Exhibit 10.5
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made as of the 18th day of August,
1997 by and between Xxxxx X. Xxxxx, a resident of Pennsylvania (the "Employee"),
and DocuNet Inc., a corporation organized and existing under the laws of the
Commonwealth of Pennsylvania (the "Company").
WHEREAS, the Company desires to employ Employee and Employee
desires to be employed by the Company for a period of time in the future upon
the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants and
obligations contained herein, and intending to be legally bound, the parties,
subject to the terms and conditions set forth herein, agree as follows:
1. Employment and Term. The Company hereby employs Employee
and Employee hereby accepts employment with the Company, as Senior Vice
President- Finance and Chief Financial Officer (such position, Employee's
"Position") for a period commencing on the date hereof and continuing until
December 31, 2000, subject to the provisions of Section 9 hereof (as may be
extended from time to time by mutual consent of Employer and Employee, the
"Term").
2. Duties. During the Term, Employee shall serve the Company
faithfully and to the best of his ability and shall devote his full time,
attention, skill and efforts to the performance of the duties required by or
appropriate for his Position. Employee agrees to assume such duties and
responsibilities as may be customarily incident to such position, and as may be
reasonably assigned to Employee from time to time by the Chief Executive Officer
of the Company and Employee shall report, throughout the Term, to the Chief
Executive Officer of the Company.
3. Other Business Activities. During the Term, Employee will
not, without the prior written consent of the Company, directly or indirectly
engage in any other business activities or pursuits whatsoever, except
activities in connection with any charitable or civic activities, personal
investments and serving as an executor, trustee or in other similar fiduciary
capacity; provided, however, that such activities do not interfere with his
performance of his responsibilities and obligations pursuant to this Agreement.
4. Compensation. The Company shall pay Employee, and Employee
hereby agrees to accept, as compensation for all services rendered hereunder and
for Employee's covenant not to compete as provided for in Section 8 hereof, an
initial base salary at the annual rate of One Hundred Thirty Thousand Dollars
($130,000) (as the same may hereafter be increased, the "Base Salary"). The Base
Salary shall be inclusive of all applicable income, social security and other
taxes and charges which are required by law to be withheld by the Company or
which are requested to be withheld by Employee, and which shall be withheld and
paid in accordance with the Company's normal payroll practice for its similarly
situated employees from time to time in effect. Increases in the Base Salary may
be granted from time to time at the sole discretion of the Company. In addition
to the Base Salary, commencing with fiscal year 1998, the Company shall pay
Employee, within 30 days after receipt of the final audit for each fiscal year,
such bonus (the "Bonus") as the Board of Directors of the Company shall
determine in its absolute discretion. Such Bonus shall be based on the
guidelines established in advance of each fiscal year, in the absolute
discretion of the Board of Directors, including, but not limited to, the results
of the Company's operations, achievement of business unit targets, if
applicable, individual performance as compared to specific management objectives
set prior to each fiscal year, and the Company's Chief Executive Officer's
subjective assessment of Employee's performance. Accrual of any Bonus on the
financial books and records of the Company for Employee shall in no way obligate
the Company to pay a Bonus if Employee is terminated hereunder for any reason.
Payment of Bonus upon termination of Employee is at the sole discretion of the
Company.
5. Benefits and Expenses. In addition to those benefits
provided to similarly situated employees of the Company, Employee shall be
entitled to those employee benefits (including expense reimbursement) as set
forth on Schedule A hereto ("Benefits").
6. Confidentiality. Employee recognizes and acknowledges that
the Proprietary Information (as hereinafter defined) is a valuable, special and
unique asset of the Business of the Company. As a result, both during the Term
and thereafter, Employee shall not, without the prior written consent of the
Company, for any reason, either directly or indirectly, divulge to any
third-party or use for his own benefit, or for any purpose other than the
exclusive benefit of the Company, any confidential, proprietary, business and
technical information or trade secrets of the Company or of any subsidiary or
affiliate of the Company ("Proprietary Information") revealed, obtained or
developed in the course of his employment with the Company. Nothing herein
contained shall restrict Employee's ability to make such disclosures as may be
necessary or appropriate to the effective and efficient discharge of the duties
required by or appropriate for his Position or as such disclosures may be
required by law; and further provided, that nothing herein contained shall
restrict Employee from divulging or using for his own benefit or for any other
purpose any Proprietary Information that is readily available to the general
public so long as such information did not become available to the general
public as a direct or indirect result of Employee's breach of this Section 6.
