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EXHIBIT 10.13
EMPLOYMENT AGREEMENT
AGREEMENT made has of this 12th day of October, 1998, by and between X.X.
Xxxxx (the "Employee") and Atlantic Data Services, Inc., a Massachusetts
corporation with a principal place of business at Xxx Xxxxxxxxxxxx Xxxx, Xxxxxx,
XX 00000 (the "Company").
WHEREAS, the Company believes it to be to its advantage that the Employee
renders services to the Company as herein provided; and
WHEREAS, the Employee's senior managerial position requires that he or she
be trusted with confidential information and trade secrets of the Company and
that he or she develop a thorough and comprehensive knowledge of various aspects
of the Company's business;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and in consideration of the mutual
covenants and obligations herein contained, the parties hereto agree as follows:
1. POSITION AND RESPONSIBILITIES. The Employee agrees to serve initially as
Senior Vice President of Corporate Development of the Company. The parties
agree that such employment shall be full-time and on an "at-will" basis,
and that either the Employee or the Company may terminate the employment
relationship at any time, with or without cause, upon written notice to the
other party. The Employee shall initially report to, and his or her
activities shall at all times be, subject to the direction and control of
the Chairman & CEO of the Company, and the Employee shall exercise such
powers and comply with and perform, faithfully and to the best of his or
her ability, such directions and duties in relation to the business and
affairs of the Company as may from time to time be vested in or requested
of him or her by the Chairman & CEO and shall use his or her best efforts
to improve and extend the business of the Company.
2. COMPENSATION. The Company shall pay the Employee the following
compensation, including the following:
A. SALARY, BONUS, EQUITY OPTIONS. In consideration of the services to be
rendered by the Employee to the Company, the Company will pay to the
Employee a monthly salary of $16,666 (the Employee's "Base Rate").
Such salary shall be payable in conformity with the Company's
customary practices for executive compensation as such practices shall
be established or modified from time to time. Salary payments shall be
subject to all applicable federal and state withholding, payroll and
other taxes. Additional details of compensation including bonus
opportunity and stock options is included in the September 11, 1998
offer letter (the "Offer Letter") extended by the Company and accepted
by the Employee which is attached and hereby incorporated as an
integral part of this Agreement.
B. FRINGE BENEFITS. The Employee will also be entitled to participate on
the same basis in the Company's standard benefits package generally
available for all other officers of the Company similarly situated.
Additional details of fringe benefits including a car allowance and
benefits related to moving Employee to the Boston area are included in
the attached and incorporated Offer Letter.
C. CHANGE OF CONTROL. If, upon a Change of Control (as hereinafter
defined), the Employee is (i) not offered employment by the acquiring
corporation in a comparable position, at a comparable
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salary or (ii) the Company or the acquiring corporation terminates the
employment of the Employee, without Cause, within twelve months of the
consummation of a Change in Control, then the Company or the acquiring
corporation, as the case may be, shall be obligated to pay the
Employee a severance payment of twelve months' salary at the
Employee's then current base rate, payable in the same manner as such
salary was payable during the period of the Employee's employment. In
the event that the Employee elects to continue health insurance
coverage in accordance with the provisions of the Consolidated Budget
Reconciliation Act of 1985 ("COBRA"), the Company shall continue to
pay for the Employee's health insurance premium on the same terms and
conditions, and subject to the same rules and regulations application
thereto, as active Company employees for a period of twelve months
from the date of termination of Employee's employment with the
Company. Thereafter, the Employee shall be solely liable for the cost
of such premium. For purposes of this Agreement, a "Change of Control"
shall have occurred if at any time during Employee's employment with
the Company any of the following events shall occur:
(i) The Company is merged or consolidated into or with another
corporation or other legal person, and as a result of such
merger or consolidation less than a majority of the combined
voting power of the then-outstanding securities of such
surviving or resulting corporation or person immediately after
such transaction is held in the aggregate by the holders of the
then-outstanding securities entitled to vote generally in the
election of directors of the Company ("Voting Stock")
immediately prior to such transaction;
(ii) The Company sells all or substantially all of its assets to any
other corporation or legal person, and after such sale less than
a majority of the combined voting power of the then-outstanding
securities of such corporation or person immediately after such
sale is held in the aggregate by the holders of the Voting Stock
of the Company immediately prior to such sale; or
(iii) There is a tender offer in which any "person" (as such term is
used in Section 13(d)(3) or Section 14(d)(2) of the Exchange
Act) acquires the beneficial ownership of securities
representing a majority or more of the Voting Stock of the
Company;
provided, however, that a "Change in Control" shall not be
deemed to have occurred for purposes of this Agreement solely
because (i) the Company, (ii) an entity in which the Company
directly or indirectly beneficially owns 50% or more of the
voting securities, or (iii) any Company-sponsored employee stock
ownership plan or any other employee benefit plan of the
Company, either files or becomes obligated to file a report or a
proxy statement under or in response to Schedule 13D, Schedule
14D-1, Form 8-K or Schedule 14A (or any successor schedule, form
or report) under the Exchange Act, disclosing beneficial
ownership by it of shares of Voting Stock or because the Company
reports that a change in control of the Company has occurred by
reason of such beneficial ownership.
