EXHIBIT 10.17
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") made as of this 1st day of October,
1998 ("Effective Date") by and between The viaLink Company, an Oklahoma
corporation with its principal place of business at 00000 Xxxxxx Xxxx, Xxxxxx,
Xxxxxxxx, 00000 ("viaLink"), and Xxxxx X. Xxxxxxxxx ("Xxxxxxxxx").
WHEREAS, viaLink desires to hire Xxxxxxxxx as its chief executive officer,
and
WHEREAS the Board of Directors of viaLink has determined that the
employment of Xxxxxxxxx is material to the success of viaLink, and
WHEREAS, the parties hereto wish to set forth certain terms and conditions
of Xxxxxxxxx'x employment with viaLink.
NOW, THEREFORE, in consideration of the above premises and the mutual
covenants hereinafter set forth, the parties hereto agree as follows:
1. Employment. viaLink hereby employs Xxxxxxxxx, and Xxxxxxxxx hereby accepts
such employment, as the Chief Executive Officer of viaLink upon the terms
and subject to the conditions contained herein.
2. Duties. During the term ("Term") of this Agreement (as defined in Section
6.1 of this Agreement), but subject to all terms, covenants and conditions
of this Agreement:
2.1. As Chief Executive Officer, Xxxxxxxxx shall have the following duties
and responsibilities:
2.1.1. Xxxxxxxxx shall be responsible for viaLink's meeting of the
reasonable financial goals established by the Board for viaLink;
2.1.2. Xxxxxxxxx shall be responsible for and have the overall
supervision of the business of viaLink, including without
limitation both its management and financial operations, and
shall direct the affairs and policies of viaLink, subject to any
directions which may be given by viaLink's Board of Directors
("Board") relating thereto;
2.1.3. Xxxxxxxxx shall faithfully, diligently and to the best of his
ability perform all of said duties;
2.1.4. Xxxxxxxxx shall devote his full time, attention, knowledge and
skills during normal business hours in furtherance of the
business of viaLink and the performance of said duties and
responsibilities as Chief Executive Officer of viaLink; provided
however and notwithstanding anything to the contrary in this
Agreement, Xxxxxxxxx'x part time work with or on behalf of
Xxxxxxxxx and
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Associates or part time teaching at Oklahoma City University or
elsewhere shall not be deemed a violation of this Agreement or of
any of the terms or conditions thereof;
2.1.5. Xxxxxxxxx shall observe and carry out all state, federal and
local laws, rules and regulations to the extent applicable to
him;
2.1.6. Xxxxxxxxx shall at all times be subject to, observe and carry out
such reasonable rules, regulations, policies, directions and
restrictions promulgated by viaLink' Board, as viaLink's Board
may from time to time establish, to the extent they are
consistent with Xxxxxxxxx'x duties and responsibilities under
this Agreement;
2.2. In carrying out his duties as Chief Executive Officer:
2.2.1. Xxxxxxxxx shall have the authority to designate the duties and
powers of the officers of viaLink and delegate special powers and
duties to specified officers, so long as such delegation or
designations are not inconsistent with any applicable laws, rules
or regulations or with the Articles of Incorporation or Bylaws of
viaLink or with any action(s) of the Board regarding the same;
and
2.2.2. Xxxxxxxxx shall have such other powers and duties as may be
prescribed by the Board from time to time regarding his duties
and responsibilities; and
2.2.3. Xxxxxxxxx shall have such other powers and duties as may be
reasonably necessary to carry out his duties and responsibilities
set forth in this Agreement.
3. Covenants. In order to induce viaLink to enter into this Agreement,
Xxxxxxxxx hereby agrees as follows:
3.1. Except when he is directed to do otherwise by viaLink's Board, and
except as may be required by law, court order or subpoena, Xxxxxxxxx
shall keep confidential and shall not divulge to any other person or
entity, during the Term of Xxxxxxxxx'x employment or thereafter, any
of the business secrets or other confidential Information of or
regarding viaLink and/or its subsidiaries (i) which have not otherwise
become public knowledge, (ii) which were not already known to
Xxxxxxxxx as of the Effective Date of this Agreement or (iii) which
have not been disclosed by viaLink to others without substantial
restriction on further disclosure. The obligations of this Subsection
shall survive the termination or expiration of this Agreement.
3.2. All papers, books and records of every kind and description relating
to the business and affairs of viaLink, whether or not prepared by
Xxxxxxxxx, shall be the sole and exclusive property of viaLink, and
Xxxxxxxxx shall surrender them to viaLink at any time upon request by
viaLink's Board.