Failure by the Company to xxxx any of the Proprietary Information as
confidential or proprietary shall not affect its status as Proprietary
Information under the terms of this Agreement.
7. Property.
(a) All right, title and interest in and to Proprietary
Information shall be and remain the sole and exclusive property of the Company.
During the Term, Employee shall not remove from the Company's offices or
premises any documents, records, notebooks, files, correspondence, reports,
memoranda or similar materials of or containing Proprietary Information, or
other materials or property of any kind belonging to the Company unless
necessary or appropriate in accordance with the duties and responsibilities
required by or appropriate for his Position and, in the event that such
materials or property are removed, all of the foregoing shall be returned to
their proper files or places of safekeeping as promptly
-2-
as possible after the removal shall serve its specific purpose. Employee shall
not make, retain, remove and/or distribute any copies of any of the foregoing
for any reason whatsoever except as may be necessary in the discharge of his
assigned duties and shall not divulge to any third person the nature of and/or
contents of any of the foregoing or of any other oral or written information to
which he may have access or with which for any reason he may become familiar,
except as disclosure shall be necessary in the performance of his duties or as
otherwise permitted pursuant to Section 6 hereof; and upon the termination of
his employment with the Company, he shall leave with or return to the Company
all originals and copies of the foregoing then in his possession, whether
prepared by Employee or by others.
(b) (i) Employee agrees that all right, title and interest
in and to any innovations, designs, systems, analyses, ideas for marketing
programs, and all copyrights, patents, trademarks and trade names, or similar
intangible personal property which have been or are developed or created in
whole or in part by Employee (1) at any time and at any place while the Employee
is employed by Company and which, in the case of any or all of the foregoing,
are related to and used in connection with the Business of the Company, (2) as a
result of tasks assigned to Employee by the Company, or (3) from the use of
premises or personal property (whether tangible or intangible) owned, leased or
contracted for by the Company (collectively, the "Intellectual Property"), shall
be and remain forever the sole and exclusive property of the Company. The
Employee shall promptly disclose to the Company all Intellectual Property, and
the Employee shall have no claim for additional compensation for the
Intellectual Property.
(ii) The Employee acknowledges that all the
Intellectual Property that is copyrightable shall be considered a work made for
hire under United States Copyright Law. To the extent that any copyrightable
Intellectual Property may not be considered a work made for hire under the
applicable provisions of the United States Copyright Law, or to the extent that,
notwithstanding the foregoing provisions, the Employee may retain an interest in
any Intellectual Property that is not copyrightable, the Employee hereby
irrevocably assigns and transfers to the Company any and all right, title, or
interest that the Employee may have in the Intellectual Property under
copyright, patent, trade secret and trademark law, in perpetuity or for the
longest period otherwise permitted by law, without the necessity of further
consideration. The Company shall be entitled to obtain and hold in its own name
all copyrights, patents, trade secrets, and trademarks with respect thereto.
(iii) Employee further agrees to reveal promptly all
information relating to the same to an appropriate officer of the Company and to
cooperate with the Company and execute such documents as may be necessary or
appropriate (1) in the event that the Company desires to seek copyright, patent
or trademark protection, or other analogous protection, thereafter relating to
the Intellectual Property, and when such protection is obtained, to renew and
restore the same, or (2) to defend any opposition proceedings in respect of
obtaining and maintaining such copyright, patent or trademark protection, or
other analogous protection.
(iv) In the event the Company is unable after
reasonable effort to secure Employee's signature on any of the documents
referenced in Section 7(b)(iii) hereof, 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 Employee's agent and attorney-in-fact, to act for and in his
behalf and stead to execute and file any such documents and to do all other
lawfully permitted acts to further the prosecution and issuance of any such
copyright, patent or trademark protection, or other analogous protection, with
the same legal force and effect as if executed by Employee.
