approvals and
other communications to be given under this Agreement by either party to the
other shall be deemed to have been duly given if given in writing and personally
delivered or sent by facsimile transmission, courier service, overnight delivery
service or by mail, registered or certified, postage prepaid with return receipt
requested, as follows:

          If to Employer:              Mobility Electronics, Inc.
                                       7955 East Redfield Road
                                       Scottsdale, Arizona 85260
                                       Attn: President
                                       Fax: 602/596-0349

          If to Employee:              Don Johnson

                                       --------------------------

                                       --------------------------

Notices delivered personally or by facsimile transmission, courier service or
overnight delivery shall be deemed communicated as of actual receipt; mailed
notices shall be deemed communicated as of three days after the date of mailing.

         12. Entire Agreement. This Agreement, including the Exhibits attached
hereto, contains the entire agreement of the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements and understandings,
oral or written between the parties hereto with respect hereto. No modification
or amendment of any of the terms, conditions or provisions herein may be made
otherwise than by written agreement signed by the parties hereto.

         13. Governing Law and Venue. THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE INTERPRETED, CONSTRUED, AND ENFORCED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO ITS CHOICE OF LAW PRINCIPLES.
ANY ACTION BROUGHT BY EITHER PARTY HERETO INVOLVING ENFORCEMENT, TERMINATION,
INTERPRETATION, OR MODIFICATION HEREOF, OR OTHERWISE RELATED TO THIS AGREEMENTS
IN ANY WAY SHALL BE BROUGHT IN A COURT LOCATED IN PHOENIX, ARIZONA, AND NEITHER
PARTY HERETO SHALL BE HEARD TO ASSERT THE DEFENSE OF INCONVENIENT FORUM IN ANY
SUCH ACTION.

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         14. Parties Bound. This Agreement and the rights and obligations
hereunder shall be binding upon and inure to the benefit of Employer and
Employee, and their respective heirs, personal representatives, successors and
assigns. Employer shall have the right to assign this Agreement to any affiliate
or to its successors or assigns. The terms "successors" and "assigns" shall
include any person, corporation, partnership or other entity that buys all or
substantially all of Employer's assets or all of its stock, or with which
Employer merges or consolidates. The rights, duties or benefits to Employee
hereunder are personal to him, and no such right, duty or benefit may be
assigned by him. The parties hereto acknowledge and agree that Employer's
affiliates are third-party beneficiaries of the covenants and agreements of
Employee set forth in Sections 5 and 6 above.

         15. Arbitration. Any dispute or claim arising under or with respect to
this Agreement shall be settled by arbitration in Phoenix, Arizona, pursuant to
the rules and guidelines of the American Arbitration Association - Commercial
Division. The decision of the arbitrators shall be final and binding upon
Employer and Employee, and any decision or award rendered by the arbitrators may
be entered as a judgment or order in any court having jurisdiction.

         16. Estate. If Employee dies prior to the payment of all sums owed, or
to be owed, to Employee pursuant to Section 4 above, then such sums, as they
become due, shall be paid to Employee's estate.

         17. Enforceability. If, for any reason, any provision contained in this
Agreement should be held invalid in part by a court of competent jurisdiction,
then it is the intent of each of the parties hereto that the balance of this
Agreement be enforced to the fullest extent permitted by applicable law.
Accordingly, should a court of competent jurisdiction determine that the scope
of any covenant is too broad to be enforced as written, it is the intent of each
of the parties that the court should reform such covenant to such narrower scope
as it determines enforceable.

         18. Waiver of Breach. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach by any party.

         19. Captions. The captions in this Agreement are for convenience of
reference only and shall not limit or otherwise affect any of the terms or
provisions hereof.

         20. Costs. If any action at law or in equity, or by reason of Section
14 above, is necessary to enforce or interpret the terms of this Agreement, the
prevailing party shall be entitled to reasonable attorneys' fees, costs and
necessary disbursements in addition to any other relief to which he or it may be
entitled.

