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EXHIBIT 10.2
EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") is made and entered into
as of July 26, 1995, among PMC International, Inc., a Colorado
corporation (the "Company"), Portfolio Technology Services, Inc., a
Colorado corporation ("PTS") and Xxxxx X. Xxxxxx (the "Executive").
RECITALS
A. The Executive has provided the Company his services as a
consultant with respect to, among other things, developing portfolio
management technologies, from January 1994, and in such capacity
Executive has rendered faithful and valuable service to the Company.
B. The Company desires to employ the Executive as its Executive Vice
President and as president of PTS, the Company's wholly-owned
subsidiary, and to more fully identify his interest with the future
and success of the Company. The Executive desires to be so employed
by, and identified with, the Company, all upon the terms and
conditions set forth in this Agreement.
In consideration of the mutual promises contained herein, and for
other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
AGREEMENT
1. Employment, Positions; Term. The Company hereby employs the
Executive, and the Executive hereby accepts employment with the
Company and PTS, in the capacity of Executive Vice President and
President, respectively. Subject to Section 4, the term of the
Executive's employment under this Agreement shall be for three (3)
years, beginning November 1, 1995. The term of this Agreement shall
be extended for successive one-year periods on November 1 of each year
beginning November 1, 1998, unless on or before August 1, prior to any
such renewal date the Company or the Executive provides written notice
to the other of its intention not to renew.
2. Duties, Responsibilities and Authority. In his capacity as
Executive Vice President, the Executive shall have primary
responsibility for interacting with, and coordinating the executive
management and business activities of, PTS and the other wholly-owned
subsidiaries of the Company. In his capacity as President of PTS, the
Executive shall have primary responsibility for overall management of
the business affairs of PTS. Executive shall perform such other
duties as are prescribed by applicable law and the bylaws of PTS and
the Company for the offices which the Executive shall hold pursuant to
this Agreement, all of which duties shall be conducted in accordance
with policies established by the Company's board of directors (the
"Board") or the President of the Company. The Executive shall be
subject to the direction and control of the President. The Executive
shall devote his full professional and managerial time and effort to
the performance of his duties as Executive Vice President of the
Company and President of PTS and he shall not engage in any other
business activity or activities which, in the judgment of the
President or the Board, do, in fact, conflict with the performance of
his duties under this Agreement.
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3. Compensation.
(a) Salary. For services rendered under this Agreement, the Company
shall pay the Executive a base salary of $240,000 per annum beginning
November 1, 1995.
(b) Annual Review. The Executive's salary will not be reviewed
during the first year of the initial three-year term of this
Agreement. The Executive's first salary review shall be for the
period ending October 31, 1996, and, as appropriate, his salary may be
adjusted effective November 1, 1996, and shall be reviewed annually
thereafter during the term of this Agreement or any renewal term
hereof. The Executive's base salary shall not be subject to
reduction, however, without the Executive's consent.
(c) Benefits and Vacation. The Executive shall be eligible to
participate in such insurance programs (health, disability, or life)
or such other health, dental, retirement, or similar employee benefits
programs as the Board may approve, on a basis comparable to that
available to other officers and executive employees of the Company.
The Executive shall be entitled to four (4) weeks of paid vacation
during each year of his employment under this Agreement. Vacation
time may be accumulated for one (1) year beyond the year for which it
is accrued and used any time during such year, but any vacation time
not used during such additional year shall be forfeited. The value of
any accrued but unused vacation time shall be paid in cash to the
Executive upon termination of his employment for any reason.
(d) Stock Options.
(i) The Company has made arrangements with one or more existing
holders of shares of the Company's Common Stock, for such
shareholder(s) to grant to the Executive an option (the "Option") to
purchase up to 654,422 shares (the "Shares") of the Common Stock at a
purchase price of $1.21 per share, the Option to vest as to forty
percent (40%) of the Shares on the date on which Xxxxxx begins to
render his services hereunder and, as to one-third (1/3) of the
remaining sixty percent (60%) thereof on each of the first, second and
third anniversaries of such date. The Option shall be subject to the
terms and conditions of any agreement between any third party and
either the Company the Executive entered to effectuate the Option.