8. Covenant not to Compete. The Employee shall not, during the
Term, including any extensions of the Term, and for a period of one (1) year
thereafter (the "Restricted Period"), do any of the following directly or
indirectly without the prior written consent of the Company:
(a) compete, directly or indirectly, with the Company or
any of its respective affiliates or subsidiaries, or any of their respective
successors or assigns, whether now existing or hereafter
-3-
created or acquired (collectively, the "Related Companies"), or otherwise engage
or participate, directly or indirectly, in any document management business
conducted or contemplated to be conducted by a Related Company, as the same are
conducted or contemplated to be conducted (as has been determined by the Board)
during the Term with respect to any period during the Term or any other business
conducted by the Company in which the Employee is or has been actively engaged
(the "Restricted Business") within any geo area located within the United
States of America, its possessions or territories (the "Restricted Area");
(b) become interested (whether as owner, stockholder,
lender, partner, co-venturer, director, officer, employee, agent, consultant or
otherwise), directly or indirectly, in any person, firm, corporation,
association or other entity that engages in the Restricted Business within the
Restricted Area; provided, that nothing contained in this Section 8(b) shall
prohibit Employee from owing, as a passive investor, not more than five percent
(5%) of the outstanding securities of any class of any publicly-traded
securities of any publicly held company listed on a well-recognized national
securities exchange or on an interdealer quotation system of the National
Association of Securities Dealers, Inc;
(c) solicit, call on, divert, take away, influence, induce
or attempt to do any of the foregoing, in each case within the Restricted Area,
with respect to the Company's or any of its Related Companies' (A) customers or
distributors or prospective customers or distributors (wherever located) with
respect to goods or services that are competitive with those of the Company or
any of its Related Companies, (B) suppliers or vendors or prospective suppliers
or vendors (wherever located) to supply materials, resources or services to be
used in connection with goods or services that are competitive with those of the
Company or any of its Related Companies, (C) distributors, consultants, agents,
or independent contractors to terminate or modify any contract, arrangement or
relationship with the Company or any of its Related Companies or (D) employees
(other than family members) to leave the employ of the Company or any of its
Related Companies.
(d) influence or attempt to influence any supplier,
customer or potential customer of the Company or any of the Related Companies to
terminate or modify any written or oral agreement or course of dealing with the
Company or the Related Companies; or
(e) influence or attempt to influence any person (other
than a family member) to either (i) terminate or modify his employment,
consulting, agency, distributorship or other arrangement with the Company or any
of the Related Companies, or (ii) employ or retain, or arrange to have any other
person or entity employ or retain, any person who has been employed or retained
by the Company or any of the Related Companies as an employee, consultant, agent
or distributor of the Company or the Related Companies at any time during the
one year period immediately preceding the termination of Employee's employment
hereunder.
9. Termination. Employee's employment hereunder may be
terminated during the Term upon the occurrence of any one of the events
described in this Section 9. Upon termination, Employee shall be entitled only
to such compensation and benefits as described in this Section 9.
9.1. Termination for Disability.
(a) In the event of the disability of the Employee such
that Employee is unable to perform his duties and responsibilities hereunder to
the full extent required by this Agreement by reasons of illness, injury or
incapacity for a period of more than ninety (90) consecutive days or more than
one hundred twenty (120) days, in the aggregate, during any seven hundred thirty
(730) day period ("Disability"), Employee's employment hereunder may be
terminated by the Company by notice to Employee pursuant to a determination by
the Board of Directors.
(b) In the event of a termination of Employee's employment
hereunder pursuant to Section 9.1(a), Employee will be entitled to receive all
accrued and unpaid (as of the date of such termination) Base Salary and Benefits
and other forms of compensation and benefits payable or provided in accordance
with the terms of any then existing compensation or benefit plan or arrangement
-4-
("Other Compensation"), including payment prescribed under any disability or
life insurance plan or arrangement in which he is a participant or to which he
is a party as an employee of the Company. Except as specifically set forth in
this Section 9.1(b), the Company shall have no liability or obligation to
Employee for compensation or benefits hereunder by reason of such termination.
