EMPLOYMENT AGREEMENT
AGREEMENT dated as of this 30th day of September, 1999, but
effective as of the Effective Time of the Merger (as such terms are defined in
the Merger Agreement (as defined below)), by and between the surviving
corporation of the Merger, M/A/R/C INC., a Texas corporation (the "Company"),
and XXXXXX X. XXXXXX (the "Executive").
W I T N E S S E T H:
WHEREAS, in order to induce Omnicom Group Inc. ("Omnicom"), to enter
into a certain Agreement and Plan of Merger of even date herewith (the "Merger
Agreement"), pursuant to which a wholly-owned subsidiary of Omnicom was merged
with and into the Company, the Executive is entering into this Agreement; and
WHEREAS, the Executive was employed by the Company, and the Company
wishes to ensure his continued employment with the Company and the Executive
wishes to accept such employment, upon the terms and conditions hereinafter set
forth;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
hereto agree as follows:
1. Employment
The Company agrees to employ the Executive during the Term specified
in paragraph 2, and the Executive agrees to accept such employment, upon the
terms and conditions hereinafter set forth.
2. Term
Subject to paragraphs 6 and 7, the Executive's employment by the
Company shall be for a term commencing on the date hereof and expiring on the
close of business on December 31, 2002 (the "Initial Term"); provided, however,
the term of the Executive's employment by the Company shall continue for an
indefinite period thereafter (also subject to paragraphs 6 and 7) unless and
until either party shall give to the other 90 days' advance written notice of
expiration of the term (a "Notice of Termination") (the Initial Term and the
period, if any, thereafter, during which the Executive's employment shall
continue are collectively referred to as the "Term"). Any Notice of Termination
given under this paragraph 2 shall specify the date of expiration (which may not
be earlier than the close of business on December 31, 2002) and may be given at
any time on or after September 30, 2002. The Company shall have the right at any
time during such 90-day notice period, to relieve the Executive of his offices,
duties and responsibilities and to place him on a paid leave-of-absence status,
provided that during such notice period the Executive shall remain a full-time
employee of the Company and shall continue to receive his salary compensation
and other benefits as provided in this Agreement. The effective
date of the termination of the Executive's employment with the Company,
regardless of the reason therefor, is referred to in this Agreement as the "Date
of Termination".
3. Duties and Responsibilities
(a) During the Term, the Executive shall have the position of Chief
Financial Officer of the Company. The Executive shall report directly to the
Chairman of the Company (currently SM) or her designee (such Chairman or her
designee being called the "Designated Officer"), at such times and in such
detail as she or he shall reasonably require.
(b) The Executive shall perform such executive and managerial duties
and responsibilities customary to his office and as are reasonably necessary to
the operations of the Company and as may be assigned to him from time to time by
or under authority of the Board of Directors of the Company (the "Board") and/or
the Designated Officer, consistent with his position as designated in paragraph
3(a).
(c) The Executive (i) will use his reasonable best efforts to ensure
that the Company and its subsidiaries comply on a timely basis with all
budgetary and reporting requirements reasonably requested by the Board and/or
management of the Diversified Agency Services Division ("DAS") of Omnicom, (ii)
will, at all times, use all reasonable efforts to perform his duties and
responsibilities in a manner consistent with the policies set forth in the
"Grant of Authority" of Omnicom as from time to time in effect and the
parameters of the then-current profit plan and capital expenditure budget of the
Company as approved by the Chief Financial Officer of DAS, (iii) will not take
any action to prevent the Company from participating in Omnicom's cash
management program, (iv) will not incur obligations on behalf of the Company
other than in the ordinary course of business or enter into any transaction on
behalf of the Company not in the ordinary course of business without the
approval of the Board and/or the Designated Officer, and (v) will not take any
action to prevent the Company from abiding by the dividend, management fee and
other corporate policies of the Company, Omnicom and DAS as from time to time in
effect. The Executive acknowledges that current policy of DAS is for every
subsidiary to pay to its parent 90% of its profit after taxes (before management
fee deductions) for the year by way of dividends and/or management fees on a
quarterly basis, generally in arrears.
