EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made as of August, 1997
(the "Effective Date"), by and between ICCE, Inc. (the "Company"), a Georgia
corporation, ACSYS Resources, Inc. ("ACSYS"), a Pennsylvania corporation and a
wholly owned subsidiary of the Company, and Xxxxxx X. Xxxxxxxxx, an individual
resident of Pennsylvania (the "Executive").
WHEREAS, Executive was an executive officer and shareholder of ACSYS prior
to its merger with a subsidiary of the Company (the "Merger");
WHEREAS, the Company recognizes the contributions of the Executive in such
capacity;
WHEREAS, Executive is expected to make a significant contribution to the
success and development of the Company; and
WHEREAS, Executive is willing to render services to the Company and/or one
or more of its subsidiaries on the terms and subject to the conditions set
forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by Executive and the Company
including, without limitation, the promises and covenants of the parties set
forth herein, the parties hereto, intending to be legally bound, hereby agree
as follows:
ARTICLE I
EMPLOYMENT
Section 1.1 Term of Employment. The term of Executive's employment
hereunder shall commence on the Effective Date hereof and continue for a period
of three (3) years, unless earlier terminated as provided in this Agreement.
At the end of the initial three-year term, this Agreement shall automatically
renew for consecutive one-year terms unless either party hereto gives written
notice to the other of its intent to terminate sixty (60) days prior to the end
of any term.
Section 1.2 Duties and Responsibilities of Executive. Executive is
hereby employed full time as the Chief Operating Officer of the Company.
Executive shall devote his full time, energy, and skill to such office and
shall do and perform all services and acts necessary or advisable to fulfill
the duties of such office. In his capacity as an officer of the Company,
Executive shall report to the Board of Directors of the Company, and shall
conduct and perform such additional services and activities as may be
determined from time to time by the Board of Directors which are normal and
customary for a similar executive of a similarly situated company. Executive's
authority and responsibility in the Company shall at all times be subject to
the review and discretion of the Board of Directors, who shall have the final
authority to make decisions regarding the business of the Company. Executive
acknowledges that he has a duty of loyalty to the Company and shall not engage
in, directly and indirectly, any other business or activity that could
materially and adversely affect the Company's business or the Executive's
ability to perform his duties under this Agreement, provided, however, that the
Executive shall be free to participate in board, civic and charitable
activities so long as such activities do not interfere with his duties and
responsibilities hereunder.
Section 1.3 Compensation. For services to be rendered by Executive
under this Agreement, Company shall pay Executive a base salary of $200,000 per
annum payable in bi-weekly installments. The Executive shall also be paid a
bonus as determined by the Board of Directors of the Company from time to time
such bonus compensation shall be determined based on the performance of AcSys
Resources, Inc. and the Company as a whole and the success of the integration
of such businesses as the Company may acquire. At the sole discretion of the
Board of Directors of the Company, Executive's annual gross salary may be
increased from time to time throughout the term of this Agreement. At no time
during the term hereof shall the Executive's base salary be decreased from the
amount of the base salary then in effect.
Section 1.4 Benefits.
(a) Vacation. Executive shall be entitled to six (6) weeks paid
vacation annually during his employment by the Company hereunder. Any vacation
not used during any calendar year shall be forfeited, except that one week's
unused vacation may be carried forward to the year following the year in which
such vacation entitlement accrued.
(b) Life, Disability and Retirement Programs. Executive shall be
entitled to participate in any life, disability and retirement programs that
are generally offered to or provided for the senior management personnel of the
Company and its subsidiaries.
(c) Group Insurance. Executive shall be entitled to participate in
such group health and dental insurance programs (including spouse coverage) as
may from time to time be offered generally to all of the other members of the
senior management personnel of the Company and its subsidiaries.
Section 1.5 Business Expenses. Executive shall be entitled to
reimbursement of all ordinary and necessary business expenses reasonably
incurred for business travel, communications (including cell phones and pager),
entertainment and meals in connection with the performance of Executive's
duties under this Agreement in accordance with the Company's established
policies for reimbursement of business expenses. The Company expects Executive
to attend and participate in continuing education seminars and courses with
respect to the staffing industry and business management related to his duties,
and the Company will reimburse all ordinary and necessary expenses of such
attendance and participation. Such continuing education courses and seminars
will be scheduled in conjunction with the other officers of the Company to
assure coordination of schedules.