(c) For purposes of this Section 9.1, except as hereinafter
provided, the determination as to whether Employee is Disabled shall be made by
a licensed physician selected by Employee and shall be based upon a full
physical examination and good faith opinion by such physician. In the event that
the Board of Directors disagrees with such physician's conclusion, the Board of
Directors may require that Employee submit to a full physical examination by
another licensed physician selected by Employee and approved by the Company. If
the two opinions shall be inconsistent, a third opinion shall be obtained after
full physical examination by a third licensed physician selected by Employee and
approved by the Company. The majority of the three opinions shall be conclusive.
9.2. Termination by Death. In the event that Employee dies
during the Term, Employee's employment hereunder shall be terminated thereby and
the Company shall pay to Employee's executors, legal representatives or
administrators an amount equal to the accrued and unpaid portion of his Base
Salary, Benefits and Other Compensation through the end of the month in which he
dies. Except as specifically set forth in this Section 9.2, the Company shall
have no liability or obligation hereunder to Employee's executors, legal
representatives, administrators, heirs or assigns or any other person claiming
under or through him by reason of Employee's death, except that Employee's
executors, legal representatives or administrators will be entitled to receive
the payment prescribed under any death or disability benefits plan in which he
is a participant as an employee of the Company, and to exercise any rights
afforded under any compensation or benefit plan then in effect.
9.3. Termination By Company for Cause.
(a) The Company may terminate Employee's employment
hereunder at any time for "cause" upon written notice to Employee based upon a
good faith determination by the Board of Directors. The good-faith nature of the
determination shall not in and of itself mean that "cause" exists. For purposes
of this Agreement, "cause" shall mean: (i) any breach by Employee of any of his
obligations under Sections 6, 7 or 8 of this Agreement, (ii) gross incompetence
in the performance by Employee of the duties required by or appropriate for his
Position; (iii) a material violation of the Company's employee policies, as may
be amended from time to time, or (iv) other conduct of Employee involving any
type of disloyalty to the Company or willful misconduct with respect to the
Company, including without limitation fraud, embezzlement, theft or proven
dishonesty in the course of his employment or conviction of a felony.
(b) In the event of a termination of Employee's employment
hereunder pursuant to Section 9.3(a), Employee shall be entitled to receive all
accrued but unpaid (as of the effective date of such termination) Base Salary,
Benefits and Other Compensation. All Base Salary and Benefits shall cease at the
time of such termination, subject to the terms of any benefit or compensation
plan then in force and applicable to Employee. Except as specifically set forth
in this Section 9.3, the Company shall have no liability or obligation hereunder
by reason of such termination.
9.4. Termination By Company Without Cause.
(a) The Company may terminate Employee's employment
hereunder at any time, for any reason, with or without cause, effective upon the
date designated by the Company upon written notice to Employee.
-5-
(b) In the event of a termination of Employee's employment
hereunder pursuant to Section 9.4(a), Employee shall be entitled to receive all
accrued but unpaid (as of the effective date of such termination) Base Salary,
Benefits and Other Compensation, plus either (i) if such termination is prior to
the last twelve months of the Term, continuation of the current Base Salary plus
Benefits (including vesting of options and other Benefits) for one year, or (ii)
if such termination is in the last twelve-month period of the Term, continuation
of the Base Salary plus continuation of Benefits (including vesting of options
and other Benefits) for the greater of (x) the remaining portion of the Term, or
(y) six months. Except as specifically set forth in this Section 9.4, the
Company shall have no liability or obligation hereunder by reason of such
termination.
9.5. Termination By Employee
(a) Employee may terminate Employee's employment hereunder
at any time effective upon the date designated by Employee in written notice of
the termination of his employment hereunder pursuant to this Section 9.5(a) (the
"Request Date"); provided that, such date shall be at least sixty (60) days
after the date of such notice. Notwithstanding the foregoing, upon receipt by
the Company of such written notice of termination, the Company in its sole
discretion, may deem such termination effective immediately (the "Accelerated
Termination Date"). In the event the parties mutually agree to an alternative
date of termination, that date shall be considered the Request Date.
(b) In the event of a termination of Employee's employment
hereunder pursuant to Section 9.5(a) hereof, Employee shall be entitled to
receive all accrued but unpaid (as of the earlier of the Request Date or the
Accelerated Termination Date), Base Salary and Benefits. If the Company does not
terminate the Employee immediately upon receipt of the termination notice and
Employee performs his duties in a satisfactory manner, as determined in the sole
discretion of the Company, until the Request Date, Employee shall also be
entitled to an amount equal to one month's Base Salary (in effect at such time).
