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EXHIBIT 10.20
[XXXXX SYSTEMS CORPORATION LETTERHEAD]
ASSOCIATE AGREEMENT
This Associate Agreement (this "Agreement") is made as of July 8, 1996 by and
between Xxxxx Systems Corporation, a Delaware Corporation, or one of its
subsidiaries or affiliates (Xxxxx Systems Corporation and all its subsidiaries
and affiliates are collectively referred to as "Xxxxx Systems" and the
organization employing the Associate, which is Xxxxx Systems Corporation
itself, will be referred to as "Company") and Xxxxx Xxxxxx ("Champy"), an
individual who, subject to satisfaction of any conditions stated in his offer
of employment, will become an employee of Company beginning on August 12 , 1996
(the "Effective Date").
1. Employment.
(a) Subject to the terms and conditions specified in this Agreement,
Company hereby agrees to employ Champy on a full time basis (subject to Section
3) as Chairman of Xxxxx Systems' Management Consulting Business ("Management
Consulting") reporting directly to Company's current Chief Executive Officer
("CEO") and Chairman of the Board (the "Chairman"), Xxxxxx X. Xxxxxxxx. If
Xxxxxx X. Xxxxxxxx ceases to serve as CEO, Champy will report jointly to Xxxxxx
X. Xxxxxxxx and the new CEO as long as Xxxxxx X. Xxxxxxxx remains the Company
Chairman. If Xxxxxx X. Xxxxxxxx ceases to serve as the Company Chairman,
Champy will report directly to the then current CEO. The Company agrees that
during the term of this Agreement Champy shall at all times be one of the most
senior executive officers of the Company.
(b) As Chairman of Management Consulting, Champy's responsibilities and
authority shall consist (subject to ultimate control of the CEO and the
Chairman) of the direction and control of Management Consulting, including
developing strategy and direction for Management Consulting, hiring senior
executives for Management Consulting and participating in general marketing
activities and consulting for key clients. Champy agrees to perform these
responsibilities and other duties normally associated with such position,
subject to such legal and ethical policies and guidelines as may be reasonably
established from time to time by the Board of Directors (the "Board"), the
Chairman or the CEO of Company.
(c) The term of Champy's employment by Company hereunder will commence on
the Effective Date and will continue until and unless terminated in accordance
with Section 8. Xxxxx Systems' management will recommend to the Board that it
elect Champy as a member of the Board at the first scheduled Board meeting
after the Effective Date.
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2. Compensation and Benefits.
(a) During the term of this Agreement, Company will pay Champy (in
accordance with the Company's normal payroll policies) a salary of $41,666.67
per month, which salary the Board shall review at least once in each calendar
year to determine whether an upward adjustment is warranted (as so adjusted
from time to time, the "Base Salary"), plus a bonus payable as of the end of
each calendar year to be determined in accordance with the then current bonus
plan applicable to the most senior executive officers of the Company.
(b) Champy will receive medical coverage, dependent medical coverage and
disability coverage on the same terms as the other most senior executive
officers of Company. Champy will be entitled to indemnification and will
receive directors' and officers' liability insurance to the maximum extent
provided to other directors and most senior executive officers of Company.
Champy will be entitled to receive benefits related to travel, as established
or revised by Company from time to time for Company's CEO and Chief Operating
Officer ("COO"). Champy will receive life insurance coverage in the amount of
$1,000,000 on the same terms as provided to the Company's current Chairman, if
Champy submits to a physical examination and receives an insurability rating
that provides for no higher premium than that paid by Company for the current
Chairman; provided that, if Champy's premium would be higher than that paid by
Company for the current Chairman, Champy may obtain a lower amount of coverage,
so as to reduce the premium to that paid for the current Chairman, or may
obtain equivalent coverage by paying the difference between his actual rate and
the rate paid for the current Chairman. Champy shall also receive other fringe
benefits, and be entitled to vacation time, consistent with the other fringe
benefits and vacation time afforded to the other most senior executive officers
of the Company.
