Exhibit 10.14
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of the 1st day of May,
2002 by and between TALX Corporation, a Missouri corporation (the "Company"),
and Xxxxx X. Xxxxx ("Executive").
RECITALS
A. The Company desires to employ Executive as Chief Financial Officer.
B. In return for the compensation, bonuses and other consideration
provided for herein, Executive has agreed to become Chief Financial Officer
pursuant to the terms and conditions of this Agreement.
NOW THEREFORE, in consideration of the foregoing, and the
representations, warranties and covenants hereinafter, the parties hereto agree
as follows (the "Agreement"):
1. Employment. At all times during the Employment Period (as
hereinafter defined), Company shall employ Executive in the capacity of Chief
Financial Officer. In such capacity, Executive shall devote his full time and
professional efforts to such position, shall be assigned and undertake only such
duties and tasks as are appropriate for a person in the position of Chief
Financial Officer, and shall exercise such authority over all of Company's
operations and employees as is customarily exercised by a Chief Financial
Officer, subject to the overall supervision of the Board of Directors of the
Company (the "Board").
2. Employment Period. The term of the Executive's employment under
this Agreement shall commence on May 1, 2002 (the "Commencement Date") and shall
expire, subject to earlier termination of employment as hereinafter provided, on
April 30, 2004 (the "Employment Period"); provided, however, that on May 1, 2003
and each anniversary of such date, the Employment Period shall automatically be
extended for an additional two year period unless prior thereto either party has
given 90-days prior written notice to the other that such party does not wish to
extend the term of this Agreement.
3. Compensation. Except as otherwise provided for herein, throughout
the Employment Period the Company shall pay or provide Executive with the
following, and Executive shall accept the same, as compensation for the
performance of his undertakings and the services to be rendered by him
throughout the Employment Period under this Agreement:
(a) Annual Compensation.
(i) Base Salary: $192,000.00 per year ("Base Amount"), to be
reviewed annually for increases only by the Management
Compensation Committee ("Compensation Committee") of the
Company's Board of Directors as such Base Amount may not be
reduced ("Base Amount").
(ii) Annual Incentive Compensation Program: Executive will
participate in an annual incentive compensation program the
terms and conditions of which will have been reviewed by the
Compensation Committee and upon the recommendation of such
Compensation Committee will have been submitted to, and
approved by, the Board.
(b) Benefits. Executive shall be entitled to participate in all
benefit plans and other applicable programs, practices and arrangements
maintained by the Company for its employees generally, to the extent that such
plans, programs, practices and arrangements do not conflict with the terms of
this Agreement.
4. Excise Tax Payments.
(a) Notwithstanding anything contained in this Agreement to the
contrary, in the event that any payment (within the meaning of Section
280G(b)(2) of the Internal Revenue Code of 1986, as amended or replaced (the
"Code"), or distribution to or for the benefit of the Executive, whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement
or otherwise in connection with, or arising out of, his or her employment with
the Company (a "Payment" or "Payments"), would be subject to the excise tax
imposed by Section 4999 of the Code or any interest or penalties are incurred by
the Executive with respect to such excise tax (such excise tax, interest and
penalties collectively referred to as the "Excise Tax"), then the Executive
shall be entitled to receive an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Executive of all such taxes (including any
interest or penalties imposed with respect to such taxes), including any Excise
Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments; provided,
that the Executive shall not be entitled to receive any additional payment
relating to any interest or penalties attributable to any action or omission by
the Executive in bad faith.
