Xxxxx Xxxxxxx
AGREEMENT
This Agreement is made as of the latest date indicated below between
Mastech Systems Corporation, a Pennsylvania corporation (hereinafter called the
"Company") and the undersigned employee (hereinafter called the "Employee").
This Agreement is entered into contemporaneously with Employee's receipt of
certain stock options offered by Company which were not previously made
available to Employee.
WHEREAS, Employee is employed by the Company as an at-will employee
whose employment may be terminated by either party with or without reason or
cause and without any liability for such termination;
WHEREAS, this Agreement is necessary for the protection of Company's
legitimate and protectible business interests in its customers, prospective
customers, accounts and confidential, proprietary and trade secret information;
and
WHEREAS, this Agreement is a term and condition of Employee's
employment and is made in consideration for certain stock options offered to
Employee contemporaneously with this Agreement as well as Employee's continued
employment and access to Company's customers, prospective customers, accounts,
and confidential, proprietary and trade secret information.
NOW THEREFORE, for the consideration set forth herein, the receipt and
sufficiency of which is acknowledged by the parties, Company and Employee agree
as follows:
1. DEFINITIONS. As used herein:
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(a) "Company" shall mean Mastech Systems Corporation and any affiliate
of Mastech Systems Corporation, including any direct or indirect parent or
subsidiary of Mastech Systems Corporation, as well as their respective
operating divisions.
(b) "Confidential Information" shall include, but is not necessarily
limited to, any information which may include, in whole or part, information
concerning the Company's accounts, sales, sales volume, sales methods, sales
proposals, customers and prospective customers, prospect lists, identity of
purchasing personnel in the employ of customers and prospective customers,
amount or kind of customer's purchases from the Company, the Company's source
of supply of products and/or personnel, sources of consultants, Company
manuals, formulae, products, processes, methods, machines, compositions,
ideas, improvements, inventions, research, computer programs, system
documentation, software products, patented products, copyrighted information,
know how and operating methods and any other trade secret or proprietary
information belonging to the Company or relating to the Company's affairs that
is not public information.
(c) "Customer(s)" shall mean any individual, corporation, partnership,
business or other entity (i) whose existence and business is known to Employee
as a result of Employee's access to the Company's customer lists or Customer
account information; or (ii) that
is an entity with whom the Company has contracted or negotiated during the two
(2) year period preceding the termination of Employee's employment.
(d) "Competing Business" shall mean any individual, corporation,
partnership, business or other entity which provides or attempts to provide any
products or services that directly compete with products or services offered
by the Company, i.e., information technology services, including software
applications solutions and services, and which were sold by the Company at any
time and from time to time during the last two (2) years prior to Employee's
termination of employment. Notwithstanding the foregoing, the term Competing
Business does not include a corporation that derives at least $500 million of
its revenues from the sale of information technology services.
2. DUTIES. Employee, who is employed in the position set forth on
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Schedule A hereof as of the date of this Agreement, agrees to be responsible
for such duties as are commensurate with and required by such position and any
other duties as may be assigned to Employee by Company from time to time.
Employee further agrees to perform his or her duties in a diligent,
trustworthy, loyal, businesslike, productive, and efficient manner and to use
Employee's best efforts to advance the business and goodwill of Company.
Employee further agrees to devote all of his or her business time, skill,
energy and attention exclusively to the business of the Company and to comply
with all rules, regulations and procedures of the Company. During the term of
this Agreement, Employee will not engage in any other business for Employee's
own account or accept any employment from any other business entity, or render
any services, give any advice or serve in a consulting capacity, whether
gratuitously or otherwise, to or for any other person, firm or corporation,
other than as a volunteer for charitable organizations, without the prior
written approval of the Company.
3. COMPENSATION. Employee's annual base salary as of the date of this
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Agreement is as set forth on Schedule A hereto. As compensation for Employee's
employment by the Company, the Company will pay the Employee during the period
of employment hereunder such remuneration as is determined to be appropriate
by the Company from time to time in its discretion.
