EXHIBIT 10.1
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into on October 15,
2004, effective as of August 4, 2004, by and between Xxxxxx X. Xxxx, an
individual ("Executive") and Gartner, Inc., a Delaware corporation (the
"Company").
1. Employment. Executive will serve as Chief Executive Officer of the
Company for the Employment Term specified in Section 3 below. Executive will
report solely to the Board of Directors and will render such services consistent
with the foregoing role as the Board of Directors (the "Board") may from time to
time direct. Executive's office shall be located at the executive offices of the
Company in Stamford, Connecticut. Executive may (i) serve on corporate, civic or
charitable boards or committees and (ii) deliver lectures, fulfill speaking
engagements or teach at educational institutions, to the extent consistent with
the Company's policies (as applicable) or are disclosed to the Board and the
Board determines in good faith that such activities do not interfere with the
performance of Executive's responsibilities hereunder.
2. Board of Directors. Executive shall be appointed to the Board
immediately upon commencement of his employment, filling the unexpired term of
Xxxxxxx X. Xxxxxxxx. During the Employment Term, the Company shall include
Executive on the Company's slate of nominees to be elected to the Board at
appropriate meetings of stockholders of the Company. Upon termination of the
Employment Term for any reason, Executive shall promptly resign as a director of
the Company if the Board so requests.
3. Term. The employment of Executive pursuant to this Agreement shall
continue through July 31, 2007 (the "Employment Term"), unless extended or
earlier terminated as provided in this Agreement. The Employment Term
automatically shall be extended for additional one-year periods commencing on
August 1, 2007 and continuing each year thereafter, unless either Executive or
the Company gives the other written notice, in accordance with Section 13(a) and
at least 90 days prior to the then scheduled expiration of the Employment Term,
of such party's intention not to extend the Employment Term. Upon termination of
the Employment Term for any reason, Executive shall promptly resign from all
positions he holds with the Company if the Board so requests.
4. Salary. As compensation for the services rendered by Executive under
this Agreement, the Company shall pay to Executive an annual base salary ("Base
Salary") initially equal to $650,000, payable to Executive on a semi-monthly
basis in accordance with the Company's payroll practices as in effect from time
to time during the Employment Term. The Base Salary shall be subject to
adjustment by the Board of Directors of the Company or the Compensation
Committee of the Board of Directors, in the sole discretion of the Board or such
Committee, on an annual basis; provided, however, that Executive's salary may
not be decreased other than pursuant to a reduction consistent with a general
reduction of pay across the executive staff as a group, as an economic or
strategic measure due to poor financial performance by the Company.
5. Bonus. In addition to Base Salary, Executive shall be entitled to
participate in the Company's executive bonus program. Executive's annual target
bonus (the "Target Bonus") shall be 100% of Base Salary, and shall be payable
based on achievement of specified Company and
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individual objectives. The actual bonus paid may be higher or lower than the
Target Bonus for over- or under-achievement of Company and individual
objectives, as determined by the Compensation Committee of the Board (the
"Committee"); provided, however, that the maximum actual bonus will not exceed
200% of Base Salary. Bonus amounts shall be subject to annual adjustment by the
Board or the Committee, in the sole discretion of the Board or the Committee;
provided, however, that Executive's Target Bonus may not be decreased without
Executive's consent other than pursuant to a reduction consistent with a general
reduction of pay across the executive staff as a group, as an economic or
strategic measure due to poor financial performance by the Company. The bonus
for the first twelve (12) months of Executive's employment will be guaranteed at
100% of target ($270,833 for fiscal year 2004 and $379,167 for fiscal year
2005). To receive a bonus, Executive must be an employee at the time bonuses are
paid to executives.
6. Executive Benefits.
(a) Stock Options. On the first market trading day on or after
August 15, 2004, Executive shall be granted a nonqualifed stock option to
purchase an aggregate of 800,000 shares of Class A Common Stock of the Company
(the "Option"), with a per-share exercise price equal to per-share fair market
value of Class A Common Stock of the Company on the date of grant, determined in
accordance with the Company's 2003 Long Term Incentive Plan (the "Plan"). The
Option shall vest in equal annual installments on the first four annual
anniversaries of the date of grant, subject to Executive's continued employment
with the Company on each vesting date, and, except as otherwise provided herein,
shall be on terms consistent with the Company's standard form of notice of grant
and the Plan. Notwithstanding the preceding sentence, if a Change in Control
occurs prior to the termination of Executive's employment and prior to the
expiration of the Option, then the Option shall vest in full and be exercisable
as to all of the covered shares, including shares as to which the Option would
not otherwise be exercisable, and subsequently shall expire in accordance with
its terms.