         21. Other Obligations. Employee represents and warrants that he is not
subject to any agreement which would be violated or breached as a direct or
indirect result of Employee executing this Agreement or Employee becoming an
employee of Employer.

         22. Affiliate; Subsidiary. An "affiliate" of any party hereto shall
mean any person controlling, controlled by or under common control with such
party. A "subsidiary" of Employer is any partnership, corporation, limited
liability company or other entity in which Employer owns an equity interest. For
purposes of this Agreement, the term "control", when

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used with respect to any specified person or entity means the power to direct or
cause the direction of the management and policies of such person or entity,
directly or indirectly, whether through the ownership of voting securities of
ten percent (10%) or more, by contract, or otherwise, and the term "controlled"
has the meaning correlative to the foregoing.

         23. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which shall
constitute one and the same instrument, but only one of which need be produced.

         IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.

                                       MOBILITY ELECTRONICS, INC.

                                       By: /s/ CHARLES R. MOLLO
                                          --------------------------------------
                                       Title:  President
                                             -----------------------------------

                                       /s/ DON JOHNSON
                                       -----------------------------------------
                                             Don Johnson

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                                    EXHIBIT A

A.       Base Salary:            Employee shall receive an annual Salary of
                                 $220,000, payable bi-weekly in arrears, which
                                 annual Salary shall be subject to increase from
                                 time to time as may be determined by the Board.

B.       Bonus Compensation:     Employee shall be eligible to receive an annual
                                 cash bonus, targeted at 40% of base salary, as
                                 determined under a bonus plan of Employer to be
                                 developed by the Board for Employer's executive
                                 officers.

C.       Additional Benefits:    Employee shall have four (4) weeks paid
                                 vacation.

D.       Additional Expenses:    Employee shall receive a relocation
                                 reimbursement to move to Scottsdale as mutually
                                 agreed up to a maximum of $100,000.

E.       Annual Raise:           Employee shall be eligible for and receive an
                                 annual raise as determined by the board of
                                 directors.

                                      A-1<PAGE>   1
                                                                   EXHIBIT 10.41

                           STRATEGIC VENDOR AGREEMENT

     This Strategic Vendor Agreement (this "Agreement") is made as of August
10, 1998, by and between Mobility Electronics, Inc., a Delaware corporation
("Mobility"), and Molex Incorporated, a Delaware corporation ("Molex").
Mobility and Molex are sometimes each referred to herein as a "Party" and
collectively as the "Parties".

                                   BACKGROUND

     Molex is a developer and Manufacturer of connectors and cable for the
computer industry. Mobility is a manufacturer and distributor of portable
computer connectivity products. The Parties desire to form a strategic
relationship whereby Molex will develop a unique cable assembly interface
solution with a proprietary connector interface for the Universal Dock (as
defined below), all on the terms and conditions set forth in this Agreement.

1.   DEFINITIONS.

     For purposes of this Agreement, the following terms shall have the
following meanings unless the context clearly otherwise requires:

          "Person" shall mean any individual, sole proprietorship, joint
     venture, partnership, corporation, association, joint-stock company,
     unincorporated organization, cooperative, trust, estate, or any other
     entity of any kind or nature whatsoever.

          "Product" shall mean a unique cable assembly interface solution with a
     proprietary connector interface to be developed by Molex for Mobility. The
     Product shall be designed from specifications provided by Mobility and
     shall be for the exclusive use of Mobility and its customers; with any
     other use requiring the prior written approval of Mobility.

          "Universal Dock" shall mean Mobility's Universal Dock product, which
     product is described in Exhibit A.

2.   DEVELOPMENT OF THE PRODUCT; EXCLUSIVISITY.

     (a) Development of the Product. Molex hereby agrees to develop, at its
primary cost and expense, the Product. The Product shall meet the specifications
required for the Universal Dock, which specifications are set forth in Exhibit
B, but which may be changed from time to time by Mobility in connection with the
development of the Universal Dock. Molex will use all reasonable commercial
efforts to meet Mobility's cable and connector requirements for the Universal
Dock with respect to cost, product development schedules and performance
criteria.