ARTICLE II
COVENANTS OF EXECUTIVE
Section 2.1 Confidentiality. Executive recognizes the interest of the
Company in maintaining the confidential nature of its proprietary and other
business and commercial information. In connection therewith, Executive
covenants that during the term of his employment with Company under this
Agreement, and for a period of one (1) year thereafter, Executive shall not,
directly or indirectly, except as authorized by the Board of Directors,
publish, disclose or use for his own benefit or for the benefit of a business
or entity (other than the Company or its subsidiaries) or otherwise, any secret
or confidential matter, or proprietary or other information not in the public
domain that was acquired by Executive during his employment, relating to the
Company's, ACSYS's or any of their respective subsidiaries' businesses,
operations, customers, suppliers, products, employees, financial affairs or
industry practices, technology, know-how or intellectual property or other
similar information (the "Proprietary Information"). If and to the extent that
Proprietary Information also is a Trade Secret (as defined under applicable
law), the time limit provided in Section 2.5 shall apply to the disclosure of
such Proprietary Information.
Executive will abide by the Company's policies and regulations, as
established from time to time, for the protection of its Proprietary
Information. Executive acknowledges that all records, files, data, documents
and the like relating to suppliers, customers, costs, prices, systems, methods,
personnel, technology and other materials relating to the Company or its
affiliated entities shall be and remain the sole property of the Company and/or
such affiliated entity and shall, upon the request of the Company, turn over
all copies of such Proprietary Information to the Company (together with a
written statement certifying as to his compliance with the foregoing).
Section 2.2 Non-Solicitation of Customers. During the term of
Executive's employment with the Company, and for a period of one (1) year
thereafter, unless Executive is terminated other than for Cause (as defined
below) or Executive resigns for Good Reason (as defined below), Executive shall
not directly or indirectly, through one or more intermediaries or otherwise,
solicit or attempt to solicit Customers, in the Restricted Territory, to induce
or encourage them to acquire or obtain from anyone other than the Company,
service competitive with or substitute for any Company Service. For purposes
of this Section, a "Customer" refers to any person or group of persons with
whom Employee has direct material contact with regard to selling, delivery or
support of Company Services, including servicing such person's or group's
account, during the period of two (2) years preceding termination of Employee's
employment; and "Company Services" refers to the services that the Company
offered or sold within six (6) months prior to the date of termination of
Employee's employment. For purposes of this Article II, the "Restricted
Territory" shall be the area that is within a thirty (30) mile radius of the
city of Philadelphia, or such other city in which the Company maintains an
office at which Executive is located on the date of termination of Executive's
employment with the Company and such other cities in which the Company
maintains offices at which Executive had material customer contacts within the
year preceding the termination of Executive's employment with the Company.
Section 2.3 Non-Compete. During the term of Executive's employment
with the Company, and for a period of two (2) years thereafter, unless
Executive is terminated other than for Cause (as defined below) or Executive
resigns for Good Reason (as defined below), Executive shall not, without the
prior written consent of the Board of Directors, which consent may be withheld
at the sole discretion of the Board of Directors, engage or participate in, as
a business executive or equity owner of any business or enterprise that
directly competes in the Restricted Area with any line of business in which (i)
the Company was engaged at the time of termination of Executive's employment
with the Company and (ii) Executive was materially involved with regard to the
selling, delivery or support of services within such line of business;
provided, however, that nothing in this Section 2.3 shall prohibit Executive
from acquiring or holding, for investment purposes only, less than five percent
(5%) of the outstanding publicly traded securities of any corporation which may
compete directly or indirectly with the Company or any of its subsidiaries.
Section 2.4 Non-Solicitation of Employees. During the term of his
employment with the Company, and for a period of one (1) year thereafter,
unless Executive is terminated other than for Cause (as defined below) or
Executive resigns for Good Reason (as defined below), Executive shall not,
directly or indirectly, through one or more intermediaries or otherwise,
employ, induce, solicit for employment, or assist others in employing, inducing
or soliciting for employment any individual who is at any time during such
period an employee of the Company for the purpose of providing services that
are the same or similar to the types of services offered or engaged in by the
Company, ACSYS or any of their respective subsidiaries with the Executive
providing services at the time of termination of Executive's employment with
the Company.
