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EXHIBIT 10.13
EXECUTIVE EMPLOYMENT AGREEMENT
AGREEMENT made as of November 17, 1999, by and between Financial
Performance Corporation, a New York corporation with offices at 000 Xxxxxxx
Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx ("FPC"), FPC Information Corp., a New
York corporation with offices at 000 Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx
Xxxx ("FPC Information Corp.") and Xxxxxxx X. Xxxxxx, an individual residing
at 000 Xxxx Xxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000 ("Xxxxxx"). FPC and FPC
Information Corp. are hereinafter jointly and severally referred to as the
"Corporation".
W I T N E S S E T H:
WHEREAS, Xxxxxx is employed by the Corporation pursuant to the
Restated and Amended Executive Employment Agreement dated April 21, 1999,
between Xxxxxx and the Corporation (the "Old Agreement");
WHEREAS, the Corporation desires to continue to engage the
services of Xxxxxx as President, Chief Executive Officer and Principal
Financial Officer of the Corporation;
WHEREAS, Xxxxxx is willing to continue such employment by the
Corporation; and
WHEREAS, the Corporation and Xxxxxx desire to amend and restate
the Old Agreement on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises, the mutual
covenants hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties agree as follows:
1. Employment. The Corporation hereby employs Xxxxxx and Xxxxxx
hereby accepts such employment upon the terms and conditions hereinafter set
forth.
2. Term. The term of this agreement shall commence on the date
hereof and end on September 30, 2000 (the "Term"), unless earlier terminated by
the Corporation or by Xxxxxx in accordance with the provisions hereof.
3. Duties. Subject to Section 7, Xxxxxx is engaged for the Term
hereof as President, Chief Executive Officer and Principal Financial Officer of
the Corporation and shall perform and discharge well and faithfully the duties
which may be undertaken by Xxxxxx in such capacity from time to time, such
duties to be substantially similar to the duties heretofore undertaken by Xxxxxx
as President, Chief Executive Officer and Principal Financial Officer of the
Corporation. The duties of Xxxxxx shall include managing the Corporation's
day-to-day operations, including, without limitation, hiring, training,
supervising and terminating employees, determining employee compensation
(including incentives) and employment policy, including assignment of employees'
duties and how same are to be performed, all aspects of client relationships,
maintaining the Corporation's books and records, serving as a member of the
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Board of Directors and any other duties consistent with his position as
President, Chief Executive Officer and Principal Financial Officer, as may be
determined by the Board of Directors; it being the intent of the parties that
Xxxxxx shall exercise full management control of the day-to-day operations of
the Corporation for so long as Xxxxxx is employed by the Corporation.
4. Extent of Services. During the period in which Xxxxxx is employed
by the Corporation, Xxxxxx shall devote Xxxxxx'x full business time, best
efforts, attention, skill and energies to the business of the Corporation and
shall not during such period be engaged in any other business activity pursued
for gain, profit or other pecuniary advantage; but this shall not be construed
as preventing Xxxxxx from investing Xxxxxx'x personal assets in businesses which
do not compete with the Corporation in such form or manner as will not require
any active business services on the part of Xxxxxx in the operation of the
affairs of the companies in which such investments are made and in which
Xxxxxx'x participation is solely that of a passive investor.
5. Compensation. (a) For all services rendered by Xxxxxx pursuant to
this agreement, the Corporation shall pay Xxxxxx an annual salary during the
Term of $250,000, payable twice monthly on the 15th and 30th of each month, in
arrears. Such salary shall be subject to periodic increases as shall be
determined by the Board of Directors of the Corporation.
(b) In consideration for agreeing to amend and restate the Old
Agreement, upon the execution of this Agreement, the Corporation shall (i) pay
to Xxxxxx $250,000, via bank certified or cashier's check; and (ii) issue to
Xxxxxx 100,000 shares of validly issued, fully paid and non-assessable shares of
the Corporation's Common Stock (collectively, the "Shares").
6. Employment Benefits.
(a) Xxxxxx shall be entitled to four (4) weeks vacation during each
one (1) year of Xxxxxx'x employment pursuant to this agreement, during which
Xxxxxx'x salary shall be paid in full. Xxxxxx shall be entitled to reimbursement
of all reasonable out-of-pocket business expenses incurred on behalf of the
Corporation, provided that such expenses are reasonably necessary and are
properly documented. Xxxxxx shall be entitled to all privileges under any
retirement, pension, long-term or short-term disability insurance plan which may
hereafter be adopted by the Corporation for the benefit of its employees. The
Corporation shall provide Xxxxxx with and shall pay all premiums for family
coverage under a group health insurance plan. The Corporation shall also provide
Xxxxxx with a leased automobile of Xxxxxx'x choice throughout the term of this
agreement, including payment or reimbursement for all insurance, maintenance and
repair costs.
