Termination of Employment Agreement
Exhibit
10.27
Made
in
Tel Aviv on the 28 day of the month of June in the year 2007
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Between:
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Ness
AT Ltd
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of
Xxxxxx Xxxxxx Xxxxxxxx 0, Xxx Xxxx
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(hereinafter:
the “Company”)
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Of
the first part
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And
between:
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Xxxxxx
Xxxxxxx I.D. 50066174
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of
4 Duchifat St. Tel Mond
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(hereinafter:
the “Manager”)
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Of
the second part
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According
to the following terms
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WHEREAS
the
Manager was employed by the Company pursuant to the terms of an Employment
Agreement dated April 21, 2005 (hereinafter, the “Employment
Agreement”);
and
WHEREAS
the
Manager requested to terminate his employment at the Company and leave his
job
position as CFO of the Company commencing on April 1, 2007; and
WHEREAS
the
parties wish to reach an agreement on the terms of the Manager’s retirement from
the Company, taking into consideration, inter
alia,
the
terms of his employment at the Company, the Company’s recognition of the
Manager’s contribution to the Company’s business, his unique acquaintance of the
Company and the know-how and expertise he accumulated in resolving problems
in
the course of his employment and the Company’s need to also avail itself of the
Manager’s services from time to time in the future; and
WHEREAS
the
parties wish to reach agreement on the Manager’s continued obligation to the
Company on matters of confidentiality and restriction on competition and
the
remuneration he shall receive on account thereof, as set forth below in this
Agreement.
Now
therefore the parties hereto agree as follows:
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1.
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Preamble
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1.1
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The
Preamble to this Agreement constitutes an integral part
hereof.
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1.2
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The
section headings are given for convenience of reference only and
shall not
affect the interpretation of this
Agreement.
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2.
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Termination
of actual Employment and Notice
Period
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2.1
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The
Manager’s actual employment at the Company shall terminate on April 1,
2007 (hereinafter,
the “Date
of Actual Termination of Employment”).
Commencing on the Date of Actual Termination of Employment the
Manager
shall cease to serve in office as an officer of the Company or
its
subsidiaries or affiliated companies and the Manager shall sign
any
document required for this
purpose.
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2.2
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The
parties hereby agree that their signature on this Agreement renders
unnecessary the Manager’s duty to give notice on termination of his
employment pursuant to his Employment Agreement and the Manager
shall not
be obligated to give further notice beyond as stated in this
Agreement.
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2.3
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The
notice period to which the Manager is entitled pursuant to the
Employment
Agreement shall commence on April 1, 2007. The notice period shall
terminate on September 30, 2008 and on this date the employer-employee
relationship between the parties shall also terminate (hereinafter,
the
“Date
of Termination of the Employment Relationship”).
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2.4
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The
Manager shall not be required to actually work at the Company during
the
notice period. However, in this period, the Manager shall cooperate
with
the Company, if necessary, to the minimum degree necessary. The
Manager’s
assistance shall be subject to prior coordination with him and
obtaining
his consent to the dates and scope of hours necessary for this
purpose.
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2.5
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In
the course of the notice period the Company shall continue to grant
the
Manager all the benefits to which he is entitled pursuant to the
provisions of the Employment Agreement, including use of the Company
vehicle and cellular phone, contributions to provident and other
funds,
accumulation of seniority for social benefits (provident funds,
vacation
and sick leave) etc. as if he had actually continued to
work.
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2.6
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Moreover,
the Manager shall receive the following
payments:
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2.6.1
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Monthly
wage of NIS 31,000 plus social provisions to which the Manager
is entitled
on account of this amount, including a pension plan and/or pension
fund
and advanced study fund, during the 18 month notice
period.
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2.6.2
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A
retirement grant in the sum of NIS 1,712,921 which shall be deposited
in
the Retirement Grants Fund, as defined in section 5 below on the
date of
execution of this Agreement.
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2.7
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It
is hereby agreed that if the Manager requests to terminate the
employment
relationship with the Company on an earlier date than that determined
in
this Agreement, he shall be able to do so, and in such circumstances
the
Company shall pay the Manager the balance of the amounts owed to
him under
subsection 2.6.1 above in one payment, within 7 days of the date
of
receipt of such a request. The employer-employee relationship between
the
parties shall terminate on the date of receipt of the balance of
monies by
the Manager.
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2
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3.