(b) Restricted Stock. Executive shall be granted 500,000 restricted
shares of Class A Common Stock of the Company (the "Stock Grant"), with a par
value purchase price, on the same day that the Option is granted. Restrictions
shall lapse as to (i) 300,000 shares when the Company's Class A Common Stock
trades at an average price of $20 or more for sixty (60) consecutive trading
days, (ii) 100,000 shares when the Company's Class A Common Stock trades at an
average price of $25 or more for sixty (60) consecutive trading days, and (iii)
100,000 shares when the Company's Class A Common Stock trades at an average
price of $30 or more for sixty (60) consecutive trading days, subject to
Executive's continued employment with the Company through each such date (the
"Vesting Schedule"). Notwithstanding the Vesting Schedule, all restrictions on
the Stock Grant shall lapse in full upon a Change in Control, provided there
still are unvested, outstanding shares. If Executive's employment with the
Company terminates for any reason, any portion of the Stock Grant still subject
to restrictions shall be forfeited to the Company.
(c) Other Employee and Executive Benefits. Executive shall be
entitled to receive all benefits provided to senior executives, executives and
employees of the Company generally from time to time, including medical, dental,
life insurance and long-term disability, and the executive split-dollar life
insurance, executive disability plan, and all other benefits under the Company's
Executive Benefits program, in each case so long as and to the extent the same
exist; provided, that
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in respect to each such plan Executive is otherwise eligible and insurable in
accordance with the terms of such plans. Notwithstanding the preceding sentence,
Executive's right to receive severance payments and benefits shall be only as
provided in Section 7 hereof. Executive also shall be eligible to participate in
the Company's relocation program, in accordance with terms and conditions
outlined in the Company's relocation policy. Relocation expenses must be
incurred within thirty months from the commencement of Executive's employment to
be eligible for reimbursement. If Executive chooses to postpone relocation, the
Company shall provide Executive with an appropriate apartment rental for up to
thirty months. Furthermore, the Company shall provide Executive with an
automobile and driver for Executive's ground transportation needs during the
Employment Term.
(d) Vacation, Sick Leave, Holidays and Sabbatical. Executive shall
be entitled to paid time off ("PTO"), sick leave, holidays and sabbatical in
accordance with the policies of the Company as they exist from time to time.
Executive understands that under the current policy he is entitled to 35 PTO
days per calendar year. PTO not used during any calendar year will roll over to
the following year only to the extent provided under the Company's PTO policies
as they exist from time to time.
7. Severance Benefits.
(a) At Will Employment. Executive's employment shall be "at will."
Either the Company or Executive may terminate this agreement and Executive's
employment at any time, with or without Business Reasons, in its or his sole
discretion, upon sixty (60) days' prior written notice of termination.
(b) Involuntary Termination. If at any time during the term of this
Agreement (other than following a Change in Control to which Section 7(c)
applies) the Company terminates the employment of Executive involuntarily and
without Business Reasons or a Constructive Termination occurs, or if the Company
elects not to renew this Agreement upon the expiration of the Employment Term
and Executive within ninety (90) days following the expiration of the Employment
Term terminates his employment, then, subject to Executive signing and not
revoking a general release of claims against the Company and its successors,
Executive shall be entitled to receive the following: (i) Base Salary and PTO
accrued through the Termination Date plus continued Base Salary for a period of
twenty-four months following the Termination Date, payable in accordance with
the Company's regular payroll schedule as in effect from time to time, (ii) at
the Termination Date, 200% of Executive's Target Bonus for the fiscal year in
which the Termination Date occurs, and any earned but unpaid bonus from the
prior fiscal year, (iii) 24 months' continued vesting under all outstanding
stock options and other equity arrangements subject to vesting and held by
Executive other than any award that vests pursuant to performance-based criteria
(such other awards to include the Stock Grant) (and in this regard, all such
options and other exercisable rights held by Executive shall remain exercisable
for 30 days following the last day of the 24 month continued vesting period,
subject to the maximum term of the award), (iv) reimbursement for premiums
incurred to continue group health benefits (or, at the Company's election, to
obtain substantially similar health benefits through a third party carrier) for
twenty-four (24) months for Executive, his spouse and any children, provided the
Executive makes the appropriate election, and (v) no other compensation,
severance or other benefits, except only that this provision shall not limit any
benefits otherwise available to Executive under Section 7(c)(ii) in the case of
a Change in
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Control. Notwithstanding the foregoing, if Executive violates the provisions set
forth in Section 12, Executive no longer shall be entitled to receive any
severance payments and benefits and Executive's outstanding stock options and
other equity arrangements shall expire immediately.