Section 2.5 Trade Secrets. The Executive shall not, at any time,
either during the term of his employment or after any termination of
employment, use or disclose any Trade Secrets (as defined under applicable law)
of the Company, ACSYS, or any of their respective subsidiaries, except in
fulfillment of his duties as the Executive during his employment, for so long
as the pertinent information or data remain Trade Secrets, whether or not the
Trade Secrets are in written or tangible form.
Section 2.6 Consideration. Executive acknowledges that his agreement
to the covenants provided in this Article II constitutes a major portion of the
consideration for the entry by the Company into this Agreement, and that the
Company's covenants under this Agreement is of direct and material benefit to
Executive and is good and adequate consideration for the covenants given
herein. Executive also acknowledges that the Company has a present and future
expectation of business within the geographic areas served by the Company and
from the present and proposed customers of the Company. Executive acknowledges
the reasonableness of the term, geographic area and scope of the covenants set
forth in this Agreement, and agrees that he will not, in any action, suit or
other proceeding, deny the reasonableness of, or assert the unreasonableness
of, the premises, consideration or scope of the covenants set forth herein.
Executive further acknowledges that complying with the provisions contained in
this Agreement will not preclude him from engaging in a lawful profession,
trade or business, or from becoming gainfully employed.
ARTICLE III
TERMINATION OF EMPLOYMENT
Section 3.1 Termination by Company. Executive's employment may be
terminated by the Company by giving notice during the term of this Agreement
upon the occurrence of one or more of the following events:
(a) Executive's death or disability which renders Executive
incapable of performing his duties for more than one hundred twenty (120)
calendar days (termination under this Section 3.1(a) shall be deemed
termination without Cause);
(b) for any reason following a determination by the Board of
Directors to terminate Executive's employment (termination under this Section
3.1(b) shall be deemed termination without Cause); or
(c) "for Cause", which for purposes of this Agreement shall mean
that the Executive shall have:
(i) committed an intentional act of fraud, embezzlement or
theft in connection with his duties or in the course of his employment with the
Company which has a material adverse effect upon the Company;
(ii) inflicted intentional wrongful material damage to any
material asset of the Company or the Company;
(iii) intentionally and wrongfully violates Article II of
this Agreement, which violation has a material adverse effect upon the Company;
(iv) been convicted of a felony or any similar crime carrying a
prison term of at least one year (regardless of whether imprisonment is
actually imposed);
(v) a habitual and debilitating use of alcohol or drugs; or
(vi) failed to meet performance expectations, as determined by
the Company's Board of Directors, provided, however, that in the event of this
subsection (vi) being the sole reason for termination for Cause, Executive
shall have the cure provisions and rights provided for in Section 3.1(d)
hereof.
(d) In the event of a determination by the Company's Board of
Directors that the Executive has failed to meet performance expectations, the
Company shall furnish to Executive in writing a notice of proposed termination
setting forth a specific statement of the deficiencies in his performance.
Executive shall then have a period of ninety (90) days after the giving of such
written notice of proposed termination by the Company in which to attempt to
effect a cure of the specified deficiencies. If at the end of such ninety (90)
day period no such cure has been effected to the reasonable satisfaction of the
Board of Directors of the Company, then Executive's employment shall be
terminated as of the end of such ninety (90) day period. The Company shall be
obligated to provide to Executive only one such notice of proposed termination,
and if subsequent to effecting a cure of specified deficiencies the Executive
is determined by the Board of Directors to have again failed to meet
performance expectations, then his employment may be terminated immediately
upon the Company's giving of notice of termination to Executive which specifies
his deficiencies in performance.
Section 3.2 Good Reason. For purposes of this Agreement, "Good Reason"
shall mean, without the express written consent of Executive, the occurrence of
any of the following events unless such events are fully corrected within
thirty (30) days following written notification by Executive to the Company
that he intends to terminate his employment hereunder for one of the reasons
set forth below:
(a) a material breach by the Company of any material provision of
this Agreement or the Registration Rights Agreement, dated as of May 16,
1997, to which Executive is a party, including, but not limited to, the
assignment to Executive of any duties inconsistent with Executive's
position in the Company or a material adverse alteration in the nature or
status of Executive's responsibilities;
(b) relocation of Executive out of the metropolitan Philadelphia
area provided, however, that the Executive shall from time to time, as may
be necessary to facilitate the Company's business, be required to render a
portion of his services hereunder at the Company's corporate headquarters
in Washington D.C.; or
(c) the occurrence of a "Change in Control" as defined below.