(d) The Executive's employment by the Company shall be full-time and
exclusive, and during the Term, the Executive agrees that he will (i) devote all
of his business time and attention, his best efforts, and all his skill and
ability to promote the interests of the Company and its subsidiaries, (ii) carry
out his duties in a competent and professional manner; and (iii) work with other
employees of the Company and its subsidiaries and DAS in a competent and
professional manner. Notwithstanding the foregoing, the Executive shall be
permitted to engage in charitable and civic activities and manage his personal
passive investments, provided that such passive investments are not in a company
which transacts business with the Company or any of its subsidiaries or engages
in business competitive with that conducted by the Company or any of its
subsidiaries (or, if such company does transact business with the Company or any
of its subsidiaries, or does engage in a competitive business, it is a publicly
held corporation and the Executive's participation is limited to owning less
than 1/4 of 1% of its outstanding shares), and
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further provided that such activities (individually or collectively) do not
materially interfere with the performance of his duties or responsibilities
under this Agreement.
(e) During the Term, the Executive's services hereunder shall be
performed at the offices of the Company in Irving, Texas, subject to necessary
travel requirements of his position and duties hereunder.
4. Compensation
(a) As compensation for his services hereunder and in consideration
of his non-solicitation/non-servicing and non-disclosure covenants as set forth
in paragraph 8, during the Term the Company shall pay the Executive, in
accordance with its normal payroll practices, an annualized base salary of
$200,000; provided, however, the then annual rate of direct salary compensation
may be increased by or under the authority of the Board or the Designated
Officer in accordance with the then salary review policy of the Company and
within the guidelines and budgetary procedures of DAS.
(b) During the Term, the Executive shall be eligible to participate
in Omnicom's 1998 Incentive Compensation Plan or any successor plan (the "ICP")
and to receive annual awards of cash bonuses and/or restricted shares of Omnicom
common stock thereunder. Under the ICP, upon recommendation by the Chairman and
Chief Executive Officer of DAS, the Compensation Committee of the Board of
Directors of Omnicom (the "Compensation Committee") will set an annual target
award for the Executive based on reaching performance goals established for the
Executive. The determination of the amount of the annual target that is actually
awarded shall be based on the Chairman and Chief Executive Officer of DAS's
evaluation of the success of the Executive in achieving the performance goals
established for him. Any incentive compensation payable pursuant to this
paragraph 4(b) shall be deemed earned only upon written notification by the
Chairman and Chief Executive Officer of DAS to the Executive of the amount of
his incentive compensation award and not any time before.
(c) The Supplemental Executive Retirement Plan contract dated
December 14, 1989 between the Company and the Executive shall be continued in
effect according to its terms.
5. Expenses; Fringe Benefits
(a) The Company agrees to pay or to reimburse the Executive for all
reasonable, ordinary, necessary and documented business or entertainment
expenses incurred during the Term in the performance of his services hereunder
in accordance with the policy of the Company as from time to time in effect. The
Executive, as a condition precedent to obtaining such payment or reimbursement,
shall provide to the Company any and all statements, bills or receipts
evidencing the travel or out-of-pocket expenses for which the Executive seeks
payment or reimbursement, and any other information or materials, as the Company
may from time to time reasonably request.
(b) During the Term, the Executive and, to the extent eligible, his
dependents
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shall be entitled to participate in and receive all benefits under any welfare
benefit plans and programs (including without limitation, medical, disability,
group life (including accidental death and dismemberment) and business travel
insurance plans and programs) provided by the Company to its employees
generally, subject, however, to the generally applicable eligibility and other
provisions of the various plans and programs in effect from time to time. In
addition, after the Date of Termination, provided that the Executive has not
been terminated for "cause" (as defined below), and until such time as the
Executive becomes eligible for medical benefits under Medicare, the Executive
shall be eligible to continue his participation (at the Executive's own expense)
in the Company's medical plan as in effect from time to time, in accordance with
the Company's policy regarding continued medical coverage for certain senior
executives, as is then in effect.
(c) During the Term, the Executive shall be entitled to participate
in all retirement plans and programs (including without limitation any profit
sharing/401(k) plan) provided by the Company to its employees generally,
subject, however, to the generally applicable eligibility and other provisions
of the various plans and programs in effect from time to time. In addition,
during the Term, the Executive shall be entitled to receive fringe benefits and
perquisites in accordance with the plans, practices, programs and policies of
the Company from time to time in effect which are made available to the senior
executives of the Company generally or to its employees generally.
(d) The Executive shall be entitled to paid vacation annually in
accordance with Company practice (with no right of carry-over), to be taken at
such time(s) as shall not, in the reasonable judgment of the Board, materially
interfere with the Executive's fulfillment of his duties hereunder, and shall be
entitled to as many holidays, sick days and personal days as are in accordance
with the Company's policy then in effect generally for its employees.
