Exhibit 10.3
EMPLOYMENT AGREEMENT dated as of June 12, 2000, between OPUS360
CORPORATION, a Delaware corporation (the "Company"), and Xxxxxx X. Xxxxxx (the
"Employee").
WHEREAS, the Company desires to employ the Employee as the Executive
Vice President, General Counsel and Secretary of the Company; and
WHEREAS, the Employee desires to accept such employment by the
Company, on the terms and subject to the conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Company and the Employee hereby agree as follows:
Section 1. Employment.
The Company hereby employs the Employee, and the Employee hereby
accepts employment by the Company, upon the terms and subject to the conditions
hereinafter set forth.
Section 2. Term of Employment.
The Employee's employment hereunder shall be for the period
commencing on June 12, 2000 (the "Start Date") and ending on the day immediately
prior to the third anniversary of the Start Date (the "Base Term"); provided,
however, unless earlier terminated pursuant to the provisions of Sections 6, 7,
8 or 9 hereof, the Base Term shall be automatically renewed and extended for
successive one-year terms without further act of the parties (each, a "Renewal
Term" and together with the Base Term, collectively, the "Employment Period"),
unless either the Company or the Employee gives the other party hereto at least
45 days prior written notice before the end of the Employment Period of such
party's intent not to renew this Agreement (each, a "Right Not To Extend").
Section 3. Duties.
The Employee shall be employed as the Executive Vice President,
General Counsel and Secretary of the Company or in such other position as the
Company and the Employee shall agree in writing. The Employee shall report to
the President and Chief Operating Officer of the Company. The Employee shall
perform such duties and services as are appropriate and commensurate with the
Employee's position as Executive Vice President, General Counsel and Secretary
of the Company and as are otherwise consistent in stature and prestige with the
position of Executive Vice President of a corporation with similar operations as
the Company, and shall perform such additional duties and services which are
similarly consistent with such position as may reasonably be assigned to her
from time to time by the President and the Chief Operating Officer. The Employee
shall be based in the New York City metropolitan area.
Section 4. Time to be Devoted to Employment.
(a) Except for three weeks vacation during each calendar year period
(accrued 1/12 for each month period) worked (in addition to public holidays),
absences due to temporary illness and time spent as a director in respect of a
directorship held by the Employee on or prior to the Start Date, the Employee
shall devote substantially all of her business time, attention and energies to
the business and affairs of the Company during the Employment Period.
Notwithstanding the foregoing, the Company acknowledges that Employee may on
certain days work out of locations other than the Company's principle place of
business without such days being considered vacation days. Further during the
period from the Start Date through December 31, 2000, Employee shall be entitled
to fifteen vacation days.
(b) During the Employment Period, the Employee shall not engage in
any other business activity which conflicts with the duties of the Employee
hereunder, whether or not such activity is pursued for gain, profit or other
pecuniary advantage; provided, however, to the extent not in conflict with this
Section 4, the Employee shall not be prohibited from (i) serving as an officer,
director, trustee or otherwise participating in purely educational, welfare,
social, charitable, religious, political and civic organizations, or (ii)
managing personal and family investments, in each case to the extent such
activities (A) do not interfere or conflict in any material respect with the
performance of her duties and responsibilities hereunder and (B) are conducted
in accordance with the limitations of Section 11. Except with the prior written
approval of the Board (excluding the Employee if she should be a member of the
Board at the time of such determination), which the Board may grant or withhold
in its sole and absolute discretion, the Employee, during the Employment Period,
will not serve on the board of directors or similar body of any business entity
other than the Company or any subsidiary thereof (other than with respect to any
directorship held by the Employee on or prior to the Start Date, which
directorships, if any, have been disclosed in writing by the Employee to the
Company).
Section 5. Compensation; Reimbursement.
(a) During the Employment Period, the Company (or at the Company's
option, any subsidiary or affiliate thereof) shall pay to the Employee an annual
salary (the "Base Salary") of not less than $225,000, payable in accordance with
the Company's regular payroll practices, but in no event less frequently than
semi-monthly. Such Base Salary will be reviewed at least annually and may be
increased by the Board or the Board's designee (excluding the Employee if she
should be a member of the Board at the time of such determination) in its sole
discretion. Effective as of any such increase, the Base Salary as so increased
shall be considered the new Base Salary for all purposes of this Agreement and
may not thereafter be reduced.
(b) The Employee shall be eligible to receive an annual bonus of no
less than $43,750 for the calendar year 2000 and no less than $75,000 during
each subsequent calendar year of the Employment Period (pro-rated for partial
calendar years of employment by the Company) based upon her achievement of
performance criteria mutually agreed upon by the Employee and the Company
("MBO's"), which performance criteria shall not be more stringent than those
established for the President and the Chief Operating Officer for a similar
period of
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time. It is expected that the performance criteria will be based on MBO targets
to be agreed upon 1) within thirty (30) days after the Start Date for the
balance of calendar year 2000, and 2) by December 31, 2000 and by each December
31 thereafter, for the subsequent calendar years of employment. Such targets
shall be consistent with and no higher than the performance targets established
for the President and Chief Operating Officer of the Company for such calendar
year.
