Exhibit 10.20
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (this "Agreement"), dated as of December 7,
2001, is entered into between Technisource, Inc., a Florida corporation (the
"Company"), and C. Xxxxxxx Xxxxx ("Executive").
Recitals
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Executive has been a member of the Company's Board of Directors since
1998. The employment of the Company's Chief Executive Officer has been
terminated, and the Company is in need of an Interim Chief Executive Officer to
serve until a permanent successor can be identified and hired. Executive has
agreed to act in such interim capacity and the Company wishes to engage
Executive in such capacity. Consequently, the Company's Board of Directors has
approved the terms and conditions of the employment of Executive as set forth
herein and has authorized the execution and delivery of this Agreement.
Agreement
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For and in consideration of the foregoing and of the mutual covenants
of the parties herein contained, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties agree
as follows:
1. EMPLOYMENT. The Company hereby employs Executive to serve in the capacities
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described herein and Executive hereby accepts such employment and agrees to
perform the services described herein upon the terms and conditions hereinafter
set forth.
2. TERM. The term of Executive's employment pursuant to this Agreement shall
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commence as of the date hereof (the "Commencement Date") and shall terminate at
the close of business on December 6, 2002, subject to earlier termination in
accordance with Section 9 hereof and the other terms, provisions, and conditions
set forth herein (the "Term").
3. DUTIES. For the period beginning on the Commencement Date and ending thirty
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(30) days after a permanent Chief Executive Officer has commenced full time
employment with the Company (the "Interim Period"), Executive shall serve as and
have the title Interim Chief Executive Officer of the Company. During the
Interim Period, Executive agrees to devote substantially his entire time,
energy, and skills to such employment while so employed. For the period
beginning immediately after the Interim Period and continuing for the remaining
balance of the Term, Executive shall serve the Company on a part-time basis as
an employee (the "Part-time Period"). During the Part-time Period, Executive
agrees to devote his time, energy and skills to such employment while so
employed, such time being approximately five (5) days per month or the
equivalent thereof as and when reasonably needed or requested by the Company.
4. COMPENSATION.
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(a) Compensation. During the Interim Period, the Company shall pay
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Executive, and Executive agrees to accept, compensation at the rate of $7,000
per week, commencing as of December 7, 2001. During the Part-time Period,
including the Part-time Period following the consummation of a "Change of
Control" (as hereinafter defined), if any, the Company shall pay Executive, and
Executive agrees to accept, compensation at the rate of $2,250 per week (the
"Part-time Compensation"). For purposes of this Agreement, a "Change in Control"
shall be deemed to have occurred when:
(i) any person, including a "group" as defined in Section 13(d)(3)
of the Securities Exchange Act of 1934, as amended, who owns less than 20% of
the Company's capital stock on the date hereof, becomes the beneficial owner of
twenty-five percent or more of the capital stock of the Company;
(ii) the Company is merged with or into any other company where
members of the board of directors of the Company immediately prior to such
transaction do not constitute a majority of the board of directors of the
Company of the surviving entity immediately following such transaction, or
substantially all of the Company's assets are acquired by any other company; or
(iv) three or more directors nominated by the Board of Directors to
serve as a director, each having agreed to serve in such capacity, fail to be
elected in a contested election of directors.
(b) Stock Options. The Company shall grant Executive a stock option
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award as set forth in a Nonqualified Stock Option Agreement, dated the date
hereof, substantially in the form of Exhibit A attached hereto ("Stock
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Options").
5. FRINGE BENEFITS.
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(a) Generally. Executive shall be eligible for fringe benefits pursuant
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to any insurance, pension or other employee fringe benefit plan approved by the
Board of Directors that now or hereafter may be made available to employees of
the Company and for which Executive will qualify according to his eligibility
under the provisions thereof; provided, however, that such eligibility
specifically does not apply to matters relating to Executive's vacation,
disability benefits, automobile allowance and compensation, which matters shall
be governed exclusively by the terms hereof.