(c) Company will provide Champy office space, a full time assistant and
telephone and electronic equipment and services reasonably necessary or
appropriate to permit him to perform his duties. Champy's office will be
located in Cambridge or Boston, Massachusetts, which will be the principal
location from which Champy will perform services hereunder.
(d) Company shall reimburse Champy for all reasonable expenses incurred or
paid by Champy in connection with, or related to, the performance of his
duties, responsibilities or services under this Agreement in accordance with
Company's normal expense reimbursement policies applicable to its most senior
executive officers.
3. Outside Activities. While employed by Company, Champy will not (a)
engage in any other business activity or (b) work for or have any financial
interest in any business enterprise, including any sole proprietorship, without
Company's prior consent; provided, however, that Champy shall be permitted (i)
to make and maintain passive personal investments for himself, members of his
immediate family and any trust or custodial account for his or their benefit,
and (ii) participate in civic, charitable, religious and other not-for-profit
organizations so long as his activities pursuant to the forgoing clauses (i)
and (ii) do not unreasonably interfere with the performance by him of his
duties and responsibilities hereunder. In addition, notwithstanding the
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foregoing, Champy may (subject to Section 5) prepare and deliver speeches and
participate in writing books pursuant to the provisions of Section 9
4. Certain Policies. Champy will comply with all Xxxxx Systems' policies that
are communicated to him from time to time, including but not limited to its
Standards and Ethical Principles. Champy understands that Xxxxx Systems'
policies are intended for general guidance only and that Xxxxx Systems may
amend or cancel those policies at any time. Champy will not knowingly engage
in or tolerate illegal or unethical conduct within Xxxxx Systems. Champy
agrees to be tested at Company's request, at any time or from time to time, to
detect drugs, controlled substances, alcohol or inhalants, by giving blood
samples, urine samples or both.
5. Confidential Information.
(a) Champy acknowledges that Xxxxx Systems is continuously developing or
receiving Confidential Information, and that during his employment he will
receive Confidential Information from Xxxxx Systems, its customers and
suppliers and special training related to Xxxxx Systems' business
methodologies. He further acknowledges and agrees that his employment by
Company creates a relationship of confidence and trust between the parties that
extends to all Confidential Information that becomes known to him.
Accordingly, Champy will not disclose or use any Confidential Information,
except in connection with the good faith performance of his duties as an
employee, and will take reasonable precautions against the unauthorized
disclosure or use of Confidential Information. Upon Company's request, Champy
will execute and comply with a third party's reasonable agreement to protect
its confidential and proprietary information. In addition, Champy will not
solicit or induce the unauthorized disclosure or use of confidential or
proprietary information for the benefit of Xxxxx Systems.
(b) For purposes of this Agreement, "Confidential Information" means all
written, machine-reproducable, oral and visual data, information and material,
including but not limited to business, financial and technical information,
computer programs, documents and records (including those that Champy develops
in the scope of his employment) that (i) Xxxxx Systems or any of its customers
or suppliers treats as proprietary or confidential through markings or
otherwise, (ii) relates to Xxxxx Systems or any of its customers or suppliers
or any of their business activities, products or services (including software
programs and techniques) and is competitively sensitive or not generally known
in the relevant trade or industry, or (iii) derives independent economic value
from not being generally known to, and is not readily ascertainable by proper
means by, other persons who can obtain economic value from its disclosure or
use. Confidential Information does not include any data, information or
material that is: (i) approved by Company for unrestricted public disclosure;
(ii) known to Champy without obligations of confidentiality prior to the time
that he learns of such data, information or material as a result of his
employment by the Company; or (iii) is or becomes publicly known without a
breach of this Agreement.