(b) The Corporation shall register, at the Corporation's sole cost
and expense, all of the shares of stock of the Corporation (including shares
issuable upon the exercise of any warrants, options or other convertible
securities of the Corporation) now or hereafter owned by Xxxxxx as set forth in
that certain Registration Rights Agreement dated the date hereof among the
Corporation, Xxxxxx and Xxxxxx X. Xxxxx.
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(c) The Corporation shall obtain and pay all premiums for a term
life insurance policy covering Xxxxxx'x life. Such policy shall be in an amount
not less than $500,000.00, provided that the premium for such policy does not
exceed customary, reasonable rates for an executive in good health. The
Corporation shall be the owner of the policy and Xxxxxx (or Xxxxxx'x
designee(s)) shall be the beneficiary of such policy.
7. Termination.
(a) The Corporation may, at its election in accordance with the
procedures more particularly set forth below, terminate this agreement for
cause. For purposes of this agreement, "cause" shall be defined as and limited
to the following: (i) a material breach by Xxxxxx of any material term of this
agreement that has not been cured within thirty (30) days of receipt by Xxxxxx
of written notice of such breach and which causes substantial damage to the
reputation, business or property of the Corporation or any of the Corporation's
subsidiaries, any of the Corporation's affiliates or any of the Corporation's
(or any affiliates') customers; (ii) a continued failure of Xxxxxx after thirty
(30) days written notice of a prior failure to devote Xxxxxx'x full business
time (as more particularly described in Section 4 above) to the performance of
Xxxxxx'x duties hereunder; (iii) an act of willful misconduct in the performance
of Xxxxxx'x duties hereunder which causes substantial damage to the reputation,
business or property of the Corporation, any of the Corporation's affiliates or
any of the Corporation's customers including, without limitation, any oral or
written material misrepresentation relating to the Corporation or any of the
Corporation's subsidiaries (or any affiliate) or any of its (or any affiliate's)
customers which causes substantial damage to the reputation of the Corporation
(or any affiliate); (iv) conviction of a felony; and (v) substantial, continuing
and willful improper performance or non-performance of any of Xxxxxx'x material
duties hereunder after thirty (30) days written notice to cure as aforesaid. For
purposes of this subsection (a), no act, or failure to act, on Xxxxxx'x part
shall be considered "willful" unless done, or omitted to be done, by him not in
good faith or without reasonable belief that his action or omission was in the
best interests of the Corporation. Notwithstanding the foregoing, Xxxxxx shall
not be deemed to have been terminated for cause without (i) thirty (30) days'
notice to Xxxxxx setting forth the reasons for the Corporation's intention to
terminate for cause as set forth above in this subsection (a); (ii) an
opportunity for Xxxxxx, together with his counsel, to be heard before the
Corporation's board of directors; and (iii) delivery to Xxxxxx of a Notice of
Termination as defined in subsection (d) below from an executive officer of the
Corporation finding that, in the good faith opinion of the Board of Directors of
FPC, Xxxxxx was guilty of conduct set forth or described above in justifying the
Corporation's termination of Xxxxxx'x employment for cause and specifying the
particulars thereof in detail.
(b) Xxxxxx may terminate his employment under this agreement for
Good Reason (as hereinafter defined). For purposes of this agreement, "Good
Reason" shall mean (i) a failure by the Corporation to comply with, or the
breach by the Corporation of, any material provision of this agreement, which
noncompliance shall have a material adverse effect upon Xxxxxx and which shall
not have been cured within thirty (30) days after notice of such noncompliance
has been given by Xxxxxx to the Corporation pursuant to this agreement, (ii) if
Xxxxxx'x management functions, duties, or responsibilities or any other material
aspect of Xxxxxx'x employment shall have been materially and adversely changed
or diminished by the Corporation, (iii) if Xxxxxx shall cease to be President,
Chief Executive Officer and Principal Financial Officer
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of FPC (other than by reason of death, disability or resignation), (iv) any
purported termination of Xxxxxx'x employment which is not properly effected
pursuant to a Notice of Termination satisfying the requirements of subsection
(d) below (and for purposes of this agreement no such purported termination
shall be effective), or (v) the failure of FPC, on or prior to the date of any
merger, consolidation or any similar transaction, to obtain the written
assumption by any successor to the business of FPC of FPC's obligations
hereunder.