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The obligations of this Subsection shall survive the termination or
expiration of this Agreement.
3.3. Xxxxxxxxx agrees that any and all inventions, developments,
discoveries, copyrightable works, or contributions thereto, including,
without limitation, any written works, software products or code,
images, designs, and/or instructions created in whole or part by
Xxxxxxxxx during his employment with viaLink hereunder or otherwise or
relating in any way to the business of viaLink (hereinafter "Work
Product") are and shall be the sole and exclusive property of vial
ink. Xxxxxxxxx conveys, transfers and assigns all rights, title and
interest in and to any Work Product to viaLink, and further agrees to
execute any written assignment or other agreement viaLink deems
necessary at any time to effect the foregoing and to obtain or uphold,
for viaLink's benefit, all copyright, patent, and/or other rights of
viaLink in such Work Product. The obligations of this Subsection shall
survive the termination or expiration of this Agreement.
4. Compensation. As full compensation for Xxxxxxxxx'x services hereunder and
in exchange for his promises contained herein, viaLink shall compensate
Xxxxxxxxx in the manner set forth below. The amounts set forth below shall
be subject to any withholding or other deductions required by law.
4.1. Beginning on October 1, 0000 Xxxxxxxxx shall receive a biweekly salary
of $2884.62 ($75,000 per year), paid two weeks in arrears. Beginning
on December 15, 1998 and continuing throughout the Term of this
Agreement, such salary shall be increased to a biweekly salary of
$5769.23 ($150,000 per year). viaLink may increase Xxxxxxxxx'x salary
during the Term of this Agreement in viaLink's sole discretion.
Xxxxxxxxx'x salary may not be decreased during the Term of this
Agreement without the prior written consent of Xxxxxxxxx.
4.2. Beginning with first quarter of quarter of 1999 and for each quarter
of the Term of this Agreement, but subject to the terms and conditions
of this Section 4.2 and all of its Subsections, Xxxxxxxxx shall be
eligible to receive a quarterly bonus equal to one/eighth of his then
current annual salary ("Bonus"). Notwithstanding anything to the
contrary in this Agreement, to be eligible to receive a Bonus for any
given quarter, Xxxxxxxxx must fully meet the criteria for such Bonus
as is established by viaLink's Board for that quarter. The Bonus
criteria for the first quarter of 1999 is set forth in Subsection
4.2.1 of this Agreement. The Bonus criteria for quarters subsequent
thereto shall be established pursuant to the procedure as set forth in
Subsection 4.2.2.
4.2.1. The Bonus criteria for the first quarter of 1999 is that
viaLink's Board must approve and viaLink must execute the
documents required by a transaction(s) which have will bring,
investment(s)
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and/or financing into viaLink of at least five million dollars
($5,000,000).
4.2.2. The Bonus criteria for each quarter of the Term of this Agreement
after the first quarter of 1999 shall be determined as follows:
4.2.2.1. At least forty-five (45) days, but not earlier than sixty
(60) days, prior to the beginning of each such quarter,
Xxxxxxxxx shall submit to viaLink's Board his
recommendations for the eligibility criteria for such Bonus
for the upcoming quarter; and
4.2.2.2. At least fifteen (15) days prior to the beginning of each
such quarter, after receipt of Xxxxxxxxx'x recommendations
pursuant to Subsection 4.2.2.1, viaLink's Board shall
establish such criteria as it, in its sole discretion deems
appropriate for Xxxxxxxxx'x eligibility for the Bonus for
that quarter and advise Xxxxxxxxx of the same.
4.2.2.3. If Xxxxxxxxx fails to meet his obligations under Subsection
4.2.2.1 of this Agreement, no Bonus shall be due to
Xxxxxxxxx for that quarter.
4.2.2.4. If Xxxxxxxxx has met his obligations under Subsection
4.2.2.1 of this Agreement, and if viaLink's Board fails to
meet its obligations under Subsection 4.2.2 of this
Agreement. Xxxxxxxxx shall be automatically eligible to
receive his Bonus for that quarter.
4.2.3. Notwithstanding anything to the contrary in this Agreement, to be
eligible for a Bonus for a given quarter, Xxxxxxxxx, except as
otherwise stated in Section 6 of this Agreement, must be an
employee of viaLink as of the end of such quarter.
4.2.4. Each quarterly Bonus, if any, shall be calculated and paid
quarterly; provided, however, the payment due hereunder for any
quarter for which a Quarter has been earned shall be paid not
later than the next regular payroll after the sixtieth (60th) day
following the end of each quarter for which the Bonus is earned
if Xxxxxxxxx fails to earn a Bonus for any given quarter, the
Bonus which otherwise could have been earned for that quarter is
not carried forward to the next or any subsequent quarter.