6. No Competition/ Non-Solicitation. Champy acknowledges that, in the course
and as a result of employment with the Company, Champy will obtain special
training and knowledge and will come in contact with the Company's customers
and potential customers, which training,
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knowledge and contacts potentially could provide invaluable benefits to
competitors of the Company. Accordingly, and in consideration of Company's
agreement to hire Champy hereunder, which Champy acknowledges is conditioned on
the covenants contained herein, Champy agrees that for one year after his
employment by Company ends, for any reason, except with the prior written
consent of Company, Champy will comply with the following covenants:
(a) except for Exempted Activities (as defined below), Champy will not
solicit or perform (or assist a third party in soliciting or performing)
services (a "Restricted Solicitation or Performance"), as an employee,
independent contractor, subcontractor or otherwise, for any Person (including
any Persons known by Champy to be affiliates or subsidiaries of the specified
Person) that is or was a customer or prospect of the Company for which Champy
solicited business or performed services on behalf of the Company during the
two-year period prior to the Restricted Solicitation or Performance (a "PSC
Customer or Prospect"); and
(b) Champy will not knowingly recruit or employ or knowingly assist any
Person in recruiting any person who is, or at any time within the preceding one
year was, an employee of the Company.
The following activities by Champy shall constitute "Exempted Activities" for
purposes of clause (a) above:
(i) soliciting or performing services for any of the Persons listed
on Exhibit A (including subsidiaries and affiliates of such Persons);
(ii) the performance by Champy of consulting services or the like as
an independent contractor working solely for himself and by himself other
than for administrative and editorial support (or a business of which
Champy is the owner of all of the equity and the sole non-administrative,
non-editorial employee); provided, however, that the performance of such
services by Champy for a PSC Customer or Prospect only shall constitute
an Exempted Activity if Champy has obtained the written consent of the
Company's Chairman or CEO, which consent shall not be unreasonably
withheld;
(iii) the presentation by Champy of speeches, seminars or the like
as an independent contractor working solely for himself and (except as to
participation on a panel or with a group of unrelated persons) by himself
other than for administrative support (or a business of which Champy is
the owner of all of the equity and the sole non-administrative employee)
and publishing of books and articles by Champy; and
(iv) serving as a member of the faculty or administration of an
academic or non-profit institution.
For purposes of this Agreement, "Person" includes an individual, corporation,
partnership, association, trust, unincorporated organization, governmental
entity, other entity or group.
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If a court of competent jurisdiction finds any provision of this Section 6 to
be unreasonable, then that provision shall be considered to be amended to
provide the broadest scope of protection to Xxxxx Systems that such court would
find reasonable and enforceable.
7. Proprietary Rights.
(a) Champy agrees to disclose to Company all works of authorship and
inventions that Champy produces, conceives or develops, working alone or
jointly with others while Champy is employed by Company, including all computer
programs, documents, and records, together with all related ideas, know-how and
techniques. Except as provided in Section 9, all copyrights, patent rights and
other intellectual property rights in and to all works of authorship and
inventions that Champy produces, conceives or develops while Champy is employed
by the Company, working alone or jointly with others, are intended to be and
will be owned solely by Company, whether or not they are produced using
Company's equipment, facilities, supplies or Confidential Information.
(b) Except as provided in Section 9, Champy assigns to Company all of his
rights in and to all works of authorship and inventions that Champy produces,
conceives or develops, working alone or jointly with others while Champy is
employed by the Company, and waives all moral or similar rights therein. Champy
will sign, without additional compensation, all necessary documents and will
otherwise assist Company, at its expense, to apply for, register and enforce
all copyrights, patents and other intellectual property rights in works of
authorship and inventions assigned by Champy to the Company pursuant to this
Agreement. Champy appoints Company as his attorney-in-fact for the sole
purpose of executing all necessary documents relating to the application for,
registration of, or enforcement of Company's copyrights, patents and other
intellectual property rights in works of authorship and inventions assigned by
Champy to the Company pursuant to this Agreement. Notwithstanding the
foregoing, Champy does not assign works of authorship or inventions which (i)
he developed entirely on his own time without using Company's equipment,
facilities, supplies or Confidential Information, and (ii) do not relate to
either (A) Xxxxx Systems' business, (B) Xxxxx Systems' actual or demonstrably
anticipated research or development, or (C) work done by him for Xxxxx Systems.
