EXHIBIT 10.40
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of _____ ___, 1998, by and between
Programmer's Paradise, Inc., a Delaware corporation with offices at 0000
Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000-0000 (the"Corporation"), and
Xxxxx Xxxxxx, an individual residing at 00000 Xxxxxxxxx 00xx Xxxxxx, Xxxxx,
Xxxxxxx 00000 (the "Executive").
W I T N E S S E T H:
In consideration of the mutual covenants herein contained and other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged by the parties hereto, the parties hereto hereby agree as follows:
1. Employment. The Corporation hereby agrees to employ the Executive in an
executive capacity, and the Executive hereby accepts and agrees to such
employment, upon the terms and conditions hereinafter set forth.
2. Term. The term of the Executive's employment under this Agreement shall
commence as of December 1, 1998 (the "Effective Date") and shall continue until
the close of business on December 31, 1999, and shall automatically be renewed
on the same terms and conditions for successive additional terms of twelve (12)
months unless terminated by either party upon written notice to the other not
less than thirty (30) days prior to the expiration of the initial twelve-month
term or of any twelve-month renewal term thereafter (the initial term and, if
the period of employment is so renewed, such additional period or periods of
employment are collectively referred as the "Term"), unless sooner terminated as
provided elsewhere in this Agreement.
3. Duties and Services. (a) The Executive agrees to serve the Corporation
as an Executive Vice President of the Corporation and shall also serve such of
its subsidiaries and affiliated companies as may be designated by the
Corporation, faithfully, diligently and to the best of his ability, subject to
and under the direction and control of the Board of Directors of the
Corporation, the President of the Corporation and their authorized designees,
devoting his entire business time, energy and skill to such employment, and to
perform from time to time such executive services, advisory or otherwise, as the
Board of Directors, the President of the Corporation or their authorized
designee shall request, and to act in such capacities or other offices for the
Corporation and for any of its subsidiary or affiliated companies as the Board
of Directors, the President of the Corporation or their authorized designee
shall request without further compensation other than that for which provision
is made in this Agreement. The Executive shall be primarily responsible for
German operations and all corporate sales in the United States.
(b) The principal place of employment of the Executive shall be at the
corporate offices of the Corporation in Shrewsbury, New Jersey, or such other
new offices of the Corporation as shall be determined by the Board of Directors,
provided that any such new office will not be located at a place which would
significantly extend the commuting or travelling time of the
Executive beyond a reasonable amount of time unless the Corporation shall
relocate the Executive and his wife. Any such relocation shall be at the expense
of the Corporation. The Executive's responsibilities to the Corporation shall
require the Executive to spend at least four days a week at such corporate
offices. It is understood, however, that in connection with his duties under
this Agreement, the Executive may be required to travel to and perform services
at other locations on a more temporary basis.
(c) The Executive shall relocate from Europe to Miami, Florida, and
shall rent housing in New Jersey within a reasonable commuting distance from the
corporate offices of the Corporation.
4. Compensation. (a) The Corporation agrees to pay to the Executive, and
the Executive agrees to accept, a basic salary for all his services (the
"Salary") at the rate of $190,000 per annum, payable from the U.S. corporate
office of the Corporation in accordance with the Corporation's standard payroll
policies from time to time.
(b) The Corporation agrees to pay the Executive from the U.S.
corporate offices of the Corporation a bonus in accordance with the bonus
program set forth on Schedule A hereto, with a base bonus of $50,000.
5. Employee Benefits. (a) The Corporation shall reimburse the Executive for
the reasonable business expenses incurred by him for or on behalf of the
Corporation in furtherance of the performance of his duties hereunder. Such
reimbursement shall be subject to receipt by the Corporation from the Executive
of such an expense statements and such vouchers and other reasonable
verifications as the Corporation shall require to satisfactorily evidence such
expenses, and shall also be subject to such policies as the Corporation shall
establish from time to time (except that international air travel by the
Executive may be by business class).
(b) The Executive shall be entitled to participate, in accordance with
the terms thereof, in employee benefit plans and programs maintained for the
U.S. executives of the Corporation, including, without limitation, any health,
hospitalization and medical insurance programs and in any pension or retirement
or other similar plans or programs. The foregoing shall not be construed to
require the Corporation to establish any such plans or programs, or to prevent
the Corporation from modifying or terminating any such plans or programs once
established. Without limiting the foregoing, the Executive shall resign from the
health plans maintained by International Software Partners GmbH and enroll in a
U.S. health care plan maintained by the Corporation.
(c) The Executive shall be entitled to six (6) weeks of vacation each
employment year during the term of this Agreement, taken consecutively or in
segments, subject to the effective discharge of the duties of the Executive
hereunder.