(c) During the Employment Period and to the extent available to
senior executive officers of the Company, the Employee shall be entitled to
participate in all of the Company's benefit plans including but not limited to,
pension and retirement plans, life insurance, hospitalization and surgical and
major medical coverages, sick leave, vacation and holiday policies, long-term
disability coverage and such other fringe benefits enjoyed by other senior
executive officers of the Company. Notwithstanding anything to the contrary
contained in this Section 5(c) or any such plan, at no time during the
Employment Period shall the long-term disability coverage and life insurance
benefits that the Company provides to the Employee be reduced to a level below
that being provided to the Employee as of the Start Date.
(d) The Company shall reimburse the Employee, in accordance with the
practice from time to time for other senior executive officers of the Company,
for all reasonable and necessary traveling expenses, disbursements and other
reasonable and necessary incidental expenses incurred by her for or on behalf of
the Company in the performance of her duties hereunder upon presentation by the
Employee to the Company of appropriate vouchers.
(e) The Company shall grant the Employee, on or as soon as
practicable after the Start Date, options (the "Options") to purchase, in the
aggregate, 125,000 shares of common stock of the Company (the "Common Stock")
which is based on the fair market value of a share of Common Stock on the date
of grant. A portion of the Options shall qualify for federal income tax purposes
as "incentive stock options" (the "ISO") (the number of options that will
qualify as the ISO shall be the maximum number permitted under the terms of the
Company's 2000 Stock Option Plan), and the remainder shall not qualify for
federal tax purposes as "incentive stock options" (the "NSO"). A written option
agreement between the Company and the Employee (the "ISO Agreement") shall be
prepared and delivered by the Company to the Employee, which ISO Agreement shall
contain all of the terms and conditions of the ISO, and a written option
agreement between the Company and the Employee (the "NSO Agreement" and together
with the ISO Agreement, the "Stock Option Agreements") shall be prepared and
delivered by the Company to the Employee, which NSO Agreement shall contain all
of the terms and conditions of the NSO. The Options shall vest over three years,
6/36 of such amount shall vest on the six month anniversary of the date of grant
and 1/36 of such amount shall vest each month thereafter. The Company shall at
least once each year commencing in 2001 consider the Employee for future annual
or other grants of stock options and other equity awards on at least the same
basis as such options and equity awards are granted to other senior executive
officers.
(f) The Employee authorizes the Company to deduct from any amounts
payable to her hereunder such sums as may be required to be deducted or withheld
under the provisions of any federal, state or local law or regulation, or
employee benefit in which the
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employee may participate, now in effect or hereafter put into effect during the
term of this Agreement, including, without limitation, social security and
income withholding taxes.
Section 6. Involuntary Termination.
(a) If the Employee is incapacitated or disabled by accident,
sickness or other cause so as to render her mentally or physically incapable of
performing the services required to be performed by her under this Agreement for
a period of 120 consecutive days or longer, or an aggregate of 150 days or
longer during any 200 day period (such condition being herein referred to as a
"Disability"), prior to the Employee resuming the performance of her duties as
contemplated herein, the Company may terminate the employment of the Employee
under this Agreement (an "Involuntary Termination"). Until the Company or the
Employee shall have terminated the Employee's employment hereunder, the Employee
shall be entitled to receive her compensation and other benefits as set forth in
this Agreement notwithstanding any such Disability.
(b) Any determination as to whether the Employee is subject to a
Disability shall first be made by the Board (excluding the Employee if he should
be a member of the Board at the time of such determination) in its good faith
judgment; provided, however, if any such determination is disputed by the
Employee, the matter shall be referred to a licensed physician practicing within
New York, New York or a 50-mile radius thereof and selected by the Board and the
Employee, and the determination of Disability made by such physician shall be
final and binding on both the Employee and the Company. The Employee represents
and warrants to the Company that, to the best of her knowledge, she does not
have a Disability as of the date hereof.
(c) If the Employee dies during the Employment Period, her
employment hereunder shall be deemed to cease as of the date of her death, and
the termination of her employment occasioned thereby shall be deemed an
Involuntary Termination.
Section 7. Termination for Cause or Without Cause.
(a) The Company may terminate the Employee's employment hereunder at
any time during the Employment Period for "Cause" (a "Termination for Cause").
Prior to, and in connection with, any Termination for Cause, (1) the President
and Chief Operating Officer of the Company or their respective designee shall
give written notice to the Employee of the specific circumstances which may
constitute the basis for a Termination for Cause, (2) the Employee shall be
provided with ten (10) days to cure the basis for a Termination with Cause (but
only if such basis is capable of cure), and (3) the Board shall have determined,
in its sole discretion (so long as not arbitrary or capricious), by a vote of
not less three-fourths (3/4) of the Board (excluding the Employee if she should
be a member of the Board at the time of such determination) at a meeting called
and held for such purpose, after reasonable notice to the Employee and an
opportunity for the Employee, together with her counsel, to be heard before the
Board, that the Company has Cause to terminate the Employee's employment. For
purposes of this Agreement, "Cause" shall be limited to:
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(i) the gross negligence or willful refusal or failure by the
Employee to attempt to substantially perform the duties described in
Section 3 (other than any failure resulting from an illness or other
similar incapacity or disability);
(ii) the Employee's conviction of, or plea of nolo contendere
to, misappropriation of funds, properties or assets of the Company, or any
other act of fraud, theft or financial dishonesty involving the Company or
its subsidiaries, or slander or libel concerning the Company or a material
tort relating to her office or employment with the Company that has a
material adverse effect on the Company;
(iii) the material breach by the Employee of the provisions of
this Agreement including, without limitation, the covenants set forth in
Sections 11 and 12 hereof;
(iv) the Employee's conviction of, or plea of nolo contendere
to, a crime constituting a felony (other than a traffic violation) or any
criminal act involving moral turpitude; or
(v) the Employee's inability to perform her duties as a result
of alcohol or drug abuse, chronic alcoholism or drug addiction.