(b) Vacation. During the Interim Period, Executive shall be entitled to
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two (2) days paid vacation for each calendar month or portion thereof.
6. EXPENSES. During the period of his employment, Executive shall be
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reimbursed for his business-related expenses incurred on behalf of the Company
in accordance with the travel and entertainment expense policy of the Company as
adopted by the Board of Directors from time to time and in effect at the time
the expense was incurred. Executive agrees to maintain such records
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and documentation of all such expenses to be reimbursed by the Company hereunder
as the Company shall require and in such detail as the Company may reasonably
request.
7. TERMINATION. Executive's employment under this Agreement may be terminated by
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the Company at any time with or without Cause as herein defined. For purposes of
this Agreement, the term "Cause" shall mean the termination of the Executive by
the Board of Directors of the Company as a result of the existence or occurrence
of one or more of the following conditions or events:
(i) An act or acts of fraud, misappropriation, or embezzlement on
the Executive's part that result in or are intended to result in his personal
enrichment at the expense of the Company or its subsidiaries or affiliates.
(ii) Conviction of a felony that (a) arises in connection with the
Company's business and (b) has a material adverse effect on the Company's
business.
(iii) The Executive's willful or intentional failure to perform his
duties as required under this Agreement; provided, that the Company shall
provide Executive with written notice of such failure and Executive shall have
thirty (30) days from the date Executive receives such notice to remedy such
failure to perform.
8. SEVERANCE. In the event of the termination of Executive's employment under
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this Agreement for any reason, the Company shall provide the payments and
benefits to Executive as indicated below:
(a) With Cause or Voluntary Resignation. If Executive is terminated for
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Cause (as defined in Section 7 of this Agreement), or if Executive voluntarily
terminates his employment by the Company, the Company shall pay Executive,
within five (5) business days after the date of termination, Executive's
compensation and unused vacation entitlement through such date of termination,
and the Company shall have no further obligation to provide compensation or
benefits to Executive under this Agreement; except that, to the extent that the
Company's insurance, stock option and other benefit plans provide certain rights
and benefits after an employee's termination, Executive may continue to receive
such rights and benefits in accordance with the terms of such plans.
(b) Without Cause or Upon a Change of Control. If terminated by the
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Company without Cause or as a result of a Change of Control, Executive shall
receive the Part-time Compensation, and the other benefits under this Agreement
until December 6, 2002.
9. CONFIDENTIAL INFORMATION. Executive recognizes and acknowledges that he will
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have access to certain confidential information of the Company and of
corporations with whom the Company does business, and that such information
constitutes valuable, special and unique property of the Company and such other
corporations. During the term of this Agreement and for a period of five (5)
years immediately following the date of termination of this Agreement, Executive
agrees not to disclose or use any confidential information, including without
limitation, information regarding research, developments, "know-how," prices,
suppliers, customers, costs or any knowledge or information with respect to
confidential or trade secrets of the Company, it being
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understood that such confidential information does not include information that
is publicly available unless such information became publicly available as a
result of a breach of this Agreement. Executive acknowledges and agrees that all
notes, records, reports, sketches, plans, unpublished memoranda or other
documents belonging to the Company, but held by Executive, concerning any
information relating to the Company's business, whether confidential or not, are
the property of the Company and will be promptly delivered to it upon
Executive's leaving the employ of the Company. Executive also agrees to execute
such confidentiality agreements that the Board may adopt, and may modify from
time to time, as a standard form to be executed by all employees of the Company,
to the extent such standard forms are not materially more restrictive than the
provisions of this Agreement.