(e) During the Term, the Company will provide the Executive with an
automobile allowance of $1,200 per month to cover the costs of leasing,
insuring, garaging and maintaining an automobile for use in the business of the
Company.
6. Termination
(a) The Company, by direction of the Board or the Designated
Officer, shall be entitled to terminate the Term and to discharge the Executive
for cause effective upon the giving of written notice. The term "cause" shall be
limited to the following grounds:
(i) the Executive's failure or refusal to materially perform
his duties and responsibilities as set forth in paragraph 3 hereof,
or the failure of the Executive to devote all of his business time
and attention exclusively to the business and affairs of the Company
and its subsidiaries in accordance with the terms hereof, in each
case if such failure or refusal is not cured (if curable) within 20
days after written notice thereof to the Executive by the Company;
(ii) the willful misappropriation of the funds or property of
the
4
Company or any subsidiary;
(iii) the use of alcohol or illegal drugs, interfering with
the performance of the Executive's obligations under this Agreement,
continuing after written warning;
(iv) the conviction in a court of law of, or entering a plea
of guilty or no contest to, any felony or any crime involving moral
turpitude, dishonesty or theft;
(v) the material nonconformance with the Company's standard
business practices and policies, including without limitation,
policies against racial or sexual discrimination or harassment, made
known to the Executive, which nonconformance is not cured (if
curable) within 10 days after written notice to the Executive by the
Company;
(vi) the commission in bad faith by the Executive of any act
which injures or could reasonably be expected to injure the
reputation, business or business relationships of the Company or any
subsidiary;
(vii) the resignation by the Executive on his own initiative
other than pursuant to a termination by the Executive for "Good
Reason" (as defined in paragraph 6(b)) or pursuant to a Notice of
Termination given by the Executive under paragraph 2;
(viii) the gross misconduct or gross negligence by the
Executive in the performance of his duties or the habitual
misconduct or habitual negligence by the Executive in the
performance of his duties which habitual misconduct or negligence is
not cured (if curable) within 10 days after written notice to the
Executive by the Company; and
(ix) any material breach (not covered by any of the clauses
(i) through (viii) above) of any term, provision or condition of
this Agreement, if such breach is not cured (if curable) within 20
days after written notice thereof to the Executive by the Company.
Any notice required to be given by the Company pursuant to clause (i), (v),
(viii) or (ix) above shall specify the specific nature of the claimed breach and
the manner in which the Company requires such breach to be cured (if curable).
In the event that the Executive is purportedly terminated for cause and the
arbitrator appointed pursuant to paragraph 19 determines that "cause" as defined
herein was not present, then such purported termination for cause shall be
deemed a termination "without cause" pursuant to paragraph 6(c) and the
Executive's rights and remedies will be governed by paragraph 6(e), in full
satisfaction and in lieu of any and all other or further remedies the Executive
may have.
5
(b) Provided that the Executive is not then otherwise in breach of
this Agreement, the Executive shall be entitled to terminate this Agreement and
the Term hereunder for "Good Reason" at any time during the Term by written
notice to the Company not more than 30 days after the occurrence of the event
constituting such Good Reason. "Good Reason" shall be limited to a breach by the
Company of a material term of this Agreement, which breach remains uncured for a
period of 20 days after written notice of such breach from the Executive to the
Company (such notice to specify the specific nature of the claimed breach and
the manner in which the Executive requires such breach to be cured).
(c) The Company shall have the right at any time during the Term to
terminate the employment of the Executive "without cause" by giving written
notice to the Executive setting forth a Date of Termination.
(d) In the event of the termination of the employment of the
Executive with the Company for any reason (including without limitation, a
termination pursuant to a Notice of Termination under paragraph 2) other than by
virtue of a termination "without cause" by the Company under paragraph 6(c) or a
termination for "Good Reason" by the Executive under paragraph 6(b), the
Executive shall be entitled to the following payments and benefits, subject to
any appropriate offsets, as permitted by applicable law, for debts or money due
to the Company or an affiliate thereof (collectively, "Offsets"):
(i) unpaid salary compensation through, and any unpaid
reimbursable expenses outstanding as of, the Date of Termination;
and
(ii) all benefits, if any, that had accrued to the Executive
through the Date of Termination under the plans and programs
described in paragraphs 5(b) and (c), or any other applicable plans
and programs in which he participated as an employee of the Company,
in the manner and in accordance with the terms of such plans and
programs.