(b) The Company may terminate the Employee's employment hereunder at
any time during the Employment Period without "Cause" by providing written
notice of such termination to the Employee (a "Termination Without Cause") at
least five days prior to such Termination Without Cause or pay in lieu of such
notice.
Section 8. Termination for Poor or Incompetent Performance.
The Company may not terminate the Employee's employment hereunder at
any time during the first year of the Base Term for the Employee's poor or
incompetent performance of her duties or responsibilities hereunder, which shall
mean performance substantially below the standard expected generally of a senior
legal officer of a public corporation. Thereafter, the Company may terminate the
Employee's employment hereunder at any time for poor or incompetent performance
("Termination for Poor or Incompetent Performance"); provided that the Board
shall have determined, in its sole discretion (so long as not arbitrary or
capricious), by a vote of not less three-fourths (3/4) of the Board (excluding
the Employee if she should be a member of the Board at the time of such
determination) at a meeting called and held for such purpose, after reasonable
notice to the Employee and an opportunity for the Employee, together with her
counsel, to be heard before the Board, that the Employee's performance hereunder
has been poor or incompetent.
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Section 9. Termination for Good Reason or by Resignation.
(a) The Employee may terminate her employment hereunder at any time
during the Employment Period for "Good Reason."
(b) For purposes of this Agreement:
(i) "Good Reason" means (A) a reduction in the title or any
material reduction in the authority, duties, responsibilities,
compensation, benefits or reporting line of the Employee from those on the
Start Date, where such reduction or material reduction is not cured within
10 days after written notice thereof by the Employee to the Company, (B) a
Change of Control, if (1) within one (1) year of such Change of Control
the employment of the Employee is terminated by the Company for any
reason, or (2) during the 30-day period commencing 6 months after a Change
of Control the Employee terminates her employment for any or no reason,
(C) the Company's headquarters and/or the Employee's office is relocated
more than thirty (30) miles outside The City of New York, (D) a material
breach by the Company of this Agreement, which breach is incurable or
otherwise not cured within 10 days after written notice thereof by the
Employee to the Company, (E) the failure of the Company to grant the
Employee the Options pursuant to the Stock Option Agreements provided for
in Section 5(e) of this Agreement, or (F) the failure of the Company to
obtain a satisfactory agreement from any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
and agree to perform this Agreement to the same extent that the Company is
required to perform it, in each case without the prior written consent or
waiver of the Employee.
(ii) the Employee's continued employment shall not constitute
consent to or a waiver of rights with respect to, any circumstances
constituting Good Reason hereunder, unless such employment extends beyond
one year.
(iii) "Change in Control" of the Company shall be deemed to
have occurred if:
(A) upon the consummation of any transaction or series
of transactions consummated in any twelve (12) month period pursuant to or
as a result of which (1) any person or entity other than Xxx Xxxxxxxx
("Xxxxxxxx") is or becomes, directly or indirectly, the beneficial owner
of 50% or more of the common stock (or other securities of the Company
having generally the right to vote for election of the Board), (2) the
Company or any subsidiary of the Company shall sell, assign or otherwise
transfer, directly or indirectly, assets (including stock or other
securities of subsidiaries) having a fair market or book value or earning
power of 50% or more of the assets or earning power of the Company and its
subsidiaries (taken as a whole) to any third party, other than
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Xxxxxxxx, the Company or a wholly owned subsidiary thereof, (3) there is
consummated a merger or consolidation of the Company with any other
corporation other than (a) a merger or consolidation which would result in
the voting securities of the Company outstanding immediately prior to such
event continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or any parent
thereof) at least 50% of the combined voting power of the securities of
the Company or such surviving entity or any parent thereof outstanding
immediately after such event or (b) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in
which no person or entity other than Xxxxxxxx becomes the beneficial owner
of more than 50% of the combined voting power of the Company's then
outstanding securities.
(B) the stockholders of the Company approve any plan or
proposal for the liquidation or dissolution of the Company; or
(C) if, during any period of twenty-four (24) months,
individuals who at the beginning of such period constitute the Board, and
any new director (other than a director designated by a third party who
has entered into an agreement to effect a transaction described in clause
A above) whose election by the Board or nomination for election by the
Company's stockholders was approved by a vote of at least a majority of
the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved (other than approval given in connection with an
actual or threatened proxy or election contest), cease for any reason to
constitute at least a majority of the members of the Board.
(c) The Employee may terminate her employment hereunder at any time
during the Employment Period without "Good Reason" by providing written notice
of such termination to the Company (a "Resignation") at least five days prior to
such Resignation.
Section 10. Effect of Termination of Employment.
