EXHIBIT 10.15
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made as of the 7th day of February, 1998, by
and between XXXXXXXXXXX XXXXXX, an individual ("Xxxxxx") and SAZTEC
INTERNATIONAL, INC., a California corporation (the "Company").
1. Employment. The Company agrees to employ Xxxxxx and Xxxxxx agrees to
serve the Company as Chief Executive Officer for a term of forty-one (41)
months, commencing on February 9, 1998 and continuing thereafter until June 30,
2001, unless earlier terminated in accordance with the terms hereof. This
Employment Agreement may be extended or renewed by mutual written agreement of
the parties hereto.
2. Duties. Xxxxxx shall perform and be responsible for all of the usual and
customary duties of a Chief Executive Officer of the Company, and such other
duties as may be reasonably assigned to him from time to time by the Board of
Directors of the Company. Xxxxxx shall report to, and be responsible to, the
Board of Directors of the Company. Xxxxxx shall perform all of his work to his
highest standards of skill, competence, and efficiency; and Xxxxxx shall give
his best efforts and skill to further the best interests of the Company.
3. Board of Directors. For so long as Xxxxxx is employed under this
Employment Agreement, Xxxxxx shall have the right to be designated as a
candidate at each election of the Board of Directors of the Company, or its
successors, and the Company and its successors shall use its best efforts to
cause Xxxxxx to be elected to its Board of Directors, including, without
limitation, placing Xxxxxx'x name in nomination, recommending him to its
shareholders, and including him on proxy solicitations for the election of
directors sent to its shareholders.
4. Business Plans. Xxxxxx shall prepare or cause to be prepared, for the
Fiscal Years beginning July 1, 1998, July 1, 1999 and July 1, 2000, Business
Plans for the Company and its subsidiaries, containing such information and
projections as are required by the Board of Directors of the Company. The
Business Plans shall be submitted to the Board of Directors for their review and
approval, in the sole discretion of the Board of Directors, prior to the
commencement of each of the foregoing Fiscal Years.
5. Full Time and Attention. Xxxxxx shall devote his full business time,
attention and energy to the performance of his duties on behalf of the Company
exclusively, other than certain charitable work, or as specifically allowed in
writing by the Company; provided that Xxxxxx may serve as a member of the Boards
of Directors of entities other than the Company, if such other entities are not
engaged in activities that are competitive with the activities of the Company,
and such service does not adversely impact upon the ability of Xxxxxx to perform
his duties on behalf of the Company, as set forth herein.
6. Relocation. Xxxxxx shall perform his duties hereunder at the Company's
headquarters in Billerica, Massachusetts; provided that Xxxxxx may maintain his
residence at his present home until no later than September 1, 1998, at which
date he shall have relocated his residence to the headquarters area. Failure of
Xxxxxx to relocate his residence as set forth herein shall constitute grounds
for termination of this Employment Agreement by the Company, for cause. The
Company shall reimburse Xxxxxx for the ordinary and reasonable costs of his
relocation including closing costs pertaining to the sale of his current
residence and the purchase of a new residence in the vicinity of the Company's
headquarters in Massachusetts, and of his travel and living expenses occasioned
by his maintaining his residence outside of the headquarters area until no later
than September 1, 1998. Reimbursement for Xxxxxx'x cost of moving his personal
property to the headquarters area shall not exceed Nine Thousand Dollars
($9,000), and shall be determined by his obtaining bids from no less than three
(3) reputable moving companies, one of which shall be acceptable to him and the
Company.
7. Compensation.
(a) Base Salary. Xxxxxx'x Base Salary will be One Hundred Forty
Thousand
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Dollars ($140,000) per annum for the term of this Agreement, which Base
Salary shall be payable every two (2) weeks in arrears. Xxxxxx'x Base
Salary shall be subject to review by the Board of Directors of the Company
on an annual basis, and may be increased, but not decreased, by the Board
of Directors, at its sole discretion. The Company will take into
consideration any significant difference in the cost of living between
Xxxxxx'x current residence area and the area of his new residence.