4.3. Xxxxxxxxx shall be entitled to four (4) weeks vacation during each
calendar year of the Term of this Agreement.
4.4. Xxxxxxxxx shall be eligible for all viaLink group benefits programs
provided to other viaLink employees.
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4.5. As additional consideration, viaLink has granted to Xxxxxxxxx options
to purchase one hundred and fifty thousand (150,000) shares of viaLink
common stock in accordance with the Stock Option Agreement(s) attached
hereto as Exhibits 1 and 2.
4.6. In the event that Xxxxxxxxx becomes subject to any excise tax imposed
pursuant to Section 280(G) of the Internal Revenue Code or any
amendment thereto, as a result of the payments made to Xxxxxxxxx under
this Agreement or as a result of the acceleration of any of the stock
options granted under this Agreement, viaLink shall reimburse
Xxxxxxxxx for such portion of any such tax which is attributable
thereto. Upon request by viaLink, Xxxxxxxxx shall provide to viaLink
such documentation as viaLink reasonably requests to support the
demand of Xxxxxxxxx for such reimbursement.
5. Non-competition.
5.1. If viaLink terminates this Agreement for cause (as defined in Section
6 of this Agreement) or if Xxxxxxxxx terminates this Agreement for
other than cause, for a period of one (1) year after the termination
of this Agreement, Xxxxxxxxx shall not, directly or indirectly, alone,
or as a partner, officer, director, employee, stockholder, consultant
or agent of any other corporation, partnership or other business
organization, knowingly solicit the employment of, or hire, any
employee of viaLink, or any viaLink subsidiary, or cause any such
employee to terminate such employee's relationship with viaLink or any
viaLink subsidiary, without the prior written approval of viaLink.
5.2. If viaLink terminates Xxxxxxxxx'x employment without Cause, the
provisions of Section 5.1 of this Agreement shall be enforceable
against Xxxxxxxxx only as long as Xxxxxxxxx is receiving the
compensation set forth in Section 4.1 of this Agreement.
5.3. If viaLink terminates this Agreement for cause (as defined in Section
6 of this Agreement) or it Xxxxxxxxx terminates this Agreement for the
uncured breach of this Agreement by viaLink, for a period of one (1)
year after the termination of this Agreement, Xxxxxxxxx shall not,
directly or indirectly, alone, or as a partner, officer, director,
employee, stockholder, consultant or agent of any other corporation,
partnership or other business organization, knowingly solicit any of
the accounts of viaLink which were customers of viaLink during, the
Term of this Agreement unless such solicitation is undertaken on
behalf of a business venture which does not compete directly with the
products or services owned, sold, manufactured, marketed, provided or
developed by viaLink. For the purposes of this Subsection, a business
shall be deemed to be in competition with viaLink only if the products
or services of such business are substantially similar in
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purpose, function or capability to the products or services then being
developed, manufactured, marketed, provided or sold by viaLink.
5.4. If viaLink terminates Xxxxxxxxx'x employment without Cause, the
provisions of Section 5.3 of this Agreement shall be enforeable
against Xxxxxxxxx only as long as Xxxxxxxxx is receiving the
compensation set forth in Section 4.1 of this Agreement.
5.5. The parties agree that Xxxxxxxxx'x services are unique and that any
breach or threatened breach of the provisions of this Agreement will
cause irreparable injury to viaLink and that money damages will not
provide an adequate remedy. Accordingly, viaLink shall, in addition to
other remedies provided by law, but subject nonetheless to the terms
and conditions of this Agreement, be entitled to such equitable and
injunctive relief as may be necessary to enforce the provisions of
this Agreement against Xxxxxxxxx or any person or entity participating
in such breach or threatened breach. Nothing contained herein shall be
construed as prohibiting viaLink from pursuing any additional remedies
available to it, at law or in equity, for such breach or threatened
breach including any recovery of damages from Xxxxxxxxx and the
immediate termination of his employment.
5.6. During the term of this Agreement, Xxxxxxxxx shall not knowingly
engage in, and shall not knowingly solicit any employees of viaLink or
its subsidiaries or other affiliates to engage in any commercial,
activities which are in any way in competition with the activities of
viaLink, or which in any way materially interfere with the performance
of his or any such other employee's duties or responsibilities to
viaLink.
5.7. Sections 5.1 through 5.5 of this Agreement shall survive the
expiration or termination of this Agreeemnt.