For purposes of this Agreement a "Change in Control" shall mean an event as a
result of which: (i) any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934 (the "Exchange Act")), is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act, except that a person shall be deemed to have "beneficial ownership" of all
securities that such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of more than 30% of the total voting power of the voting stock of
the Company; (ii) the Company consolidates with, or merges with or into another
corporation or sells, assigns, conveys, transfers, leases or otherwise disposes
of all or substantially all of its assets (or substantially all of the assets
of, or of the Company's interest in, ACSYS) to any person or any corporation
consolidates with, or merges with or into, the Company, in any such event
pursuant to a transaction in which the outstanding voting stock of the Company
is changed into or exchanged for cash, securities or other property, other than
any such transaction where (A) the outstanding voting stock of the Company is
changed into or exchanged for (x) voting stock of the surviving or transferee
corporation or (y) cash, securities (whether or not including voting stock) or
other property, and (B) the holders of the voting stock of the Company
immediately prior to such transaction own, directly or indirectly, not less
than 30% of the voting power of the voting stock of the surviving corporation
immediately after such transaction; or (iii) individuals who at the date of the
Merger constitute the Board of the Company (together with any new directors
whose election by such Board or whose nomination for election by the
stockholders of the Company was approved by a vote of 66-2/3% of the directors
then still in office who were directors at the date of the Merger or whose
election or nomination for election was previously so approved) ceased for any
reason to constitute a majority of the Board of the Company then in office; or
(iv) the Company is liquidated or dissolved or adopts a plan of liquidation.
Section 3.3 Severance. For purposes of this Agreement, Executive's
entitlement to any severance payments upon termination of his employment shall
be as set forth below:
(a) Termination Without Cause.
(i) Executive may not be terminated prior to a firm commitment
underwritten public offering of the Company's equity
securities;
(ii) If Executive is terminated without Cause or resigns for
Good Reason at any time, Executive shall be entitled to
severance pay of a lump sum equal to three times the sum of
(i) his annual salary then in effect plus (ii) the amount
of his bonus as calculated based on the results of
operations for the twelve months prior to such termination.
(b) Voluntary Termination. If Executive voluntarily resigns for
reason other than Good Cause, Executive shall receive a lump sum severance
payment equal to his then current annual salary. Executive shall provide a
minimum of thirty (30) days prior notice to the President of his resignation.
In the event Executive shall provide thirty (30) days prior written notice of
his intent to resign, the Company may accept such resignation effective as of
any date during such thirty (30) day period as the Company deems appropriate,
provided that Executive shall receive from the Company his salary and be
entitled to participate at the Company's expense in any Company sponsored
benefit programs in which he was a participant as of the effective date of his
resignation for the duration of such thirty (30) day period.
(c) For Cause. Executive shall not be entitled to any severance pay
whatsoever if his employment is terminated "for Cause" pursuant to Section
3.1(c) of this Agreement, unless severance pay is approved by the Board of
Directors of the Company in its sole discretion, provided, however, that the
Executive shall receive such annual salary that is accrued but unpaid up to the
date of such termination for Cause. If termination is for Cause pursuant to
Section 3.1(c)(vi), then Executive shall be entitled to severance equal to pay
for the remainder of the then current term of this Agreement, or equal to one
year's salary at his then current rate, whichever is greater.
ARTICLE IV
GENERAL PROVISIONS
Section 4.1 Withholding of Taxes. The Company may withhold from any
amounts payable under this Agreement all federal, state, city or other taxes
and withholdings as shall be required pursuant to any applicable law, rule or
regulation.
Section 4.2 Notice. For purposes of this Agreement, all communications
including, without limitation, notices, consents, requests or approvals,
provided for herein shall be in writing and shall be deemed to have been duly
given when personally delivered or five (5) business days after having been
mailed by United States registered mail or certified mail, return receipt
requested, postage prepaid, addressed to the Company (to the attention of the
Secretary of the Company) at its principal executive office or to Executive at
his principal residence, or to such other address as any party may have
furnished to the other in writing and in accordance herewith, except the
notices of change of address shall be effective only upon receipt.