(b) Incentive Compensation. Xxxxxx shall receive Incentive Compensation
as follows:
(i) If and in the event that the Company shall attain the goals
and objectives set forth in the Business Plans approved by the Board of
Directors, including attaining not less than seventy-five percent (75%)
of the Pre-Tax Net Income projected by the Business Plan for the Fiscal
Year in question, the company shall pay Xxxxxx Incentive Compensation,
with respect to such Fiscal Year, in the following amount: For each one
percentage point (1%) by which the Pre-Tax Net Profit of the Company
exceeds seventy-five percent (75%) of the amount in the Business Plan,
Xxxxxx will receive bonus compensation equal to two percentage points
(2%) of his Base Salary; provided that such amount shall not exceed
fifty percent (50%) of the amount of Xxxxxx'x Base Salary for such
Fiscal Year. The amount as determined above shall be paid to Xxxxxx
within ninety (90) days of the end of the fiscal year. In the event the
audited results are not known within ninety (90) days, Xxxxxx shall be
paid fifty percent (50%) of the anticipated amount of the Incentive
Compensation on the ninetieth (90') day, and the balance when known.
(ii) If and in the event that the Company shall attain the goals
and objectives set forth in the Business Plans approved by the Board of
Directors, including attaining more than one hundred percent (100%) of
the Pre-Tax Net Income projected by the Business Plan for the Fiscal
Year in question, then Xxxxxx shall receive additional Incentive
Compensation equal to five percent (5%) of the amount by which the
Pre-Tax Net Income exceeds the Pre-Tax Net Income in the Business Plan
for the Fiscal Year in question.
(iii) For the purposes hereof, the Pre-Tax Net Income of the
Company shall be as determined by the audit of the books and records of
the Company by its independent Certified Public Accountants, after
allowance for all bonuses and incentive compensation payable, including
the Incentive Compensation payable to Xxxxxx hereunder.
(iv) The Board of Directors of the Company, in its sole
discretion, may grant to Xxxxxx, Incentive Compensation in addition to
that set forth herein, regardless of the financial or operating
performance of the Company. Said additional Incentive Compensation may
be in the form of cash, stock options, deferred compensation or other
form.
(c) Automobile Expense. Employee will use an automobile in the
discharge of his duties under this Agreement and shall be entitled to a
Five Hundred Dollar ($500) per month car allowance to be paid to Employee
in addition to the Base Salary.
(d) Stock Options. The Company shall, as of February 9, 1998, grant to
Xxxxxx, options to purchase One Hundred Forty Thousand (140,000) shares of
common stock of the Company pursuant to and in accordance with the terms
of, the Company's 1995 Stock Option Plan adopted by the Company's Board of
Directors by resolution dated December 9, 1994, including with respect to
the Option Price. The Stock Options granted hereunder shall vest as
follows:
35,000 Shares February 1, 1999
45,000 Shares February 1, 2000
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60,000 Shares February 1, 2001
(e) Expenses. The duties of employment may require that Xxxxxx incur
expenses for meals, lodging, travel and entertainment in the interest of
the business. Accordingly, the Company will reimburse Xxxxxx for all
reasonable expenses incurred by him in connection with the performance of
his duties under this Employment Agreement.
8. Termination of Employment by the Company. The Company may terminate this
Employment Agreement immediately only for good cause in which case all of
Xxxxxx'x compensation rights as set forth herein which have not vested, shall be
terminated, and shall be null and void, and of no further force or effect.
Termination of this Employment Agreement by the Company for any reason other
than good cause shall be a breach hereof by the Company and Xxxxxx shall be
entitled to all applicable rights and remedies in connection therewith. For the
purposes of this Employment Agreement, good cause shall be deemed to include,
but shall not in any manner be limited to, the following acts of Xxxxxx:
(a) recurring absence from company business without cause acceptable to
the Board of Directors of the Company;
(b) material breach of any provision of this Agreement;
(c) repeated, material and willful failure to communicate with the
Board of Directors of the Company regarding the business of the Company;
(d) material, willful failure to properly respond to and implement
appropriate, express directives of the Board of Directors of the Company;
(e) any material act of deceit, misrepresentation or dishonesty in the
discharge of Xxxxxx'x duties;
(f) material, improper use or diversion of Company fiunds to personal
use;
(g) conviction of a felony; provided that good cause shall also include
the Company's reasonable determination, following an appropriate
investigation, that the Company would suffer material, adverse consequences
arising from Xxxxxx'x indictment for a felony or involvement in any other
act of moral turpitude; and;
(h) abusive use of drugs and/or alcohol.
(i) Prior to any termination hereunder, Xxxxxx shall have reasonable
written notice and at least thirty (30) days in which to cure the breach,
except for instances involving moral turpitude.