10. INTELLECTUAL PROPERTY. Executive acknowledges and agrees that all
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discoveries, inventions, designs, improvements, ideas, writings, copyrights,
publications, study protocols, study results, computer data or programs, or
other intellectual property, whether or not subject to patent or copyright laws,
which Executive shall conceive solely or jointly with others, in the course or
scope of his employment with the Company or in any way related to the Company's
business, whether during or after working hours, or with the use of the
Company's equipment, materials or facilities (collectively referred to herein as
"Intellectual Property"), shall be the sole and exclusive property of the
Company without further compensation to Executive. As used in this Section 10
and the following Section 11, it is understood that the Company's principal
"business" is providing IT consultant staffing and services. Executive shall
take such steps as are deemed necessary to maintain complete and current records
of the Intellectual Property conceived by the Executive, and Executive shall
assign to the Company or its designees, the entire right, title and interest in
said Intellectual Property.
11. NON-COMPETITION. Executive acknowledges that his services to be rendered
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hereunder are of a special and unusual character that have a unique value to the
Company and the conduct of its business, the loss of which cannot adequately be
compensated by damages in an action at law. In view of the unique value to the
Company of the services of Executive for which the Company has contracted
hereunder, and because of the confidential information to be obtained by or
disclosed to Executive as herein above set forth, and as a material inducement
to the Company to enter into this Agreement and to pay and make available to
Executive the compensation and other benefits referred to herein, Executive
covenants and agrees that Executive will not, directly or indirectly, whether as
principal, agent, trustee or through the agency of any corporation, partnership,
association or agent (other than as the holder of not more than 10% of the total
outstanding stock of any company the securities of which are traded on a regular
basis on recognized securities exchanges):
(a) while employed under this Agreement (i) work for (in any capacity,
including without limitation director, officer or employee) any other business
or IT staffing company that competes with the Company and is located in the
United States or within 50 miles of any branch office of the Company, or (ii)
recruit, or otherwise influence or attempt to induce employees of the Company to
leave the employment of the Company; and
(b) for the one-year period immediately following the termination,
including the Part-time Period, of Executive's employment for any reason, work
for a company or business (in
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any capacity, including without limitation as director, officer, or employee)
that is in the business of providing IT consultant staffing or services, that
competes with the Company and is located in the United States or within 50 miles
of any branch office of the Company.
Executive has carefully read and considered the provisions of Sections 9, 10
and 11 hereof and agrees that the restrictions set forth in such sections are
fair and reasonable and are reasonably required for the protection of the
interests of the Company, its officers, directors, shareholders, and other
employees, for the protection of the business of the Company, and to ensure that
Executive devotes his time and efforts to the business of the Company, as set
forth in this Agreement. Executive acknowledges that he is qualified to engage
in businesses other than those that are subject to this Section 11. It is the
belief of the parties, therefore, that the best protection that can be given to
the Company that does not in any way infringe upon the rights of Executive to
engage in any unrelated businesses is to provide for the restrictions described
above. In view of the substantial harm which would result from a breach by
Executive of Sections 9, 10 and 11, the parties agree that the restrictions
contained therein shall be enforced to the maximum extent permitted by law. In
the event that any of said restrictions shall be held unenforceable by any court
of competent jurisdiction, the parties hereto agree that it is their desire that
such court shall substitute a reasonable judicially enforceable limitation in
place of any limitation deemed unenforceable and that as so modified, the
covenant shall be as fully enforceable as if it had been set forth herein by the
parties.
12. REMEDIES. The provisions of Sections 9, 10 and 11 of this Agreement shall
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survive the termination of this Agreement as set forth therein, regardless of
the circumstances or reasons for such termination, and inure to the benefit of
the Company. The restrictions set forth in Sections 9, 10 and 11 are considered
to be reasonable for the purposes of protecting the business of the Company. The
Company and Executive acknowledge that the Company would be irreparably harmed
and that monetary damages would not provide an adequate remedy to the Company if
the covenants contained in Sections 9, 10 and 11 were not complied with in
accordance with their terms. Accordingly, Executive agrees that the Company
shall be entitled to injunctive and other equitable relief to secure the
enforcement of these provisions, in addition to any other remedy which may be
available to the Company, and that the Company shall be entitled to receive from
Executive reimbursement for reasonable attorneys' fees and expenses incurred by
the Company in enforcing these provisions.