(c) Company can waive the rights in any work of authorship or invention to
which it otherwise has rights under this Agreement only through a written
instrument signed by an officer of Company after Champy has materially
disclosed in writing the existence and nature of that work of authorship or
invention.
(d) Champy will not disclose to Xxxxx Systems or use for Xxxxx Systems'
benefit any Third Party Intellectual Property. "Third Party Intellectual
Property" means any confidential or proprietary information owned by any Person
other than Xxxxx Systems.
8. Termination.
(a) Company may terminate Champy's employment under this Agreement at any
time for Cause or Substantial Misconduct. "Cause" means termination of
employment for (i) a felony
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conviction of Champy for a crime involving moral turpitude; or (ii) actions by
Champy relating to his employment by the Company and constituting moral
turpitude, theft or dishonesty in a material matter. "Substantial Misconduct"
means termination of employment for (i) a knowing and material breach by Champy
of any obligation under Sections 3, 5 or 7; (ii) actions involving a knowing
and material lack of business ethics or a knowing and material failure to
comply with Xxxxx Systems' Standards and Ethical Principles; or (iii) a felony
conviction of Champy other than for a crime involving moral turpitude. If
Company wishes to terminate Champy for Substantial Misconduct under clause (i)
or (ii) in the previous sentence, Company may only do so if Champy does not
substantially cure such breach within 15 days after receipt of notice from
Company specifying the breach, or, if such breach is not susceptible to a cure,
Champy does not within such 15 days (i) remedy the breach to the extent
possible; (ii) provide an appropriate apology; and (iii) agree in writing that
if he commits a similar breach in the future, such breach will constitute
Substantial Misconduct without any cure period. In addition, before Company
may terminate Champy for Cause or Substantial Misconduct, Company shall give
Champy written notification of the proposed termination. Champy shall have one
week from the date of the notice of the proposed termination to submit a
written statement to the Board concerning the proposed termination (in the case
of a termination for Substantial Misconduct under clauses (i) and (ii) the
one-week period shall not begin until the end of the 15-day cure period). If
Champy fails to submit such a statement, his employment with Company shall
terminate automatically at the end of the one-week period. In the event Champy
does submit such a statement within the one-week period, and the Board has not
decided to continue Champy's employment by the end of a second one-week period,
Champy's employment will terminate automatically at the end of such second
one-week period.
(b) Company may terminate Champy's employment under this Agreement at any
time for any reason other than Cause or Substantial Misconduct upon 30 days'
prior written notice to Champy. If on or before August 12, 1997, (i) Company
terminates Champy's employment for any reason other than Cause or Substantial
Misconduct or (ii) Champy is Constructively Terminated (as defined below), upon
such termination, Company will (A) pay Champy severance pay equal to Champy's
then current Base Salary for one year from the date of termination, to be paid
in semi-monthly payments, less appropriate withholdings pursuant to Company's
payroll practices; (B) continue all of Champy's benefits under Section 2(b)
until the expiration of such severance period; and (C) pay Champy any other
amounts due him hereunder that have accrued or been incurred prior to the date
of termination. If after August 12, 1997, (i) Company terminates Champy's
employment for any reason other than Cause or Substantial Misconduct or (ii)
Champy is Constructively Terminated (as defined below), upon such termination,
Company will (A) pay Champy severance pay equal to Champy's then current Base
Salary for six months from the date of termination, to be paid in semi-monthly
payments, less appropriate withholdings pursuant to Company's payroll
practices; (B) continue all of Champy's benefits under Section 2(b) until the
expiration of such severance period; and (C) pay Champy any other amounts due
him hereunder that have accrued or been incurred prior to the date of
termination. "Constructively Terminated" or "Constructive Termination" means
the occurrence of any of the circumstances set forth below, if within 90 days
after such occurrence, Champy delivers written notice to the Board stating that
he will terminate his employment with Company
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if such circumstance is not substantially cured within 30 days, and such
circumstance is not substantially cured within such 30-day period.
