EMPLOYMENT AGREEMENT
This Employment Agreement (the “Agreement”) is
entered into effective as of April 1st, 2009 by and between Xxxx Xxxxx (“Employee”) and
Conversion Services International, Inc. (the “Company”).
WHEREAS, the Company is engaged in the
business of data warehousing and business intelligence consulting;
and
WHEREAS, the Company and Employee are
willing to continue an employment relationship, on the terms, conditions and
covenants set forth in this Agreement;
NOW, THEREFORE, in consideration of
Employee’s continued employment with the Company, the mutual covenants contained
herein and other good and valuable consideration, the receipt of which the
Company and Employee hereby acknowledge, Employee and the Company agree, as
follows:
1. Position. Employee
agrees to employment with the Company, and the Company hereby employs Employee,
in the position of President and Chief Executive Officer of the
Company. Employee further agrees to perform the job duties and to
carry out the responsibilities of that position, and such other duties and
responsibilities traditionally associated with such position, as determined by
the Board of Directors of the Company from time to time.
2. Employee’s
Effort. Employee shall perform her duties in the capacity as
an employee and in such capacity shall spend her full working time and best
efforts, skill and attention to her position and to the business and interests
of the Company. Employee shall perform her duties principally at the
offices of the Company.
3. Salary.
(a) The
Company shall pay Employee (i) base compensation (the "Salary") for
services rendered in the amount of Two Hundred and Eighty Thousand dollars
($280,000) per annum payable on a semi-monthly basis (which base compensation
may be increased by the Board of Directors of the Company, in its sole
discretion), and (ii) bonus, if any, as may be determined by the Board of
Directors of the Company, in its sole discretion. It is also
understood that during the term of this agreement that Xx. Xxxxx reports
to the Board of Directors of the company.
(b) The
Employee will receive an incentive for the following acheivments:
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1.
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2.0
% of the gross sales of any project that she is managing
excluding her personal xxxxxxxx
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2.
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7.5
% of net income From April 1st
2009 thru December 31st
2009 provided that net income is greater than $ 133,000 dollars
during that period. Notwithstanding the above, this amount
shall be payable March 31st
2010 at the discretion of the Board of Directors or the Compensation
Committee of the Board of Directors. For purpose of calculating
net income for the incentive payment in this section b(2), depreciation
expenses and other non-cash items included in the Employee’s net income
shall be added back. Net income will be otherwise calculated
using GAAP and certified by the CFO of the company. Thereafter
this incentive payment will be based on the annual net income excluding
non cash items of the Company and paid if net income as so calculated is
in excess of $200,000 and payable at the CFO’s discretion on March 31 of
such successive year. If the contract is
not renewed, then payment will be based on net income from
January 1 2010 thru termination, assuming it exceeds an average of $
16,667 per month for the duration of the employment period,
payable at the CFO’s descretion upon non renewal or contract
termination.
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Any
disputes in the interpretation of the above incentive plan shall be adjudicated
by the compensation committee of the Board of Directors of the company, whose
decision is final.
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4.
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Benefits.
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(a) Employee
will be entitled to at least nine (9) paid holidays and two (2) personal days
each calendar year. The Company will notify Employee on or about the
beginning of each calendar year with respect to the Company holiday schedule for
the coming year. Personal days, if any, will be scheduled in advance
subject to requirements of the Company. Such holidays and personal
days must be taken during the calendar year and cannot be carried forward into
the next year.
(b) In
addition to the above, Employee shall be entitled to twenty five (25) paid
vacation days each year, and if unused due to the requirements of the Company's
business, such unused vacation days may be carried forward into subsequent
years.
(c) Employee
shall be entitled to sick leave and emergency leave according to the regular
policies and procedures of the Company. Additional sick leave or
emergency leave over and above paid leave provided by the Company, if any, shall
be unpaid and shall be granted at the discretion of the Board of Directors or
any committee thereof.
(d) The
Company agrees to include Employee in the group medical and hospital plan of the
Company and provide group life insurance for Employee at no charge to Employee
in the amount of the annual Salary during this
Agreement. Employee shall be responsible for payment of any federal
or state income tax imposed upon these benefits.
(e) Employee
shall be entitled to participate in any pension or profit sharing plan,
incentive stock option plan or any other type of plan adopted by the Company for
the benefit of its officers and/or regular employees as determined by the
compensation committee.
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(f)
The Company will reimburse car
payments up to $1,200.00 dollars per month for
one car that is used for Company business. In addition all actual expenses
for insurance, gas, oil, tolls, parking, car maintenance and any lease mileage
overage will be reimbursed with proper documentation presented to the CFO. The
Employee shall be responsible for payment of any federal or state income tax
imposed upon these benefits, if any. The Employee must pay all invoices
directly and submit an expense report in order to be reimbursed for these
expenses.