(b) An initial determination shall be made by an accounting firm
mutually agreeable to the Company and the Executive and, if not agreed to within
three days after the Date of Termination, a national independent accounting firm
selected by the Executive (the "Accounting Firm"), as to whether a Gross-Up
Payment is required pursuant to this Section 4 and the amount of such Gross-Up
Payment. To permit the Accounting Firm to make the initial determination, the
Company shall furnish the Accounting Firm with all information reasonably
required for such firm to complete such determination as soon as practicable
after the Date of Termination, but in no event more than fifteen (15) days
thereafter. All fees, costs and expenses (including, but not limited to, the
cost of retaining experts) of the Accounting Firm shall be borne by the Company
and the Company shall pay such fees, costs and expenses as they become due. The
Accounting Firm shall provide detailed supporting calculations, reasonably
acceptable both to the Company and the Executive within thirty (30) days of the
Date of Termination, if applicable, or such other time as requested by the
Company or by the Executive (provided the Executive reasonably believes that any
of the Payments may be subject to the Excise Tax). The Gross-Up Payment, if any,
as determined pursuant to this Section 4(b) shall be paid by the Company to the
Executive within five (5) business days of the receipt of the Accounting Firm's
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determination. If the Accounting Firm determines that no Excise Tax is payable
by the Executive with respect to a Payment or Payments, it shall furnish the
Executive with an opinion reasonably satisfactory to the Executive that no
Excise Tax will be imposed with respect to any such Payment or Payments. Any
such initial determination by the Accounting Firm of the Gross-Up Payment shall
be binding upon the Company and the Executive subject to the application of
Section 4(c).
(c) As a result of the uncertainty in the application of Sections 4999
and 280G of the Code, it is possible that a Gross-Up Payment (or a portion
thereof) will be paid which should not have been paid (an "Overpayment") or a
Gross-Up Payment (or a portion thereof) which should have been paid will not
have been paid (an "Underpayment"). An Underpayment shall be deemed to have
occurred upon a "Final Determination" (as hereinafter defined) that the tax
liability of the Executive (whether in respect of the then current taxable year
of the Executive or in respect of any prior taxable year of the Executive) will
be increased by reason of the imposition of the Excise Tax on a Payment or
Payments with respect to which the Company has failed to make a sufficient
Gross-Up Payment. An Overpayment shall be deemed to have occurred upon a "Final
Determination" (as hereinafter defined) that the Excise Tax shall not be imposed
(or shall be reduced) upon a Payment or Payments with respect to which the
Executive had previously received a Gross-Up Payment. A Final Determination
shall be deemed to have occurred when (i) in the case of an Overpayment, the
Executive has received from the applicable governmental taxing authority a
refund of taxes or other reduction in his or her tax liability imposed as a
result of a Payment or, in the case of an Underpayment, the Executive receives
notice from a competent governmental authority that his or her tax liability
imposed as a result of a Payment will be increased, and (ii) in the case of an
Overpayment or an Underpayment, upon either (x) the date a determination is made
by, or an agreement is entered into with, the applicable governmental taxing
authority which finally and conclusively binds the Executive and such taxing
authority, or in the event that a claim is brought before a court of competent
jurisdiction, the date upon which a final determination has been made by such
court and either all appeals have been taken and finally resolved or the time
for all appeals has expired or (y) the statute of limitations with respect to
the Executive's applicable tax return has expired. If an Underpayment occurs,
the Executive shall promptly notify the Company and the Company shall promptly
pay to the Executive an additional Gross-Up Payment equal to the amount of the
Underpayment plus any interest and penalties imposed on the Underpayment (other
than interest and penalties attributable to any action or omission by the
Executive in bad faith). If an Overpayment occurs, the amount of the Overpayment
shall be treated as a loan by the Company to the Executive and the Executive
shall, within ten (10) business days of the occurrence of such Overpayment, pay
the Company the amount of the Overpayment, without interest.
(d) Notwithstanding anything contained in this Agreement to the
contrary, in the event it is determined that an Excise Tax will be imposed on
any Payment or Payments, the Company shall pay to the applicable governmental
taxing authorities as Excise Tax withholding, the amount of the Excise Tax that
the Company has actually withheld from the Payment or Payments.
5. Expenses. During the Employment Period, the Company shall promptly
pay or reimburse Executive for all reasonable out-of-pocket expenses incurred by
Executive in
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the performance of duties hereunder in accordance with the Company's policies
and procedures then in effect.
6. Conditions of Employment. Throughout the Employment Period, (a) the
Company shall not require or assign duties to Executive which would require him
to have the location of his principal business office or his principal place of
residence other than the County of St. Louis, Missouri, and (b) the Company
shall not require or assign duties to Executive which would require him to spend
more than ninety (90) consecutive days away from his office during, any
consecutive twelve-month period.