9. Termination of Employment by Xxxxxx.
(a) "Xxxxxx may terminate this Employment Agreement in the event the
Company should materially breach any provision hereunder including, but not
limited to the failure to timely pay any compensation owned to Xxxxxx. In
such event, Xxxxxx shall give the Company reasonable written notice of the
claimed breach and at least thirty (30) days in which to cure the same.
(b) Xxxxxx may also terminate this Employment Agreement if control of
the Company should be sold or transferred to another party and Xxxxxx shall
not be retained or is retained with material or diminished changes in his
responsibilities. In such case, the restrictive covenants in Paragraphs 13,
14 and 15 shall be null and void. In the event of sale or transfer of
control and Xxxxxx is not retained, fifty (50%) of any shares not
previously vested under Paragraph 7(d) shall be considered fully vested and
earned.
10. Fringe Benefit and Health Care Plans. Xxxxxx shall be entitled to
participate in the various incentive or "fringe benefit" plans offered by the
Company to its executive employees pursuant to the normal policies of the
Company, including vacation benefits, disability, life and other insurance
benefits and such participation shall not be deemed to reduce or affect the
compensation payable to Xxxxxx under this Employment Agreement. Specifically,
but not in limitation of the foregoing, the Company shall pay the full premium
on Xxxxxx'x behalf for family coverage for Xxxxxx and Xxxxxx'x family under the
Company's Health Care Plan.
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11. Death or Incapacity. Xxxxxx'x death, illness or incapacity such that he
shall be unable to perform his duties hereunder for a period of six (6)
consecutive months or more, shall result in automatic termination of his
employment hereunder. In the event of termination of Xxxxxx'x employment
hereunder due to death, illness or incapacity, any stock options or grants
earned pursuant this Employment Agreement, as of such date, shall be considered
to have fully vested as of the date of such death, illness or incapacity.
12. Business Conduct. During Xxxxxx'x employment by the Company, Xxxxxx
will not:
(a) willfully act contrary to the best interests of the Company, its
parent, subsidiary, or affiliated companies, or its employees, in a manner
that has a direct, material, adverse impact upon the Company;
(b) (other than as specifically allowed in writing by the Company)
engage in, or have any financial or other interest in, or render any
service in any capacity to any competitor, customer, or supplier of the
Company;
(c) solicit or encourage a customer of the Company to take its
business. elsewhere; or
(d)(other than as specifically allowed in writing by the Company)
solicit or encourage a Company employee to work elsewhere.
13. Covenant Not to Compete with Company. Xxxxxx agrees that:
(a) if the Company terminates Xxxxxx for good cause at any time during
the term of this Employment Agreement; or
(b) if Xxxxxx terminates his employment with the Company for any reason
during the term of this Employment Agreement, then for a period of one (1)
year immediately following the termination of Xxxxxx'x active employment
with the Company, Xxxxxx will not engage or participate, directly or
indirectly, in (i) data conversion and imaging involving the conversion of
information from traditional media including paper, microfilm, microfiche
and aperture cards to computer usable formats and media; or (ii) any other
business activity in which the Company is actively engaged during the
course of Xxxxxx'x employment with the Company, in competition with the
business conducted by the Company within the United States of America or
the United Kingdom. Said restriction shall not prohibit Xxxxxx from owning
up to two percent (2%) of the stock of any public company.
14. Agreement of Non-Solicitation. Xxxxxx further agrees that for a period
of one (1) year immediately following the termination described in Xxxxxxxxx 0,
Xxxxxx will not, directly or indirectly, or in concert with any other person or
persons, firm, corporation or other entity or in any other manner, solicit,
divert or handle or attempt to solicit, divert or handle any active customers of
the Company, or entities that were active customers of the Company within one
(1) year prior to the date of Termination of Xxxxxx'x employment with the
Company, regardless of where such customers might be located , with respect to
any business that consists of or relates or pertains in any way to the business
described in paragraph 13(i) and (ii), above.
15. Agreement of Non-Disclosure. Xxxxxx agrees that he will not at any time
impart to any competitor of the Company or otherwise use for the purpose of
competing with the Company any customer lists or other customer information or
any confidential information which he may have acquired as an officer, director
or shareholder of the Company unless the same shall have otherwise become known
to competitors of the Company.