(i) Removal of Champy as Chairman of Management Consulting (unless
such removal is in conjunction with a promotion accepted by Champy) or a
material diminution, on a cumulative basis, in Champy's duties,
authority, position, Base Salary or other compensation or benefits
(excluding any diminution of bonus or other discretionary payments);
(ii) If Champy is not elected to the Board at the first scheduled
Board meeting after the Effective Date or ceases to serve as a member of
the Board other than as a result of (i) his death, permanent disability,
resignation or refusal to serve on the Board; or (ii) his removal from
the Board in connection with a termination of Champy's employment for
Cause or Substantial Misconduct or Champy's resignation of employment
with the Company;
(iii) the relocation of Champy's offices, or the principal location
at which he is to perform services hereunder, outside of
Cambridge/Boston, Massachusetts; or
(iv) the material breach by the Company of any of its material
covenants or agreements contained in this Agreement.
(c) In the event a Change in Control of Company (as defined below) occurs
on or before August 12, 1997, and Champy's employment with Company is
terminated by either party (other than a termination by Company for Cause)
within one year after such Change in Control, upon such termination, Company
will (A) pay Champy severance pay equal to Champy's then current Base Salary
for one year from the date of termination, to be paid in semi-monthly payments,
less appropriate withholdings pursuant to Company's payroll practices; (B)
continue all of Champy's benefits under Section 2(b) until the expiration of
the severance period; and (C) pay Champy any other amounts due him hereunder
that have accrued or been incurred prior to the date of termination. If a
Change in Control of Company (as defined below) occurs after August 12, 1997,
and Champy's employment with Company is terminated by either party (other than
a termination by Company for Cause) within one year after such Change in
Control, upon such termination, Company will (A) pay Champy severance pay equal
to Champy's then current Base Salary for six months from the date of
termination, to be paid in semi-monthly payments, less appropriate withholdings
pursuant to Company's payroll practices; (B) continue all of Champy's benefits
under Section 2(b) until the expiration of the severance period; and (C) pay
Champy any other amounts due him hereunder that have accrued or been incurred
prior to the date of termination
(d) "Change in Control" of Company is defined to mean any of the following
events:
(i) The Company is merged, consolidated or reorganized into or with
another corporation or other legal entity and as a result of such merger,
consolidation or reorganization less than 50% of the combined equity
interests or voting power of the then
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outstanding securities of the remaining corporation or legal entity or
its ultimate parent immediately after such transaction are received in
respect of or in exchange for voting securities of the Company pursuant
to such transaction;
(ii) The Company sells all or substantially all of its assets to
any other corporation or other legal entity and, immediately following
such sale, the equity owners of the Company prior to such sale own less
than 50% of the combined equity interests or voting power of the then
outstanding securities of such other corporation or legal entity or its
ultimate parent; or
(iii) any person (including any "person" as such term is used in
Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")) has become the beneficial owner
(as the term "beneficial owner" is defined under Rule 13d-3 or any
successor rule or regulation promulgated under the Exchange Act) of
securities which, when added to any securities already owned by such
person, represent in the aggregate (i) 50% or more, if the Company's
common stock is not Publicly Traded (as defined in the Restricted Stock
Agreement between the Company and Champy of even date herewith) at such
time, or (ii) 40% or more, if the Company's common stock is Publicly
Traded at such time, of the outstanding securities of the Company which
are entitled to vote to elect directors.
provided, however, that notwithstanding subsection (1), (2) or (3) above, the
ownership or acquisition of securities by Swiss Bank Corporation ("SBC") or its
affiliates (subject to the limitations of any agreement between SBC or its
affiliates and Xxxxx Systems) or Xxxx Xxxxx or his affiliates or family members
or affiliates of his family will not constitute, or be deemed to cause, a
Change in Control.