7. Termination.
(a) In addition to the termination rights in Section 2 of this
Agreement, this Agreement shall terminate upon the following circumstances:
(i) At any time at the election of Company for Cause. "Cause"
for this purpose shall mean (1) Executive commits a material
breach of this Agreement which has not been cured within 10
days of written notice from the Company that such material
breach has occurred; (2) Executive commits a crime against
moral turpitude, including, without limitation, committing
an act of fraud, dishonesty, disclosure of confidential
information or the commission of a felony, or direct and
deliberate acts constituting a breach of trust to Company;
(3) Executive willfully violates the provisions of this
Agreement, including, without limitation, willfully or
continuously refusing to perform the duties reasonably
assigned to him by the Board which are consistent with the
provisions of this Agreement; or (4) Executive willfully
engages in conduct that damages the Company's business or
reputation or materially injures the Company.
(ii) At any time at the election of Executive for Good Reason.
"Good Reason" for this purpose shall mean (1) a material
breach of this Agreement by the Company which has not been
cured within 10 days of written notice from Executive that
such material breach has occurred; (2) the reduction of
salary, benefits or other perquisites provided to Executive
under this Agreement; (3) failure by the Company to obtain a
successor's commitment to perform the Company's obligations
under this Agreement; or (4) the Company providing written
notice to Executive pursuant to Section 2 hereof that it
does not wish to extend the term of this Agreement.
(iii) Executive's death or his being unable to render the
services required to be rendered by his during the
Employment Period for a period of one hundred eighty (180)
days during any twelve-month period ("Disability").
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(b) In the event the Company or Executive intend to terminate this
Agreement for Cause or Good Reason, respectively, such termination may only be
accomplished upon compliance with the following procedures:
(i) The party seeking to terminate this Agreement (the
"Notifying Party") shall provide the other (the "Defaulting
Party") with written notice of its or his belief that Cause
or Good Reason, as the case may be, exists. The parties
shall for a period of 30 days from the date of such notice
attempt to resolve to their mutual satisfaction whether or
not Cause or Good Reason exists, and, if so, the rights and
obligations of the parties.
(ii) In the event the parties are unable to reach a mutually
acceptable resolution during such 30-day period, the
Notifying Party shall afford the Defaulting Party an
additional 10 days or such longer period as the Notifying
Party in its or his sole discretion may determine to cure
the alleged breach.
(iii) In the event the Defaulting Party does not cure the breach
during the 10-day period, the Notifying Party shall be
required to institute an arbitration proceeding to determine
whether Cause or Good Reason existed and has not been cured
in accordance with Section 18 herein.
(iv) This Agreement shall be terminated as of the date when the
Notifying Party institutes an arbitration proceeding in
accordance with subsection (iii) preceding; provided,
however, that in the event Good Reason exists as a result of
the application of Section 7(a)(ii), no further employment
services will be required or expected of Executive and
Executive and Company will coordinate the timing and press
releases, if any, of his departure. The sole decision of the
arbitrator in such proceeding shall be to determine whether
Cause (if initiated by Company) or Good Reason (if initiated
by Executive) exists. Thereafter, the obligations of the
parties to each other shall be determined by applying the
decision of the arbitrator(s) in accordance with Exhibit A
hereto.
(v) In the event the Company does not prevail in any such
proceeding initiated by it for Cause, Executive's
termination shall be deemed to have occurred for Good
Reason. In the event Executive does not prevail in any such
proceeding initiated by him for Good Reason, Executive shall
be considered as having voluntarily terminated employment
other than for Good Reason, and his rights under this
Agreement shall be determined as if he had been terminated
by Company for Cause.
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(c) Upon expiration or termination of this Agreement under Section 2
or Section 7 herein, Executive shall be entitled to receive compensation and
other benefits provided for herein in accordance with Exhibit A hereto. The
parties agree that, in the event of termination by Executive for Good Reason
under Section 7, such payments and benefits shall be deemed to constitute
liquidated damages for the breach of this Agreement by Company.