In the event of the termination of the Employee's employment other than by
virtue of a termination "without cause" or a termination for "Good Reason", the
Company shall have no further liability to the Executive or the Executive's
heirs, beneficiaries or estate for damages, compensation, benefits, severance,
indemnities or other amounts of whatever nature, directly or indirectly, arising
out of or otherwise related to this Agreement and the Executive's employment or
cessation of employment with the Company.
(e) In the event of a termination by the Company "without cause" or
a termination by the Executive for "Good Reason", the Executive shall be
entitled to continue to receive from the Company, as liquidated damages, subject
to any Offsets, the following:
(i) as severance compensation, his applicable salary
compensation when it would be payable to him if his employment had
continued hereunder through (x) December 31, 2002 if the Date of
Termination occurs on or prior to
6
September 30, 2002, or (y) 90 days after the Date of Termination, if
the Date of Termination occurs after September 30, 2002;
(ii) any unpaid reimbursable expenses outstanding as of the
Date of Termination;
(iii) all benefits, if any, that had accrued to the Executive
through the Date of Termination under the plans and programs
described in paragraphs 5(b) and (c), or any other applicable
benefit plans and programs in which he participated as an employee
of the Company, in the manner and in accordance with the terms of
such plans and programs; and
(iv) continued participation on the same basis (including,
without limitation, cost contributions) as the other senior
executives of the Company in all medical, dental, disability and
life insurance coverage (such benefits collectively called the
"Continued Plans") in which he was participating on the Date of
Termination (as such Continued Plans are from time to time in effect
at the Company) until the earlier of (x) the end of the period that
he receives severance compensation payments under clause (i) of this
paragraph 6(e) or (y) the date, or dates, he is entitled to receive
coverage and benefits under the same type of plan of a subsequent
employer; provided, however, if the Executive is precluded from
continuing his participation in any Continued Plan, then the Company
will be obligated to pay him the economic equivalent of the benefits
provided under the Continued Plan in which he is unable to
participate, for the period specified above, plus an amount equal to
the tax, if any, payable by him thereon, it being understood that
the economic equivalent of a benefit foregone shall be deemed the
lowest cost in the State of Texas that would be incurred by the
Executive in obtaining such benefit himself on an individual basis,
and payment of such after-tax economic benefit shall be made
quarterly in advance.
In connection with a termination "without cause" or for "Good Reason", (x) the
Company shall have no further liability to the Executive or the Executive's
heirs, beneficiaries or estate for damages, compensation, benefits, severance,
indemnities or other amounts of whatever nature, directly or indirectly, arising
out of or otherwise related to this Agreement and the Executive's employment or
cessation of employment with the Company, and (y) the Executive shall be under
no obligation to mitigate his damages or to seek other employment, and if the
Executive obtains other employment, any compensation earned by the Executive
therefrom shall not reduce the Company's severance obligations under clause (i)
of this paragraph 6(e). The making of any severance payments and providing the
other benefits as provided in this paragraph 6(e) is conditioned upon the
Executive signing a general release (the "Release") in favor of the Company and
its subsidiaries and affiliates, and its and their respective successors and
assigns, officers directors, employees, agents, attorneys and representatives,
of any claims (including, without limitation, claims of discrimination) relating
to the Executive's employment with the Company or the termination thereof. In
the event the Executive breaches any provisions of the Release or the provisions
of paragraph 8 of this Agreement, in addition to any other remedies at law or in
equity
7
available to it, the Company may cease making any further severance payments and
providing the other benefits provided for herein, without affecting its rights
under this Agreement or the Release.
7. Disability; Death
In the event the Executive shall be unable to perform his duties
hereunder by virtue of illness or physical or mental incapacity or disability
(from any cause or causes whatsoever) in substantially the manner and to the
extent required hereunder prior to the commencement of such disability (all such
causes being herein referred to as "disability") and the Executive shall fail to
perform such duties for periods aggregating 180 days, whether or not continuous,
in any continuous period of 270 days, the Company shall have the right to
terminate the Executive's employment hereunder as at the end of any calendar
month during the continuance of such disability upon at least 30 days' prior
written notice to him. In the event of the Executive's death, the Date of
Termination shall be the date of such death. In the event the Executive's
employment is terminated as a result of his disability or death, he shall be
entitled to the payments and benefits, subject to any Offsets, as provided in
paragraph 6(d).