D. TERMINATION FOR CAUSE. The Company may terminate the employment of the
Employee at any time for "Cause." For purposes of this Agreement,
"Cause" means: (a) the Employee's conviction of any crime (whether or
not involving the Company) other than unintentional motor vehicle
felonies; (b) any intentional act of theft, fraud or embezzlement by
the Employee in connection with his work with the Company; (c)
Employee's continuing, repeated or willful failure or refusal to
perform his duties and services under this Agreement (other than due
to his incapacity due to illness or injury); or (d) the Employee's
violation of Section 3 of this Agreement.
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If the Company terminates the Employee's employment for Cause at any
time (regardless of whether or not the Company experiences a Change of
Control), the Employee shall not be entitled to any compensation or
benefits following the date of such termination, other than
compensation and benefits required to be paid or provided by law and
payment of the Employee's normal post-termination benefits in
accordance with the Company's retirement, insurance and other benefit
plans and arrangements.
E. TERMINATION WITHOUT CAUSE. The Company may terminate the employment of
the Employee at any time without Cause. If the Company terminates the
Employee's employment without Cause at any time, then the Company
shall be obligated to pay the Employee a severance payment of twelve
months salary at the Employee's current base rate, payable in the same
manner as such salary was payable, during the period of the Employee's
employment. In the event that the Employee elects to continue health
insurance coverage in accordance with the provisions of COBRA, the
Company shall continue to pay for Employee's health insurance premium
on the same terms and conditions, and subject to the same rules and
regulations applicable thereto, as active Company employees for a
period of twelve months from the date of termination of Employee's
employment with the Company. Thereafter, the Employee shall be solely
liable for the cost of such premium.
3. NONDISCLOSURE AND DEVELOPMENTS; NON-SOLICITATION
A. NONDISCLOSURE. Employee will not at any time, whether during or after
his or her period of employment by the Company ("Employment Period")
reveal to any person or entity any of the trade secrets or
confidential information concerning the organization, business or
finances of the Company or of any third party which the Company is
under an obligation to keep confidential (including but not limited to
trade secrets or confidential information respecting inventions,
products, designs, methods, know-how, techniques, systems, processes,
software programs, works of authorship, customer lists, software,
supplier lists, pricing, projects, plans and proposals), except as may
be required in the ordinary course of performing duties as an employee
of the Company, and Employee shall keep secret all matters entrusted
to him or her and shall not use or attempt to use any such information
in any manner which may injure or cause loss or may be calculated to
injure or cause loss, whether directly or indirectly, to the Company.
Further, Employee agrees that during and after the Employment Period
he or she shall not make, use or permit to be used any notes,
memoranda, reports, lists, records, drawings, sketches,
specifications, software programs, data, documentation or other
materials of any nature relating to any matter within the scope of the
business of the Company or concerning any of its dealings or affairs
otherwise than for the benefit of the Company, it being agreed that
all of the foregoing shall be and remain the sole and exclusive
property of the Company, and that immediately upon the termination of
Employee's employment he or she shall deliver all of the foregoing,
and all copies thereof, to the Company, at its main office.