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Non-Competition
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3.1
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The
parties hereby agree that the Manager’s period of non-competition under
the Employment Agreement shall be extended by six further months
(so that
it shall be 18 months after the Date of Termination of the Employment
Relationship).
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3.2
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As
special remuneration for the non-competition period and its extension,
and
in order that the non-competition clause in the Employment Agreement
shall
remain in force pursuant to the case law of the courts and labor
courts on
the date of execution of this Agreement, the Company shall pay
the Manager
a sum of 950,000 NIS (hereinafter, the “Special
Consideration for Non-Competition”).
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3.3
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The
Special Consideration for Non-Competition shall be transferred
to the
Retirement Grants Fund on the date of execution of this Agreement
and the
rules set forth below in this Agreement shall apply
thereto.
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4.
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Directors
& Officers Liability
Insurance
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4.1
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The
Company shall undertake to pay the payments necessary for including
the
Manager in a directors and officers liability insurance on account
of his
employment and position at the Company and its subsidiaries and
affiliated
companies.
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4.2
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The
Company declares that it acted and shall act as aforesaid even
after the
Manager’s actual termination of employment and it shall also continue to
make such payments after the execution of this Agreement and until
termination of all the limitation periods for a claim against
him.
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5.
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Retirement
Grants Fund
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5.1
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The
Company shall appoint a trustee (hereinafter, the “Trustee”)
who shall act to ensure performance of this Agreement and the Trust
Agreement attached as Appendix
A
of
this Agreement.
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5.2
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The
Trustee shall be registered as an irrevocable beneficiary of the
policy /
the Manager’s increased retirement grants deposit, in the beneficiary’s
lifetime clause.
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5.3
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On
the Date of Termination of the Employment Relationship or in the
event of
the death of the Manager prior to such date (hereinafter, the
“Entitling
Event”),
the Company shall instruct the entity managing the Retirement Grants
Fund
and the Trustee to transfer to the Manager or the beneficiaries
appointed
by the Manager (as the case may be), the amounts accumulated to
his credit
in the Retirement Grants Fund, including any profit accumulated
on account
thereof.
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5.4
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The
Company shall instruct the entity managing the Retirement Grants
Fund and
the Trustee to transfer of the monies, as stated above, by no later
than
30 days after the date of the occurrence of the Entitling Event
and the
submission of all documents and certificates
necessary under the provisions of any
law.
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3
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5.5
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Any
tax or other compulsory payment, as they may be from time to time,
of any
type whatsoever, on account of payment of the monies accumulated
in the
Retirement Grants Fund or for the profits on account thereof, shall
be
payable by the Manager, and upon his death, shall be payable by
the
beneficiaries to be determined by the
Manager.
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5.6
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The
Manager declares and agrees that he shall not be entitled to assign,
impose a lien, grant or transfer in any manner whatsoever his right
to
receive the monies accumulated in the Retirement Grants Fund, including
any profits on account thereof, apart from a transfer to beneficiaries
to
be determined by the Manager in the event of his
death.
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6.
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Activities
of the Parties on the Date of Termination of the Employment
Relationship
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6.1
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In
addition to the payments mentioned above, the Company shall deliver
to the
Manager letters of release for the pension plan (including on account
of
the severance pay component) and for the advanced study fund managed
in
his favor, within 15 days of the Date of Termination of the Employment
Relationship.
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6.2
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On
the Date of Termination of the Employment Relationship the Company
shall
assign to the Manager his rights as they may be, vis-a-vis
the leasing company in all matters relating to the acquisition
of the
Company vehicle which had been provided for his
use.
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6.3
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The
cellular phone affixed in the vehicle shall be transferred to the
ownership of the Manager, and he shall also have transferred into
his
ownership the cellular phone used by him until the Date of Termination
of
the Employment Relationship, all at no
charge.
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6.4
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Furthermore,
the laptop computer used by the Manager in the course of his term
of
employment shall be gratuitously transferred to the ownership of
the
Manager, subject to the removal of any information belonging to
the
Company.
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7.
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No
Claims or Contentions
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7.1
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The
Company hereby certifies that upon the execution of this Agreement
and
subject to performance and compliance with its terms, it or any
person
acting on its behalf does not have and shall not have any contention
and/or claim of any kind or form whatsoever against the Manager
or any one
acting on his behalf apart from the fulfillment of his duties to
keep
confidentiality, non solicitation of employees and non-competition
under
the Employment Agreement as extended in this
Agreement.