8. Change of Control.
(a) If (i) Executive terminates his employment for Good Reason during
the period commencing with the date of a Change of Control (as hereinafter
defined) and ending twelve months following the Change of Control (the "Change
of Control Period"), (ii) the Company terminates Executive's employment without
Cause during the Change of Control Period, or (iii) Company terminates
Executive's employment without Cause within six months prior to a Change of
Control and Executive can reasonably demonstrate that such termination was in
connection with or in anticipation of a Change of Control, the Executive shall
be entitled to receive compensation and other benefits ("Change of Control
Payments") described on Exhibit A under the column heading "Related to Change of
Control" and such Change of Control Payments shall be in lieu of any other
payments described in Section 7 herein. Notwithstanding anything to the contrary
contained herein, nothing in this Agreement shall relieve Employer of its
obligation of providing Employee with all retirement and deferred compensation
benefits in accordance with the terms of all retirement and deferred
compensation plans in which Employee participates.
(b) The term "Change of Control" shall mean a change of control of a
nature that would be required to be reported in response to Item 1(a) of the
Current Report on Form 8-K, as in effect on the date hereof, pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934 ("Exchange Act"), or any
comparable successor provisions. Without limiting the foregoing, a "Change of
Control" also means for purposes of this Agreement, regardless of its meaning
under the provisions of the Exchange Act:
(i) The purchase or other acquisition (other than from the
Company) by any person, entity or group of persons, within
the meaning of Section 13(d) or 14(d) of the Exchange Act
(excluding, for this purpose, the Company or its
subsidiaries or any employee benefit plan of the Company or
its subsidiaries), of beneficial ownership, (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of
25% or more of either the then outstanding shares of common
stock or the combined voting power of the Company's then
outstanding voting securities entitled to vote in the
election of directors; or
(ii) Individuals who, as of the date hereof, constitute the Board
of Directors of the Company (as of the date hereof, the
"Incumbent Board") cease for any reason to constitute at
least two-thirds of the Board, provided that any person
(other than a person whose election or nomination or whose
initial assumption of office is in connection with an actual
or threatened election contest relating to
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the election of directors of the Company, as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) who becomes a director subsequent to the date
hereof whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least
three-quarters of the directors then comprising the
Incumbent Board shall be, for purposes of this Agreement,
considered as though such person were a member of the
Incumbent Board; or
(iii) Approval by the shareholders of the Company of a
reorganization, merger, or consolidation, in each case, with
respect to which persons who were the shareholders of the
Company immediately prior to such reorganization, merger or
consolidation do not, immediately thereafter, own more than
50% of the combined power entitled to vote generally in the
election of directors of the reorganized, merged or
consolidated company's then outstanding voting securities or
a liquidation or dissolution of the Company or of the sale
of all or substantially all of the assets of the Company.
9. Non-Competition Agreement. Executive acknowledges, agrees and
recognizes that (i) the Company has spent substantial money, time and effort
over the years in developing and solidifying its relationships with its
customers and in developing its confidential, proprietary and trade secret
information; (ii) long-term customer relationships often can be difficult to
develop and require a significant investment of time, effort and expense; (iii)
the Company pays its employees to, among other things, develop and preserve the
Company's business, confidential and trade secret information, customer
goodwill, customer loyalty and customer contacts for and on behalf of the
Company; and (iv) the Company is hereby agreeing to hire Executive and pay
Executive based upon Executive's assurances and promises contained herein not to
divert the Executive's customers' goodwill or to put himself in a position
during or following the term of this Agreement in which the confidentiality of
the Company's information might somehow be compromised. Executive agrees that
during his employment by the Company and for the Restricted Period (as defined
below), Executive will not as an individual or as a partner, employee, agent,
advisor, consultant or in any other capacity of or to any person, firm,
corporation or other entity, on Executive's own behalf or on behalf of any other
person, firm corporation or entity, directly or indirectly:
(a) carry on any business, become involved in any business activity,
or render any products or services to any business, competitive with the
business of the Company or any of its subsidiaries, affiliates or related
companies as such business or businesses are presently conducted and as such
business or businesses may evolve in the ordinary course during the Employment
Period anywhere in the United States or in any other jurisdiction in which the
Company shall conduct business during the Employment Period;
(b) knowingly and intentionally hire, or assist anyone else to hire,
any employee or distributor of the Company or seek to persuade, or assist anyone
else to seek to persuade, any employee or distributor of the Company to
discontinue his or her employment with the Company or business relationship with
the Company, as the case may be;
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(c) knowingly and intentionally induce or attempt to induce, or assist
anyone else to induce or attempt to induce, any customer of the Company to
reduce or discontinue its business with the Company or disclose to anyone else
the name and/or requirements of any such customer; or
(d) knowingly and intentionally interfere with any relationships
between the Company and its vendors, customers, strategic partners, distributors
or other persons with whom the Company has business relations.