     (b) Use of Technology. The patented technology utilized by Molex in
developing the Product shall be the exclusive property of Molex, and may be
utilized by Mobility without a license. In addition, Mobility shall have the
exclusive right to utilize the Product in the Universal

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Dock, and Molex hereby agrees not to offer, sell or otherwise market to any
Person, directly or indirectly, the Product, or any cable or connectors which
is, or could reasonably be expected to be, competitive with the Product.
Notwithstanding the above, Molex will have the right to use the patented and
proprietary technology in the Product in applications not related to, or
competitive with, the Universal Dock.
     (c) Molex Exclusivity. Mobility agrees to utilize Molex as the exclusive
supplier for its initial and ongoing Universal Dock cable and connector
requirements; provided that Molex meets Mobility's quality, price and delivery
requirements as provided in Exhibit C, which Exhibit may be amended from time to
time by Mobility, upon sixty days prior written notice, as Mobility's needs
change. If Molex fails to meet the above requirements, Molex shall develop and
implement a plan of corrective action, reasonably acceptable to Mobility, within
thirty days after notice from Mobility (or such other period of time as agreed
to by the Parties). Notwithstanding the above, that Mobility shall be permitted
to second source up to 30% of its Product requirements for the Universal Dock
from a mutually agreeable other Person to the extent required by any significant
customer of Mobility provided that (i) Mobility purchases an agreed upon number
of products in calendar year 2000 and in any calendar year thereafter and (ii)
an appropriate license is granted to any such Person from Molex (which license
will be set forth in a separate document, but will be limited to a royalty of
not more than 5% of the Product sales price).

3.   Term. The term of this Agreement shall commence as of the date first above
written, and shall remain in effect for an initial term ending on the later of
June 30, 2001 or whenever the volume commitments outlined in Exhibit B and C
have been fulfilled (the "Initial Term"), which Initial Term shall be deemed to
be extended for an additional one-year term (each, a "Renewal Term") at the end
of the Initial Term and any Renewal Term, unless either Party delivers to the
other Party written notice at least ninety (90) days before the end of the
Initial Term or the applicable Renewal Term of such Party's desire to terminate
this Agreement at the expiration of the Initial Term or Renewal Term (as the
case may be). As used herein, "Term" shall mean the Initial Term and any Renewal
Term. The Parties acknowledge that Exhibits B and C have not yet been completed,
and that the Parties shall use all reasonable commercial efforts to complete
such Exhibits as soon as possible (but no later than October 1, 1998), at which
time such Exhibits shall be attached to this Agreement. If the parties have not
agreed upon Exhibits B and C by October 1, 1998 either party may terminate this
agreement without additional obligation by providing written notice within
thirty (30) days to the other party.

4.   PURCHASE ORDERS; FORECASTS.

     (a) Purchase Orders. Mobility will issue to Molex from time to time in
writing purchase orders for Products (each, a "PO", and collectively, the
"POs"), which POs shall be in substantially the form of Exhibit D. The terms and
conditions of this Agreement shall govern in the event of any inconsistency
between any PO and the terms and conditions of this Agreement. POs may only be
changed, rescheduled or canceled as follows (i) POs may not be changed,
rescheduled or canceled within thirty (30) days or the requested date of
delivery; (ii) POs may be rescheduled. but not otherwise changed or canceled,
between thirty (30) days and sixty (60) days

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of the requested upon date of delivery; and (iii) POs may be changed,
rescheduled or canceled if the requested date of delivery is more that sixty
(60) days from the date of any notice of change, rescheduling or cancellation.
Upon completion of Exhibits B and C, Mobility agrees to place a PO for an
initial quantity of Products.

