EXHIBIT 10.16
EMPLOYMENT AGREEMENT
Technology Solutions Company, doing business as TSC, and Xxxxxxx X.
Xxxxxx ("Employee") enter into this Employment Agreement ("Agreement") as of
April 28, 1999.
In consideration of the agreements and covenants contained in this
Agreement, TSC and Employee agree as follows:
1. Employment Duties: TSC shall employ Employee as Senior Vice President
and Chief Financial Officer. Employee shall have such responsibilities, duties
and authority as the Chief Executive Officer may reasonably designate. The
Chief Executive Officer may from time to time expand or contract such duties and
responsibility and may enhance but not diminish Employee's title or position.
Employee shall perform faithfully the duties assigned to him to the best of his
ability and shall devote his full and undivided business time and attention to
the transaction of TSC's business.
2. Term of Employment: The term of employment covered by this Agreement
shall commence as of the effective date of this Agreement and continue until
terminated pursuant to Section 3 below.
3. Termination: TSC may terminate Employee's employment and this
Agreement for any reason upon giving Employee 90 days notice of termination.
TSC may make the termination effective at any time within the 90 day notice
period. TSC must, however, continue Employee's normal salary, bonus, and health
insurance benefits for a period of one year following the effective date of the
termination unless Employee is terminated for Serious Misconduct. TSC may
terminate Employee's employment and this Agreement immediately without notice
and with no salary and benefit continuation if Employee engages in "Serious
Misconduct". "Serious Misconduct" means embezzlement or misappropriation of
corporate funds, other acts of dishonesty, significant activities materially
harmful to TSC's reputation, willful refusal to perform or substantial disregard
of Employee's assigned duties (including, but not limited to, refusal to travel
or work the requested hours), or any significant violation of any statutory or
common law duty of loyalty to TSC.
If following a Change in Control (which is defined as (i) the acquisition by any
individual, entity or group, of beneficial ownership (within the meaning of Rule
13 d-3 promulgated under the Securities Exchange Act of 1934) of 40% or more of
the outstanding shares of the common stock of TSC; (ii) the approval of the
stockholders of TSC of a merger, where immediately after the merger, persons who
were the holders of a majority of TSC's
outstanding common stock immediately prior to the merger fail to own at least a
majority of the outstanding common stock of the surviving entity in
substantially the same proportions as their holdings of TSC common stock
immediately prior to the merger; (iii) the sale of substantially all the assets
of TSC other than to a corporation in which more that 60% of the outstanding
shares are beneficially owned by the individuals and entities who are the
beneficial owners of the Company stock prior to the acquisition, or (iv) the
naming of a new CEO), Employee's title, position, duties, or salary is
diminished and Employee resigns within 90 days after the diminishment becomes
effective, or if Employee is ordered to relocate permanently to any location
outside of the Chicago metropolitan area and employee declines and is
terminated, Employee shall be entitled to Employee's normal salary, bonus, and
health insurance benefits for a one-year period following his resignation or
termination.
Notwithstanding anything to the contrary in any of Employee's stock option
agreements, Employee's unvested TSC shares at option shall vest automatically
upon a Change in Control.
If Employee dies or becomes permanently disabled and unable to continue to work
at TSC, TSC must continue Employee's normal salary, bonus, and health insurance
benefits for a period of one year following the date of his death or his
permanent disability.
Employee may terminate employment upon giving TSC 90 day notice. Upon receiving
notice, TSC may waive its rights under this paragraph and make Employee's
resignation effective immediately or anytime before the 90 day notice period
ends.
4. Salary: As compensation for his services, TSC shall pay Employee a
base salary in the amount listed in Exhibit A to this Agreement. Employee's base
salary shall be subject to annual review and may, at the discretion of TSC's
management, be increased from that listed in Exhibit A according to Employee's
responsibilities, capabilities and performance during the preceding year.
5. Bonuses: TSC may elect to pay Employee annual bonuses. Payment of
such bonuses, if any, shall be at the sole discretion of TSC.
6. Employee Benefits: During the employment period, Employee shall be
entitled to participate in such employee benefit plans, including group pension,
life and health insurance and other medical benefits, and shall receive all
other fringe benefits, as TSC may make available to its Vice Presidents.
7. Business Expenses: TSC shall reimburse Employee for all reasonable
and necessary business expenses incurred by Employee in performing his duties.
Employee shall provide TSC with supporting documentation sufficient to satisfy
reporting requirements of the Internal Revenue Service and TSC. TSC's
determination as to reasonableness and necessary shall be final.
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8. Noncompetition and Nondisclosure: Employee acknowledges that the
successful development and marketing of TSC's professional services and products
require substantial time and expense. Such efforts generate for TSC valuable
and proprietary information ("confidential information") which gives TSC a
business advantage over others who do not have such information. Confidential
information of TSC and its clients and prospects includes, but is not limited
to, the following: business strategies and plans; proposals; deliverables;
prospects and customer lists; recruiting prospects and employee lists,
methodologies; training materials; and computer software. Employee acknowledges
that during the course of his employment, he will obtain knowledge of such
confidential information. Accordingly, Employee agrees to undertake the
following obligations which he acknowledges to be reasonably designed to protect
TSC's legitimate business interests without unnecessarily or unreasonably
restricting Employee's post-employment opportunities:
(a) Upon termination of employment for any reason, Employee shall return
all TSC property, including but not limited to computer programs, files, notes,
records, charts, or other documents or things containing in whole or in part any
of TSC's confidential information;
(b) During the course of his employment and subsequent to termination,
Employee agrees to treat all such information as confidential and to take all
necessary precautions against disclosure of such information to third parties
during and after Employee's employment with TSC. Employee shall refrain from
using or disclosing to any person, without the prior written approval of TSC's
Chief Executive Officer any confidential information unless at that time the
information has become generally and lawfully known to TSC's competitors;
(c) Without limiting the obligations of paragraph 8(b), Employee shall
not, for a period of one year following his termination for any reason, for
himself or as an agent, partner or employee of any person, firm or corporation,
engage in the practice of consulting or related services for any client of TSC
for whom Employee performed services, or prospective TSC client to whom Employee
submitted, or assisted in the submission of a proposal during the two year
period preceding his termination;
(d) During a one year period immediately following Employee's
termination for any reason, Employee shall not induce or assist in the
inducement of any TSC employee away from TSC's employ or from the faithful
discharge of such employee's contractual and fiduciary obligations to serve
TSC's interests with undivided loyalty;
(e) For one year following his termination for any reason, Employee
shall keep TSC currently advised in writing of the name and address of each
business organization for which he acts as agent, partner, representative or
employee.