The "Restricted Period" shall be during the term of the Executive's employment
with the Company, and for a period of one year after the termination of such
employment for whatever reason.
Executive expressly agrees that the covenants set forth in this
Section 9 are reasonable and enforceable because, among other things, (i) the
nature of the markets in which the Company's products or services are marketed
and sold; (ii) the Executive will be exposed or have access to confidential
information; (iii) the Company would not have adequate protection if Executive
were permitted to work for any of its competitors since the Company would be
unable to verify whether its confidential information was being disclosed and/or
misused, and (iv) Executive's other businesses and background which are such
that the restraint will not impose any undue hardships upon Executive.
Furthermore, Executive recognizes and agrees that the restraints contained in
this Section 9 are reasonable and enforceable in view of the Company's
legitimate interests in protecting its confidential information and customer
goodwill and the limitations contained therein on the duration and geographic
scope of, and activities prohibited by, such restraints.
10. Confidential Information.
(a) Without the express written consent of the Company, Executive
agrees, during the term of this Agreement and thereafter (including after the
termination of this Agreement for any reason) to keep secret and confidential,
and not to use or disclose to any third parties, any of the Company's and/or its
clients/customers' proprietary trade secret information or other confidential
information acquired by or disclosed to the Executive prior to, during the
course of, or in connection with, this Agreement.
(b) The Company and its clients/customers consider and treat as
confidential, proprietary and trade secret, among other things, their respective
marketing data, plans and strategies, internal financial information, customer
lists, costs, margins, pricing and policies, component sourcing and supply
information, planning methods, systems, processes, computer software (whether in
object code, source code, applications, machine readable form, printouts, or
human readable form), computer programs and documentation, computer hardware
designs and configurations, systems, research and development plans and
activities, ideas, drawings, photographs, models, prototypes, developments,
constructions, computer firmware, videotapes (including, but not limited to,
original, work and/or finished master tapes), manufacturing methods and
techniques, quality control procedures and methods, investigations, engineering,
test methods and data, technical data, security methods and procedures, designs,
plans and
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specifications, and actual and potential applications thereof, business
acquisition and expansion plans, product applications, information provided to
the Company in confidence by its clients and third parties, and the like
(collectively the "Confidential Information"), and Executive agrees to treat any
and all such information as secret, confidential and proprietary to the Company
and/or, as applicable, its customers/clients. Executive understands that
confidential information may or may not be labeled as "confidential" and will
treat all information as confidential whether or not labeled as such.
Confidential information shall not include information which (i) was already
available to the general public at the time of receipt by Executive, (ii)
subsequently becomes known to the general public through no fault or admission
of Executive, (iii) is subsequently disclosed by a third party which has the
bona fide right to make such disclosure; or (iv) is required to be disclosed by
law or by any court or authority.
(c) Executive acknowledges that any and all notes, records, sketches,
computer diskettes, programs, and other documents or things obtained by or
provided to Executive, or otherwise made, produced, generated or compiled during
the course of Executive's employment by the Company, which contain any of the
Company's Confidential Information, regardless of the type of medium in which it
is preserved, are and shall remain the sole and exclusive property of the
Company and shall be surrendered by Executive to the Company upon the
termination of this Agreement and/or upon the request or demand of the Company.