     (b) Forecasts; Inventory. Mobility agrees that during the Term, it shall
provide Molex on or before the beginning of each month a six-month rolling
forecast (each, a "Forecast" and collectively, the "Forecasts") for the
Products, and any future products agreed to between the Parties. Molex agrees to
establish master production schedules for the Products in order to meet
Mobility's expected needs thereof provided in the Forecasts. The Forecasts shall
not be binding commitments of Mobility, but their sole purpose is to enable
Molex to plan its manufacturing and inventory requirements.

5.   PRICING; PAYMENT.

     (a) Pricing. The initial Products shall be marketed and sold by Molex to
Mobility for the prices set forth on Exhibit C. All Products shall be delivered
F.O.B. Molex's plant. Any future cables or connectors designed by Molex for
Mobility shall be priced as may be mutually agreed to by the Parties. Molex
agrees to use its best efforts to meet the targeted price reductions set forth
in Exhibit C.

     (b) Payment Terms. The purchase price for any Products ordered by Mobility
from Molex pursuant to a PO shall be due and payable within forty-five (45)
days after the date of invoice from Molex. Molex shall invoice PO's upon
delivery of the ordered Products to Mobility.

6.   WARRANTY AND; REMEDIES

     (a) Warranty. Molex warrants that the Products shall be free from defects
in material and workmanship, and agrees to repair or replace any defective
Products for a period equal to any warranty period provided by Mobility to its
customers (but in no event, not to exceed (3) three years). This warranty is for
the benefit of Mobility and Persons purchasing or using a Universal Dock which
utilizes any Products. OTHER THAN THE WARRANTIES SET FORTH ABOVE MOLEX MAKES NO
OTHER WARRANTIES OR REPRESENTATIONS OF ANY KIND WHETHER EXPRESS OR IMPLIED,
INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR
PURPOSE, MERCHANTABILITY OR AS TO ANY OTHER MATTER.

     (b) Remedies. EXCEPT FOR ACTIONS INSTITUTED BY THIRD PERSONS AGAINST
MOBILITY, MOBILITY'S SOLE AND EXCLUSIVE REMEDY AND MOLEX'S SOLE OBLIGATION FOR
ANY BREACH OF THE WARRANTIES CONTAINED IN THIS SUBSECTION SHALL BE LIMITED TO
THE REPAIR OR REPLACEMENT OF THE PRODUCTS, AS MOLEX IN ITS SOLE DISCRETION SHALL
DETERMINE. NEITHER PARTY SHALL BE LIABLE OR RESPONSIBLE TO THE OTHER PARTY FOR
ANY CONSEQUENTIAL, INDIRECT, INCIDENTAL, PUNITIVE, DIRECT OR SPECIAL

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DAMAGES BASED UPON BREACH OF WARRANTY, BREACH OF CONTRACT, NEGLIGENCE, OR
OTHERWISE OR ANY OTHER LEGAL THEORY.

7.   DEFAULT.

     (a) Default by Mobility. In the event that: (i) Mobility shall default in
the payment of any PO when due, and such default is not cured within thirty (30)
days after written notice from Molex to Mobility; or (ii) Mobility shall default
in the observance or performance of any other material covenant or agreement in
this Agreement, and such default shall continue for a period of thirty (30) days
after written notice from Molex to Mobility; then, and in any such event, Molex
may, by written notice to Mobility, terminate this Agreement, in addition to any
other rights Molex may have against Mobility at law or in equity.

     (b) Default by Molex. In the event that Molex shall default in the
observance or performance of any other material covenant or agreement in this
Agreement or under any PO, and such default shall continue for a period of
thirty (30) days after written notice from Mobility to Molex; then, and in any
such event, Mobility may, by written notice to Molex, terminate this Agreement,
in addition to any other rights Mobility may have against Molex at law or in
equity.