(c) Change in Control.
(i) Benefits. If during the term of this Agreement a "Change
in Control" occurs, then Executive shall be entitled to receive the following:
(A) Base Salary and PTO accrued through the date of the Change in Control plus
an amount equal to three (3) years of Executive's Base Salary as then in effect,
payable immediately upon the Change in Control, (B) an amount equal to three (3)
times Executive's Target Bonus for the fiscal year in which the Change in
Control occurs (as well as any earned but unpaid bonus from the prior fiscal
year, such bonus not to be multiplied by three (3)), all payable immediately
upon the Change in Control, and (C) (a) for at least three (3) years following
the date of the Change in Control (even if Executive ceases employment),
continuation of group health benefits at the Company's cost pursuant to the
Company's standard programs as in effect from time to time (or at the Company's
election substantially similar health benefits as in effect at the Termination
Date (if applicable), through a third party carrier) for Executive, his spouse
and any children, and (b) thereafter, to the extent COBRA shall be applicable,
continuation of health benefits for such persons at Executive's cost, for a
period of 18 months or such longer period as may be applicable under the
Company's policies then in effect, provided the Executive makes the appropriate
election and payments, and (D) no other compensation, severance or other
benefits.
(ii) Additional Payments by the Company.
A. If any payment or benefit Executive would receive
pursuant to Section 7(c)(i) or otherwise (collectively, the "Payment") would (x)
constitute a "parachute payment" within the meaning of Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code"), and (y) be subject to
the excise tax imposed by Section 4999 of the Code or any interest or penalties
payable with respect to such excise tax (such excise tax, together with any such
interest and penalties, are hereinafter collectively referred to as the "Excise
Tax"), then Executive shall be entitled to receive from the Company an
additional payment (the "Gross-Up Payment," and any iterative payments pursuant
to this paragraph also shall be "Gross-Up Payments") in an amount that shall
fund the payment by Executive of any Excise Tax on the Payment, as well as all
income and employment taxes on the Gross-Up Payment, any Excise Tax imposed on
the Gross-Up Payment and any interest or penalties imposed with respect to
income and employment taxes imposed on the Gross-Up Payment.
B. Subject to the provisions of clause F below, all
determinations required to be made under this Section 7(c)(ii), including
whether an Excise Tax is payable by Executive and the amount of such Excise Tax
and whether a Gross-Up Payment is required and the amount of such Gross-Up
Payment, will be made by the Company's independent certified public accountants
prior to the Change in Control (the "Accounting Firm"). The Company will direct
the Accounting Firm to submit its determination and detailed supporting
calculations to both the Company and Executive within fifteen (15) calendar days
after the date of the Change in Control or the date of Executive's termination
of employment, if applicable, and any other such time or times as
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may be requested by the Company or Executive. If the Accounting Firm determines
that any Excise Tax is payable by Executive, the Company will pay the required
Gross-Up Payment to Executive within five business days after receipt of such
determination and calculations. If the Accounting Firm determines that no Excise
Tax is payable by Executive, it will, at the same time as it makes such
determination, furnish Executive with an opinion that he has substantial
authority not to report any Excise Tax on his federal, state, local income or
other tax return. Any determination by the Accounting Firm as to the amount of
the Gross-Up Payment will be binding upon the Company and Executive. As a result
of the uncertainty in the application of Section 4999 of the Code (or any
successor provision thereto) and the possibility of similar uncertainty
regarding applicable state or local tax law at the time of any determination by
the Accounting Firm hereunder, it is possible that Gross-Up Payments which will
not have been made by the Company should have been made (an "Underpayment"),
consistent with the calculations required to be made hereunder. In the event
that the Company exhausts or fails to pursue its remedies pursuant to clause F
below and Executive thereafter is required to make a payment of any Excise Tax,
the Company or Executive may direct the Accounting Firm to determine the amount
of the Underpayment that has occurred and to submit its determination and
detailed supporting calculations to both the Company and Executive as promptly
as possible. Any such Underpayment will be promptly paid by the Company to
Executive within twenty days after receipt of such determination and
calculations.
C. The Company and Executive will each provide the
Accounting Firm access to and copies of any books, records and documents in the
possession of the Company or Executive, as the case may be, reasonably requested
by the Accounting Firm, and otherwise cooperate with the Accounting Firm in
connection with the preparation and issuance of the determination contemplated
by clause B above.