B. DEVELOPMENTS. If at any time or times during the Employment Period,
Employee shall (either alone or with others) make, conceive, create,
discover, invent or reduce to practice any invention, modification,
discovery, design, development, improvement, process, software
program, work of authorship, documentation, formula, data, technique,
know-how, trade secret or intellectual property right whatsoever or
any interest therein (whether or not patentable or registrable under
copyright, trademark or similar statutes, including but not limited to
the Semiconductor Chip Protection Act, or subject to analogous
protection) (herein called "Development") that (i) relates to the
business of the Company or any customer of or supplier to the Company
or any of the products or services being developed, manufactured or
sold by the Company or which may be
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used in relation therewith, (ii) results from tasks assigned the
Employee by the Company or (iii) results from the use of premises or
personal property (whether tangible or intangible) owned, leased or
contracted for by the Company, then:
(i) such Development and the benefits thereof are deemed
works-made-for-hire (if applicable) and shall immediately become
the sole and absolute property of the Company and its assigns,
as works made for hire or otherwise;
(ii) Employee shall promptly disclose to the Company (or any persons
designated by it) each such Development;
(iii) as may be necessary to ensure the Company's ownership of such
Developments, Employee hereby assigns any rights (including, but
not limited to, any patents, copyrights and trademarks) he or
she may have or acquire in the Developments and benefits and/or
rights resulting therefrom to the Company and its assigns
without further compensation; and
(iv) Employee shall communicate, without cost or delay, and without
disclosing to others the same, all available information
relating thereto (with all necessary plans and models) to the
Company.
C. FURTHER ASSURANCES. Employee will, during and after the Employment
Period, at the request and cost of the Company, promptly sign,
execute, make and do all such deeds, documents, acts and things as the
Company and its duly authorized agents may reasonably require:
(i) to apply for, obtain, register and vest in the name of the
Company alone (unless the Company otherwise directs) letters
patents, copyrights, trademarks or other analogous protection in
any country throughout the world and when so obtained or vested
to renew and restore the same; and
(ii) to defend any judicial, opposition or other proceedings in
respect of such applications and any judicial, opposition or
other proceedings or petitions or applications for revocation of
such letters patent, copyright, trademark or other analogous
protection.
In the event the Company is unable, after reasonable effort, to secure
Employee's signature on any application for patent, copyright or
trademark registration or other documents regarding any legal
protection relating to a Development, whether because of Employee's
physical or mental incapacity or for any other reason whatsoever,
Employee hereby irrevocably designates and appoints the Company and
its duly authorized officers and agents as his or her agent and
attorney-in-fact, to act for and in Employee's behalf and stead to
execute and file any such application or applications or other
documents and to do all other lawfully permitted acts to further the
prosecution and issuance of letters patent, copyright or trademark
registration or any other legal protection thereon with the same legal
force and effect as if executed by Employee.
D. NON-SOLICITATION. For a period of two (2) years after any termination
of employment with the Company, whether voluntary or involuntary,
Employee will not, directly or indirectly,
(i) solicit for employment or employ, or permit any other company or
business organization which is directly or indirectly controlled
by Employee to solicit for employment or employ, any person who
is employed by the Company, or in any manner assist any person or
entity in soliciting for employment or hiring any employee of the
Company, or
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otherwise seek to induce any such employee to leave his or her
employment with the Company; or
(ii) solicit any of the Company's then current customers, or permit
any other company or business or business organization which is
directly or indirectly controlled by Employee to solicit any such
customers, or in any manner assist any person or entity in
soliciting such customers of the Company, or otherwise seek to
induce any such customer to terminate its business relationship
with the Company.
E. SPECIFIC PERFORMANCE. Employee agrees that any breach of this Section
3 by Employee will cause irreparable damage to the Company and that in
the event of such breach the Company shall have, in addition to any
and all remedies of law, the right to an injunction, specific
performance or other equitable relief to prevent the violation of
Employee's obligations hereunder.
4. CONSENT AND WAIVER BY THIRD PARTIES. The Employee hereby represents and
warrants that he or she has obtained all waivers and/or consents from third
parties which are necessary to enable him or her to enjoy employment with
the Company on the terms and conditions set forth herein and to execute and
perform this Agreement without being in conflict with any other agreement,
obligation or understanding with any such third party. The Employee
represents that he or she is not bound by any agreement or any other
existing or previous business relationship which conflicts with, or may
conflict with, the performance of his or her obligations hereunder or
prevent the full performance of his or her duties and obligations
hereunder.