(c) Any termination of Xxxxxx'x employment by the Corporation or by
Xxxxxx (other than termination by reason of Xxxxxx'x death or disability as set
forth in Section 15 below) shall be communicated by written Notice of
Termination to the other party hereto. For purposes of this agreement, a "Notice
of Termination" shall mean a notice which shall indicate the specific
termination provision in this agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of Xxxxxx'x employment under the provision so indicated.
(d) "Date of Termination" shall mean (i) if Xxxxxx'x employment is
terminated by his death, the date of his death, (ii) if Xxxxxx'x employment is
terminated pursuant to subsection (c) above, the date specified in the Notice of
Termination, and (iii) if Xxxxxx'x employment is terminated for any other
reason, the date on which a Notice of Termination is given; provided that if
within thirty (30) days after any Notice of Termination is given the party
receiving such Notice of Termination notifies the other party that a dispute
exists concerning the termination, the Date of Termination shall be the date on
which the dispute is finally determined, either by mutual written agreement of
the parties, by a binding and final arbitration award or by a final judgment,
order or decree of a court of competent jurisdiction (the time for appeal
therefrom having expired and no appeal having been perfected).
8. Compensation Upon Termination or During Disability.
(a) During any period that Xxxxxx fails to perform his duties
hereunder as a result of incapacity due to physical or mental illness
("disability period"), Xxxxxx shall continue to receive his full salary at the
rate then in effect for such period and all employment benefits due to Xxxxxx
until his employment is terminated pursuant to Section 7 above and Section 15
below, provided that payments so made to Xxxxxx during the disability period
shall be reduced by the sum of the amounts, if any, payable to Xxxxxx at or
prior to the time of any such payment under disability benefit plans of the
Corporation and which were not previously applied to reduce any such payment.
Within thirty (30) days of the termination of Xxxxxx'x employment due to
disability, the Corporation shall pay to Xxxxxx all salary and employment
benefits due to him accrued through the date of such termination.
(b) If Xxxxxx'x employment shall be properly terminated for cause
pursuant to all of the applicable provisions of this agreement, the Corporation
shall pay Xxxxxx his full salary only through the Date of Termination at the
rate in effect at the time Notice of Termination is given and the Corporation
shall have no further obligations to Xxxxxx under or pursuant to this Agreement.
(c) If (i) in breach of this agreement, the Corporation shall
terminate Xxxxxx'x employment other than pursuant to subsection 7 (a) above
(termination for cause) or
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Section 15 below (termination by reason of death or disability)(it being
understood that a purported termination by the Corporation pursuant to
subsection 7 (a) above or Section 15 below which is disputed and finally
determined not to have been proper shall be deemed a termination by the
Corporation in breach of this agreement) or (ii) Xxxxxx shall terminate his
employment for Good Reason, then
(I) the Corporation shall pay Xxxxxx his full salary and all
employment benefits due to Xxxxxx through the Date of Termination at the rate in
effect at the time the Notice of Termination is given; and
(II) the Corporation shall pay to Xxxxxx, as severance pay (and not
as a penalty to the Corporation), an amount equal to Xxxxxx'x annual base salary
for the period from the Date of Termination through the expiration of the Term,
such payment to be made in a lump sum on the Date of Termination in the event of
termination by the Corporation under 8(c)(i) above, and on or before the third
business day following the Date of Termination in the event of Xxxxxx'x
termination under 8(c)(ii) above;
(d) The Corporation may withhold from any payments or other benefits
payable to Xxxxxx pursuant to this Section 8 or any other provision of this
agreement all federal, state, city or other taxes as shall be required pursuant
to any law, government regulation or ruling.
(e) In addition to any compensation otherwise required hereunder
upon termination, if (i) in breach of this agreement, the Corporation shall
terminate Xxxxxx'x employment other than pursuant to subsection 7 (a) above
(termination for cause) or Section 15 below (termination by reason of death or
disability)(it being understood that a purported termination by the Corporation
pursuant to subsection 7 (a) above or Section 15 below which is disputed and
finally determined not to have been proper shall be deemed a termination by the
Corporation in breach of this agreement) or (ii) Xxxxxx shall terminate his
employment for Good Reason, then Xxxxxx shall have the right (the "Put") to
require the Corporation to purchase from Xxxxxx all or any portion of the shares
of capital stock and warrants, options or other securities exercisable for or
convertible into capital stock of the Corporation (collectively, "Convertible
Securities") then owned by Xxxxxx. Upon exercise of the Put by Xxxxxx, the
Corporation shall pay Xxxxxx an amount equal to the Purchase Price multiplied by
the number of shares of capital stock and Convertible Securities subject to the
Put (the "Put Purchase Price"), minus the exercise price or conversion price of
the Convertible Securities, if any, subject to the Put. Xxxxxx shall exercise
this Put right by giving the Corporation written notice of exercise (the "Put
Notice") at any time during the ten (10) day period commencing on the Date of
Termination. The Purchase Price shall mean the fair market value of the shares
of capital stock of the Corporation determined by the average of the closing
sale prices of such shares on the stock exchange, securities association or
automated quotation system on which such shares are then traded or quoted for
the five (5) consecutive trading days immediately preceding the Date of
Termination or, if such shares are not then traded or quoted on any such
exchange, association or system, the fair market value of the shares as mutually
determined by the Corporation and Xxxxxx. The Put Purchase Price shall be
payable in one lump sum payment, in immediately available funds, on a date
within five (5) business days of the date on which the Put Notice is given.