13. NOTICES. Any notice required or permitted to be given under this Agreement
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shall be sufficient if in writing and if sent by registered mail to the
addresses below or to such other address as either party shall designate by
written notice to the other:
If to the Executive: To the address set forth below his signature on the
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signature page hereof.
If to the Company:
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Technisource, Inc.
0000 X. Xxxxxxx Xxxxx Xxxx
Xxxxx 000
Xx. Xxxxxxxxxx, XX 00000
Attention: Chairman of the Compensation Committee
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14. ENTIRE AGREEMENT; MODIFICATION.
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(a) This Agreement contains the entire agreement of the Company and
Executive, and the Company and Executive hereby acknowledge and agree that this
Agreement supersedes any prior statements, writings, promises, understandings or
commitments.
(b) No future oral statements, promises or commitments with respect to
the subject matter hereof, or other purported modification hereof, shall be
binding upon the parties hereto unless the same is reduced to writing and signed
by each party hereto.
15. ASSIGNMENT. The rights and obligations of the Company under this
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Agreement shall inure to the benefit of and shall be binding upon the successors
and assigns of the Company. The Executive may not assign his rights and
obligations under this Agreement.
16. FULL SETTLEMENT. The Executive shall not be obligated to seek other
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employment by way of mitigation of the amounts payable to the Executive under
any of the provisions of this Agreement. The amounts payable to Executive under
this Agreement shall not be reduced by any compensation payable to Executive
from employment by another employer after the date of Executive's termination
provided such employment does not violate the terms of Section 9 hereof. The
Company agrees to pay all legal fees and expenses which the Executive may
reasonably incur as a result of any contest by the Executive or the Company or
others of the validity or enforceability of, or liability under any provision of
this Agreement or any guarantee of performance thereof, in each case plus
interest, provided that the Executive is the prevailing party in any such
contest. If the Executive is not the prevailing party each party shall pay its
own legal fees and expenses except that if such contest is the result of a
claimed breach of Section 9, 10 or 11, and the Company shall be the prevailing
party, the Executive shall pay the reasonable legal fees and expenses of the
Company. The determination of the prevailing party in any contest shall be made
by the tribunal which shall resolve such contest, or by the parties if such
contest is settled without resort to any such tribunal.
17. MISCELLANEOUS.
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(a) This agreement shall be subject to and governed by the laws of the
State of Florida, without regard to the conflict of laws principles thereof.
(b) The section headings contained herein are for reference purposes
only and shall not in any way affect the meaning or the interpretation of this
Agreement.
(c) The failure of any party to enforce any provision of this Agreement
shall in no manner affect the right to enforce the same, and the waiver by any
party of any breach of any provision of this Agreement shall not be construed to
be a waiver by such party of any succeeding breach of such provision or a waiver
by such party of any breach of any other provision.
(d) All written notices required in this Agreement shall be sent
postage prepaid by certified or registered mail, return receipt requested.
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(e) In the event any one or more of the provisions of this Agreement
shall for any reason be held invalid, illegal or unenforceable, the remaining
provisions of this Agreement shall be unimpaired, and the invalid, illegal or
unenforceable provision shall be replaced by a mutually acceptable valid, and
enforceable provision which comes closest to the intent of the parties.
(f) This Agreement may be executed in any number of counterparts, each
of which shall constitute an original and all of which together shall constitute
one and the same instrument.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties have executed this Employment Agreement
as of the day and year first above written.
TECHNISOURCE, INC., a Florida corporation
By:----------------------------------------------
Xxxxx X. Xxxxxxxxx
President
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C. Xxxxxxx Xxxxx
Address: ________________________________________
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Exhibit A
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Nonqualified Stock Option Agreement
See attached
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