4. BENEFITS. Employee will receive the standard Company benefits
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described in the Company Handbook which is incorporated as though fully set
forth in this Agreement and which may be modified at any time by the Company.
5. STOCK OPTIONS. Upon the initial public offering of the Company's
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common stock, Employee shall receive that number of stock options covering the
Company's shares as is set forth on Schedule A hereto. Such options shall be
granted under the Company's Stock Incentive Plan as then in effect and shall
be subject to the Stock Option Agreement evidencing such stock options.
6. POLICIES AND PRACTICES. Employee agrees to abide by all rules,
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regulations and instruments established by the Company including the policies,
practices and procedures contained in the Company Employee Handbook which
Employee has received and which is incorporated by reference as though fully
set forth herein. The Company reserves the
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right to disregard the Company Employee Handbook in the event that a
particular portion of the Company Employee Handbook conflicts with this
Agreement or is deemed by the Company to be incompatible with Employee's
position in the Company, and the Company may amend the Handbook from time to
time in its sole discretion.
7. AGREEMENT NOT TO COMPETE. In order to protect the business interest
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and good will of the Company in respect to customers and accounts, and to
protect Confidential Information, Employee covenants and agrees that for the
entire period of time that this Agreement remains in effect, and for a period
of two (2) years after termination of Employee's employment for any reason he
or she will not:
(a) directly or indirectly contact any Customer of the Company for the
purpose of soliciting such Customer to purchase, lease or license a product or
service that is the same as, similar to, or in competition with those products
and/or services made, rendered, offered or under development by the Company;
(b) engage in any activity or business as a consultant, independent
contractor, agent, employee, employer, officer, partner, director or otherwise,
alone or in association with any other person, corporation or other entity, in
any Competing Business operating in the United States of America or any other
country where the Company has conducted business within the two (2) year period
prior to the termination of Employee's employment; provided, however, that this
subsection (b) shall not apply if the Employee is terminated by the Company
without cause after the sale of substantially all of the business or assets of
Mastech Systems Corporation to an unaffiliated third party for fair value;
(c) directly or indirectly employ, or knowingly permit any company or
business directly or indirectly controlled by Employee to employ, any person
who is employed by the Company at any time during the term of this Agreement,
or in any manner to seek to induce any such person to leave his or her
employment with the Company; or
(d) directly or indirectly interfere with or attempt to disrupt the
relationship, contractual or otherwise, between the Company and any of its
employees or solicit, induce, or attempt to induce employees of the Company to
terminate employment with the Company and become self-employed or employed with
others in the same or similar business or any product line or service provided
by Company.
Employee acknowledges that the Company is engaged in business
throughout the United States as well as in other countries and that the
marketplace for the Company's products and services is worldwide. Employee
further covenants and agrees that the geographic, length of term and types of
activities restrictions (non-competition restrictions) contained in this
Agreement are reasonable and necessary to protect the legitimate business
interests of the Company because of the scope of the Company's business
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In the event that a court of competent jurisdiction shall determine
that one or more of the provisions of this Section 7 is so broad as to be
unenforceable, then such provision shall be deemed to be reduced in scope or
length, as the case may be, to the extent required to make this Paragraph
enforceable. If the Employee violates the provisions of this Section 7, the
periods described therein shall be extended by that number of days which equals
the aggregate of all days during which at any time any such violations
occurred.
8. NONDISCLOSURE AND NONUSE OF CONFIDENTIAL INFORMATION. The Employee
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covenants and agrees during Employee's employment or any time after the
Termination of such employment, not to communicate or divulge to any person,
firm or corporation, either directly or indirectly, and to hold in strict
confidence for the benefit of the Company, all Confidential Information except
that employee may disclose such Information to persons, firms or corporations
who need to know such Information during the course and within the scope of
Employee's employment. Employee will not use any Confidential Information for
any purpose or for his or her personal benefit other than in the course and
within the scope of Employee's employment,
(a) Work Made For Hire. Employee recognizes and understands that his or
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her duties at Company have included and may continue to include the
preparation of materials, including computer software and other written or
graphic materials, and that any such materials conceived or written by him or
her were done and shall continue to be done as "work made for hire" as defined
and used in the Copyright Act of 1976, 17 USC 1 et seq. In the event of
publication of such materials, Employee understands that since the work is a
"work made for hire," the Company will solely retain and own all rights in all
such materials, including the right to copyright.