16. Severance. If, and in the event that, Xxxxxx'x employment hereunder
shall be terminated for any reason other than good cause, as defined above,
including termination without good cause, or expiration of the term hereof or of
any extended term, Xxxxxx shall be entitled to severance payments equal to six
(6) months of his base salary payable in lump sum within thirty (30) days
following the termination of his employment hereunder. Such severance shall be
in full satisfaction of Xxxxxx'x rights hereunder, including those set forth in
Paragraph 8 hereof. The Company will provide outsourcing placement services to
Xxxxxx for a reasonable period of time after termination, to be determined by
Company in its sole discretion.
17. Indemnification. The Company agrees to defend any cause of action
against
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Xxxxxx as an Officer or Director of the Company and to indemnify and hold him
harmless from any loss resulting from such action which is related to the
conducting of this responsibilities under the Employment Agreement, to the full
extent permitted under the Bylaws of the Company and the Laws of the State of
California. The Company shall attempt to obtain Directors and Officers liability
insurance at such time as it is judged to be financially reasonable by the Board
of Directors of the Company.
18. Equitable Remedies. It is recognized by the parties hereto that
irreparable damage will result to Company from any violation of Paragraphs 12,
13, 14 or 15 hereof by Xxxxxx. Therefore, Xxxxxx agrees that, in addition to any
and all other remedies available to the Company, it shall have the remedy of
restraining order, injunction, and other equitable relief as may be declared or
issued by a court to enforce the provisions of said Paragraphs, and Xxxxxx, in
any such equitable proceeding agrees not to claim that a remedy at law is
available to the Company.
19. Construction. It is agreed that the terms and provisions hereof are
severable, and that should any clause or provisions hereof be unenforceable or
be declared invalid for any reason whatsoever, this Employment Agreement shall
be construed and read as if such invalid or unenforceable clause or provisions
were omitted.
20. Savings Clause. Notwithstanding anything to the contrary herein
contained and if, and only if, provisions of the type contained in this
Paragraph 20 are enforceable in the jurisdiction in question, if any one or more
of the provisions contained in Paragraphs, 12, 13, 14 or 15 of this Employment
Agreement shall for any reason be held to be excessively broad as to time,
duration, geographical scope, activity or subject, said provisions shall be
construed by limiting and reducing them so as to be enforceable to the extent
compatible with the applicable law as it should then be determined.
21. Company Policies. Xxxxxx will be subject to and will adhere to all of
the Company's policies applicable to the Company's employees generally,
including, but not limited to, all policies relating to standards of conduct,
conflicts of interest, and compliance with the Company's rules and obligations.
Xxxxxx represents that he has no agreements with or obligations to others that
in any way conflict with any of his obligations contained in this Employment
Agreement.
22. Recovery of Expenses. In the event a dispute arises with respect to
this Employment Agreement, the party prevailing in such dispute shall be
entitled to recover all expenses including, without limitation, reasonable
attorneys' fees and expenses incurred in ascertaining such party's rights, in
preparing to enforce, or in enforcing such party's rights under this Employment
Agreement, whether or not it was necessary for such party to institute suit.
23. Governing Law. This Employment Agreement shall be governed by and
construed in accordance with the laws of the State of Massachusetts. Any claim
arising hereunder shall be heard in a court of competent jurisdiction in the
State of Massachusetts.
24. Entire Agreement: Amendments. This Employment Agreement is intended to
be a complete and exclusive statement of the terms of the agreements between the
parties, superseding all prior agreements, and may not be changed or terminated
orally. Subject to applicable law, this Employment Agreement may be amended only
by a writing executed by all parties hereto. Waiver of any part of this
Employment Agreement shall not constitute a waiver of any other part of this
Employment Agreement and shall not operate as any future waiver of the same
part.
25. Counterparts. This Employment Agreement may be executed in any number
of counterparts, all of which, taken together, shall constitute one agreement.
IN WITNESS WHEREOF, the undersigned have executed this Employment Agreement
as of the day and year first set forth above.
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COMPANY:
SAZTEC INTERNATIONAL, INC.,
a California Corporation
By- /s/ Xxxxxx X. Xxxxx
-----------------------
Xxxxxx X. Xxxxx, Chairman
XXXXXX:
/s/ Xxxxxxxxxxx Xxxxxx
-----------------------
Xxxxxxxxxxx Xxxxxx
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