D. The federal, state and local income or other tax
returns filed by Executive will be prepared and filed on a consistent basis with
the determination of the Accounting Firm with respect to the Excise Tax payable
by Executive. Executive will make proper payment of the amount of any Excise
Tax, and at the request of the Company, provide to the Company true and correct
copies (with any amendments) of his federal income tax return as filed with the
Internal Revenue Service and corresponding state and local tax returns, if
relevant, as filed with the applicable taxing authority, and such other
documents reasonably requested by the Company, evidencing such payment. If prior
to the filing of Executive's federal income tax return, or corresponding state
or local tax return, if relevant, the Accounting Firm determines that the amount
of the Gross-Up Payment should be reduced, Executive will within twenty (20)
days thereafter pay to the Company the amount of such reduction.
E. The fees and expenses of the Accounting Firm for its
services in connection with the determinations and calculations contemplated by
clauses B and D above will be borne by the Company. If such fees and expenses
are initially advanced by Executive, the Company will reimburse Executive the
full amount of such fees and expenses within twenty (20) days after receipt from
Executive of a statement therefore and reasonable evidence of his payment
thereof.
F. Executive will notify the Company in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of a Gross-Up Payment. Such notification will be given as
promptly as practicable but no later than ten (10)
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business days after Executive actually receives notice of such claim and
Executive will further apprise the Company of the nature of such claim and the
date on which such claim is requested to be paid (in each case, to the extent
known by Executive). Executive will not pay such claim prior to the earlier of
(i) the expiration of the 30-calendar-day period following the date on which he
gives such notice to the Company and (ii) the date that any payment of amount
with respect to such claim is due. If the Company notifies Executive in writing
prior to the expiration of such period that it desires to contest such claim,
Executive will:
(i) provide the Company with any written records
or documents in his possession relating to such claim reasonably requested by
the Company;
(ii) take such action in connection with
contesting such claim as the Company will reasonably request in writing from
time to time, including without limitation accepting legal representation with
respect to such claim by an attorney competent in respect of the subject matter
and reasonably selected by the Company;
(iii) cooperate with the Company in good faith in
order effectively to contest such claim; and
(iv) permit the Company to participate in any
proceedings relating to such claim;
provided, however, that the Company will bear and pay directly all costs
and expenses (including interest and penalties) incurred in connection with such
contest and will indemnify and hold harmless Executive, on an after-tax basis,
for and against any Excise Tax or income tax, including interest and penalties
with respect thereto, imposed as a result of such representation and payment of
costs and expenses. Without limiting the foregoing provisions of this clause F,
the Company will control all proceedings taken in connection with the contest of
any claim contemplated by this clause F and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings, hearings and conferences
with the taxing authority in respect of such claim (provided that Executive may
participate therein at his own cost and expense) and may, at its option, either
direct Executive to pay the tax claimed and xxx for a refund or contest the
claim in any permissible manner, and Executive agrees to prosecute such contest
to a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company will determine;
provided, however, that if the Company directs Executive to pay the tax claimed
and xxx for a refund, the Company will advance the amount of such payment to
Executive on an interest-free basis and will indemnify and hold Executive
harmless, on an after-tax basis, from any Excise Tax or income tax, including
interest or penalties with respect thereto, imposed with respect to such
advance; and provided further, however, that any extension of the statute of
limitations relating to payment of taxes for the taxable year of Executive with
respect to which the contested amount is claimed to be due is limited solely to
such contested amount. Furthermore, the Company's control of any such contested
claim will be limited to issues with respect to which a Gross-Up Payment would
be payable hereunder and Executive will be entitled to settle or contest, as the
case may be, any other issue raised by the Internal Revenue Service or any other
taxing authority.
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G. If, after the receipt by Executive of an amount
advanced by the Company pursuant to clause F above, Executive receives any
refund with respect to such claim, Executive will (subject to the Company's
complying with the requirements of clause F above) within twenty (20) days
thereafter pay to the Company the amount of such refund (together with any
interest paid or credited thereon after any taxes applicable thereto). If, after
the receipt by Executive of an amount advanced by the Company pursuant to clause
F above, a determination is made that Executive will not be entitled to any
refund with respect to such claim and the Company does not notify Executive in
writing of its intent to contest such denial or refund prior to the expiration
of thirty (30) days after such determination, then such advance will be forgiven
and will not be required to be repaid and the amount of such advance will
offset, to the extent thereof, the amount of Gross-Up Payment required to be
paid pursuant to this Section 7(c)(ii).