(a) Termination For Cause or by Resignation. Upon the termination of
the Employee's employment hereunder pursuant to a Termination For Cause or a
Resignation, neither the Employee nor her beneficiary or estate shall have any
further rights or claims against the Company under this Agreement except to
receive:
(i) any unpaid portion of the Base Salary provided for in
Section 5(a), computed on a pro rata basis to the date of termination;
(ii) cash compensation equal to the product of (A) the number
of days of accrued vacation, if any, accumulated by the Employee to the
date of termination divided by 365 multiplied by (B) the Base Salary;
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(iii) reimbursement for any business expenses for which the
Employee shall not have theretofore been reimbursed as provided in Section
5(d);
(iv) any bonus for the prior calendar year which has been
earned but not yet paid; and
(v) all vested benefits under any compensation or employee
benefit plan maintained by the Company, whether funded or unfunded,
accrued through the date of termination.
(b) Involuntary Termination. Upon the termination of the Employee's
employment hereunder pursuant to an Involuntary Termination, neither the
Employee nor her beneficiary or estate shall have any further rights or claims
against the Company under this Agreement except the right:
(i) to receive the payments and benefits, if any, equal to
those provided for in Section 10(a) hereof;
(ii) to receive monthly cash severance payments in an amount
equal to one-twelfth of the cash compensation (including Base Salary and
bonus) received by the Employee during the 12-month period immediately
prior to the date of termination under this subsection; provided, however,
that if such termination occurs prior to the date of payment of any bonus
for calendar year 2000, the bonus amount for such calculation shall be
deemed to be $43,750.00 (such monthly payments, "Monthly Severance"), for
a period of twelve (12) months;
(iii) to be credited with one additional year of employment
for purposes of calculating the Employee's vested interest in the Options
and any other stock options and equity awards granted to the Employee
during the Employment Period, which Options and other options shall vest
according to their original schedule as if the Employee's employment
hereunder had continued for twelve (12) months from the date of
Involuntary Termination, and all such Options and other options shall be
exercisable by the Employee for their full remaining term; and
(iv) in the case of termination due to a Disability, to
receive all benefits pursuant to Section 5(c) above for a period of twelve
(12) months following the date of such termination.
(c) Termination Without Cause or With Good Reason. Upon the
termination of the Employee's employment hereunder pursuant to a Termination
Without Cause or With Good Reason, neither the Employee nor her beneficiary or
estate shall have any further rights or claims against the Company under this
Agreement except the right:
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(i) to receive the payments and benefits, if any, equal to
those provided for in Section 10(a) hereof;
(ii) to receive Monthly Severance, for a period lasting the
longer of (A) twelve (12) months, or (B) the remainder of the Base Term;
provided, however, such payments shall be reduced by the amount of any
salary or other cash compensation paid by another employer during such
period;
(iii) to become fully vested in all of the Options and any
other stock options and equity awards granted to the Employee during the
Employment Period, which Options and other options shall vest according to
their original schedule as if the Employee's employment hereunder had
continued until all such Options and other options had fully vested, and
all such Options and other options shall be exercisable by the Employee
for their full remaining term; and
(iv) to receive all benefits pursuant to Section 5(c) above
for a period lasting the longer of (A) twelve (12) months from the date of
Termination Without Cause or With Good Reason, or (B) the remainder of the
Base Term; provided, however, that the Employee will not be entitled to
any such benefits on or after the date that the Employee becomes employed
by another entity during the period that such benefits would otherwise be
due except as required under applicable law and only to the extent that
comparable benefits are available from such other entity.
(d) Termination for Poor or Incompetent Performance. Upon
termination of the Employee's employment hereunder pursuant to a Termination for
Incompetence or Non-Performance, neither the Employee nor her beneficiary or
estate shall have any further rights or claims against the Company under this
Agreement except the right:
(i) to receive payments and benefits, if any, equal to those
provided for in Section 10(a) hereof;
(ii) to receive Monthly Severance, for a period of twelve (12)
months; provided, however, such payments shall be reduced by the amount of
any salary or other cash compensation paid by another employer during such
period; and
(iii) to be credited with twelve (12) additional months of
employment for purposes of calculating the Employee's vested interests in
the Options and any other stock options and equity awards granted to the
Employee during the Employment Period, which options shall vest according
to their original schedule as if the Employee's employment hereunder had
continued for twelve (12) months from the date of the Termination for Poor
or Incompetent Performance, and all such Options and other options shall
be exercisable by the Employee for their full remaining term.
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(iv) to receive all benefits pursuant to Section 5(c) above
for a period of twelve (12) months following the date of such Termination
for Poor or Incompetent Performance; provided, however, that the Employee
will not be entitled to any such benefits on or after the date that the
Employee becomes employed by another entity during the period that such
benefits would otherwise be due except as required under applicable law
and only to the extent that comparable benefits are available from such
other entity.
(e) Termination Based on the Employee's Right Not To Extend. Upon
the termination of the Employee's employment hereunder pursuant to the
Employee's Right Not To Extend, neither the Employee nor her beneficiary or
estate shall have any further rights or claims against the Company under this
Agreement except the right to receive the payments and benefits, if any, equal
to those provided for in Section 10(a) hereof.