(e) In addition to Champy's other rights to terminate this Agreement, (i)
effective at the expiration of the first year of this Agreement, Champy may
terminate his employment under this Agreement upon written notice of such
termination given to Company at least 30 days' prior to the expiration of such
first year, and (ii) effective at any time after the expiration of the second
year of the term of this Agreement, Champy may terminate his employment under
this Agreement upon 30 days' prior written notice to the Company. In the
event of a termination by Champy pursuant to this Section 9(e), Company will
have no further obligations to Champy hereunder, except for: (i) payment of
accrued Base Salary and provision of benefits pursuant to Section 2(b) through
the date of termination, (ii) payment of any other amounts due Champy hereunder
that have accrued or been incurred prior the date of termination; and (iii)
payments to Champy pursuant to Section 9.
(f) If Champy brings a claim against Company or its directors, officers or
employees related to his employment by Company or termination thereof, he shall
concurrently return to Company any severance payments previously made to him
pursuant to this Agreement and Company's obligation to make additional
severance payments as provided in this Agreement shall be suspended pending the
outcome of such claim. If Champy is not the prevailing party with respect to
such claim, Champy and Company will request the arbitrator or judge before
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whom the claim was brought to determine whether the claim was frivolous or
brought by Champy in bad faith (any such claim, a "Bad Faith Claim"). If the
judge or arbitrator determines that the claim brought by Champy was a Bad Faith
Claim, Champy will forfeit his right to any severance payments returned by him
to Company, any severance payments which have been suspended and any future
severance payments. If the judge or arbitrator determines that the claim
brought by Champy was not a Bad Faith Claim, the Company promptly will pay to
Champy all severance pay provided for under this Agreement plus simple interest
at 8% per annum from the date Champy brings the claim (and returns previously
paid severance payments, if any) to the date Company tenders such severance
payments to Champy.
9. Speeches and Publications. During the term of this Agreement, Champy may
(subject to Section 5) prepare and participate in writing and publishing books,
newspaper columns and articles for general distribution to the public (as
opposed to for use primarily in connection with Xxxxx Systems' clients or
prospective client projects). Such books, newspaper columns and articles of
general distribution are referred to herein as "Publications." Champy shall
notify the Company reasonably promptly upon his participation in preparing
books, newspaper columns or articles that constitute Publications under this
Section 9. Champy will own the copyright in connection with any Publications.
During the term of this Agreement, Champy will determine the timing and method
of any publishing, sale, lease or distribution of any Publication, but will
consult with the CEO or the CEO's designee in connection with these matters and
will take into account the reasonable requests and interests of the Company as
to these matters. After the termination of this Agreement, Company shall be
entitled to distribute copies of the Publications under arrangements with the
current or future publisher as determined by Champy or the Company; provided,
however, the Company shall not be entitled to make any editorial modifications
to or based on such Publications without Champy's consent In connection with
preparing any Publications while Champy is employed by the Company, Company
agrees to provide Champy with secretarial assistance and pay other reasonable
expenses, including expenses relating to editorial/writing and marketing
assistance. Company shall be entitled to receive all royalty income generated
by any Publication, including advances and publisher assistance in writing the
Publication, until Company has been reimbursed for all out-of-pocket expenses
and costs paid by Company to third parties (other than compensation costs of
Xxxxx Systems' employees) relating to the Publication. After Company has been
reimbursed for all such expenses and costs, Company and Champy will share in
the royalty income generated from the Publication (whether arising during or
after the term of this Agreement) with each party receiving fifty percent of
the royalty income. After the term of this Agreement, Champy will not interfere
with customary efforts by either the Company or the publisher to promote any
Publication in order to commercially exploit the value thereof.