(d) Termination for Disability. If at any time during the Employment
Term Executive becomes unable to perform his duties as an employee as a result
of incapacity, which gives rise to termination of employment for Disability,
then (i) Executive shall be entitled to receive payments and benefits in
accordance with the Company's then applicable plans, policies, and arrangements
and (ii) Executive's outstanding stock options and other equity arrangements
shall expire in accordance with the terms of the applicable award agreement(s).
(e) Voluntary Termination, Involuntary Termination for Business
Reasons or Termination following a Change in Control. If (i) Executive
voluntarily terminates his employment (other than in the case of a Constructive
Termination), (ii) Executive is terminated involuntarily for Business Reasons,
or (iii) Executive's employment is terminated following a Change in Control to
which Section 7(c) applies, then in any such event (A) all further vesting of
Executive's stock options and other equity arrangements will cease immediately
and such awards will expire in accordance with the terms of the applicable award
agreement(s), (B) all payments of compensation by the Company to Executive
hereunder will terminate immediately (except as to amounts already earned), and
(C) Executive will not be entitled to any severance but Executive will be paid
all accrued but unpaid PTO, expense reimbursements and other benefits due to
Executive through his termination date under any Company-provided or paid plans,
policies, and arrangements.
(f) Termination Upon Death. If Executive's employment is terminated
because of death, then (i) Executive's representatives shall be entitled to
receive payments and benefits in accordance with the Company's then applicable
plans, policies, and arrangements and (ii) Executive's outstanding stock options
and other equity arrangements shall expire in accordance with the terms of the
applicable award agreement(s).
(g) Exclusivity. The provisions of this Section 7 are intended to be
and are exclusive and in lieu of any other rights or remedies to which Executive
or the Company may otherwise be entitled, either at law, tort or contract, in
equity, or under this Agreement, in the event of any termination of Executive's
employment. Executive shall be entitled to no benefits, compensation or other
payments or rights upon termination of employment other than those benefits
expressly set forth in paragraph (b), (c), (d), (e) or (f) of this Section 7,
whichever shall be applicable and those benefits required to be provided by law.
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(h) Mitigation. Amounts provided under this Section 7 shall not be
reduced by any future earnings Executive may receive following the termination
of his employment with the Company.
8. Definition of Terms. The following terms referred to in this Agreement
shall have the following meanings:
(a) Business Reasons. "Business Reasons" means (i) gross negligence,
willful misconduct or other willful malfeasance by Executive in the performance
of his duties, (ii) Executive's conviction of a felony, or an other criminal
offense involving moral turpitude, or (iii) Executive's material breach of this
Agreement, including without limitation any repeated breach of Sections 9
through 12 hereof, provided that, in the case of any such breach, the Board
provides written notice of breach to the Executive, specifically identifying the
manner in which the Board believes that Executive has materially breached this
Agreement, and Executive shall have the opportunity to cure such breach to the
reasonable satisfaction of the Board within thirty (30) days following the
delivery of such notice. For purpose of this paragraph, no act or failure to act
by Executive shall be considered "willful" unless done or omitted to be done by
Executive in bad faith or without reasonable belief that Executive's action or
omission was in the best interests of the Company or its affiliates. Any act, or
failure to act, based upon authority given pursuant to a resolution duly adopted
by the Board or based upon the advice of counsel for the Company shall be
conclusively presumed to be done, or omitted to be done, by Executive in good
faith and in the best interests of the Company. The Board must notify Executive
of any event constituting Business Reasons within ninety (90) days following any
Board member's (excluding Executive) actual knowledge of its existence (which
period shall be extended during the period of any reasonable investigation
conducted in good faith by or on behalf of the Board) or such event shall not
constitute Business Reasons under this Agreement.
(b) Disability. "Disability" shall mean that Executive has been
unable to perform his duties as an employee as the result of his incapacity due
to physical or mental illness, and such inability, at least 26 weeks after its
commencement, is determined to be total and permanent by a physician selected by
the Company's insurers. Termination resulting from Disability may only be
effected after at least sixty (60) days written notice by the Company of its
intention to terminate Executive's employment. In the event that Executive
resumes the performance of substantially all of his duties hereunder before the
termination of his employment becomes effective, the notice of intent to
terminate automatically shall be deemed to have been revoked.