In addition, in the event of a termination of Employee's employment pursuant to
Section 9.5(a) at the end of the Term upon sixty (60) prior written notice and
upon the satisfactory completion, in the sole discretion of the Company, of
Employee's duties during the 60-day period after receipt of such termination
notice, Employee shall be entitled to receive an amount equal to one month's
Base Salary (in effect at such time) multiplied by the number of the complete
12-month periods of service completed prior to giving notice of termination.
Except as specifically set forth in this Section 9.5(b), all Base Salary,
Benefits and Bonuses shall cease at the time of such termination, subject to the
terms of any benefit or compensation plan then in force and applicable to
Employee. Except as specifically set forth in this Section 9.5, the Company
shall have no liability or obligation hereunder by reason of such termination.
9.6. Sale of Company/Change of Control.
(a) If there is a Sale of the Company or a Change of
Control during the Term, then the Company or the successor to all or
substantially all of the Company's assets, capital stock or business (the
"Successor Entity"), as the case may be, must offer Employee employment pursuant
to a written contract offer (the "Offer") within five (5) days of such Sale of
the Company or Change of Control. Employee shall, within fifteen (15) days after
receipt of such Offer, either (i) accept the terms of the Offer, such acceptance
indicated by return of a copy of the Offer duly executed, (ii) elect in writing,
provided to the Company or the Successor Entity, as the case may be, to remain
employed under this Agreement for the remainder of the Term, or (iii) elect to
terminate Employee's employment hereunder upon sixty (60) days prior notice,
such termination to be effective at the expiration of said sixty (60) day
period, or sooner, if desired by the Company or the Successor Entity.
(b) For purposes of this Section 9.7, (i) a "Change of
Control" means the sale, transfer, assignment or other disposition (including by
merger or consolidation) by stockholders of the Company, in one transaction or a
series of related transactions, of more than fifty percent (50%) of the voting
power represented by the then outstanding stock of the Company to one or more
Persons, other than
-6-
(i) any such sales, transfers, assignments or other dispositions by such
stockholders to their respective Affiliates, (ii) any such transaction effected
primarily to reincorporate the Company in another jurisdiction or (iii) any
transaction in connection with the simultaneous acquisition of document
management companies and the initial public offering of the common stock of the
Company or its affiliate; (ii) "Affiliate" means, with respect to any
stockholder of the Company, (w) any Person directly or indirectly controlling,
controlled by or under common control with such stockholder, (x) any Person
owning or controlling ten percent (10%) or more of the outstanding voting
securities of such stockholder, (y) any officer, director or general partner of
such stockholder, or (z) any Person who is an officer, director, general
partner, trustee or holder of ten percent (10%) or more of the outstanding
voting securities of any Person described in clauses (w) through (y) of this
sentence; and (iii) "Person" means an individual, partnership, corporation,
joint venture, association, trust, unincorporated association, other entity or
association.
(c) For purposes of this Section 9.7, a "Sale of the
Company" means a sale, transfer, assignment or other disposition (including by
merger or consolidation), of all of the outstanding stock of the Company, or of
all or substantially all of the assets of the Company, a liquidation or
dissolution of the Company. A "Sale of the Company" shall not include the
consummation of a public offering of Common Stock of the Company or its
affiliate pursuant to a registration statement or any transaction effected
primarily to reincorporate the Company in another jurisdiction.
(d) In the event of termination of Employee's employment
hereunder pursuant to clause (iii) in Section 9.7(a) above, Employee shall be
entitled to receive all accrued but unpaid (as of the effective date of such
termination) Base Salary and Benefits. In addition, in such case Employee shall
be entitled to receive Base Salary and Benefits for the eighteen (18) months
following the effective date of such termination (the "Additional Amount").
Employee, at his sole option, may receive the Additional Amount paid either (i)
monthly for eighteen (18) months, or (ii) in one payment on the effective date
of such termination, in which case the value of the Benefits otherwise payable
will be monetized, and such payment of the Additional Amount will be discounted
at the then current Federal Short Term Rate as defined in the Internal Revenue
Code of 1986, as amended.