Against receipt of payment in full of the Put Purchase Price on such date,
Xxxxxx shall deliver to the Corporation all certificates
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representing the securities subject to the Put. Such certificates shall be
accompanied by executed stock powers or similar transfer documents relating to
the Convertible Securities.
9. Intentionally omitted.
10. Disclosure of Information. Xxxxxx recognizes and acknowledges
that the trade secrets and know how of FPC and its subsidiaries as they may
exist from time to time are a valuable, special and unique asset of the
businesses of such companies, access to and knowledge of which are essential to
the performance of Xxxxxx'x duties hereunder. For the purposes of this
agreement, Confidential Information includes any and all information disclosed
or made available to Xxxxxx in consequence of or through his employment by the
Corporation and not generally known in the industries in which FPC and its
subsidiaries or any of the customers of FPC and its subsidiaries is or may be
engaged, or which is beneficial to FPC or its subsidiaries, or any of the
customers of FPC or its subsidiaries, in the promotion or operation of their
respective businesses, (ii) relating to the business, business practices,
operation, affairs, practices, procedures, policies or methods of FPC or its
subsidiaries, (iii) customer lists, (iv) marketing information and (v) training
materials. Since the services of Xxxxxx are unique, extraordinary and of a
specialized character which will require Xxxxxx to handle Confidential
Information of FPC and FPC's subsidiaries and such companies' suppliers and
customers, Xxxxxx shall not, at any time during the term of this agreement or
thereafter, make use of any Confidential Information for the benefit of any
person or entity (other than FPC or its subsidiaries) nor shall Xxxxxx disclose
any Confidential Information to any person or entity for any reason or purpose
whatsoever.
11. Covenants Not to Solicit. For the six (6) month-period
immediately following the earlier of the termination of Xxxxxx'x employment
hereunder or the date of expiration of this agreement, Xxxxxx, whether as a
proprietor, partner, employee, agent, consultant, director, officer, controlling
stockholder or in any other capacity whatsoever, shall not, without the consent
of FPC or of any of its subsidiaries, (a) solicit any Business Associate (as
hereinafter defined) for the purpose of interfering with, disrupting or
attempting to disrupt the relationship, contractual or otherwise between FPC
and/or any of its subsidiaries and such Business Associate, or (b) request any
Business Associate to cancel, curtail or divert his, her or its business with
FPC and/or any of its subsidiaries. For purposes hereof, the term "Business
Associate" means any person or entity that, to Xxxxxx'x knowledge, is, at the
time of any such solicitation or request, a customer, client, or employee of FPC
and/or any of its subsidiaries with whom Xxxxxx had any direct or indirect
contact during his employment hereunder. However, notwithstanding the foregoing
provisions of this Section 11, it is understood that Xxxxxx may, in good faith,
contact all customers and clients of FPC and/or any of its subsidiaries
originated by or otherwise brought to FPC and/or any of its subsidiaries by
Xxxxxx during the term of Xxxxxx'x employment by the Corporation in connection
with establishing any other business enterprises subsequent to the expiration or
termination of this agreement.
12. Return of Documents. Upon termination of employment with the
Corporation, Xxxxxx shall promptly return to the Corporation all documents,
notes, records and other materials of FPC and/or any of its subsidiaries in
Xxxxxx'x possession, whether prepared by Xxxxxx or others. However, Xxxxxx
shall be entitled to retain copies of all such documents,
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notes, records and other materials and may use same subject only to Xxxxxx'x
covenants set forth in Section 10 ("Disclosure of Information") and Section 11
("Covenants Not to Solicit").
13. Enforcement of Non-Disclosure and Non-Solicitation Provisions.
It is the desire and intent of the parties that the provisions of Sections 10,
11 and 12 shall be enforced to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is sought.