9. Remedies: Employee recognizes and agrees that a breach of any or all
of the provisions of paragraph 8 will constitute immediate and irreparable harm
to TSC's business advantage, including but not limited to TSC's valuable
business relations, for
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which damages cannot be readily calculated and for which damages are an
inadequate remedy. Accordingly, Employee acknowledges that TSC shall therefore
be entitled to an order enjoining any further breaches by the Employee. Employee
agrees to reimburse TSC for all costs and expenses, including reasonable
attorneys' fees, incurred by TSC in connection with the enforcement of its
rights under any provision of this Agreement.
10. Intellectual Property: During the employment period, Employee shall
disclose to TSC all ideas, inventions and business plans which he develops
during the course of his employment with TSC which relate directly or indirectly
to TSC's business, including but not limited to any computer programs,
processes, products or procedures which may, upon application, be protected by
patent or copyright. Employee agrees that any such ideas, inventions or
business plans shall be the property of TSC and that Employee shall at TSC's
request and cost, provide TSC with such assurances as is necessary to secure a
patent or copyright.
11. Assignment: Employee acknowledges that the services to be rendered
pursuant to this Agreement are unique and personal. Accordingly, Employee may
not assign any of his rights or delegate any of his duties or obligations under
this Agreement. TSC may assign its rights, duties or obligations under this
Agreement to a purchaser or transferee of all, or substantially all, of the
assets of TSC.
12. Notices: All notices shall be in writing, except for notice of
termination which may be oral if confirmed in writing within 14 days. Notices
intended for TSC shall be sent by registered or certified mail addressed to it
at 000 Xxxxx Xxxxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxx 00000 or its current
principal office, and notices intended for Employee shall be either delivered
personally to his or sent by registered or certified mail addressed to his last
known address.
13. Entire Agreement: This Agreement constitutes the entire agreement
between TSC and Employee. Neither Employee nor TSC may modify this Agreement by
oral agreements, promises or representations. The parties may modify this
Agreement only by a written instrument signed by the parties.
14. Applicable Law: This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois.
15. Mediation of Disputes: Neither party shall initiate arbitration or
other legal proceedings (except for any claim in equity under Sections 8(b),
8(c), or 8(d) of this Agreement), against the other party, or, in the case of
TSC, any of its directors, officers, employees, agents, or representatives,
relating in any way to this Agreement, to Employee's employment with TSC, the
termination of his employment or any or all other claims that one party might
have against the other party until 30 days after the party against whom the
claim[s] is made ("respondent") receives written notice from the claiming party
of the specific nature of any purported claim and the amount of any purported
damages. Employee and TSC further agree that if respondent submits the claiming
party's claim to the Center for Public Resources, 000 Xxxxx Xxxxxx, Xxx Xxxx,
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Xxx Xxxx 00000, for nonbinding mediation prior to the expiration of such 30 day
period, the claiming party may not institute arbitration or other legal
proceedings against respondent until the earlier of a) the completion of
nonbinding mediation efforts, or b) 90 days after the date on which the
respondent received written notice of the claimant's claim.
16. Binding Arbitration: Employee and TSC agree that all claims or
disputes relating to his employment with TSC or the termination of such
employment, and any and all other claims that Employee might have against TSC,
any TSC director, officer, employee, agent, or representative, and any and all
claims or disputes that TSC might have against Employee (except for any claim in
equity under Sections 8(b), 8(c), or 8(d) of this Agreement) shall be resolved
under the Expedited Commercial Rules of the American Arbitration Association.
If either party pursues a claim and such claim results in an Arbitrator's
decision, both parties agree to accept such decision as final and binding.
17. Severability: Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be prohibited by or
invalid under applicable law, such provision will be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Agreement.
18. Employee acknowledges that he has read, understood and accepts the
provisions of this Agreement.
Technology Solutions Company Xxxxxxx X. Xxxxxx
By: /s/ XXXX X. XXXXXX /s/ XXXXXXX X. XXXXXX
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Position:_________________________ Position: Senior Vice President and
Chief Financial Officer
Date:____________________________ Date: 4/28/99
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EXHIBIT A
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EMPLOYEE: Xxxxxxx X. Xxxxxx
POSITION: Senior Vice President and Chief Financial Officer
BASE SALARY: $240,000
EFFECTIVE DATE: April 28, 1999
/s/ XXXXXXX X. XXXXXX
Xxxxxxx X. Xxxxxx
4/28/99
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Date
/s/ XXXX X. XXXXXX
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Technology Solutions Company
_____________________________
Date
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