(e) In the event Employee chooses to continue employment
hereunder pursuant to clause (ii) in Section 9.7(a) above and Employee's
employment is thereafter terminated prior to the expiration of the Term for any
reason other than Death, Disability or termination pursuant to Section
9.3(a)(iv), Employee shall be entitled to receive all the benefits and
compensation referred to in Section 9.7(d) above. In the event Employee chooses
to continue employment hereunder pursuant to clause (ii) in Section 9.7(a)
above, at the expiration of the Term, Employee shall be entitled to receive an
amount equal to one month's Base Salary (in effect at such time) multiplied by
the number of complete 12-month periods of service completed prior to such
termination.
(f) If this Agreement is assumed by any Successor Entity,
any payments set forth herein shall be the obligation of such Successor Entity.
Except as specifically set forth in this Section 9.7, (i) all Base Salary,
Benefits and Bonuses shall cease at the time of such termination, subject to the
terms of any benefit or compensation plans then in force and applicable to
Employee, and (ii) the Company shall have no liability or obligation hereunder
by reason of such termination.
(g) If the Successor Entity fails to make the Offer,
Employee shall be entitled to receive all of the benefits and compensation
referred to in Section 9.7(d) above.
10. Other Agreements. Employee represents and warrants to the
Company that:
(a) There are no restrictions, agreements or understandings
whatsoever to which Employee is a party which would prevent or make unlawful
Employee's execution of this Agreement or Employee's employment hereunder, or
which is or would be inconsistent or in conflict with this Agreement or
Employee's employment hereunder, or would prevent, limit or impair in any way
the performance by Employee of his obligations hereunder,
-7-
(b) That Employee's execution of this Agreement and
Employee's employment hereunder shall not constitute a breach of any contract,
agreement or understanding, oral or written, to which Employee is a party or by
which Employee is bound, and
(c) That Employee is free to execute this Agreement and to
enter into the employ of the Company pursuant to the provisions set forth
herein.
(d) In the event that they are still in effect, that
Employee shall disclose the existence and terms of the restrictive covenants set
forth in this Agreement to any employer that the Employee may work for during
the term of this Agreement (which employment is not hereby authorized) or after
the termination of the Employee's employment at the Company.
11. Survival of Provisions. The provisions of this Agreement
set forth in Sections 6, 7, 8 and 20 hereof shall survive the termination of
Employee's employment hereunder.
12. Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the Company and Employee and their respective
successors, executors, administrators, heirs and/or permitted assigns; provided,
however, that neither Employee nor the Company may make any assignments of this
Agreement or any interest herein, by operation of law or otherwise, without the
prior written consent of the other parties hereto, except that, without such
consent, the Company may assign this Agreement to an Affiliate or any successor
to all or substantially all of its assets and business by means of liquidation,
dissolution, merger, consolidation, transfer of assets, or otherwise, provided
that such successor assumes in writing all of the obligations of the Company
under this Agreement, subject, however, to Employee's rights as to termination
as provided in Section 9.5 hereof.
13. Notice. Any notice or communication required or permitted
under this Agreement shall be made in writing and sent by certified or
registered mail, return receipt requested, addressed as follows:
13. If to Employee:
------------------------------
------------------------------
------------------------------
With a copy to:
------------------------------
------------------------------
------------------------------
------------------------------
If to Company:
Xxxxx Xxxxxx
DocuNet Inc.
000 Xxxxxx'x Xxxx Xxxx
Xxxxxxxxx, XX 00000
with a copy to:
Xxxxx X. Xxxxxxx
Pepper, Xxxxxxxx & Xxxxxxx LLP
0000 Xxx Xxxxx Xxxxxx
00xx & Xxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000
or to such other address as either party may from time to time duly specify by
notice given to the other party in the manner specified above.
14. Entire Agreement; Amendments. This Agreement contains the
entire agreement and understanding of the parties hereto relating to the subject
matter hereof, and merges and supersedes all prior and contemporaneous
discussions, agreements and understandings of every nature between the parties
hereto relating to the employment of Employee with the Company. This Agreement
may not be changed or modified, except by an Agreement in writing signed by each
of the parties hereto.