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7.2
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The
Manager declares that payment and/or release and/or performance
of the
payments and rights mentioned in this Agreement and the Employment
Agreement and settling of accounts amounts constitute absolute
and final
payment of all that is owed to him from the Company or any other
company
from the Ness Technologies Inc. group or anyone acting on their
behalf and
of all his claims or demands vis-א-vis
the Company, including on account of wages, bonuses, severance
pay,
vacation days and redemption of vacation days,
sick pay, notice period and redemption of notice period, recuperation
pay,
travel fees, holiday gifts, reimbursement of any expenses whatsoever,
courses and professional seminars, any social benefits (including
pension
plan, advanced study fund, etc.), any payment related to and/or
derived
from the Manager’s rights under any incentive plan and/or grants of any
kind whatsoever.
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4
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7.3
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For
the removal of any doubt it is hereby clarified that the provisions
of
section 7.2 above shall not constitute a waiver of the options
to which
the Manager is entitled by virtue of the Employment Agreement and
that the
conditions agreed between the parties in the Employment Agreement
and its
appendices shall apply.
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8.
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Taxation
and Compulsory
Payments
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8.1
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The
amounts under this Agreement - excluding payments or benefits to
which the
Manager is entitled to receive in net values or with tax gross
up - are
gross amounts and any tax and/or any compulsory payment applying
to them
under the provisions of any law, shall be paid by the
Manager.
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8.2
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The
Company shall deduct any tax and/or compulsory payment applying
as
aforesaid and any personal deduction applying to the Manager under
the
provisions of any law or agreement and pursuant to approvals the
Manager
shall submit to the Company from the tax authorities, if
any.
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8.3
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It
is hereby agreed and clarified that the Company shall not deduct
taxes or
compulsory payments at source from the payments it shall transfer
to the
Retirement Grants Fund and that at the time of withdrawal of the
monies
from the Fund, all tax liabilities as shall be in force on the
date of
withdrawal shall apply to the
Manager.
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8.4
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For
the removal of any doubt it is hereby clarified that the payments
mentioned as a limitation in subsection 8.1 above (viz.,
payments paid in net values) include the Company’s payments to the Manager
on account of the value of the use of the vehicle and the payments
to the
advanced study fund.
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9.
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Status
of Agreement
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9.1
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This
Agreement and the Employment Agreement jointly reflect the consents
of the
parties with respect to the Manager’s termination of employment at the
Company.
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9.2
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It
is hereby clarified and agreed that this Agreement does not invalidate
the
consents of the parties as expressed in the Employment Agreement,
except
on issues expressly dealt with in this Agreement. Hence, on all
issues not
dealt with in this Agreement, the terms of the Employment Agreement
shall
continue to apply.
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9.3
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The
Agreement is subject to the approval of Ness Technologies Inc.
Stock
Option and Compensation Committee.
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5
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10.
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General
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10.1
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Israeli
law shall apply to this contract and its
interpretation.
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10.2
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Any
modification of the provisions of this contract shall be in writing
only
and signed by both parties.
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10.3
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Any
dispute between the parties in connection with and deriving from
this
contract shall be heard by the competent courts in Tel
Aviv.
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10.4
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The
addresses of the parties are as set forth in the preamble to this
Agreement. Any notice sent by one party to the other party by registered
mail shall be deemed to have been received within 72 hours of having
been
handed in at the post office for dispatch by registered mail. In
the case
of a notice sent by facsimile, it shall be deemed to have been
received on
the first business day after its transmission.
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In
witness whereof the parties hereto have set their hands and
seals:
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The
Company
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DATE:
June 28, 2007
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BY:
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/s/
Xxxxxxxx
Xxxxxxx
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Name:
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Xxxxxxxx
Xxxxxxx
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Title:
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President
& Chief Executive Officer
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/s/
Xxxx
Xxxxx
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Name:
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Xxxx
Xxxxx
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Title:
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Chief
Financial Officer
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The
Manager
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DATE:
June 28, 2007
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/s/
Xxxxxx
Xxxxxxx
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Xxxxxx
Xxxxxxx
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6
Appendix
A - Trust Agreement
Made
in
Tel Aviv on the 28 day of the month of June in the year 2007
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BY
AND BETWEEN:
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Roi
Poplaik and co, Trust Company
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of
0 Xxxxxxxx Xxxxxx,
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Xxxxxxxxxx
Xxxxx Xxx Xxxx
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(hereinafter,
the “Trustee”)
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Of
the first part
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AND:
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Ness
AT Ltd.