5. GOVERNING LAW; JURISDICTION AND VENUE. This Agreement, the employment
relationship contemplated herein and any claim arising from such
relationship, whether or not arising under this Agreement, shall be
governed by and construed in accordance with the internal laws of the
Commonwealth of Massachusetts, without reference to its conflicts of law
principles, and this Agreement shall be deemed to be performable in
Massachusetts. Any legal action or proceeding arising out of or relating to
this Agreement may be instituted in either the courts of the Commonwealth
of Massachusetts or the United States District Court for the District of
Massachusetts, and Employee hereby irrevocably submits to the jurisdiction
of any such court in any such action or proceeding, and Employee expressly
consents to personal jurisdiction and venue in any such action.
6. SEVERABILITY. In case any one or more of the provisions contained in this
Agreement for any reason shall be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement,
but this Agreement shall be construed and reformed to the maximum extent
permitted by law.
7. WAIVERS AND MODIFICATIONS. This Agreement may be modified, and the rights,
remedies and obligations contained in any provision hereof may be waived,
only in accordance with this Section 7. No waiver by either party of any
breach by the other or any provision hereof shall be deemed to be a waiver
of any later or other breach thereof or as a waiver of any other provision
of this Agreement. This Agreement sets forth all of the terms of the
understandings between the parties with reference to the subject matter set
forth herein and may not be waived, changed, discharged or terminated
orally or by any course of dealing between the parties, but only an
instrument in writing signed by the party against who any waiver, change,
discharge or termination is sought.
8. ASSIGNMENT. The Employee acknowledges that the services to be rendered by
him or her hereunder are unique and personal in nature. Accordingly, the
Employee may not assign any of his or her rights or delegate any of his or
her duties or obligations under this Agreement. The rights and obligations
of the
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Company under this Agreement shall inure to the benefit of, and shall be
binding upon, the successors and assigns of the Company.
9. ACKNOWLEDGEMENTS. The Employee hereby acknowledges and recognizes that the
enforcement of any of the provisions of this Agreement may potentially
interfere with the Employee's ability to pursue a proper livelihood. The
Employee represents that he or she is knowledgeable about the business of
the Company and further represents that he or she is capable of pursuing a
career in other industries to earn a proper livelihood. The Employee
recognizes and agrees that the enforcement of the provisions of Section 3
of this Agreement are necessary to ensure the preservation, protection and
continuity of the business, trade secrets and goodwill of the Company.
10. ENTIRE AGREEMENT. This Agreement constitutes the entire understanding of
the parties relating to the subject matter set forth herein and supersedes
and cancels all agreements, written or oral, (with the single exception of
the Offer Letter which stands and is formally incorporated into this
Agreement), made prior to the date hereof between the Employee and the
Company relating to employment, salary, bonus, or other compensation or any
description, equity participation, pension, post-retirement benefits,
severance or other remuneration.
11. NOTICES. All notices hereunder shall be in writing and shall be delivered
in person or mailed by certified or registered mail, return receipt
requested, addressed as follows:
If to the Company, to: Atlantic Data Services, Inc.
Attention: Chief Executive Officer
Xxx Xxxxxxxxxxxx Xxxx
Xxxxxx, XX 00000
If to the Employee, at the Employee's current address on file with the
Company, or failing that, at the address set forth on the signature page
hereto.
12. COUNTERPARTS. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original, but all of which together
shall constitute one and the same instrument.
13. SECTION HEADINGS. The descriptive section headings herein have been
inserted for convenience only and shall not be deemed to define, limit, or
otherwise affect the construction of any provision hereof.
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IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the date first above written as an instrument under seal.
ATLANTIC DATA SERVICES, INC. EMPLOYEE
By: /s/ Xxxxxx X. Xxxx /s/ X. X. Xxxxx
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Title: Chairman and CEO Xxxxx Xxxxxxxx
---------------------------------- 0 xxx xxx Xxxxxxxxx
XX 00000 XXXXXX
ATTACHMENT
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Offer Letter of September 11, 1998 extended by Atlantic Data Services, Inc. and
accepted by X.X. Xxxxx