5.   CONFIDENTIALITY.

     (a) Information. All information furnished by or on behalf of either Party
(the "Disclosing Party") to the other Party (the "Receiving Party") in
connection with the transactions contemplated hereby shall be deemed
confidential. As used herein, "Information" includes all confidential and
proprietary information of such party (including, without limitation, all
software or hardware product information, designs, trade secrets, customer
lists, pricing policies and patent applications pertaining or relating to such
products and marketing and promotion information with respect to such products,
business policies and practices), except information which (i) is or becomes
generally available to the public other than as a result of disclosure which is
in violation of this Agreement, (ii) was known by the Receiving Party on a
nonconfidential basis prior to its disclosure thereof, as evidenced by such
Receiving Party's records, (iii) was fully disclosed in a patent issued anywhere
in the world, or (iv) is acquired by the Receiving Party from a third party who
has no confidential commitment, directly or indirectly, to the Disclosing Party
with respect to same. As used herein, "Materials" shall mean all tangible
materials containing Information, including, without limitation, written or
printed documents and computer disks or tapes.

     (b) Nondisclosure. Each Party agrees that it will keep all Information
confidential and, except as permitted by the remainder of this subsection (a) or
with the express prior written consent of the other Party, will not (i) disclose
or permit the disclosure of any of such Information to any person or entity
(including, without limitation, any of its employees, agents, representatives or
affiliates), (ii) use or permit the use of the Information in any way
detrimental to the other Party, or (iii) use or permit the use of the
Information for any purpose other than in connection with the transactions
contemplated hereby. Each Party is permitted to disclose the Information to such
of its employees, attorneys and advisors (the "Authorized Representatives") who
need to

                                       4

<PAGE>   5

know such Information for the sole purpose of such Party's participation in the
Project. Each Party agrees to inform those of its Authorized Representatives to
whom it wishes to disclose any of the information of the existence of these
confidentiality provisions and will cause each of such persons to agree to be
bound by the terms of this letter. Each Party shall be responsible for the
breach of this Agreement by its Authorized Representatives.

     (c) Return of Information. Each Party agrees that it will deliver to the
other Party, promptly upon the written request of the other Party, all written
or tangible information furnished by or on behalf of the other Party to such
Party in connection with the Project, including all Material and all copies or
extracts of such Information and all notes based upon Information. The Receiving
Party agrees to segregate all Materials from the confidential materials of
others in order to prevent commingling. The Receiving Party agrees not to
reverse engineer, decompile or disassemble any software disclosed to such
Receiving Party. Each Party may visit the other Party's premises, with
reasonable prior notice and during normal business hours, to review the other
Party's compliance with the terms of this Agreement.

     (d) Remedies. Each Party agrees that money damages would not be a
sufficient remedy for any breach of the provisions of this Section 8 by the
other Party or its Authorized Representatives, and that each Party shall be
entitled to seek specific performance as a remedy for any breach hereof, in
addition to all other remedies available at law or in equity to the other Party.

9.   MISCELLANEOUS.

     (a) Assignment. This Agreement and the rights and obligations of the
Parties hereunder shall be binding upon and inure to the benefit of the Parties
and their respective successors and assigns. Neither Party shall assign this
Agreement or any rights or obligations hereunder without first obtaining the
written consent of the other Party, which consent shall not be unreasonably
withheld.

     (b) Amendments; Entire Agreement. This Agreement may not be altered,
amended, changed, or terminated without a written agreement signed by the
Parties. This Agreement and the Exhibits represent the entire agreement between
the Parties with respect to the subject matter hereof, and supersedes any and
all existing and prior agreements between the Parties with respect thereto.