During the term of this Agreement, Champy shall also be entitled to prepare and
deliver speeches. To the extent Champy receives income from third parties for
speeches and similar events while Champy is employed by the Company, such
income will be the property of the Company, and Champy will submit payment to
the Company for such income promptly upon receipt of such income from third
parties. To the extent Champy receives income from third parties for speeches
and similar events after Champy ceases to be employed by the Company, such
income will be the property of Champy.
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10. End of Employment.
(a) Promptly after the end of his employment, Champy will return to the
Company all tangible forms of Confidential Information and all equipment,
records and other physical property in his possession or under his control that
was furnished to him, or is owned, by Xxxxx Systems.
(b) CHAMPY EXPRESSLY AUTHORIZES XXXXX SYSTEMS TO OFFSET ANY AMOUNTS
PAYABLE OR REIMBURSABLE TO XXXXX SYSTEMS BY HIM AGAINST, AND TO WITHHOLD SUCH
AMOUNTS FROM, ANY AMOUNTS PAYABLE OR REIMBURSABLE TO HIM BY XXXXX SYSTEMS,
INCLUDING WITHOUT LIMITATION ANY BASE SALARY, COMMISSIONS, OTHER INCENTIVE
COMPENSATION, AND EXPENSE REIMBURSEMENTS TO THE MAXIMUM EXTENT PERMITTED BY
LAW.
11. Governing Law. This Agreement will be governed by the laws of Texas,
excluding any conflicts of law provisions thereof.
12. Legal Fees. Company will pay all reasonable legal fees incurred by Champy
through the Effective Date in connection with the negotiation and documentation
of this Agreement and the Restricted Stock Agreement executed simultaneously
herewith, including any related loan agreements with NationsBank of Texas, N.A.
13. Withholding. Company may withhold from any amounts payable under this
Agreement all federal, state, city or other taxes as may be required pursuant
to any law or government regulation or ruling.
14. ARBITRATION. ANY DISPUTE ARISING BETWEEN CHAMPY AND XXXXX SYSTEMS UNDER
THIS AGREEMENT OR WITH RESPECT TO THE SUBJECT MATTER OR INTERPRETATION HEREOF
SHALL BE SETTLED BY ARBITRATION. SUCH ARBITRATION SHALL BE CONDUCTED IN
WASHINGTON, D.C. IN ACCORDANCE WITH THE COMMERCIAL ARBITRATION RULES OF THE
AMERICAN ARBITRATION ASSOCIATION (EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN
THIS AGREEMENT) BEFORE A SINGLE ARBITRATOR. SUCH ARBITRATOR SHALL BE SELECTED
BY AGREEMENT OF CHAMPY AND XXXXX SYSTEMS OR, IF THEY ARE UNABLE TO AGREE UPON
SUCH SINGLE ARBITRATOR, BY THE WASHINGTON, D.C. OFFICE OF THE AMERICAN
ARBITRATION ASSOCIATION. ANY AWARD RENDERED BY THE ARBITRATOR SHALL BE FINAL
AND BINDING UPON THE PARTIES HERETO. JUDGMENT UPON THE AWARD MAY BE ENTERED IN
ANY COURT OF COMPETENT JURISDICTION. THE ARBITRATOR SHALL BE ALLOWED TO
DETERMINE THE COSTS OF ARBITRATION (INCLUDING THE PARTIES' LEGAL AND OTHER
COSTS AND EXPENSES) AND ALLOCATE WHICH PARTY SHOULD BEAR THE COSTS OF
ARBITRATION. THE ARBITRATOR SHALL HAVE NO AUTHORITY TO AWARD DAMAGES IN EXCESS
OR IN CONTRAVENTION OF THIS AGREEMENT. NEITHER PARTY WILL BE LIABLE TO THE
OTHER FOR SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES OR LOST PROFITS FOR ANY
CLAIMS ARISING OUT A BREACH OR ALLEGED BREACH OF THIS AGREEMENT, AND CHAMPY AND
XXXXX SYSTEMS EACH HEREBY WAIVES ANY CLAIMS AGAINST THE OTHER FOR SUCH DAMAGES.