6. Duration and Termination.
6.1. Unless earlier terminated pursuant to the provisions hereof, the
Initial Term ("Initial Term") of this Agreement shall commence on
October 1, 1998 and shall continue through September 30, 2001, and the
same shall be automatically renewed on a year to year basis thereafter
("Extended Term") unless one party hereto notifies the other party
hereto in writing at least six (6) months prior to the end of the then
current Initial Term or Extended Term, as the case may be, that such
party giving the notice will terminate this Agreement at the end
thereof. For purposes of this Agreement, unless otherwise indicated by
the context of the reference, the word "Term" shall refer collectively
to both the Initial Term to any Extended Term.
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6.2. This Agreement shall immediately terminate, and all rights, benefits
and obligations hereunder shall cease, in the event of Xxxxxxxxx'x
death, except such rights of Xxxxxxxxx which have accrued as of the
date of death.
6.3. In the event that a physician, mutually acceptable to both viaLink and
Xxxxxxxxx, determines that Xxxxxxxxx is unable to substantially
perform his usual and customary duties under this Agreement for more
than three (3) months in any calendar year, this Agreement shall
immediately terminate and all rights, benefits and obligations
hereunder shall cease, except such rights of Xxxxxxxxx which have
accrued as of date of disability.
6.4. If, and only if, Xxxxxxxxx has fully met the Bonus criteria for the
first quarter of 1999 established by viaLink's Board for him as set
forth in Subsection 4.2.1 of this Agreement, and subject to all of the
terms and conditions of this Agreement, upon the termination of this
Agreement, unless such termination is (i) by viaLink for cause as
defined in this Agreement, (ii) by Xxxxxxxxx other than for the
uncured breach of this Agreement by viaLink or (iii) pursuant to
either Section 6.2 or 6.3 of this Agreement or (iv) as a result of the
rejection of this Agreement by a Bankruptcy Court, Xxxxxxxxx shall be
entitled to the following payments:
6.4.1. The continuation of his then current salary as of the effective
date of the termination (without duty to mitigate) for the
remaining portion of the then current Term of this Agreement; and
6.4.2. The continuation of the group employee benefits Xxxxxxxxx
available to Xxxxxxxxx immediately prior to his termination to
the extent that the applicable plan(s) allow for the continuation
of the same or, to the extent that such plan(s) do not allow for
the continuation of the same, a payment equal to the cost of
Cobra benefits for Xxxxxxxxx only, if Xxxxxxxxx elects such Cobra
option. Such reimbursement, if any, shall be due within thirty
(30) days after Kilbournc presents proof of payment for the same
to viaLink; and
6.4.3. A one-time payment, which shall by made by viaLink not later than
sixty (60) days following the quarter in which the termination
occurs, and which payment shall be equal to the greater of (i)
the Bonus due pursuant to the applicable Subsection of Section
4.2 of this Agreement or (ii) fifteen percent (15%) of his the
salary as of the effective date of the termination; and
6.4.4. A one-time lump sum payment of four hundred thousand dollars
($400,000) to be paid by viaLink not later than sixty (60) days
following the date of Xxxxxxxxx'x termination.
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6.5. viaLink shall have the right to terminate this Agreement in any of the
following events, each of which shall constitute "Cause":
6.5.1. Xxxxxxxxx fails to earn the Bonus first quarter of 1999 as set
forth in Section 4.2.1 of this Agreement.
6.5.2. Xxxxxxxxx'x breach in respect of his duties under this Agreement
if such breach constitutes unremedied for thirty (30) days after
receipt of written notice thereof to Xxxxxxxxx specifying in
detail the acts constituting the alleged breach and requesting
that the same be remedied; or
6.5.3. a conviction, plea of nolo contendere, plea to a lesser charge in
lieu of a felony, of a felony, a crime involving fraud or
misrepresentation, or any other crime, the effect of which is
likely to materially adversely affect viaLink; or
6.5.4. intentional violation of any Law which results in material
liability to viaLink; or
6.5.5. abuse of alcohol or other drugs, or the illegal use of drugs,
which materially interferes with the performance by Xxxxxxxxx of
his duties hereunder.
6.5.6. Notwithstanding anything to the contrary herein, no notice or
cure period is required to be given to Xxxxxxxxx if the
termination is as a result of a violation of said Subsections
6.6.3, 6.6.4, or 6.6.5 of this Agreement.
6.6. Xxxxxxxxx shall have the right to terminate this Agreement in the
event of the following:
6.6.1. viaLink's breach in respect of its duties under this Agreement if
such breach continues unremedied for thirty (30) days after
receipt of written notice thereof directed to the Chairman of
viaLink's Board specifying in detail the acts constituting the
alleged breach and requesting that the same by remedied.