The Shares are subject to and are entitled to the benefits of that
certain Registration Rights Agreement dated the date hereof among the
Company and certain of its shareholders.
(ii) In addition to the Option provided for in subsection 3(d)(i),
the Executive may participate in stock option programs of the Company
in accordance with the policies applicable to other officers of the
Company, upon such terms as the Board or the administrators of such
programs in their discretion determine. Notwithstanding any of the
provisions of this subsection 3(d), the options provided for hereunder
shall vest immediately as to all of the Xxxxxx Option Shares upon
either a Change in Control (as defined herein) in the Company or the
due authorization of actions to cause the common stock of the Company
to become unregistered and privately traded.
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(e) Reimbursement of Expenses. The Company shall reimburse the
Executive for all reasonable out-of-pocket expenses incurred by the
Executive in connection with the businesses of the Company and PTS and
in the performance of his duties under this Agreement upon the
Executive's presentation to the Company of an itemized accounting of
such expenses with reasonable supporting data.
4. Termination. Either party may terminate the Executive's
employment under this Agreement, without cause, upon ninety (90) days'
written advance notice to the other party, but subject to the
provisions of Section 7 hereof. The Company may terminate the
Executive's employment for "Cause" (as hereinafter defined) effective
immediately upon the giving [of?] written notice stating the basis for
such termination. For purposes of this Agreement, "Cause" shall mean
(a) breach of this Agreement and either (i) such breach is not cured
within 30 days after notice from the Company specifying the action
which constitutes the breach and demanding its discontinuance, or (ii)
such breach is cured and the breach recurs during or after such 30-day
period, (b) exhibited willful disobedience of or repeated failure to
perform reasonable directions of the Board, or committed gross
malfeasance in performance of his duties hereunder or acts resulting
in an indictment charging the Executive with the commission of a
felony; engaging in fraud, misappropriation or embezzlement;
disclosure of confidential information in violation of this Agreement;
or willfully engaging in conduct materially injurious to the Company.
A material failure to perform his duties hereunder that results from
the disability of the Executive shall not be considered Cause for his
termination.
5. Disability. If the Executive shall be prevented by illness,
accident, or other incapacity from properly performing his duties
hereunder (and, if required by the Company, upon the furnishing of
evidence satisfactory to the Company of such disability), the Company
shall, during the continuance of his disability, but only for the
remaining term of this Agreement, pay the Executive his compensation
payable under the provisions of Section 3 (less the amount of any
benefits paid to Executive under any disability insurance provided by
the Company) and continue to provide the Executive all other benefits
provided hereunder. As used herein, the term "disability" shall mean
the complete and total inability of the Executive, due to illness,
physical or comprehensive mental impairment to substantially perform
all of his duties as described herein for a consecutive period of
thirty (30) days or more.
6. Death. In the event of the death of the Executive, except with
respect to any benefits which have accrued and have not been paid to
the Executive hereunder, the provisions of this Employment Agreement
shall terminate immediately. However, the Executive's estate shall
have the right to receive compensation due to the Executive as of and
to the date of his death and, furthermore, to receive an additional
amount equal to one-twelfth (1/12) of the Executive's annual
compensation then in effect as specified in Section 3, above.
7. Severance Pay. In the event that the Executive's employment is
terminated by the Company other than for Cause, whether during or
after the term of this Agreement, the Executive shall be entitled to
receive his then current compensation as provided for in Section 3,
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payable at the Company's regular payment intervals, for a maximum
period of one year following the date of termination or until the date
on which Executive has successfully gained employment affording
comparable compensation (whichever first occurs) so long as Executive
shall not have breached the covenants set forth in Section 8;
provided, that if any of such payments would (i) constitute a
"parachute payment" within the meaning of Section 280G of the Internal
Revenue Code of 1986 (the "Code") and (ii) but for this proviso be
subject to the excise tax imposed by Section 4999 of the Code (the
"Excise Tax"), the amount payable hereunder shall be reduced to the
largest amount which the Executive determines would result in no
portion of the payments hereunder being subject to the Excise Tax. If
the Executive voluntarily resigns his employment hereunder, or if his
employment is terminated for Cause, the Executive shall not be
entitled to any severance pay or other compensation beyond the date of
termination of his employment. The foregoing provisions shall be
applicable in addition to the provisions of Section 8 hereof.