(f) Termination Based on the Company's Right Not To Extend. Upon the
termination of the Employee's employment hereunder pursuant to the Company's
Right Not To Extend, neither the Employee nor her beneficiary or estate shall
have any further rights or claims against the Company under this Agreement
except the right:
(i) to receive the payments and benefits, if any, equal to
those provided for in Section 10(a) hereof, provided, however, such
payments shall be reduced by the amount of any salary or other cash
compensation paid by another employer during such period.;
(ii) to receive Monthly Severance, for a period of twelve (12)
months; provided, however, such payments shall be reduced by the amount of
any salary or other cash compensation paid by another employer during such
period.
(iii) to become fully vested in all of the Options and any
other stock options and equity awards granted to the Employee during the
Employment Period, which Options and other options shall vest according to
their original schedule for twelve (12) months from the date of
Termination Based on the Company's Right Not To Extend, and all such
Options and other options shall be exercisable by the Employee for their
full remaining term; and
(iv) to receive all benefits pursuant to Section 5(c) above
for a period of twelve (12) months following the date of the termination
of the Employee's employment hereunder pursuant to the Company's Right Not
To Extend; provided, however, that the Employee will not be entitled to
any such benefits on or after the date that the Employee becomes employed
by another entity during the period that such benefits would otherwise be
due, except as required under applicable law and only to the extent that
comparable benefits are available from such other entity.
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(g) Mitigation of Damages. If the Employee's employment with the
Company hereunder terminates, the Employee shall not have the obligation to
mitigate any damages resulting from such termination.
(h) Conditional Obligation. Any obligations of the Company to
provide payments and benefits to the Employee under this Section 10 are
expressly conditioned on the Employee's compliance with Sections 11 and 12 of
this Employment Agreement.
(i) Resignation. Except to the extent requested by the Board, upon
the date of termination, the Employee shall immediately resign all positions and
directorships with the Company and each subsidiary thereof.
Section 11. Non-Competition; Non-Solicitation.
(a) In consideration of the compensation and other benefits to be
provided to the Employee hereunder, the Employee shall not, directly or
indirectly, for any reason whatsoever, during the Employment period and for a
period of one year following the Employee's Termination if such Termination is a
Termination for Cause, Termination for Poor or Incompetent Performance, or
Employee's Resignation:
(i) engage, become involved or acquire an interest in any
Competitive Business (as hereinafter defined), whether such engagement,
interest or involvement shall be as an employee, employer, manager,
material investor, owner, consultant, lender, partner or other participant
in any Competitive Business;
(ii) assist others in engaging in any Competitive Business in
the manner described in the foregoing clause (i);
(iii) solicit or induce, or attempt to solicit or induce,
employees of, consultants to, or independent contractors of, the Company
or its subsidiaries to terminate their employment, engagement or
affiliation with the Company or in any way interfere with the relationship
between the Company or any of its subsidiaries, on the one hand, and any
such employee of, consultant to, or independent contractor of the Company
or any of its subsidiaries, on the other hand;
(iv) knowingly employ or retain any such employee of,
consultant to, or independent contractor of the Company or any of its
subsidiaries during her employment, engagement or affiliation with the
Company or any of its subsidiaries for a period of three months after the
termination of such employee's, consultant's or independent contractor's
employment, engagement or affiliation with the Company or any of its
subsidiaries unless such retainer is not competitive, and does not
interfere with, the simultaneous retention of such consultant or
independent contractor by the Company; or
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(v) induce customers or vendors of the Company, or any independent
knowledge workers or other information technology professionals, or end user
organizations that have a business relationship with the Company, to alter or
terminate their business relationship with the Company or any of its
subsidiaries; provided, however, that nothing contained in this Section 11 shall
be deemed to prohibit the Employee from acquiring, directly or indirectly,
solely as a passive investment, securities of any Competitive Business traded on
any national securities exchange if the Employee is not a controlling person of,
nor a member of a group which controls such person and does not, directly or
indirectly, own 5% or more of any class of securities of such person. As used
herein, the term "Competitive Business" shall mean any business which competes
with the Company in the business of primarily providing labor resource
management services or products relating to information technology professionals
by means of business-to-business electronic commerce or any business or activity
that is substantially the same as any material business or activity conducted by
the Company (including without limitations any subsidiary thereof) at any time
during the Employment period within the geographic area that the Company is
engaged in such business or activity during the Employment period.
(b) Notwithstanding any other provision of this Agreement to the
contrary, any business activities engaged in by the Employee on behalf of, or in
connection with the Employee's employment by, or service as a director or
consultant to, any subsidiary or affiliate of the Company or in connection with
a directorship held by the Employee on or prior to the Start Date, shall not be
deemed to violate the provisions of this Agreement.
(c) The Employee is aware that the services performed by her for the
Company are of a special, unique and intellectual character and understands that
the foregoing restrictions may limit her ability to earn a livelihood in a
Competitive Business, but she nevertheless believes that she has received and
will receive sufficient consideration and other benefits in connection with her
employment to clearly justify such restrictions which, in any event, the
Employee does not believe would prevent her from earning a living. Nothing
herein contained shall prohibit the Employee from engaging in a business that is
not a Competitive Business.
Section 12. Non-Disclosure of Information.