8. Non-Solicitation/Non-Servicing Agreement and Protection of Confidential
Information
(a) The Executive acknowledges (i) that his position and employment
with the Company result from the transaction contemplated by the Merger
Agreement; (ii) the highly competitive nature of the business and the industry
in which the Company competes; (iii) that as a key executive of the Company and
its predecessor he has participated in and will continue to participate in the
servicing of current clients and/or the solicitation of prospective clients,
through which, among other things, the Executive has obtained and will continue
to obtain knowledge of the "know-how" and business practices of the Company, in
which matters the Company has a substantial proprietary interest; (iv) that his
employment hereunder requires the performance of services which are special,
unique, extraordinary and intellectual in character, and his position with the
Company and its predecessor placed and places him in a position of confidence
and trust with the clients and employees of the Company; and (v) that his
rendering of services to the clients of the Company necessarily requires the
disclosure to the Executive of, and the Company will so disclose to the
Executive, confidential information (as defined in paragraph 8(b)) of the
Company. In the course of the Executive's employment with the Company (and its
predecessor), the Executive has and will continue to develop a personal
relationship with the clients of the Company and a knowledge of those clients'
affairs and requirements, and the relationship of the Company with its
established clientele will therefore be placed in the Executive's hands in
confidence and trust. The Executive consequently agrees that it is a legitimate
interest of the Company, and reasonable and necessary for the protection of the
confidential information, goodwill and business of the Company, which is
valuable to the Company, that the Executive make the covenants contained herein
and that the Company would not have entered into this Agreement or the Merger
Agreement unless the covenants set forth in this paragraph 8 were contained in
this Agreement. Accordingly, the Executive agrees that during the period that he
is employed by the Company and thereafter through the later of (x) December 31,
2002 and (y) two
8
years after the Date of Termination, he shall not, as an individual, employee,
consultant, independent contractor, partner, shareholder, member or in
association with any other person, business or enterprise, except on behalf of
the Company, directly or indirectly, and regardless of the reason for his
ceasing to be employed by the Company:
(i) attempt in any manner to solicit or accept from any client
business of the type performed by the Company or to persuade any
client to cease to do business or to reduce the amount of business
which any such client has customarily done or is reasonably expected
to do with the Company, whether or not the relationship between the
Company and such client was originally established in whole or in
part through his efforts; or
(ii) employ as an employee or retain as a consultant any
person who is then or at any time during the preceding twelve months
was an employee of or exclusive consultant to the Company, or
persuade or attempt to persuade any employee of or exclusive
consultant to the Company to leave the employ of the Company or to
become employed as an employee or retained as a consultant by anyone
other than the Company; or
(iii) render to or for any client any services of the type
rendered by the Company.
As used in this paragraph 8, the term "client" shall mean (1) anyone who is a
client of the Company on the Date of Termination or, if the Executive's
employment shall not have terminated, at the time of the alleged prohibited
conduct (any such applicable date being called the "Determination Date"); (2)
anyone who was a client of the Company at any time during the one year period
immediately preceding the Determination Date; (3) any prospective client to whom
the Company had made a new business presentation (or similar offering of
services) at any time during the one year period immediately preceding the
Determination Date; and (4) any prospective client to whom the Company made a
new business presentation (or similar offering of services) at any time within
six months after the Date of Termination (but only if the initial discussions
between the Company and such prospective client relating to the rendering of
services occurred prior to the Date of Termination, and only if the Executive
actively participated in or supervised such discussions). For purposes of this
clause, it is agreed that a general mailing or an incidental contact shall not
be deemed a "new business presentation or similar offering of services" or a
"discussion". In addition, if the client is part of a group of companies which
conducts business through more than one entity, division or operating unit,
whether or not separately incorporated (a "Client Group"), the term "client" as
used herein shall also include each entity, division and operating unit of the
Client Group where the same management group of the Client Group has the
decision making authority or significant influence with respect to contracting
for services of the type rendered by the Company.