(b) Disclosure of Discoveries, Ideas and Inventions. Employee represents
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that he does not have any right, title or interest in, nor has he made or
conceived wholly or in part prior to the commencement of his employment by the
Company any discovery, idea and invention.
(c) Disclosure of Other Discoveries, Ideas and Inventions/Assignment of
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Patents. Employee shall disclose promptly to the Company, any and all works,
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inventions, discoveries and improvements authored, conceived or made by
Employee during the period of employment and related to the business or
activities of the Company, solely or jointly with others, which is related to
the lines of business, work or investigation of the Company at the time of
such discovery, idea or invention or which results from, or is suggested by,
any work which the Employee may do for or on behalf of the Company, and hereby
assigns and agrees to assign all his interest therein to the Company or its
nominee. Whenever requested to do so by the Company, Employee shall execute
any and all applications, assignments or other instruments which the Company
shall deem necessary to apply for and obtain Letters Patent or Copyrights of
the United States or any foreign country or to otherwise protect the interest
therein and shall assist the Company in every proper way (entirely at the
Company's expense, including reimbursement to him for all expense and loss of
income) to obtain such patents and copyrights and to enforce them. Such
obligations shall continue beyond the termination of employment
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with respect to works, inventions, discoveries and improvements authored,
conceived or made by Employee during the period of employment, and shall be
binding upon Employee's assigns, executors, administrators and other legal
representatives. All such works, inventions, discoveries and improvements
shall remain the sole and exclusive property of the Company, whether
patentable or not.
9. RETURN OF MATERIALS. Upon termination of employment with Company for
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any reason, Employee shall promptly deliver to Company the originals and
copies of all correspondence, drawings, manuals, computerized information,
letters, notes, notebooks, reports, prospect lists, flow charts, programs,
proposals, and any documents concerning Company's customers or suppliers and,
without limiting the foregoing, will promptly deliver to Company any and all
other documents or materials containing or constituting Confidential
Information.
10. TERMINATION. This Agreement may be terminated with or without
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cause by either party without any liability for such termination by giving to
the other party at least fifteen (15) days prior written notice, except that
the covenants of Sections 6, 7, 8, 9, 11, 12, 13, 14, 15, 16 and 18 hereof
shall survive the termination of this Agreement. All payments due as of the
date of termination shall be paid in full within thirty (30) days of this
date.
11. SEVERANCE. If the Employee's employment is at any time terminated
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by the Company without cause, then the Company shall pay the Employee a
severance payment equal to three (3) times the monthly base salary of the
Employee then in effect, payable in the form of salary continuation in
accordance with the Company's then existing payroll practices; provided,
however, if the Employee's employment is terminated by the Company without
cause within 90 days after the sale of substantially all of the business or
assets of Mastech Systems Corporation to an unaffiliated third party for fair
value, then the Company (or its successor) shall pay the Employee a severance
payment equal to six (6) times the monthly base salary of the Employee then in
effect in accordance with the Company's then existing payroll practices.
12. ENTIRE AGREEMENTS. This Agreement supersedes all prior agreements,
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written or oral, between the parties hereto concerning the subject matter
hereof.
13. CHOICE OF LAW, JURISDICTION AND VENUE. The parties agree that this
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Agreement shall be deemed to have been made and entered into in Pennsylvania
and that the Law of the Commonwealth of Pennsylvania shall govern this
Agreement. Jurisdiction and venue is proper in any proceeding by the Company
to enforce its rights hereunder filed in any court geographically located in
Allegheny County, Pennsylvania.
14. ACKNOWLEDGMENTS OF EMPLOYEE. Employee hereby acknowledges and
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agrees that:
(a) This Agreement is necessary for the protection of the legitimate
business interests of the Company.