Accordingly, if any portion or portions of such Sections 10, 11 or 12 shall be
adjudicated to be invalid or unenforceable, such Sections shall be deemed
amended to delete therefrom the portion or portions thus adjudicated to be
invalid or unenforceable, such deletion to apply only with respect to the
operation of such Sections in the particular jurisdiction in which such
adjudication is made. The provisions of Sections 10, 11, 12 and 14 shall survive
the expiration or earlier termination of this agreement.
14. Injunctive Relief. If there is a breach or threatened breach of
any of the provisions of Sections 10, 11 or 12 of this agreement, the
Corporation shall be entitled to an injunction restraining Xxxxxx from such
breach. Nothing herein shall be construed as prohibiting the Corporation from
pursuing any other remedies for such breach or threatened breach.
15. Disability/Death. Xxxxxx'x employment under this agreement shall
terminate upon the death or, at the election of the Corporation, the physical or
mental disability of Xxxxxx. For purposes of this Agreement, Xxxxxx shall be
deemed to be disabled if he is unable to perform his services for twelve (12)
consecutive months. If the Corporation elects to terminate this agreement
pursuant to this Section 15, the Corporation shall notify Xxxxxx of the
Corporation's decision to terminate Xxxxxx'x employment hereunder by means of a
Notice of Termination pursuant to the provisions of subsection (d) of Section 7
above. From and after such termination of employment of Xxxxxx pursuant to this
Section 15, Xxxxxx'x compensation and rights thereto and all of Xxxxxx'x other
rights under this agreement shall terminate except as otherwise specifically set
forth in Sections 8 and 9 above.
16. Notices. Any notice required or permitted to be given under this
agreement shall be sufficient if in writing and if sent by certified mail,
return receipt requested, or by personal delivery, to Xxxxxx'x mailing address
set forth above in the case of Xxxxxx, and to its office address set forth
above, in the case of the Corporation, with a copy sent in like manner to Xxxx
Marks & Xxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxxxxx X. Xxxxx, Esq. Notices shall be deemed given two (2) business days
after mailing, or on the date personal delivery is effected, as the case may be.
17. Waiver of Breach. The waiver by a party of a breach of any
provision of this agreement by another party shall not operate or be construed
as a waiver of any subsequent or other breach by such other party. Any waiver
must be in writing.
18. Entire Agreement. This Agreement contains the entire agreement
of the parties hereto with respect to Executive's employment by the Corporation,
and all prior agreements and arrangements are hereby superceded in all respects
from and after the date hereof. This Agreement may not be waived, changed,
modified or extended orally but only by an agreement in writing signed by the
party against whom enforcement of any waiver, change, modification or extension
is sought.
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19. Applicable Law. This agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York without regard to the application of conflict of laws.
20. Severability. If any provision of this agreement is found to be
void or unenforceable by a court of competent jurisdiction, the remaining
provisions of this agreement shall nevertheless be binding upon the Corporation
and Xxxxxx with the same effect as though the void or unenforceable provision
had been severed and deleted.
21. Conflict. If any provision of this agreement is found to be in
conflict with any provision of any other agreement to which the Corporation and
Xxxxxx are parties, the provision of such other agreement shall control.
22. Arbitration. If any dispute shall arise between the Corporation
and Xxxxxx with regard to this agreement, such dispute shall be promptly
submitted to and decided by arbitration by the American Arbitration Association
in the City and County of New York in accordance with the Expedited Procedures
of the Commercial Arbitration Rules of the American Arbitration Association. The
award rendered by the arbitrators shall be final, shall include an award of
reasonable legal fees and costs to the prevailing party as determined by the
arbitrator(s) and judgment may be entered upon the award in accordance with
applicable law in any court having jurisdiction.
23. Non-Assignment. This Agreement and all rights hereunder are
personal to Xxxxxx and shall not be assignable; provided, however, all of
Xxxxxx'x rights to compensation following his death shall inure to the benefit
of his surviving spouse, his estate or other legal representatives as the case
may be. Any person, firm, corporation or entity succeeding to the business of
FPC and/or FPC Information Corp. by merger, purchase, consolidation or otherwise
shall assume by contract or operation of law all obligations of the Corporation
hereunder; provided, however, the Corporation shall, notwithstanding such
assumption or assignment, remain liable and responsible for the fulfillment of
its obligations under this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this
Employment Agreement to be duly executed as of the day and year first above
written.
FINANCIAL PERFORMANCE CORPORATION
By:
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Dunan Xxxxx, Vice President
FPC INFORMATION CORP.
By:
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Dunan Xxxxx, Vice President
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Xxxxxxx X. Xxxxxx, individually
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