     (c) Notices. Any notice required to be given hereunder by either party
shall be in writing and any be given by hand delivery, by delivery to a
nationally recognized overnight courier, or by sending the same by facsimile or
telex or by registered air mail, postage prepaid, addressed to the other at the
respective numbers, places or addresses set forth below, or to such other
facsimile number, telex number, address, place or places as the parties, or
either of them from time to time may designate in writing. All such notices,
demands and communications shall be deemed to have been duly given or made; (i)
on the date delivered if hand delivered or via overnight courier, charges
prepaid; (ii) three days after the date deposited via U.S. mail if mailed
certified mail, return receipt requested; or (iii) on the date sent if sent by
telex or facsimile

                                        5

<PAGE>   6

transmission provided that (1) in the case of a telex transmission, the receipt
of the telex is confirmed by way of the callback signal; (2) in the case of a
facsimile transmission, receipt of confirmation from the facsimile transmitter
at the conclusion of the transmission of complete and uninterrupted transmission
of the facsimile, on the day of transmission at the place where the recipient is
located except when it is transmitted after 5:00 p.m. Arizona time at that
place, then on the next business day. All notices shall be sent to the following
addresses:

               If to Mobility:         Mobility Electronics
                                       7955 East Redfield Road
                                       Scottsdale, Arizona 85260
                                       Attention: Charles R. Mollo
                                       Telecopier No.: (602) 596-0349

               With a copy to:         Richard F, Dahlson, Esq.
                                       Jackson Walker L.L.P.
                                       901 Main Street, Suite 6000
                                       Dallas, Texas 75202
                                       Telecopier No: (214) 953-6187

               If to Molex:            Molex Incorporated
                                       222 Wellington Court
                                       Lisle, IL 60532-1682
                                       Attention: Gary Manchester
                                       Telecopier No.: (630)969-1352

     (d) Non-Waiver. No failure by either part to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise by either party of any right hereunder preclude any
other further exercise thereof or the exercise of any other right.

     (c) Headings. Headings in this Agreement are for convenience only and shall
not be used to interpret or construe its provisions.

     (f) Severability. If any term or other provision of this Agreement is held
to be invalid, illegal or unenforceable by any rule of law or public policy,
such provision shall be fully severable and this Agreement shall be construed
and enforced as if such illegal, invalid or unenforceable provision never
comprised a part hereof; and the remaining provisions hereof shall remain in
full force and effect and shall not be effected by the illegal, invalid or
unenforceable provision or by its severance herefrom. Furthermore, in lieu of
such illegal, invalid or unenforceable provision, there shall be added
automatically as part of this Agreement a provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible and be legal,
valid and enforceable.

     (g) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without regard to choice of
law principles.

                                        6

<PAGE>   7

     (h) Force Majeure. Neither Party shall be penalized under any
non-performance standards contained in this Agreement by reason, directly or
indirectly, from fire, explosion, strike, freight embargo, Act of God, or the
public enemy, war, civil disturbances, quarantine, or epidemic. Each Party
agrees, however, to use its best efforts to remedy such mishaps and restore
normal business activities within a reasonable period of time.

     (i) No Agency Created. This Agreement shall not constitute either Party an
affiliate, joint venturer, partner, agent, employee or representative of the
other Party for any purpose.

     (j) Counterparts. This Agreement may be executed in two counterparts, each
of which shall be deemed an original but all of which together shall constitute
one and the same instrument.

     IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly
executed and is effective as of the date and year first above written.

                                            MOBILITY ELECTRONICS, INC.

                                            By: /s/ CHARLES R. MOLLO,
                                                -------------------------------
                                                Charles R. Mollo,
                                                Chief Executive Officer

                                            MOLEX INCORPORATED

                                            By: /s/ JOHN STIPANUK
                                                -------------------------------
                                            Name: John Stipanuk
                                                  -----------------------------
                                            Title: Vice President DataComm
                                                   ----------------------------

                                       7

<PAGE>   8

                                    EXHIBIT A

     Universal Dock means either a port replicator or a full docking station
with expansion bays and plug in PCI circuit cards that are used in conjunction
with portable or handheld computers. The unique characteristics of the universal
dock are its ability to interface to any PCI based portable computer directly
from the PCI bus or via the CardBus interface. The distinction between the
universal dock and a conventional dock is this high speed (gigabit) serial
interface consisting of an ASIC on each end, a proprietary 20 pin connector on
one or both ends and a special cable capable of transmitting these high speed
serial signals.

                                       8

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