(g) Employee
shall be entitled to reimbursement for all reasonable expenses, including travel
and entertainment, incurred by Employee in the performance of Employee's duties.
Employee will maintain records and written receipt as required by the Company
policy and reasonably requested by the Board of Directors of the Company to
substantiate such expenses.
5. Term;
Termination. This Agreement and the status and obligations of
Employee thereunder as an employee of the Company (except as provided for below)
shall cease and terminate effective upon the close of business on July 31, 2010
(the “Expiration
Date”) unless earlier terminated pursuant to this Section 5 or further
extended by the parties hereto in writing in a separate instrument; provided,
however, that upon such date said termination shall not affect any rights that
may have been specifically granted to Employee by the Board of Directors of the
Company or a designated committee thereof pursuant to any of the Company’s
retirement plans, supplementary retirement plans, profit sharing and savings
plans, healthcare, 401(k) or any other employee benefit plans sponsored by the
Company by its terms that continue after such termination, it being understood
that no such rights are granted hereunder. In addition,
notwithstanding the expiry or termination of this Agreement pursuant to this
Section 5 or otherwise, Employee’s rights and obligations under Sections 7
through 12 inclusive of this Agreement shall survive such termination or
expiration of this Agreement in accordance with the terms of such
Sections.
(a) Death
or Disability. This Agreement shall automatically termiante upon the
death or disability of Employee and all her rights hereunder, including the
rights to receive compensation and benefits, except as otherwise required by
law.
(b) (b) Termination
with Notice by Either Party. The Company or Employee may terminate
this Agreement for any reason or no reason upon written notice to the
other. In case of termination by the Company the Company shall pay
Employee severance compensation, in the amount of 3 months salary without
incentives.
(c) At
the date of termination, the employee’s incentive plan shall terminate and all
vested rights in such plan as described in Section 3 (b). Payments due under
such plan, if any, due up until the date of termination, shall be paid within 30
days from date of termination. The net-profit portion of the plan in
Section 3 (b) 3 for that given quarter in which the termination
occurred shall be forfeited.
6. Ommitted
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7. Confidentiality. Employee
shall keep confidential, except as the Company may otherwise consent in writing,
and not disclose or make any use of except for the benefit of the Company, at
any time either during the term of this Agreement or therafter, any trade
secrets, knowledge, data or other information of the Company relating to the
products, processes, know how, technical data, designs, formulas, test data,
customer lists, business plans, marketing plans and strategies, and product
pricing strategies or other subject matter pertaining to any business of the
Company or any of its clients, customers, consultants, licensees or affiliates
which Employee may produce, obtain or otherwise learn of during the course of
Employee’s performance of services (collectively “Confidential
Information”). Employee shall not deliver, reproduce, or in
any way allow any such Confidential Information to be delivered to or used by
any third parties without the specific direction or consent of a duly authorized
representative of the Company, except in connection with the dischage of her
duties thereunder. The terms of this paragraph shall survive
termination of this Agreement. Notwithstanding anything to the
contrary herein, Employee shall not have any obligation to keep confidential any
information (and the term "Confidential Information" shall not be deemed to
include any information) that (a) is generally available to the public through
no fault or wrongful act of Employee in breach of the terms hereof, (b) is
disseminated by the Company or any of its affiliates publicly without requiring
confidentiality, (c) is required by law or regulation to be disclosed by
Employee, or (d) is required to be disclosed by Employee to any government
agency or person to whom disclosure is required by judicial or administrative
process.
8. Return of Confidential
Material. Upon the completion or other termination of
Employee’s services for the Company, Employee shall promptly surrender and
deliver to the Company all records, materials, equipment, drawings, computers,
data files, documents, notes and books and data of any nature pertaining to any
invention, trade secret or Confidential Information of the Company or to
Employee’s services, and Employee will not take with him any description
containing or pertaining to any Confidential Information, knowledge or data of
the Company which Employee may produce or obtain during the course of her
services. The terms of this paragraph shall survive termination of
this Agreement.
9. A) Non-Solicitation of
Customers. During employee’s employment and for a period of one (1)
year following the date of any voluntary or involuntary termination of
Employee’s employment for any reason by either Employee or Employer, Employee
agrees not to , directly or indirectly, contact, solicit, divert, appropriate or
call upon with the intent of doing business with the customers or clients of
Employer with whom Employee has had material contact during the final year
of Employee’s employment with Employer if the purpose of such activity is either
(1) solicit these customers or clients or (2) to otherwise encourage any such
customer or client to discontinue , reduce, or adversely alter the amount of its
business with Employer.