(b) In the course of the Executive's employment with the Company he
will acquire and have access to confidential or proprietary information about
the Company and/or its clients, including but not limited to, trade secrets,
methods, models, passwords, access to
9
computer files, financial information and records, computer software programs,
agreements and/or contracts between the Company and its clients, client
contacts, the marketing and/or creative policies and ideas, advertising
campaigns, media plans and budgets, practices, concepts, strategies, and methods
of operations, financial or business projections of the Company, and information
about or received from clients and other companies with which the Company does
business. The foregoing shall be collectively referred to as "confidential
information". The Executive is aware that the confidential information is not
readily available to the public and accordingly, the Executive also agrees that
he will not at any time (whether during the Term or after termination of this
Agreement) disclose to anyone (other than his counsel in the course of a dispute
arising from the alleged disclosure of confidential information or as required
by law) any confidential information, or utilize such confidential information
for his own benefit, or for the benefit of third parties. The Executive agrees
that the foregoing restrictions shall apply whether or not any such information
is marked "confidential". The term "confidential information" does not include
information which (i) becomes generally available to the public other than by
breach of this provision or (ii) the Executive learns from a third party who is
not under an obligation of confidence to the Company or a client of the Company.
In the event that the Executive becomes legally required to disclose any
confidential information, he will provide the Company with prompt notice thereof
so that the Company may seek a protective order or other appropriate remedy
and/or waive compliance with the provisions of this paragraph 8(b) to permit a
particular disclosure. In the event that such protective order or other remedy
is not obtained, or the Company waives compliance with the provisions of this
paragraph 8(b) to permit a particular disclosure, the Executive will furnish
only that portion of the confidential information which he is legally required
to disclose and, at the Company's expense, will cooperate with the efforts of
the Company to obtain a protective order or other reliable assurance that
confidential treatment will be accorded the confidential information. The
Executive further agrees that all memoranda, disks, files, notes, records or
other documents, whether in electronic form or hard copy (collectively, the
"material"), compiled by him or made available to him during his employment with
the Company and/or its predecessor (whether or not the material contains
confidential information) shall be the property of the Company and shall be
delivered to the Company on the termination of the Executive's employment with
the Company or at any other time upon request. Except in connection with the
Executive's employment with the Company, the Executive agrees that he will not
make or retain copies or excerpts of the material.
(c) If the Executive commits a breach or is about to commit a
breach, of any of the provisions of paragraphs 8(a) or (b), the Company shall
have the right to have the provisions of this Agreement specifically enforced by
the arbitrator appointed under paragraph 19 or by any court having equity
jurisdiction without being required to post bond or other security and without
having to prove the inadequacy of the available remedies at law, it being
acknowledged and agreed that any such breach or threatened breach will cause
irreparable injury to the Company and that money damages will not provide an
adequate remedy to the Company. In addition, the Company may take all such other
actions and remedies available to it under law or in equity and shall be
entitled to such damages as it can show it has sustained by reason of such
breach.
(d) The parties acknowledge that (i) the type and periods of
restriction imposed in the provisions of paragraphs 8(a) and (b) are fair and
reasonable and are reasonably
10
required in order to protect and maintain the proprietary interests of the
Company described above, other legitimate business interests of Company and the
goodwill associated with the business of the Company, including without
limitation, the business acquired pursuant to the Merger Agreement, (ii) the
business of the Company currently extends throughout the United States, and the
Executive will engage in such business pursuant to the terms of this Agreement
throughout all areas in which the Company conducts its business, and (iii) the
time, scope, geographic area and other provisions of this paragraph 8 have been
specifically negotiated by sophisticated commercial parties, represented by
legal counsel, and are given as an integral part of the transactions
contemplated by the Merger Agreement. It is further understood and agreed that
the clients of the Company may be serviced from any location and accordingly it
is reasonable that the covenants set forth herein are not limited by narrow
geographic area but generally by the location of such clients and potential
clients. The Executive specifically acknowledges that his being restricted from
soliciting and servicing clients as contemplated by this Agreement will not
prevent him from being employed or earning a livelihood in the type of business
conducted by the Company. If any of the covenants contained in paragraphs 8(a)
or (b), or any part thereof, is held to be unenforceable by reason of it
extending for too great a period of time or over too great a geographic area or
by reason of it being too extensive in any other respect, the parties agree (x)
such covenant shall be interpreted to extend only over the maximum period of
time for which it may be enforceable and/or over the maximum geographic areas as
to which it may be enforceable and/or over the maximum extent in all other
respects as to which it may be enforceable, all as determined by the court or
arbitration panel making such determination and (y) in its reduced form, such
covenant shall then be enforceable, but such reduced form of covenant shall only
apply with respect to the operation of such covenant in the particular
jurisdiction in or for which such adjudication is made.