(c) Termination Date. "Termination Date" shall mean (i) if this
Agreement is terminated on account of death, the date of death; (ii) if this
Agreement is terminated for Disability, the date specified in Section 8(b);
(iii) if this Agreement is terminated by the Company, the date on which
indicated in a notice of termination is given to Executive by the Company in
accordance with Sections 7(a) and 13(a); (iv) if the Agreement is terminated by
Executive, the date indicated in a notice of termination given to the Company by
Executive in accordance with Sections 7(a) and 13(a); or (v) if this Agreement
expires by its terms, then the last day of the term of this Agreement.
(d) Constructive Termination. A "Constructive Termination" shall be
deemed to occur if Executive elects to voluntarily terminate employment within
the ninety (90) day period
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immediately following any of the following events: (i) Executive's position
changes as a result of an action by the Company such that (A) Executive shall no
longer be Chief Executive Officer of the Company, (B) Executive shall have
duties and responsibilities demonstrably less than those typically associated
with a Chief Executive Officer, or (C) Executive shall no longer report directly
to the Company's Board of Directors; provided that if the Board determines by
unanimous vote of all directors (excluding Executive) that it is required either
by law or by rule of any exchange or listing entity whose rules must be complied
with in order for the Company to maintain such listing that Executive not be
Chief Executive Officer, then the involuntary removal of Executive from the
position of Chief Executive Officer will not, in and of itself, constitute a
Constructive Termination, (ii) Executive is required to relocate his place of
employment, other than a relocation within fifty (50) miles of the Company's
current Stamford headquarters, (iii) there is a reduction in Executive's Base
Salary or Target Bonus other than any such reduction consistent with a general
reduction of pay across the executive staff as a group, as an economic or
strategic measure due to poor financial performance by the Company or (iv) there
occurs any other material breach of this Agreement by the Company (other than a
reduction of Executive's Base Salary or Target Bonus which is not described in
the immediately preceding clause (iii) or the termination of Executive's service
as a director due to applicable legal or listing requirements or stockholders
failing to reelect Executive to the Board) after a written demand for
substantial performance is delivered to the Board by Executive which
specifically identifies the manner in which Executive believes that the Company
has materially breached this Agreement, and the Company has failed to cure such
breach to the reasonable satisfaction of Executive within thirty (30) days
following the delivery of such notice.
(e) Change in Control. "Change in Control" shall have the same
meaning as in the Company's 2003 Long Term Incentive Plan.
9. Confidential Information.
(a) Executive acknowledges that the Confidential Information
relating to the business of the Company and its subsidiaries which Executive has
obtained or will obtain during the course of his association with the Company
and subsidiaries and his performance under this Agreement are the property of
the Company and its subsidiaries. Executive agrees that he will not disclose or
use at any time, either during or after the Employment period, any Confidential
Information without the written consent of the Board of Directors of the
Company, other than proper disclosure or use in the performance of his duties
hereunder. Executive agrees to deliver to the Company at the end of the
Employment Term, or at any other time that the Company may request, all
memoranda, notes, plans, records, documentation and other materials (and copies
thereof) containing Confidential Information relating to the business of the
Company and its subsidiaries, no matter where such material is located and no
matter what form the material may be in, which Executive may then possess or
have under his control. If requested by the Company, Executive shall provide to
the Company written confirmation that all such materials have been delivered to
the Company or have been destroyed. Executive shall take all appropriate steps
to safeguard Confidential Information and to protect it against disclosure,
misuse, espionage, loss and theft.
(b) "Confidential Information" shall mean information which is not
generally known to the public and which is used, developed, or obtained by the
Company or its subsidiaries relating to the businesses of any of the Company and
its subsidiaries or the business of any customer thereof
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including, but not limited to: products or services; fees, costs and pricing
structure; designs; analyses; formulae; drawings; photographs; reports; computer
software, including operating systems, applications, program listings, flow
charts, manuals and documentation; databases; accounting and business methods;
inventions and new developments and methods, whether patentable or unpatentable
and whether or not reduced to practice; all copyrightable works; the customers
of any of the Company and its subsidiaries and the Confidential Information of
any customer thereof; and all similar and related information in whatever form.
Confidential Information shall not include any information which (i) was
rightfully known by Executive prior to the Employment Term; (ii) is publicly
disclosed by law or in response to an order of a court or governmental agency;
(iii) becomes publicly available through no fault of Executive or (iv) has been
published in a form generally available to the public prior to the date upon
which Executive proposes to disclose such information. Information shall not be
deemed to have been published merely because individual portions of the
information have been separately published, but only if all the material
features comprising such information have been published in combination.