B) Non-Piracy of Employees and
Independent Contractors. During Employee’s employment and for a period of
one (1) year following the date of any voluntary or involuntary termination of
Employee’s employment for any reason by either Employee or Employer, Employee
covenants and agrees that Employee shall not, directly or indirectly,
solicit, recruit, or hire or oth erwise assist anyone in soliciting, recruiting,
or hiring, any employee or independent contractor of Employer who performed work
for Employer within the final year of Employee’s employment with
Employer.
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10. Other
Obligations.
(a) Employee
acknowledges that the Company from time to time may have agreements with other
persons which impose obligations or restrictions on the Company made during the
course of work thereunder or regarding the confidential nature of such
work. Employee will be bound by all such obligations and restrictions
and will take all action necessary to discharge the obligations of the Company
thereunder.
(b) All
of Employee’s obligations under this Agreement shall be subject to any
applicable agreements with, and policies issued by the Company to which Employee
is subject, that are generally applicable to the five highest paid executives of
the Company.
11. Trade Secrets of
Others. Employee represents that her performance of all the
terms of this Agreement as employee to the Company does not and will not breach
any agreement to keep in confidence proprietary information, knowledge or data
acquired by Employee in confidence or in trust, and Employee will not disclose
to the Company, or allow the Company to use, any confidential or proprietary
information or material belonging to any other person or
entity. Employee will not enter into any agreement, either written or
oral, which is in conflict with this Agreement.
12. Injunctive
Relief. Employee acknowledges that any breach or attempted
breach by Employee of paragraphs 7 through 12 of this Agreement shall cause the
Company irreparable harm for which any adequate monetary remedy does not
exist. Accordingly, in the event of any such breach or threatened
breach, the Company shall be entitled to obtain injunctive relief, without the
necessity of posting a bond or other surety, restraining such breach or
threatened breach.
13. Modification. This
Agreement may not be changed, modified, released, discharged, abandoned, or
otherwise amended, in whole or in part, except by an instrument in writing,
signed by Employee and by the Company. Any subsequent change or
changes in Employee’s relationship with the Company or Employee’s compensation
shall not affect the validity or scope of this Agreement.
14. Entire
Agreement. Employee acknowledges receipt of this Agreement,
and agrees that with respect to the subject matter thereof, it is Employee’s
entire agreement with the Company, superseding any previous oral or written
communications, representations, understandings with the Company or any office
or representative thereof. Each party to the Agreement acknowledges
that, in executing this Agreement, such party has had the opportunity to seek
the advice of independent legal counsel, and has read and understood all of the
terms and provisions of the Agreement.
15. Severability. In
the event that any paragraph or provision of this Agreement shall be held to be
illegal or unenforceable, the entire Agreement shall not fall on account
thereof, but shall otherwise remain in full force and effect, and such paragraph
or provision shall be enforced to the maximum extent
permissible.
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17. Governing
Law. This Agreement shall be governed by the laws of the State
of New Jersey except for any conflicts of law rules thereof that might direct
the application of the substantive law of another state.
18. Counterparts. This
Agreement may be signed in counterparts and by facsimile transmission, each of
which shall be deemed an original and both of which shall together constitute
one agreement.
19. No
Waiver. No waiver by either party hereto of any breach of this
Agreement by the other party hereto shall constitute a waiver of any subsequent
breach.
20. Notice. Any
notice hereby required or permitted to be given shall be sufficiently given if
in writing and upon mailing by registered or certified mail, postage prepaid, to
either party at the address of such party or such other address as shall have
been designated by written notice by such party to the other party.
21. 21.
Arbitration
clause - In the event of any dispute between the parties which arises
under this Agreement, such dispute shall be settled by arbitration in accordance
with the rules for commercial arbitration of the American Arbitration
Association (or a similar organization) in effect at the time such arbitration
is initiated., A list of arbitrators shall be presented to the Claimant and
Respondent from which one will be chosen using the applicable rules. The hearing
shall be conducted in New Jersey, unless both parties consent to a different
location. The decision of the arbitrator shall be final and binding upon all
Parties.
22. The
prevailing party shall be awarded all of the filing fees and related
administrative costs. Administrative and other costs of enforcing an arbitration
award, including the costs of subpoenas, depositions, transcripts and the like,
witness fees, payment of reasonable attorney's fees, and similar costs related
to collecting an arbitrator's award, will be added to, and become a part of, the
amount due pursuant to this Agreement. Any questions involving contract
interpretation shall use the laws of New Jersey. An arbitrator's decision may be
entered in any jurisdiction in which the party has assets in order to collect
any amounts due hereunder.
[Signature
Page Follows]
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The
undersigned have executed this Agreement as of the date first forth
above.
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CONVERSION
SERVICES INTERNATIONAL, INC.
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By:
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Name: Xxxxxxx
Xxxxxx
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Title: Vice
President and CFO
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Xxxx
Xxxxx
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