(d) During the term of the Executive's employment hereunder, the
Corporation shall afford the Executive the use of a Mercedes 300 or similar
automobile, chosen by the Executive and reasonably satisfactory to the
Corporation.
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(e) In connection with the relocation of the Executive from Europe to
Miami, Florida, and the maintenance by the Executive of local housing in New
Jersey, it is agreed as follows:
(i) the Corporation shall pay or reimburse the Executive for up
to 50% of the cost of moving the Executive's household goods and personal
effects from his current residence in Europe to his new residence in Miami,
Florida, up to a maximum of $10,000;
(ii) the Corporation shall provide the Executive, for use in his
new home in Miami, Florida, with a telephone and fax machine (which may be
combined), and miscellaneous office supplies, it being understood that the
Corporation shall not absorb the cost of a full home office, and that all of
such equipment and supplies provided or paid for by the Corporation shall remain
the property of the Corporation;
(iii) the Corporation shall provide or reimburse the Executive
for regular round-trip air fare or tickets between New York and Miami airports
on a weekly basis, so as to enable the Executive to be at his Miami residence
the balance of each work week; it being understood that the expenses of ground
transportation to and from such airports shall be the responsibility of the
Executive;
(iv) the Corporation shall pay or reimburse the Executive for the
rent expense for the Executive's local housing in New Jersey, which is to be in
the range of $1,000 to $1,500 per month; and
(v) the Corporation shall pay or reimburse the Executive for the
fees and expenses of counsel satisfactory to the Corporation in connection with
the Executive obtaining the requisite work permit (L-1), up to a maximum of
$5,000.
6. Termination. (a) Notwithstanding anything to the contrary contained
herein, the Executive's employment with the Corporation, as well as the
Executive's right to any compensation which thereafter otherwise would accrue to
him hereunder or in connection therewith, shall terminate upon the earliest to
occur of the following events:
(i) the death or disability (as defined below) of the Executive,
(ii) the expiration of the Term of this Agreement,
(iii) the Executive's termination of such employment, or
(iv) upon delivery of written notice, with or without "cause" (as
defined below), to the Executive from the Corporation of such termination.
(b) For the purpose of this Section 6, (i) the term "cause" is defined
as (A) the commission by the Executive of a felony or an offense involving moral
turpitude, the Executive's engaging in theft, embezzlement, fraud, obtaining
funds or property under false pretenses, or similar
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acts of misconduct with respect to the property of the Corporation or its
employees, stockholders, affiliates, customers, licensees, licensors or
suppliers, (B) the repeated failure by the Executive to perform his duties
hereunder or comply with reasonable policies or directives of the Board of
Directors or President of the Corporation, or (C) the breach of this Agreement
or the Conditions of Employment by the Executive in any material respect, and
(ii) the Executive shall be deemed "disabled" if, at the Corporation's option,
it gives notice to the Executive or his representative that due to a disabling
mental or physical condition, he has been prevented, for a continuous period of
90 days during the Term or for an aggregate of 120 days during any six-month
period during the Term, from substantially performing those duties which he was
required to perform pursuant to the provisions of this Agreement prior to
incurring such disability.
(c) In the event of the termination by the Corporation of the
employment of the Executive under this Agreement without "cause" in accordance
with Section 6(a)(iv) above, the giving by the Corporation of notice of
non-renewal of this Agreement pursuant to Section 2 or the voluntary resignation
or retirement of the Executive, in addition to the Salary and other compensation
(including cash bonuses) earned hereunder and unpaid or not delivered through
the date of termination and any benefits referred to in Section 5(b) hereof in
which the Executive has a vested right under the terms and conditions of the
plan or program pursuant to which such benefits were granted (without regard to
such termination), the Corporation shall pay the Executive severance
("Severance") in an amount equal to his monthly Salary for nine (9) months from
the date of termination. The Severance shall be paid to the Executive or his
estate in nine consecutive, equal monthly installments of $15,833.33 each
(subject to withholding), on the fifteenth day of each calendar month commencing
during the month next following the month in which the Executive is no longer
employed by the Corporation, and shall be in lieu of any other claim to
severance or similar payments or benefits which the Executive may otherwise have
or make. Without limiting any other rights or remedies which the Corporation may
have, it is understood that the Corporation shall be under no further obligation
to make any such Severance payments and shall be entitled to be reimbursed
therefor by the Executive or his estate if the Executive violates any of the
covenants set forth in the Conditions of Employment attached as Exhibit A
hereto. In the event that the Severance shall become payable to the Executive,
the Executive shall not be required, either in mitigation of damages or by the
terms of any provisions of this Agreement or otherwise, to seek or accept other
employment, and if the Executive does accept other employment, any benefits or
payments under this Agreement shall not be reduced by any compensation earned or
other benefits received as a result of such employment.