7. Successors and Assigns. The rights and obligations of viaLink hereunder
shall run in favor of and shall be binding upon viaLink, its successors,
assigns, nominees or other legal representatives. Termination of
Xxxxxxxxx'x employment shall not operate to relieve him of any remaining
obligations hereunder. Xxxxxxxxx may not assign his rights and obligations
hereunder.
8. Notices. All notices, requests, demands and other communications hereunder
must be in writing and shall be given (i) by hand delivery, (ii) by
telecopier, (iii) by overnight courier such as Federal Express, or (iv) by
certified mail, return
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receipt requested, postage prepaid, to the other party. The Notice in each
case shall be addressed as follows:
8.1. if to viaLink: The viaLink Company, 00000 Xxxxxx Xxxx, Xxxxxx,
Xxxxxxxx 00000 Attention to viaLink's then current Chairman of the
Board; and
8.2. if to Xxxxxxxxx: Xxxxx X. Xxxxxxxxx, 0000 Xxxxxxx Xxxxx Xxxx, Xxxxxxxx
Xxxx, Xxxxxxxx 00000.
The address at which a party wants Notice under this Agreement to be
sent may be changed by that party by giving Notice thereof to the
other party pursuant to this Section 8.
9. Severability. If any provision of this Agreement shall be adjudged by any
court of competent jurisdiction to be invalid or unenforceable for any
reason, such judgment shall not affect, impair or invalidate the remainder
of this Agreement.
10. Entire Understanding. This Agreement embodies the entire understanding of
the parties hereto, and supersedes all other oral or written agreements or
understandings between them regarding the subject matter. No change
alteration or modification hereof may be made except in a writing, signed
by both parties hereto.
11. Captions. The headings in this Agreement are for convenience and reference
only and shall not be construed as part of this Agreement or to limit or
otherwise affect the meaning hereof.
12. Execution in Counterparts. This Agreement may be executed by the parties
hereto in counterparts, each of which shall be deemed to be original, but
all such counterparts shall constitute one and the same instrument, and all
signatures need not appear on any one counterpart.
13. Choice of Law. Jurisdiction over disputes with regard to this Agreement
shall be exclusively in the courts of the State of Oklahoma, and this
Agreement shall be construed in accordance with and governed by the laws of
the State of Oklahoma without giving effect to principles of conflicts of
law hereunder.
14. Attorney Fees. In the event of any litigation between the parties hereto,
the prevailing shall be entitled to all of its costs incurred in such
litigation, including reasonable attorneys' fees.
15. Nonwaiver. The waiver of any violation of breach of this Agreement by
either party hereto shall not be deemed to be a waiver of any continuing
violation or breach or a waiver of any other violation or breach of this
Agreement.
16. Arbitration. Notwithstanding anything to the contrary in this Agreement,
any controversy or claim arising out of or relating to this Agreement, or
its breach, or
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its validity or interpretation, except claims for injunctive relief and
claims involving necessary third parties who refuse to participate shall be
settled by binding arbitration in accordance the then current Commercial
Arbitration Rules of the American Arbitration Association ("AAA") subject,
however, to the following:
16.1. The location for the arbitration shall be at such location as by the
parties in Oklahoma County, Oklahoma or if the parties cannot agree at
such location in Oklahoma County, Oklahoma as designate by the AAA.
16.2. Such arbitration shall be heard and determined by a panel (3)
arbitrators in accordance with the then current rules or regulations
of the AAA relating to commercial disputes ("Rules"). All Arbitrators
shall be selected pursuant to the then current Rules thereof within
thirty (30) days after the filing of a demand for arbitration. Each
arbitrator shall be a person with experience in handling disputes
relating to employment disputes regarding management or executive
personnel.
16.3. The hearing on the arbitration shall be heard not later than six (6)
months after the demand for arbitration have been made by a party.
16.4. The arbitration award shall be binding on the parties and may be
enforced in any court of competent jurisdiction.
16.5. The prevailing party in such arbitration shall be entitled to recover
its reasonable attorney fees and costs incurred in such arbitration
proceeding.
17. Exclusivity. Unless specifically otherwise stated in this Agreement, the
rights and remedies granted to the parties in this Agreement are exclusive.
18. Limitation of Actions. No arbitration or action, regardless of form,
relating to or arising out of this Agreement may be brought by either party
more than three (3) years after such party knew or should have known of the
occurrence of the event(s) which gave rise to any claim, demand or cause of
action.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
THE viaLink Company Xxxxxxxxx
By:
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Xxxxx X. Xxxxxxxxx
Its:
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Date: Date:
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