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(b) the restrictions contained in this Agreement may be enforced in
a court of law whether or not Employee is terminated with or
without cause or for performance related reasons;
(c) The execution and delivery of this Agreement is a mandatory
condition precedent to the Employee's receipt of the consideration
provided herein;
(d) Employee has no intention of competing with the Company within the
limitations set forth above;
(e) Employee has received adequate and valuable consideration for
entering into this Agreement;
(f) Employee's covenants shall be construed as independent of any other
provision in this Agreement and the existence of any claim or cause
of action Employee may have against the Company, whether predicated
on this Agreement or not, shall not constitute a defense to the
enforcement by Company of these covenants;
(g) this Agreement does not prevent Employee from earning a livelihood
after termination of employment; and
(h) Employee further acknowledges that his or her education and
experience enables Employee to work for different types of
employers, so that it will not be necessary for Employee to violate
the provisions of this covenant not to compete in order to remain
economically viable.
15. FULL UNDERSTANDING. Employee acknowledges that Employee has
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carefully read and fully understands all of the provisions of this Agreement
and that Employee, in consideration for the compensation set forth herein, is
voluntarily entering into this Agreement.
16. EQUITABLE RELIEF; FEES AND EXPENSES. Employee stipulates and agrees
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that any breach of this Agreement by Employee will result in immediate and
irreparable harm to the Company, the amount of which will be extremely
difficult to ascertain, and that the Company could not be reasonably or
adequately compensated by damages in an action at law. For these reasons, the
Company shall have the right, without objection from Employee, to obtain such
preliminary, temporary or permanent injunctions or restraining orders or
decrees as may be necessary to protect the Company against, or on account of,
any breach by Employee of the provisions of this Agreement. Such right to
equitable relief is in addition to all other legal remedies the Company may
have to protect its rights. In the event the Company obtains any such
injunction, order, decree or other relief, in law or in equity, Employee shall
be responsible for reimbursing the Company for all costs associated with
obtaining the relief, including reasonable attorneys' fees, and expenses and
costs of suit. Employee further covenants and agrees that any order of court
or judgment obtained by the Company which enforces the Company's rights under
this Agreement may be transferred, without objection or opposition by
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Employee, to any court of law or other appropriate law enforcement body located
in any other country in the world where Company does business, and that said
court or body will give full force and effect to said order and or judgment.
17. AMENDMENTS. No supplement, modification, amendment or waiver of the
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terms of this Agreement shall be binding on the parties hereto unless executed
in writing by the party to be bound thereby. No waiver of any of the provisions
of this Agreement shall be deemed to or shall constitute a waiver of any other
provisions hereof (whether or not similar), nor shall such waiver constitute a
continuing waiver unless otherwise expressly provided. Any failure to insist
upon strict compliance with any of the terms and conditions of this Agreement
shall not be deemed a waiver of any such terms or conditions.
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18. SUCCESSORS IN INTEREST. This Agreement shall be binding upon and
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shall inure to the benefit of the successors, assigns, heirs and legal
representatives of the parties hereto. The Company shall have the right to
assign this Agreement in connection with a merger involving the Company or a
sale or transfer of substantially all of the business and assets of the
Company, and Employee agrees to be obligated by this Agreement to any
successor, assign or surviving entity,
19. HEADINGS. The headings used in this Agreement are for convenience
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only and are not to be considered in construing or interpreting this
Agreement.
MASTECH SYSTEMS
CORPORATION (COMPANY)
By: /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx (Employee)
Date: 12/8/96 Date: 12/8/96
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Xxxxx Xxxxxxx
Attachment A
1. Position: Vice President--International Operations
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2. Base Salary (for fiscal 1997): $150,000, subject to the appropriate
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federal, state and local taxes and withholdings.
3. Target Bonus (for fiscal 1997): $100,000, subject to individual, business
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unit/function and/or corporate performance goals to be established
by the Company's Board of Directors by January 1, 1997.
4. Stock Options: As consideration for this Agreement, Employee is entitled
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to the stock options set forth on Schedule A hereto, subject to the terms
of the Stock Option Agreement evidencing the same.