11. Effect of Breach of Sections 9 or 10. So long as any stock options
held by the Executive shall not have been exercised or shall not be vested, the
exercise of such stock options shall each be subject to Executive's full
compliance with the terms and conditions of Section 9 (which shall continue to
apply for this purpose) and Section 10 herein; provided, however, that any such
breach will not have any effect on stock options exercised prior to the date of
such breach. Notwithstanding any other provision is this Agreement, Executive
further agrees that a breach of Sections 9 or 10 cannot adequately be
compensated by money damages and, therefore, Company shall be entitled, in
addition to any other right or remedy available to it (including, but not
limited to, an action for damages), to an injunction restraining such breach or
a threatened breach and to specific performance of either such provision, and
Executive hereby consents to the issuance of such injunction and to the ordering
of specific performance. The purpose of this Section 11 is to, in certain
circumstances, limit the rights the Executive has with respect to his stock
options and nothing herein shall be construed to expand or create any rights
with respect to such Executive's stock options.
12. Legal Expenses. The Company shall pay to Executive all
out-of-pocket expenses, including reasonable attorneys' fees, incurred by
Executive in connection with any claim or legal action or proceeding brought
under or involving this Agreement, whether brought by Executive or by or on
behalf of the Company or by another party; provided, however, the Company shall
not be obligated to pay to Executive out-of-pocket expenses, including
attorneys' fees, incurred by Executive in any claim or legal action or
proceeding involving Sections 7, 8, 9, 10 or 11 of this Agreement if Company
prevails in such litigation or arbitration.
13. No Mitigation. The Executive shall not be required to mitigate the
amount of any payment provided for in this Agreement by seeking other employment
or otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to Executive in any subsequent employment.
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14. Notices. All notices required or permitted under this Agreement
shall be in writing, may be made by personal delivery or facsimile transmission,
effective on the day of such delivery or receipt of such transmission, or may be
mailed by registered or certified mail, effective five (5) days after the date
of mailing, addressed as follows:
to Company: TALX Corporation
0000 Xxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
President and Chief Executive Officer
Facsimile number: (000) 000-0000
to Executive: Xxxxx X. Xxxxx
00 Xxx Xxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
or such other person or address as designated in writing to Executive at his
last known residence address or to such other addresses as designated by him in
writing to Company.
15. Successors. This Agreement may not be assigned by the Company
(other than by merger or operation of law) without the express written consent
of Executive, and the obligations of the Company provided for in this Agreement
shall be binding legal obligations of any successor to the Company or the
principal business of Company by purchase, merger, consolidation, or otherwise.
This Agreement may not be assigned by Executive during his life, and upon his
death will be binding upon and inure to the benefit of his heirs, legatees and
the legal representatives of his estate.
16. Waiver, Modification and Interpretation. No provisions of this
Agreement may be modified, waived or discharged unless such waiver, modification
or discharge is agreed to in a writing signed by Executive and an appropriate
officer of the Company empowered to sign same by the Board of Directors of the
Company. No waiver by either party at any time of any breach by the party of, or
compliance with, any condition or provision of this Agreement to be performed by
the other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same time or at any prior to subsequent time. The validity,
interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of Missouri.
17. Invalidity of Provisions. In the event that any provision of this
Agreement is adjudicated to be invalid or unenforceable under applicable law in
any jurisdiction, the validity or enforceability of the remaining provisions
thereof shall be unaffected as to such jurisdiction and such adjudication shall
not affect the validity or enforceability of such provision in any other
jurisdiction. To the extent that any provision of this Agreement is adjudicated
to be invalid or unenforceable because it is over broad, that provision shall
not be void but rather shall be limited to the extent required by applicable law
and enforced as so limited. The parties expressly acknowledge and agree that
this Section 17 is reasonable in view of the parties' respective interests.
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18. Arbitration
(a) Scope; Initiation. Resolution of any and all disputes arising from
or in connection with this Agreement, whether based on contract, tort, statute
or otherwise, including disputes over arbitrability and disputes in connection
with claims by third persons ("Disputes") shall be exclusively governed by and
settled in accordance with the provisions of this Section 18. Either party to
this Agreement (each a "Party" and together the "Parties") may commence
proceedings hereunder by delivery of written notice providing a reasonable
description of the Dispute to the other, including a reference to this Section
18 (the "Dispute Notice").