8. Covenant Not to Compete; Trade Secrets. During the continuance of
his employment by the Company and PTS and for a period of twenty-four
(24) months after termination of his employment, the Executive shall
not (a) anywhere in the United States, engage in any business which
competes directly or indirectly with the Company or PTS or (b)
directly or indirectly, use, disseminate, or disclose for any purpose
other than for the purposes of the Company's business or that of PTS,
any of the Company's or PTS' confidential information or trade
secrets, unless such disclosure is compelled in a judicial proceeding.
Upon termination of his employment, all documents, records, notebooks,
and similar repositories of records containing information relating to
any trade secrets or confidential information then in the Executive's
possession or control, whether prepared by him or by others, shall be
left with the Company or returned to the Company upon its request.
9. Change of Control. For purposes of this Agreement, a "Change of
Control" shall be deemed to have occurred on the date on which (a) any
person or entity other than Executive or Bedford Capital Financial
Corporation or Xxxxxxx X. Xxxxxxxx becomes the record or beneficial
owner, directly or indirectly, of more than fifty percent (50%) of the
then outstanding voting stock of the Company; (b) the shareholders of
the Company approve a merger or consolidation of the Company with any
other entity, other than a merger or consolidation which would result
in the voting securities of the Company outstanding immediately prior
thereto continuing to represent at least 80% of the combined voting
power of the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or (c) the
shareholders approve an agreement for the sale or disposition by the
Company of all or substantially all of the Company's assets.
10. Severability. It is the desire and intent of the parties that
the provisions of Section 8 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
particular sentence or portion of Section 8 shall be adjudicated to be
invalid or unenforceable, the remaining portions of such section
nevertheless shall continue to be valid and enforceable as though the
invalid portions were not a part thereof. In the event that any of
the provisions of Section 8 relating to the geographic areas of
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restriction or the period of restriction shall be deemed to exceed the
maximum area or period of time which a court of competent jurisdiction
would deem enforceable, the geographic areas and times shall, for the
purposes of this Agreement, be deemed to be the maximum areas or time
periods which a court of competent jurisdiction would deem valid and
enforceable in any state in which such court of competent jurisdiction
shall be convened.
11. Injunctive Relief. The Executive agrees that any violation by
him of the agreements contained in Section 8 are likely to cause
irreparable damage to the Company, and therefore agrees that if there
is a breach or threatened breach by the Executive of the provisions of
said sections, the Company shall be entitled to an injunction
restraining the Executive from such breach. Nothing herein shall be
construed as prohibiting the Company from pursuing any other remedies
for such breach or threatened breach.
12. Miscellaneous.
(a) Notices. Any notice required or permitted to be given under this
Agreement shall be directed to the appropriate party in writing and
mailed or delivered, if to the Company, to 000 Xxxxxxxxxxx Xxxxxx,
00xx Xxxxx, Xxxxxx, Xxxxxxxx 00000 or to the Company's then principal
office, if different, and if to the Executive, to 0000 Xxxxxx Xxxxx,
Xxxxxxx, Xxxxxxxx 00000.
(b) Binding Effect. This Agreement is a personal service agreement
and may not be assigned by the Company or the Executive, except that
the Company may assign this Agreement to a successor by merger,
consolidation, sale of assets or other reorganization. Subject to the
foregoing, this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors,
assigns, and legal representatives.
(c) Amendment. This Agreement may not be amended except by an
instrument in writing executed by each of the parties hereto.
(d) Applicable Law. This Agreement is entered into in the State of
Colorado and for all purposes shall be governed by the laws of the
State of Colorado.
(e) Counterparts. This instrument may be executed in one or more
counterparts, each of which shall be deemed an original.
(f) Entire Agreement. This Agreement supersedes and replaces all
prior agreements or other expressions or understandings between the
parties related to the employment of the Executive by the Company.
IN WITNESS WHEREOF, the parties have executed this Employment
Agreement as of the date first above written.
PMC INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
Title: President
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PORTFOLIO TECHNOLOGY SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
Title: President
THE EXECUTIVE:
/s/
Xxxxx X. Xxxxxx
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