Section 4.3 Validity; Severability. The covenants set forth in this
Agreement are and shall be deemed and construed as separate and independent
covenants. It is not the intent of any party hereto to violate any public
policy of any jurisdiction in which this Agreement may be enforced. If any
term, covenant, condition or provision of this Agreement, or the application
thereof to any person or circumstance, shall to any extent be held invalid or
unenforceable by a court of competent jurisdiction because its duration, the
territory and/or the restricted activities are invalid or unreasonable in
scope, (i) each such term, covenant or provision of this Agreement shall be
valid and be enforced to the fullest extent permitted by law, shall be reformed
to the extent (and only to the extent) necessary to make it valid, enforceable
and legal taking into consideration the reasonable concerns and needs of the
Company's business interests such that the intent of the Company, in
consummating the transactions contemplated by the Agreement, will not be
impaired, provided that such invalid or unenforceable term, covenant, condition
or provision shall be curtailed, limited or eliminated only to the extent
necessary to remove such invalidity or unenforceability with respect to the
applicable law as it shall then be applied, and (ii) the remainder of this
Agreement or the application of such term, covenant, condition or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable shall not be affected thereby.
Section 4.4 Remedies. The restrictions contained in Article II of this
Agreement are considered by the parties hereto to be fair and reasonable and
necessary for the protection of the legitimate business interests of the
Company. It is recognized that damages in the event of breach of the
provisions of this Agreement by Executive would be difficult, if not
impossible, to ascertain, and it is therefore agreed that the Company, in
addition to and without limiting any other remedy or right it may have, shall
have the right to an injunction or other equitable relief in any court of
competent jurisdiction, enjoining any such breach. The existence of this right
shall not preclude any other rights and remedies at law or in equity which the
Company may have. Any violation of the restrictions contained in Article II of
this Agreement shall automatically toll and suspend the period of restraint for
the amount of time that the violation continues, provided that the Company
seeks enforcement of such restraint promptly after discovery of the violation.
Executive agrees to indemnify and hold harmless the Company from and against
any loss, damage, liability, cost or expense, including but not limited to
reasonable attorneys fees, suffered or incurred by the Company as and when
incurred, by reason of, or arising out of, any breach of the covenants
contained in this Agreement.
Section 4.5 Entire Agreement. This Agreement supersedes any other
agreements, oral or written, between the parties with respect to the subject
matter hereof, and contains all of the agreements and understandings between
the parties with respect to the employment of Executive by the Company. Any
waiver or modification of any term of this Agreement shall be effective only if
it is set forth in a writing signed by both parties hereto.
Section 4.6 Successors and Binding Agreement.
(a) This Agreement shall be binding upon and inure to the benefit of
the Company and any Successor of or to the Company, but shall not otherwise be
assignable or delegable by the Company. "Successor" shall mean any successor
in interest, including, without limitation, any entity, individual or group of
persons acquiring directly or indirectly all or substantially all of the
business or assets of the Company, as the case may be, whether by sale, merger,
consolidation, reorganization or otherwise.
(b) The Company shall require any Successor to agree at the time of
becoming a Successor to perform this Agreement to the same extent as the
original parties would be required if no succession had occurred.
(c) This Agreement shall inure to the benefit of and be enforceable
by Executive's personal or legal representatives, executors, administrators,
heirs, distributes and legatees.
(d) This Agreement is personal in nature and neither of the parties
shall, without the consent of the other, assign, transfer or delegate this
Agreement or any rights or obligations hereunder except as expressly provided
in this Section 4.6.
Section 4.7 Governing Law. This Agreement shall be governed by, and
construed and enforced in accordance with the laws of the Commonwealth of
Pennsylvania without regard to the choice of law rules utilized in that
jurisdiction.
Section 4.8 Captions. The captions in this Agreement are solely for
convenience of reference and shall not be given any effect in the construction
or interpretation of this Agreement.
Section 4.9 Miscellaneous. No provisions of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in a writing signed by Executive and the Company. No waiver by a
party hereto at any time of any breach by another party hereto or compliance
with any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provision or conditions
at the same or at any prior or subsequent time. Failure by the Company to
insist upon strict compliance with any of the terms, covenants or conditions
hereof shall not be deemed to be a waiver of such term, covenant or condition,
nor shall any relinquishment of any right of power hereunder by the Company any
one or more times be deemed a waiver or relinquishment of such right or power
by the Company at any other time or times.
Section 4.10 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the date first above written.
"Company":
ICCE, Inc. "Executive"
By:/s/ Xxxx Xxxxxxxxx /s/ Xxxxxx X. Xxxxxxxxx
Signature Xxxxxx X. Xxxxxxxxx
Xxxx Xxxxxxxxx Print Residence Address:
Print Name
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx Xxxxxxx, XX 00000
Print Title