(b) Negotiations Between Parties. The Parties shall first attempt in
good faith to resolve promptly any Dispute by good faith negotiations. Not later
than three (3) business days after delivery of the Dispute Notice, the Company
shall appoint an executive to meet with the Executive or his or her
representative at a reasonably acceptable time and place, and thereafter as such
representatives deem reasonably necessary. The Parties shall exchange relevant
non-privileged information and endeavor to resolve the Dispute. Prior to any
such meeting, each Party or representative shall advise the other as to any
other individuals who will attend such meeting. All negotiations pursuant to
this Section 18(b) shall be confidential and shall be treated as compromise
negotiations for purposes of Rule 408 of the Federal Rules of Evidence and
similarly under other federal and state rules of evidence.
(c) Binding Arbitration. The Parties hereby agree to submit all
Disputes to arbitration under the following provisions, which arbitration shall
be final and binding upon the Parties, their successors and assigns, and that
the following provisions constitute a binding arbitration clause under
applicable law.
(i) Either Party may initiate arbitration of a Dispute by
delivery of a demand therefor (the "Arbitration Demand") to
the other Party not sooner than five (5) business days after
the date of delivery of the Dispute Notice but at any time
thereafter.
(ii) The arbitration shall be conducted in the County of St.
Louis, Missouri, by three arbitrators (acting by majority
vote, the "Panel") selected by agreement of the Parties not
later than 10 days after delivery of the Arbitration Demand
or, failing such agreement, appointed pursuant to the
Commercial Arbitration Rules of the American Arbitration
Association, as amended from time to time (the "AAA Rules").
If an arbitrator becomes unable to serve, his or his
successor(s) shall be similarly selected or appointed.
(iii) The arbitration shall be conducted pursuant to the Federal
Arbitration Act and the Missouri Uniform Arbitration Act,
such procedures as the Parties may agree or, in the absence
of or failing such agreement, pursuant to the AAA Rules.
Notwithstanding the foregoing: (w) each party shall be
allowed to conduct discovery through written requests for
information, document requests,
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requests for stipulations of fact, and depositions; (x) the
nature and extent of such discovery shall be determined by
the Panel, taking into account the needs of the Parties and
the desirability of making discovery expeditious and
cost-effective; (y) the Panel may issue orders to protect
the confidentiality of information, to be disclosed in
discovery; and (z) the Panel's discovery rulings may be
enforced in any court of competent jurisdiction.
(iv) All hearings shall be conducted on an expedited schedule,
and all proceedings shall be confidential. Either Party may
at its expense make a stenographic record thereof.
(v) The Panel shall complete all hearings not later than twenty
(20) days after selection or appointment, and shall make a
final award not later than ten (10) days thereafter. The
award shall be in writing and shall specify the factual and
legal bases for the award, and shall include a determination
as to whether any claim by the Executive of Good Reason was
manifestly unreasonable. Notwithstanding anything contained
in Section 8, in circumstances where a Dispute has been
asserted by the Executive or defended against by the
Executive on grounds that the Panel deems manifestly
unreasonable (whether related to a claim of Good Reason or
otherwise), the Panel may assess all or part of the costs
and expenses of the arbitration, including the Panel's fees
and expenses and fees and expenses of experts and legal
counsel ("Arbitration Costs"), against the Executive and may
include in the award the Executive's and the Company's
attorney's fees and expenses in connection with any and all
proceedings under this Section 18. Notwithstanding the
foregoing, in no event may the Panel award multiple,
punitive or exemplary damages to either party.
(d) Confidentiality - Notice. Each Party shall notify the other
promptly, and in any event prior to disclosure to any third person, if it
receives any request for access to confidential information or proceedings
hereunder.
(e) Injunctions. However, notwithstanding anything else in this
Section 18, the Company shall be entitled to seek a restraining order or
injunction in any court of competent jurisdiction to prevent any continuation of
any violation of this Agreement, and the Executive hereby consents that such
restraining order or injunction may be granted without the necessity of the
Company posting any bond. The expense of such arbitration shall be borne by the
Company.