7. Deductions and Withholding. The Executive agrees that the Corporation
shall withhold from any and all payments required to be made to the Executive
pursuant to this Agreement all federal, state, local and/or other taxes which
are required to be withheld in accordance with applicable statutes and/or
regulations from time to time in effect.
8. Non-Solicitation, Restrictive Covenants, Confidentiality and Injunctive
Relief. (a) The Executive shall execute and deliver to and for the benefit of
the Corporation, the Conditions of Employment attached as Exhibit A hereto,
pertaining, among other matters, to proprietary information, confidentiality
obligations, and non-competition obligations, the provisions
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of which shall be deemed incorporated herein by reference as if set forth herein
(the "Conditions of Employment").
(b) The provisions of this Section 8 shall survive the termination or
expiration of this Agreement, irrespective of the reason therefor, including
under circumstances in which the Executive continues thereafter in the employ of
the Corporation.
9. Warranty. The Executive warrants and represents that he is not a party
to any agreement, contract or understanding, whether of employment or otherwise,
which would in any way restrict or prohibit him from undertaking his position as
an executive of the Corporation and complying with his obligations in accordance
with the terms and conditions of this Agreement and the Conditions of
Employment.
10. Insurance. The Executive agrees that the Corporation may from time to
time and for the Corporation's own benefit apply for and take out life insurance
covering the Executive, either independently or together with others, in any
amount and form which the Corporation may deem to be in its best interests. The
Corporation shall own all rights in such insurance and in the cash values and
proceeds thereof and the Executive shall not have any right, title or interest
therein. The Executive agrees to assist the Corporation, at the Corporation's
expense, in obtaining any such insurance by, among things, submitting to
customary examinations and correctly preparing, signing and delivering such
applications and other documents as reasonably may be required. Nothing
contained in this Section 10 shall be construed as a limitation on the
Executive's right to procure any life insurance for his own personal needs.
11. Notices. All notices shall be in writing and shall be deemed to have
been duly given to a party hereto on the date of such delivery, if delivered
personally, or on the third day after being deposited in the mail if mailed via
registered or certified mail, return receipt requested, postage prepaid, or on
the next business day after being sent by recognized national overnight courier
service, in the case of the Executive at his current address as set forth in the
Corporation's records, and in the case of the Corporation, at it address set
forth above.
12. Assignability and Binding Effect. This Agreement shall inure to the
benefit of and shall be binding upon the heirs, executors, administrators,
successors and legal representatives of the Executive, and shall inure to the
benefit of and be binding upon the Corporation and its successors and assigns.
The Executive may not assign, transfer, pledge, encumber, hypothecate or
otherwise dispose of this Agreement, or any of his rights or obligations
hereunder, and any such attempted delegation or disposition shall be null and
void and without effect.
13. Severability. In the event that any provisions of this Agreement would
be held to be invalid, prohibited or unenforceable in any jurisdiction for any
reason (including, but not limited to, any provisions which would be held to be
unenforceable because of the scope, duration or area of its applicability),
unless narrowed by construction, this Agreement shall, as to such jurisdiction
only, be construed as if such invalid, prohibited or unenforceable provision had
been more narrowly drawn so as not to be invalid, prohibited or unenforceable
(or if such language cannot be drawn narrowly enough, the court making any such
determination shall have the power to modify
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such scope, duration or area or all of them, but only to the extent necessary to
make such provision or provisions enforceable in such jurisdiction, and such
provision shall then be applicable in such modified form). If, notwithstanding
the foregoing, any provision of this Agreement would be held to be invalid,
prohibited or unenforceable in any jurisdiction, such provision shall be
ineffective to the extent of such invalidity, prohibition or unenforceability,
without invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.
14. Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New Jersey, without regard to
principles of conflict of laws and regardless of where actually executed,
delivered or performed.
15. Complete Understanding; Counterparts. This Agreement constitutes the
complete understanding and supersedes any and all prior agreements and
understandings between the parties with respect to its subject matter, and no
statement, representation, warranty or covenant has been made by either party
with respect thereto except as expressly set forth herein. This Agreement shall
not be altered, modified, amended or terminated except by written instrument
signed by each of the parties hereto. The Section and paragraph headings
contained herein are for convenience only, and are not part of and are not
intended to define or limit the contents of said Sections and paragraphs. This
Agreement may be executed in counterparts, each of which shall be deemed an
original and all of which, when taken together, shall constitute one and the
same agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
PROGRAMMER'S PARADISE, INC.
By:
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Xxxxx Xxxxxx
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