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of
Xxxxxx Xxxxxx Xxxxxxxx 0 Xxx Xxxx
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(hereinafter:
the “Company”)
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Of
the second part
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AND:
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Xxxxxx
Xxxxxxx I.D. 50066174
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of
4 Duchifat St. Tel Mond
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(hereinafter:
the “Manager”)
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Of
the third part
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WHEREAS
the
Company and the Manager signed a termination of employment agreement of which
this Agreement constitutes an Appendix; and
WHEREAS
the
Trustee was appointed by the Company to conduct the activities necessary
to
perform this Agreement and the Manager’s termination of employment agreement;
and
WHEREAS
the
Trustee agrees to assume the performance of the activities stipulated in
this
Agreement and the termination of employment agreement, all in accordance
with
the definition of his function in the Trust Law, 5739-1979 (hereinafter,
the
“Law”).
Now
therefore the parties hereto agree as follows:
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1.
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Preamble
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1.1
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The
Preamble to this Agreement constitutes an integral part
hereof.
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1.2
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The
section headings are given for convenience of reference only and
shall not
affect the interpretation of the
Agreement.
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1.3
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Terms
not defined expressly in this Agreement shall be interpreted as
stated in
the termination of employment
agreement.
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2.
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Activities
and Duties of the
Trustee
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2.1
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The
Trustee shall be an irrevocable beneficiary to receive any amount
accumulated in the Manager’s favor in the Retirement Grants Fund, as
defined in the termination of employment agreement, including the
profits
accumulated on account thereof.
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2.2
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The
Company shall open a special account for the purpose of management
of the
Retirement
Grants Fund and for the purpose of performing the other activities
under
this Agreement and the termination of employment agreement (hereinafter,
the “Special
Account”).
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2.3
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The
Company shall transfer monies to the Special Account pursuant to
the
provisions of the termination of employment
agreement.
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2.4
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The
Trustee shall approve the release of the amounts accumulated in
the
Special Account on the date of the Entitling Event, as defined
in the
termination of employment agreement and pursuant to the provisions
of the
termination of employment
agreement.
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3.
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Obligations
of the Company and the
Manager
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3.1
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The
Company and the Manager undertake to provide the Trustee with any
information or approval, at his sole discretion, and to sign any
document
necessary in his opinion for performance of the activities he is
obligated
to perform under the termination of employment agreement, under
this
Agreement and under the provisions of any
law.
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3.2
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The
Manager hereby undertakes to indemnify the Trustee for any loss
and/or
damage and/or debt and/or expense incurred by him in connection
with the
fulfillment of his position under this Agreement, including and
without
derogating from the generality of the aforesaid, losses, damage
and
expenses incurred by him in consequence of raising any contentions
on the
part of any of the parties to this Agreement and/or the contentions
of any
third party whatsoever, and to be liable for his fee as agreed
with
him.
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3.3
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The
Trustee shall act in good faith and loyally on behalf of the parties
as
set forth in this Agreement and the termination of employment
agreement.
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4.
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General
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4.1
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No
amendment, modification or addition to this Agreement shall be
valid
unless made in writing and signed by all the parties to this
Agreement.
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4.2
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The
addresses of the parties are as set forth in the preamble to this
Agreement. Any notice sent by one party to the other party by registered
mail shall be deemed to have been received within 72 hours of having
been
handed in at the post office for dispatch by registered mail. In
the case
of a notice sent by facsimile, it shall be deemed to have been
received on
the first business day after its
transmission.
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In
witness whereof the parties hereto have set their hands and
seals:
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The
Company
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DATE:
June 28, 2007
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BY:
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/s/
Xxxxxxxx
Xxxxxxx
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Name:
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Xxxxxxxx Xxxxxxx | ||
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Title:
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President & Chief Executive Officer | ||
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/s/
Xxxx
Xxxxx
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Name:
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Xxxx
Xxxxx
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Title:
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Chief
Financial Officer
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The
Trustee
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DATE:
June 28, 2007
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/s/
Roi
Poplaik
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Roi
Poplaik
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The
Manager
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DATE:
June 28, 2007
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/s/
Xxxxxx
Xxxxxxx
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Xxxxxx
Xxxxxxx
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8