19. Headings. The headings contained herein are for reference purposes
only and shall not in any way affect the meaning or interpretation of any
provision of this Agreement.
20. Entire Agreement. This Agreement (together with the Exhibit
hereto) constitutes the entire agreement between the parties, supersedes in all
respects any prior
12
agreement between Company and Executive and may not be changed except by a
writing duly executed and delivered by Company and Executive in the same manner
as this Agreement; provided however, that the terms of any securities of the
Company (or any options, warrants or other securities convertible into, or
exchangeable or exercisable for, securities of the Company), which are held by
the Executive shall be governed by the agreements entered into upon issuance of
such securities (or such options, warrants or other securities convertible into,
or exchangeable or exercisable for, securities of the Company).
21. Counterparts. Company and Executive may execute this Agreement in
any number of counterparts, each of which shall be deemed to be an original but
all of which shall constitute but one instrument. In proving this Agreement, it
shall not be necessary to produce or account for more than one such counterpart.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.
THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY
THE PARTIES.
TALX CORPORATION
By:
-------------------------------------
Xxxxxxx X. Xxxxxxxx
President and Chief Executive Officer
Executive
-----------------------------------------
Xxxxx X. Xxxxx
13
Exhibit A
EFFECT OF AGREEMENT TERMINATION
REASON FOR TERMINATION
TYPE OF NORMAL EXPIRATION DATE OF BY EXECUTIVE FOR BY EMPLOYER FOR
COMPENSATION AGREEMENT OR RENEWAL "GOOD REASON" "CAUSE"
/BENEFIT PERIOD
-----------------------------------------------------------------------------------------------------------
Base Salary Payable through end of Receives Base Amount (as Payable through date
Employment Period (as defined in the Agreement) for a of early termination.
defined in Agreement) two year period commencing on
the Executive's early
termination date (the
"Continuation Period"), payable
ratably over such Continuation
Period.
-----------------------------------------------------------------------------------------------------------
Annual Incentive Payable through Receives targeted incentive Amount determined by
Compensation Program Employment Period; amount compensation (based on Compensation
recommended by estimated targeted incentive Committee in its
Compensation Committee compensation for year of sole discretion;
based on Company's and termination) for the would likely be zero.
Executive's performance. Continuation Period, payable
over the Continuation Period.
-----------------------------------------------------------------------------------------------------------
Other Employee Continue through end of Continue through end of Continue through
Benefits (excluding Employment Period, Continuation Period, subject to date of early
any benefits related subject to legal and legal and contractual rights in termination, subject
to securities of the contractual rights in plans to convert or extend to legal and
Company or options, plans to convert or coverages . contractual rights
warrants or extend coverages. in plans to convert
convertible into or or extend coverages.
exercisable or
exchangeable for
securities of the
Company)
RELATED TO DEATH OR DISABILITY
CHANGE OF CONTROL (AS DEFINED IN AGREEMENT)
--------------------------------------------------------------
Receives 200% of the Base Payable through end of
Amount in effect immediately month in which death or
prior to the Change of disability occurs.
Control, payable in one lump
sum cash payment.
--------------------------------------------------------------
Receives 200% of the targeted Amount earned (recommended
incentive compensation for the by the Compensation
Continuation Period (based on Committee based on the
estimated targeted incentive Company's and Executive's
compensation for year of performance for the year in
termination), payable in one which death or disability
lump sum cash payment. occurs) will be prorated.
--------------------------------------------------------------
Continue through end of the Continue through end of
Continuation Period, subject month in which death or
to legal and contractual disability occurs, subject
rights in plans to convert or to legal and contractual
extend coverages; provided, rights to convert or extend
further, if extension of coverages.
insurance coverage is not
permitted, the Company shall
pay the premiums for a new
similar insurance plan which
would allow similar coverage
of the Executive through
the Continuation Period.
Additionally, Executive
entitled to reimbursement
of reasonable out-of-pocket
expenses related to
outplacement services.