The Employee understands that she will have access to Confidential
Information relating to the Company and agrees that she will not, at any time
during or after the Employment Period, disclose to any person, firm, corporation
or other entity, except as required by law and the Rules of Professional
Conduct, any Confidential Information concerning the business, clients or
affairs of the Company or any subsidiary or affiliate thereof, or of any person
which the Company or any of its subsidiaries is under an obligation to keep
secret or confidential, for any reason or purpose whatsoever other than in
furtherance of the Employee's good faith performance of her duties as an
employee of the Company, nor shall the Employee make use of any of such
Confidential Information for her own purpose or for the benefit of any person,
firm, corporation or other business entity except the Company or any subsidiary
or affiliate thereof. For purposes of this Agreement, "Confidential Information"
shall include, without limitation, products or
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services, fees, costs, pricing schedules, designs, analyses, drawings,
photographs, reports, computer software and hardware (including operating
systems, applications and program listings), customers and clients, customer and
client lists, marketing plans and related information, sales plans and related
information, operating policies and manuals, business plans, financial records
or practice management methods, inventions, devices, new developments, methods
and processes, technology or trade secrets, know-how or techniques, whether
patentable or unpatentatable and whether or not reduced to practice, and all
similar and related information in whatever form. Notwithstanding the foregoing,
Confidential Information shall not include any such information, which has
previously been made public by the Company or has otherwise become public
through no action or omission of the Employee.
Section 13. Company Right to Inventions and Business Opportunities.
(a) The Employee shall promptly disclose, grant and assign to the
Company for its sole use and benefit any and all (i) discoveries, developments,
designs, improvements, inventions, formulae, processes, techniques, computer
programs, strategies, know-how and data, whether or not patentable or
registerable under patent, copyright, trademark or similar statutes, together
with all patent applications, patents, copyrights, copyright applications,
trademarks, trademark applications and any reissues thereof that may at any time
be granted for or upon any such inventions (the "Inventions") or (ii) business
opportunities relating to the actual or anticipated business of the Company or
any of its subsidiaries ("Business Opportunity"), presented to or learned by the
Employee during the period of the Employee's employment with the Company prior
to any termination of employment (whether or not during usual working hours).
The Company and the Employee understand, expect and acknowledge that in her
capacity as a lawyer, the Employee develops and uses forms, documents,
knowledge, expertise and other legal skills, both tangible and intangible
(hereafter "Legal Work Product") in the representation of clients, including the
Company, prior to, during and after the Employment period. The Company and the
Employee agree that nothing contained in this Section 13 shall prohibit the
Employee's continued development and use of Legal Work Product for future
clients and/or employers and Legal Work Product shall not constitute Inventions
as defined herein. Notwithstanding the foregoing, no such use of Legal Work
Product shall diminish the obligations of the Employee under Section 12 hereof.
(b) The Employee shall promptly, without charge and at the expense
of the Company, at all times hereafter execute and deliver such applications,
assignments, descriptions and other instruments as may be reasonably necessary
or proper in the reasonable opinion of the Company to (i) vest title to and
enforce patents, copyrights, trademarks, improvements, technical information and
methods and other rights and protections relating to the Inventions and (ii) to
assign or otherwise establish such ownership of the Company in all rights in or
to such Business Opportunities, and to enable the Company to obtain and maintain
the entire right and title thereto in any and all countries; and
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(c) The Employee shall render to the Company at its expense
(including a reasonable payment for the time involved in case she is not then in
its employ) all such assistance as it may reasonably require at times and
locations agreed to by the Company and the Employer in the (i) prosecution of
applications for the Inventions, in the prosecution or defense or interferences
which may be declared involving the Inventions and in any litigation in which
the Company may be involved relating to the Inventions, each including, without
limitation, the execution of assignments, consents, powers of attorney,
applications and other instruments and the giving of testimony in support
thereof or (ii) confirmation and protection of such ownership of the Company in
all rights in or to any Business Opportunities, provided, however, that such
assistance shall not interfere with the Employee's employment or business
activities.
(d) The Employee shall deliver to the Company at the termination of
the Employment Period, or upon the request of the Company, at any time, all
memoranda, notes, plans, records, reports, computer tapes and software and other
documents and data (and copies thereof) relating to the Confidential
Information, Inventions, Business Opportunities or the business of the Company
or any of its subsidiaries, which he may then possess or have under her control,
regardless of the location or form of such material and, if requested by the
Company, shall provide the Company with written confirmation that all such
materials have been delivered to the Company.
Section 14. Enforcement.
It is the desire and intent of the parties hereto that the
provisions of this Agreement shall be enforced to the fullest extent permissible
under the laws and public policies applied in each jurisdiction in which
enforcement is sought. Accordingly, if any particular provision of this
Agreement shall be adjudicated to be invalid or unenforceable, such provision
shall be deemed amended to delete therefrom the portion thus adjudicated to be
invalid or unenforceable, such amendment to apply only with respect to the
operation of such provision in the particular jurisdiction in which such
adjudication is made; provided, however, that if any one or more of the
provisions contained in this Agreement shall be adjudicated to be invalid or
unenforceable because such provision is held to be excessively broad as to
duration, geographical scope, activity or subject, such provision shall be
deemed amended by limiting and reducing it so as to be valid and enforceable to
the maximum extent compatible with the applicable laws of such jurisdiction,
such amendment to apply only with respect to the operation of such provision in
the particular jurisdiction in which such adjudication is made.
Section 15. Excise Taxes.