NOTWITHSTANDING THE FOREGOING, NOTHING IN THIS SECTION 14 SHALL BE CONSTRUED TO
LIMIT THE RIGHT OF A PARTY TO SEEK INJUNCTIVE RELIEF WITH RESPECT TO ANY ACTUAL
OR THREATENED BREACH OF THIS AGREEMENT FROM A COURT OF COMPETENT JURISDICTION.
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15. Continuing Obligations. Sections 2(d), 5, 6, 7, 8, 9, 10, 11, 12 and 14
will continue to be enforceable after Champy's employment with Company ends and
the termination of this Agreement for any reason. Champy acknowledges and
agrees that any breach of Champy's obligations with respect to intellectual
property or proprietary rights will cause irreparable injury for which there
are no adequate remedies at law and that Company will be entitled to equitable
relief in addition to all other remedies that may be available.
16. Entire Agreement. This Agreement and the other documents and instruments
specifically referenced herein (together with the Restricted Stock Agreement
and indemnification letter agreement, both of even date herewith) constitute
the entire agreement between Company and Champy with respect to the subject
matter hereof. Such agreements supersede any prior discussions, promises, or
agreements on these subjects. This Agreement cannot be changed except in a
writing signed by an officer of Company and Champy. If any part of this
Agreement is too broad to be fully enforced, it will be enforced to the extent
permitted by law.
17. Successors and Assigns; Assignment. This Agreement shall be binding upon,
and inure to the benefit of, the parties hereto and their respective heirs,
successors and assigns; provided, however, that no party hereto may assign its
rights or delegate its obligations hereunder without the prior written consent
of the other party hereto.
18. Notices. Any notice to Xxxxx Systems or Company that is required or
permitted by this Agreement shall be addressed to the attention of the CEO with
a copy to the General Counsel at its principal office. Any notice to Champy
that is required or permitted by this Agreement shall be addressed to Champy at
the most recent address for Champy reflected in the appropriate records of the
Company, with a copy to Xxxxx X. Xxxxxxx, Esq., Xxxx and Xxxx, 00 Xxxxx Xxxxxx,
Xxxxxx, XX 00000. Either party may at any time change its address for
notification purposes by giving the other prior written notice of the new
address and the date upon which it will become effective. Whenever this
Agreement requires or permits any notice from one party to another, the notice
must be in writing to be effective. If mailed, a notice hereunder shall be
deemed to have been given on the third business day after the same is enclosed
in an envelope, addressed to the party to be notified at the appropriate
address, properly stamped, sealed and deposited in the United States mail,
certified mail, return receipt requested. If given in any other manner, the
notice will be deemed given when actually received by the recipient.
11
Associate Agreement Revised (May 96)
12
Xxxxx Xxxxxx COMPANY
Xxxxx Systems Corporation
Signed: /s/ XXXXX XXXXXX Signed: /s/ XXXXXX X. XXXXXXXX
------------------------------- ----------------------------
Name: Xxxxxx X. Xxxxxxxx
----------------------------
Date: July 9, 1996 Date: July 9, 1996
------------------------------- ----------------------------
12
Associate Agreement Revised (May 96)
13
Exhibit A
o General Electric
o Pepsico
o Cynergy
o Wisconsin Energy and Northern States Power
(individually and/or combined)
o Factory Mutual Life Insurance Company
o Royal Dutch Shell
o Chrysler
o AMR (American Airlines including SABRE)
o State Street Bank
o ENRON
13
Associate Agreement Revised (May 96)
