EXHIBIT 10.42
SECOND AMENDMENT TO EMPLOYMENT AGREEMENT
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This second amendment to the Employment Agreement dated as of August 20,
1996 (and amended effective September 17, 1999) by and between Edgewater
Technology, Inc., formerly Staffmark, Inc. (the "Company") and Xxxxx Xxxxxxx
(the "Employee"), is made and entered into effective as of December 1, 2000
between the Company and Employee.
RECITALS
WHEREAS, the Compensation Committee of the Board of Directors of the Company
has determined that it is necessary and in the best interests of the Company to
amend the Employment Agreement as a result of various business restructurings
that have occurred and in order to secure the continued services of Employee
following these business changes; and
WHEREAS, this second amendment has been approved by the Compensation
Committee on behalf of the Company's Board of Directors effective July 20, 2000.
AGREEMENT
NOW, THEREFORE, in consideration of the promises and the mutual covenants
and agreements contained herein, the parties hereto agree as follows:
1. "Paragraph 2(a) of the Employment Agreement, as amended, is further amended
by deleting the phrase "$200,000 per year through September 30, 1999 and
thereafter $250,000 per year, in each case" and replacing it with "$200,000 per
year through September 30, 1999, $250,000 per year from October 1, 1999 to
November 30, 2000 and thereafter $150,000 per year, in each case.
2. A new Paragraph 2(c) shall be added to the Employment Agreement as follows:
"(c) Stay-on Payment. Employee in exchange for the salary reduction
and other commitments as outlined shall be paid a payment of $200,000, less
all legally required tax withholding and deductions (the "Stay-On Payment")
on the effective date hereof."
3. Paragraph 4(a) of the Employment Agreement, as amended, is further amended
to add the following sentence to the end of the paragraph:
"Notwithstanding the above, on and after December 1, 2000,
Employee's temporary worksite shall be at the Company's Wakefield,
Massachusetts offices or other locations on a temporary basis as requested
by the Company's Chief Executive Officer."
4. Paragraph 5 of the Employment Agreement, as amended, is further amended to
delete the date "April 1, 2002" in the first line thereof and replacing it with
"December 1, 2001."
5. Paragraph 5(d) of the Employment Agreement, as amended, is further amended
to add a new sentence to the end of the subsection (d) as follows:
"Notwithstanding the above, Employee acknowledges that "Good
Reason" for terminating the Agreement does not exist as of the second
amendment to the Agreement, either solely as a result of any of the
business restructurings or sales that have occurred, or which are being
contemplated by the Company, or solely as a result of his transfer to the
Boston, Massachusetts area."
6. A new Paragraph shall be added to the Employment Agreement as follows:
"(e) Transition Payment. Employee shall be entitled to receive a
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transition payment (the "Transition Payment") in the amount of $300,000,
payable in a lump-sum, less all legally required tax withholdings and
deductions, on the earlier of: (i) thirty (30) days following the
consummation of a Change of Control; (ii) the date of any salary
continuation payments made to either the Company's Chief Executive Officer
(Xxxxx Xxxxxx) or its General Counsel (Xxxxxx Xxxxxxx) following a
termination of the CEO's or General Counsel's respective Employment
Agreements for a "Good Reason" or by the Company for any reason other than
"Good Cause" (as defined in those Employment Agreements), if Employee
remains employed by the Company on that date; or (iii) the date the Company
terminates this Agreement for reasons other than Good Cause or the date on
which the Employee leaves for a Good Reason, as defined in the Agreement."
The Transition Payment shall be reduced by the amount of any Change of
Control payment received by Employee pursuant to Paragraph 9(b) of this
Agreement.
7. The Employment Agreement, as amended, is further amended to include a new
Paragraph as follows:
"Notwithstanding the foregoing, to the extent Employee receives or
has received the Transition Payment, the amount of the payment in Paragraph
5(d) and/or Paragraph 9(b)(i) shall be reduced by the gross amount of the
Transition Payment paid, as applicable. In this connection, the
differential amount due to Employee under Paragraph 9(b)(i) when deducting
the Transition Payment shall be due and payable on earlier of: (i) a Good
Reason event; (ii) termination of Employee without Cause; or (iii) the date
that either of the Company's Chief Executive Officer (Xxxxx Xxxxxx) or its
General Counsel (Xxxxxx Xxxxxxx) receive payments under Section 9(b)(i) of
their respective employment agreements with the Company. Notwithstanding
the preceding sentence, in the event a Good Reason event shall have
occurred following execution of this Second Amendment to the Employment
Agreement or a Change of Control event shall have occurred following
payment of the Transition Payment, and in each event this Agreement and
employment of Employee shall have been terminated, Employee shall be
entitled to the base salary payable to Employee for the remaining term of
the Agreement, plus the pro rata portion (based on the number of months
served in the performance period) of any performance payment which Employee
shall have earned in accordance with the payment program."
IN WITNESS WHEREOF, the parties have executed this second amendment to the
Employment Agreement as of the effective date first written above.
/s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
EDGEWATER TECHNOLOGY, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Chairman and Chief Executive Officer