10. Inventions and Patents. In the event that Executive, as a part of
Executive's activities on behalf of the Company, generates, authors or
contributes to any invention, new development or method, whether or not
patentable and whether or not reduced to practice, any copyrightable work, any
trade secret, any other Confidential Information, or any information that gives
any of the Company and its subsidiaries an advantage over any competitor, or
similar or related developments or information related to the present or future
business of any of the Company and its subsidiaries (collectively "Developments
and Information"), Executive acknowledges that all Developments and Information
are the exclusive property of the Company. Executive hereby assigns to the
Company, its nominees, successors or assigns, all rights, title and interest to
Developments and Information. Executive shall cooperate with the Company's Board
of Directors to protect the interests of the Company and its subsidiaries in
Developments and Information. Executive shall execute and file any document
related to any Developments and Information requested by the Company's Board of
Directors including applications, powers of attorney, assignments or other
instruments which the Company's Board of Directors deems necessary to apply for
any patent, copyright or other proprietary right in any and all countries or to
convey any right, title or interest therein to any of the Company's nominees,
successors or assigns.
11. No Conflicts.
(a) Executive agrees that in his individual capacity he will not
enter into any agreement, arrangement or understanding, whether written or oral,
with any supplier, contractor, distributor, wholesaler, sales representative,
representative group or customer, relating to the business of the Company or any
of its subsidiaries, without the express written consent of the Board.
(b) As long as Executive is employed by the Company or any of its
subsidiaries, Executive agrees that he will not, except with the express written
consent of the Board, become engaged in, render services for, or permit his name
to be used in connection with, any for-profit business other than the business
of the Company, any of its subsidiaries or any corporation or partnership in
which the Company or any of its subsidiaries have an equity interest.
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12. Non-Competition Agreement.
(a) Executive acknowledges that his services are of a special,
unique and extraordinary value to the Company and that he has access to the
Company's trade secrets, Confidential Information and strategic plans of the
most valuable nature. Accordingly, Executive agrees that for the period of
twenty-four (24) months following the Termination Date, Executive shall not
directly or indirectly own, manage, control, participate in, consult with,
render services for, or in any manner engage in any business competing with the
businesses of the Company or any of its subsidiaries as such businesses exist or
are in process of development on the Termination Date (as evidenced by written
proposals, market research or similar materials), including without limitation
the publication of periodic research and analysis of the information technology
industries. Nothing herein shall prohibit Executive from being a passive owner
of not more than 1% of the outstanding stock of any class of a corporation that
is publicly traded, so long as Executive has no active participation in the
business of such corporation.
(b) In addition, for a period of twenty-four (24) months commencing
on the Termination Date, Executive shall not (i) directly or indirectly induce
or attempt to induce any employee of the Company or any subsidiary (other than
his own assistant) to leave the employ of the Company or such subsidiary, or in
any way interfere with the relationship between the Company or any subsidiary
and any employee thereof, (ii) hire directly or through another entity any
person who was an employee of the Company or any subsidiary at any time during
the then preceding 12 months, (iii) directly or indirectly induce or attempt to
induce any customer, supplier, licensee or other business relation of the
Company or any subsidiary to cease doing business with the Company or such
subsidiary, or in any way interfere with the relationship between any such
customer, supplier, licensee or business relation and the Company or any
subsidiary, or (iv) disparage the Company, its executive officers, or its
directors.
(c) Executive agrees that these restrictions on competition and
solicitation shall be deemed to be a series of separate covenants not-to-compete
and a series of separate non-solicitation covenants for each month within the
specified periods, separate covenants not-to-compete and non-solicitation
covenants for each state within the United States and each country in the world,
and separate covenants not-to-compete for each area of competition. If any court
of competent jurisdiction shall determine any of the foregoing covenants to be
unenforceable with respect to the term thereof or the scope of the subject
matter or geography covered thereby, such remaining covenants shall nonetheless
be enforceable by such court against such other party or parties or upon such
shorter term or within such lesser scope as may be determined by the court to be
enforceable.
(d) Because Executive's services are unique and because Executive
has access to Confidential Information and strategic plans of the Company of the
most valuable nature, the parties agree that the covenants contained in this
Section 12 are necessary to protect the value of the business of the Company and
that a breach of any such covenant would result in irreparable and continuing
damage for which there would be no adequate remedy at law. The parties agree
therefore that in the event of a breach or threatened breach of this Agreement,
the Company or its successors or assigns may, in addition to other rights and
remedies existing in their favor, apply to any court of competent jurisdiction
for specific performance and/or injunctive or other relief in order to enforce,
or prevent any violations of, the provisions hereof.