To the extent that any of the payments and benefits provided for in
this Agreement or otherwise payable to the Employee constitute "parachute
payments" within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the "Code"), and, but for this Section 15, would be subject to
the excise tax imposed by Section 4999 of the Code, then the Employee's benefits
under this Agreement shall be payable either (i) in full or (ii) to such lesser
amount as would result in no portion of severance payments being subject to
excise tax under Section 4999 of the Code, which ever of the foregoing amounts,
taking into account the
14
applicable federal, state and local income taxes and excise tax imposed by
Section 4999, results in the receipt by the Employee on an after tax basis of
the greatest amount of severance benefits provided pursuant to this Agreement,
notwithstanding that all or some portion of such severance benefits may be
taxable under Section 4999 of the Code. Unless the Company and the Employee
otherwise agree in writing, any determination required under this Section shall
be made in writing by an independent public accounting firm selected by the
Employee and reasonably acceptable to the Company other than that used by the
Company (the Accountants), whose determination shall be conclusive and binding
upon the Employee and the Company for all purposes. For purposes of making the
calculations required by this Section 15, the Accountants may make reasonable
assumptions and approximations concerning applicable taxes and may rely on
reasonable, good faith interpretations concerning the application of Sections
280G and 4999 of the Code. The Company and the Employee shall furnish to the
Accountants such information as the Accountants may reasonably request in order
to make a determination under this Section 15 The Company shall bear all costs
the Accountants may reasonably incur in connection with any calculations
contemplated by this Section 15.
Section 16. Remedies; Survival.
(a) The Employee acknowledges and understands that the provisions of
Sections 11, 12 and 13 of this Agreement are of a special and unique nature, the
loss of which cannot be accurately compensated for in damages by an action at
law, and that the breach of such provisions of this Agreement would cause the
Company irreparable harm. In the event of a breach by the Employee of the
provisions of Section 11, 12, or 13 hereof, the Company shall be entitled to an
injunction restraining her from such breach; provided, however, nothing herein
contained shall be construed as prohibiting the Company from pursuing any other
remedies available for any breach of this Agreement.
(b) Notwithstanding anything contained in this Agreement to the
contrary, the provisions of Sections 9 through 18, including this Section 16,
shall survive the expiration or other termination of this Agreement until, by
their terms, such provisions are no longer operative.
(c) It is understood and agreed that the provisions of Sections 11,
12 and 13 of this Agreement are separate and distinct from any other agreement
between the parties hereto. Accordingly, in the event of a breach of such
provisions, the breaching party shall only be held responsible for damages
arising under such provisions and not for any damages which may be claimed to
arise under or with respect to any other agreement that is not separately
breached.
Section 17. Notices.
All notices, demands or other communications to be given or
delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given or made when (i) delivered
personally to the recipient, (ii) transmitted by facsimile or electronic mail
(with hard copy sent to the recipient by reputable overnight courier service
(charges prepaid) that same day and, in the latter case, with receipt
acknowledged by the recipient by return electronic mail) if faxed or e-mailed
before 5:00 p.m. (New York City time)
15
on a Business Day, and otherwise on the next Business Day (as hereinafter
defined), (iii) two Business Days after being sent to the recipient by reputable
overnight courier service (charges prepaid), or (iv) five Business Days after
being sent to the recipient by registered or certified mail (postage prepaid and
return receipt requested). The term "Business Day" shall mean any day, other
than a Saturday, Sunday or other day on which banking institutions in the State
of New York are authorized or obligated by law or executive order to close. Such
notices, demands and other communications shall be sent to the address for such
recipient as set forth below (or to such other address or to the attention of
such other person as the recipient party has specified by like notice):
(i) if to the Company, to:
Opus360 Corporation
00 Xxxx 00xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
President and Chief Operating Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
E-Mail: xxxx@xxxx000.xxx
(ii) and, if to the Employee, to:
Xxxxxx X. Xxxxxx
00 Xxxxx Xxx Xxxx Xxxxxx
Xxxxxxxxx XX 00000-0000
Telephone: (000) 000-0000
Facsimile (000) 000-0000
E-Mail: xxxxxx_x_xxxxxx@xxxxx.xxx
Section 18. General Provisions.
(a) Binding Agreement. This Agreement shall inure to the benefit of
and be enforceable by the Employee's personal or legal representatives,
executors, administrators, successors, heirs, distributees and devisees. If the
Employee should die while any amount would still be payable to her hereunder if
she had continued to live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement to the beneficiary
designated by the Employee in a writing delivered to the Company, or if there be
no such designated beneficiary, to her estate.
(b) Governing Law and Choice of Jurisdiction and Venue. THE
PROVISIONS OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
16
CONTRACTS ENTERED INTO AND FULLY PERFORMED WITHIN THE STATE OF NEW YORK BY
RESIDENTS OF THE STATE OF NEW YORK. WITH RESPECT TO ANY LAWSUIT OR PROCEEDING
BROUGHT WITH RESPECT TO THIS AGREEMENT, EACH OF THE PARTIES HERETO IRREVOCABLY
(I) SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK
OR FEDERAL COURT OF THE UNITED STATES OF AMERICA SITTING IN NEW YORK, (II)
WAIVES ANY OBJECTION IT MAY HAVE AT ANY TIME TO THE LAYING OF VENUE OF ANY
PROCEEDING BROUGHT IN ANY SUCH COURT, (III) WAIVES ANY CLAIM THAT SUCH
PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM, AND (IV) FURTHER WAIVES
THE RIGHT TO OBJECT, WITH RESPECT TO SUCH PROCEEDINGS, THAT SUCH COURT DOES NOT
HAVE JURISDICTION OVER SUCH PARTY.