(f) The temporal duration of the non-solicitation/non-servicing
covenants set forth in this paragraph 8 shall not expire, and shall be tolled,
during any period in which Executive is in violation of any of the
non-solicitation/non-servicing covenants set forth in this paragraph 8; and all
restrictions shall automatically be extended by the period of Executive's
violation of any such restrictions.
9. Intellectual Property
During the Term, the Executive will disclose to the Company all
ideas, inventions and business plans developed by him during such period which
relate directly or indirectly to the business of the Company, including without
limitation, any design, logo, slogan, advertising campaign or any process,
operation, product or improvement which may be patentable or copyrightable. The
Executive agrees that all patents, licenses, copyrights, tradenames, trademarks,
service marks, planning, marketing and/or creative policies, advertising
campaigns, public relations or public affairs campaigns, promotional campaigns,
media campaigns, and budgets, practices, concepts, strategies, and methods of
operations, financial or business projections, designs, logos, slogans and
business plans developed or created by the Executive in the course of his
employment hereunder, either individually or in collaboration with others, will
be deemed works for hire and the sole and absolute property of the Company. The
Executive agrees, that at the Company's request and expense, he will assign all
rights thereto to the
11
Company and take all such other steps necessary to secure the rights thereto to
the Company by patent, copyright or otherwise.
10. Enforceability
The failure of any party at any time to require performance by
another party of any provision hereunder shall in no way affect the right of
that party thereafter to enforce the same, nor shall it affect any other party's
right to enforce the same, or to enforce any of the other provisions in this
Agreement; nor shall the waiver by any party of the breach of any provision
hereof be taken or held to be a waiver of any subsequent breach of such
provision or as a waiver of the provision itself.
11. Assignment
The Company and the Executive agree that the Company shall have the
right to assign this Agreement, and, accordingly, this Agreement shall inure to
the benefit of, and may be enforced by, any and all successors and assigns of
the Company, including, without limitation, by asset assignment, stock sale,
merger, consolidation or other corporate reorganization, provided such successor
entity assumes the obligations of the Company. The Company and Executive agree
that Executive's rights and obligations under this Agreement are personal to the
Executive, and the Executive shall not have the right to assign or otherwise
transfer his rights or obligations under this Agreement. The rights and
obligations of the Company hereunder shall be binding upon and run in favor of
the successors and assigns of the Company.
12. Modification
This Agreement may not be orally canceled, changed, modified or
amended, and no cancellation, change, modification or amendment shall be
effective or binding unless in writing, signed by the parties to this Agreement,
and approved in writing by the Designated Officer.
13. Severability; Survival
In the event any provision or portion of this Agreement is
determined to be invalid or unenforceable for any reason, in whole or in part,
the remaining provisions of this Agreement shall nevertheless be binding upon
the parties with the same effect as though the invalid or unenforceable part had
been severed and deleted or reformed to be enforceable. The respective rights
and obligations of the parties hereunder shall survive the termination of the
Executive's employment to the extent necessary to the intended preservation of
such rights and obligations.
14. Life Insurance
The Executive agrees that the Company shall have the right to obtain
life insurance on the Executive's life, at the sole expense of the Company, as
the case may be, and with the Company as the sole beneficiary thereof. The
Executive shall (a) cooperate fully in obtaining such life insurance, (b) sign
any necessary consents, applications and other related forms or documents
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and (c) at the Company's expense, take any reasonably required medical
examinations.
15. Notice
Any notice, request, instruction or other document to be given
hereunder by any party hereto to another party shall be in writing and shall be
deemed effective (a) upon personal delivery, if delivered by hand or local
courier, or (b) three days after the date of deposit in the mails, postage
prepaid if mailed by certified or registered mail, or (c) on the next business
day, if sent by prepaid overnight courier service or facsimile transmission (if
electronically confirmed), and in each case, addressed as follows:
If to the Executive:
Xxxxxx X. Xxxxxx
0000 Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxx 00000
If to the Company:
M/A/R/C Inc.
0000 Xxxxxxxx Xxxx
Xxxxxx, Xxxxx 00000-0000
Attn: Secretary
Fax: 000-000-0000
with a copy to:
Omnicom Group Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Secretary
Fax: 000-000-0000
and
Xxxxx & Xxxxxxx LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Fax: 000-000-0000
Either party may change the address to which notices are to be sent by giving
notice of such change of address to the other party in the manner herein
provided for giving notice.