15. Waiver. The waiver of the breach of any term or provision
of this Agreement shall not operate as or be construed to be a waiver of any
other or subsequent breach of this Agreement.
-8-
16. Governing Law. This Agreement shall be construed and
enforced in accordance with the laws of the Commonwealth of Pennsylvania.
17. Invalidity. In case any one or more of the provisions
contained in this Agreement shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect the validity of any other provision of this
Agreement, and such provision(s) shall be deemed modified to the extent
necessary to make it enforceable.
18. Section Headings. The section headings in this Agreement
are for convenience only; they form no part of this Agreement and shall not
affect its interpretation.
19. Number of Days. In computing the number of days for
purposes of this Agreement, all days shall be counted, including Saturdays,
Sundays and legal holidays; provided, however, that if the final day of any time
period falls on a Saturday, Sunday or day which is a holiday in Philadelphia,
Pennsylvania, then such final day shall be deemed to be the next day which is
not a Saturday, Sunday or legal holiday.
20. Specific Enforcement; Extension of Period.
(a) Employee acknowledges that the restrictions contained
in Sections 6, 7, and 8 hereof are reasonable and necessary to protect the
legitimate interests of the Company and its affiliates and that the Company
would not have entered into this Agreement in the absence of such restrictions.
Employee also acknowledges that any breach by him of Sections 6, 7, or 8 hereof
will cause continuing and irreparable injury to the Company for which monetary
damages would not be an adequate remedy. The Employee shall not, in any action
or proceeding to enforce any of the provisions of this Agreement, assert the
claim or defense that an adequate remedy at law exists. In the event of such
breach by Employee, the Company shall have the right to enforce the provisions
of Sections 6, 7, and 8 of this Agreement by seeking injunctive or other relief
in any court, and this Agreement shall not in any way limit remedies of law or
in equity otherwise available to the Company. If an action at law or in equity
is necessary to enforce or interpret the terms of this Agreement, the prevailing
party shall be entitled to recover, in addition to any other relief, reasonable
attorneys' fees, costs and disbursements. In the event that the provisions of
Sections 6, 7, or 8 hereof should ever be adjudicated to exceed the time,
geographic, or other limitations permitted by applicable law in any applicable
jurisdiction, then such provisions shall be deemed reformed in such jurisdiction
to the maximum time, geographic, or other limitations permitted by applicable
law.
(b) In the event that Employee shall be in breach of any of
the restrictions contained in Section 8 hereof, then the Restricted Period shall
be extended for a period of time equal to the period of time that Employee is in
breach of such restriction.
21. Arbitration. In the event that the parties are unable to
resolve any disputes arising hereunder, such dispute shall be submitted for a
binding determination by a neutral third party designated by the President of
the Philadelphia office of the American Arbitration Association.
22. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, and all of which
together shall be deemed to be one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed the day and year first written above.
ATTEST: DOCUNET INC.
By: By: /s/ Xxxxx X. Xxxxxx
------------------- -----------------------------------
Title: Title:
[CORPORATE SEAL]
/s/ S. Xxxxx Xxxxx
_________________________________
[EMPLOYEE]
-9-
SCHEDULE A
EMPLOYEE BENEFITS OF XXXXXX X. XXXXX
1. Automobile: Automobile allowance comparable to other executive management
of the Company ("Executive Management").
2. Vacation: 20 business days of vacation per year.
3. Major medical and hospitalization insurance: Major medical and
hospitalization insurance and other benefits available through Company's
cafeteria plan effected by the Company's contribution on behalf of Employee
to Company's cafeteria plan in an amount equal to $ per year.
4. Life Insurance: Policy with death benefit to Employee equal to three times
initial Base Salary.
5. Expense Reimbursement: The Company will reimburse Employee for business
trade and entertainment expenses normally reimbursed under the Company's
general expense reimbursement policy, as may be in effect from time to
time.
6. Other Benefits: Participation in 401(k) Plan, Supplemental Retirement Plan
and Short-Term disability policy, and any other benefit plan which may be
generally available to the class of employees of which Employee is
employed.
A-1