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13. Miscellaneous Provisions.
(a) Notice. Notices and all other communications contemplated by
this Agreement shall be in writing, shall be effective when given, and in any
event shall be deemed to have been duly given (i) when delivered, if personally
delivered, (ii) three (3) business days after deposit in the U.S. mail, if
mailed by U.S. registered or certified mail, return receipt requested, or (iii)
one (1) business day after the business day of deposit with Federal Express or
similar overnight courier, if so delivered, freight prepaid. In the case of
Executive, notices shall be addressed to him at the home address which he most
recently communicated to the Company in writing. In the case of the Company,
notices shall be addressed to its corporate headquarters, and all notices shall
be directed to the attention of its Corporate Secretary.
(b) Notice of Termination. Any termination by the Company or
Executive shall be communicated by a notice of termination to the other party
hereto given in accordance with paragraph (a) hereof. Such notice shall indicate
the specific termination provision in this Agreement relied upon.
(c) Successors.
(i) Company's Successors. Any successor to the Company
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company's business and/or assets shall be entitled to assume the rights and
shall be obligated to assume the obligations of the Company under this Agreement
and shall agree to perform the Company's obligations under this Agreement in the
same manner and to the same extent as the Company would be required to perform
such obligations in the absence of a succession. For all purposes under this
Agreement, the term "Company" shall include any successor to the Company's
business and/or assets which executes and delivers the assumption agreement
described in this subsection (i) or which becomes bound by the terms of this
Agreement by operation of law.
(ii) Executive's Successors. The terms of this Agreement and
all rights of Executive hereunder shall inure to the benefit of, and be
enforceable by, Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
(iii) No Other Assignment of Benefits. Except as provided in
this Section 13(c), the rights of any person to payments or benefits under this
Agreement shall not be made subject to option or assignment, either by voluntary
or involuntary assignment or by operation of law, including (without limitation)
bankruptcy, garnishment, attachment or other creditor's process, and any action
in violation of this subsection (iii) shall be void.
(d) Waiver. No provision of this Agreement shall be modified, waived
or discharged unless the modification, waiver or discharge is agreed to in
writing and signed by Executive and by an authorized officer of the Company
(other than Executive). No waiver by either party of any breach of, or of
compliance with, any condition or provision of this Agreement by the other party
shall be considered a waiver of any other condition or provision or of the same
condition or provision at another time.
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(e) Entire Agreement. This Agreement shall supersede any and all
prior agreements, representations or understandings (whether oral or written and
whether express or implied) between the parties with respect to the subject
matter hereof.
(f) Severability. The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in full force
and effect.
(g) Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
New York, New York, in accordance with the rules of the American Arbitration
Association then in effect. Judgment may be entered on the arbitrator's award in
any court having jurisdiction. No party shall be entitled to seek or be awarded
punitive damages. All attorneys fees and costs shall be allocated or apportioned
as agreed by the parties or, in the absence of an agreement, in such manner as
the arbitrator or court shall determine to be appropriate to reflect the final
decision of the deciding body as compared to the initial positions in
arbitration of each party. This Agreement shall be construed in accordance with
and governed by the laws of the State of New York as they apply to contracts
entered into and wholly to be performed within such State by residents thereof.
(h) Withholding of Taxes. All payments made pursuant to this
Agreement will be subject to withholding of applicable taxes.
(i) Indemnification. Executive will be covered under the Company's
insurance policies and, subject to applicable law, will be provided
indemnification to the maximum extent permitted by the Company's bylaws and
Certificate of Incorporation, with such insurance coverage and indemnification
to be in accordance with the Company's standard practices for senior executive
officers but on terms no less favorable than provided to any other Company
senior executive officer or director.
(j) Compliance with Company Policies. During the Employment Term,
Executive will comply with all Company policies generally applicable to the
Company's executive officers.
(k) Legal Fees. The Company will pay directly the reasonable fees
and expenses of counsel retained by Executive in connection with the
preparation, negotiation and execution of this Agreement (and the offer letter
that preceded this Agreement), up to a maximum of $10,000.
(l) Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together will
constitute one and the same instrument.
o O o
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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by its duly authorized officer, as of the day and year
first above written.
GARTNER, INC.
By: /s/ Xxxxxxx X. Xxxx, Xx.
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Xxxxxxx X. Xxxx, Xx., Chairman,
Compensation Committee of the Board of
Directors
XXXXXX X. XXXX
/s/ Xxxxxx X. Xxxx
------------------------------------------
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