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16. Applicable Law
This Agreement, and all issues and matters related to this
Agreement, shall be governed by, enforced under, and construed in accordance
with the laws of the State of Texas without regard to any conflicts or conflict
of laws principles in the State of Texas that would result in the application of
the law of any other jurisdiction.
17. No Conflict
The Executive represents and warrants that he is not subject to any
agreement, instrument, order, judgment or decree of any kind, or any other
restrictive agreement of any character, which would prevent him from entering
into this Agreement or which would be breached by the Executive upon his
performance of his duties pursuant to this Agreement.
18. Entire Agreement
This Agreement represents the entire agreement between the Company
and the Executive with respect to the employment of the Executive by the
Company, and all prior agreements, plans and arrangements relating to the
employment of the Executive by the Company are nullified and superseded hereby.
19. Arbitration
(a) The parties hereto agree that any dispute, controversy or claim
arising out of, relating to, or in connection with this Agreement (including,
without limitation, any claim regarding or related to the interpretation, scope,
effect, enforcement, termination, extension, breach, legality, remedies and
other aspects of this Agreement or the conduct and communications of the parties
regarding this Agreement and the subject matter of this Agreement) shall be
settled by arbitration at the offices of Judicial Arbitration and Mediation
Services, Inc. or successor organization for binding arbitration in Dallas,
Texas by a single arbitrator. The arbitrator may grant injunctions or other
relief in such dispute or controversy. All awards of the arbitrator shall be
binding and non-appealable, except as provided by the applicable rules of
arbitration and/or by applicable law. Judgment upon the award of the arbitrator
may be entered in any court having jurisdiction. The arbitrator shall apply
Texas law to the merits of any dispute or claims, without reference to any rules
of conflicts of law that might result in the application of any other state's
law. Suits to compel or enjoin arbitration or to determine the applicability or
legality of arbitration shall be brought in the United States District Court for
the Northern District of Texas, or if that court lacks jurisdiction, in a state
court located within the geographic boundaries thereof. Notwithstanding the
foregoing, no party to this Agreement shall be precluded from applying to a
proper court for injunctive relief by reason of the prior or subsequent
commencement of an arbitration proceeding as herein provided. The prevailing
party in any arbitration shall be entitled to receive its reasonable attorneys'
fees and costs from the other party(ies) as awarded by the arbitrator.
(b) The Executive has read and understands this paragraph 19 which
discusses arbitration. The Executive understands that by signing this Agreement,
the
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Executive agrees to submit any claims arising out of, relating to, or in
connection with this Agreement, or the interpretation, validity, construction,
performance, breach or termination thereof, or his employment or the termination
thereof, to binding arbitration, and that this arbitration provision constitutes
a waiver of the Executive's right to a jury trial and relates to the resolution
of all disputes relating to all aspects of the employer/employee relationship,
including but not limited to the following:
(i) Any and all claims for wrongful discharge of employment,
breach of contract, both express and implied; breach of the covenant
of good faith and fair dealing, both express and implied; negligent
or intentional infliction of emotional distress; negligent or
intentional misrepresentation; negligent or intentional interference
with contract or prospective economic advantage; and defamation;
(ii) Any and all claims for violation of any federal, state or
municipal statute, including, without limitation, Title VII of the
Civil Rights Act of 1964, as amended, the Civil Rights Act of 1991,
the Equal Pay Act, the Employee Retirement Income Security Act, as
amended, the Age Discrimination in Employment Act of 1967, the
Americans with Disabilities Act of 1990, the Family and Medical
Leave Act of 1993, the Fair Labor Standards Act and the Texas
Employment Discrimination Law; and
(iii) Any and all claims arising out of any other federal,
state or local laws or regulations relating to employment or
employment discrimination.
20. Headings
The headings contained in this Agreement are for reference purposes
only, and shall not affect the meaning or interpretation of this Agreement.
21. Withholdings
The Company may withhold from any amounts payable under this
Agreement such federal, state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
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IN WITNESS WHEREOF, the parties have executed this Employment Agreement as
of the day and year first above written.
M/A/R/C INC.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chairman and Chief
Executive Officer
/s/ Xxxxxx X. Xxxxxx
------------------------------------
XXXXXX X. XXXXXX
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