(c) Waiver of Breach. The waiver by either party of a breach of any
provision of this Agreement by the other party must be in writing and shall not
operate or be construed as a waiver of any subsequent breach by such other
party.
(d) Complete Agreement; Amendments; Prior Agreements. This Agreement
together with the Stock Option Agreements and the other agreements referred to
herein contain the entire agreement between the parties with respect to the
subject matter contained herein and supersede all prior agreements or
understandings written or oral between the parties with respect thereto. This
Agreement may not be amended, supplemented, canceled or discharged except by
written instrument executed by both parties hereto.
(e) Counterparts. This Agreement may be executed in two
counterparts, each of which shall be deemed an original and all of which
together shall constitute but one and the same instrument.
(f) Business Days. If any time period for giving notice or taking
action hereunder expires on a day which is not a Business Day, the time period
for giving notice or taking action shall be automatically extended to the
immediately following Business Day.
(g) Headings. The section headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(h) Severability. Any provision of this Agreement that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
(i) Assignment. With respect to the Employee, this Agreement is
personal in its nature and the Employee shall not assign or transfer this
Agreement or any rights or obligations hereunder. The Company may in its sole
discretion assign or otherwise transfer this
17
Agreement and the provisions hereof (including, without limitation, Sections 11,
12 and 13) shall inure to the benefit of, and be binding upon, each successor of
the Company, whether by merger, consolidation, transfer of all or substantially
all assets, or otherwise. No such assignment shall be given effect in
determining whether or not a Change of Control has occurred.
(j) Nouns and Pronouns. Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns and pronouns shall include the
plural and vice-versa.
(k) Construction. Where specific language (such as the word
"including") is used to clarify by example a general statement contained herein,
such specific language shall not be deemed to modify, limit or restrict in any
manner the construction of the general statement to which it relates. The
language used in this Agreement shall be deemed to be the language chosen by the
parties hereto to express their mutual intent, and no rule of strict
construction shall be applied against any party hereto. The parties hereto have
participated jointly in the negotiation and drafting of this Agreement. In the
event an ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the parties hereto, and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any of the provisions of this Agreement.
(l) Delivery by Facsimile. This Agreement, the agreements referred
to herein, and each other agreement or instrument entered into in connection
herewith or therewith or contemplated hereby or thereby, and any amendments or
supplements hereto or thereto, to the extent signed and delivered by means of a
facsimile machine, shall be treated in all manner and respects as an original
agreement or instrument and shall be considered to have the same binding legal
effect as if it were the original signed version thereof delivered in person. At
the request of any party hereto or to any such agreement or instrument, each
other party hereto or thereto shall reexecute original forms thereof and deliver
them to all other parties. No party hereto or to any such agreement or
instrument shall raise the use of a facsimile machine to deliver a signature or
the fact that any signature or agreement or instrument was transmitted or
communicated through the use of a facsimile machine as a defense to the
formation or enforceability of a contract and each such party forever waives any
such defense.
(m) Indemnification. The Company shall indemnify the Employee to the
fullest extent permitted by applicable law and its certificate of incorporation
and by-laws against all costs, charges and expenses incurred or sustained by the
Employee in connection with her employment with the Company or service on behalf
of or at the request of the Company as an officer, director or otherwise of any
other company or entity or in any fiduciary capacity, other than as a result of
actions taken by her in bad faith or due to her gross negligence. This
indemnification obligation shall survive termination of this Agreement. In
addition, during the Employment Period, the Company shall continue to maintain,
and shall cover the Employee under, its Directors and Officers Liability
Insurance, Fiduciary Liability Insurance and Errors and Omissions Insurance at
coverage levels which are no less than those currently in effect.
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(n) Costs And Expenses of Agreement. All reasonable costs and
expenses (including fees and disbursements of counsel) incurred by the Employee
in negotiating the terms and conditions of this Agreement or any agreements
ancillary to this Agreement shall be promptly reimbursed to the Employee by the
Company together with a tax gross-up payment to cover all taxes due on such
payment upon submission of an invoice therefor.
(o) Arbitration. Prior to the commencement of any legal action to
enforce any provision of this Agreement or to resolve any dispute arising under
this Agreement, the Company and the Employee agree to notify the other for the
purpose of determining whether the parties will agree to submit any such dispute
to mediation or arbitration on mutually agreeable terms; provided, however, that
the Company does not need to notify the Employee of its intent to file a legal
action for a breach of Sections 12 or 13 hereof, nor must the Company seek to
mediate or arbitrate any such dispute. Nothing in this Section 18(o) shall
require the parties to mediate or arbitrate any disputes arising under this
Employment Agreement.
* * *
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IN WITNESS WHEREOF, the undersigned have duly executed this
Agreement as of the date first above written.
OPUS360 CORPORATION
By: /s/Xxxx Xxxx Walk
Name: Xxxx Xxxx Walk
Title: Executive Vice President Human Resources
/s/ Xxxxxx X. Xxxxxx
XXXXXX X. XXXXXX
