EXHIBIT 10.42
EMPLOYMENT AGREEMENT
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AGREEMENT made this 18th day of April, 1995, by and between XXXXXX
INTERNATIONAL, INC., a Maryland corporation, with offices at 000 Xxxxxx Xxxxxx,
Xxxxxxxx, Xxx Xxxxxx 00000 (hereinafter referred to as "Employer") and XXXXXX X.
XXXXXXXX residing at 0000 Xxxxxxxxx Xxxxx, Xxxxxxxxx Xxxxx, Xxxxxxxx 00000
(hereinafter referred to as "Employee").
WHEREAS, the Employer and Employee are desirous of setting forth the terms
and conditions of their employment relationship in writing, it is in
consideration of the mutual promises and covenants hereinafter set forth, agreed
as follows:
1. The Employee is hereby engaged to work in the capacity of Senior Vice
President and Chief Information Officer of Xxxxxx International, Inc., and/or
any other capacity so designated. If and so long as Employee is elected and
appointed to serve as an officer, director, or employee of the Employer or any
of its, parent, affiliate or subsidiary corporations, Employee shall do so at no
additional compensation.
2. The effective date of this Agreement and the commencement of work
hereunder shall be the 10th day of April, 1995, and the employment shall
continue until terminated as hereinafter provided.
3. The Employer agrees as follows:
(A) To pay the Employee a salary at the rate of One Hundred Fifty Eight
Thousand ($158,000.00) Dollars per year, payable in accordance with the
Employer's regularly scheduled pay periods ("Base Salary").
(B) That Employee shall receive such other incidental benefits of
employment, such as insurance, pension plan participation, and vacation, as are
provided generally to Employer's other salaried employees on the same terms as
are applicable to such other employees. These incidental benefits are subject
to change at the discretion of the Employer.
(C) To reimburse the Employee for business expenses incurred in the
execution of his duties, it being expressly understood that all such expenses
are subject to the approval of the Employer. Submission of business expenses
for reimbursement will be in accordance with the Employer's regularly
established procedures and must conform to the Internal Revenue Code.
(D) To pay the Employee a car allowance as more specifically set forth
in Paragraph Eight (8) below.
(E) To pay the Employee a one time signing bonus of Twelve Thousand
Five Hundred ($12,500.00) Dollars, payable within days of Employee's
commencement of employment hereunder.
(F) Employee is eligible for participation in Xxxxxx'x Stock Option
Plan under which options to purchase shares of common stock of Xxxxxx
International, Inc., at the last price traded on NASDAQ on April 10, 1995, will
be granted as follows:
(i) on January 2, 1996, option to purchase 6,250 Xxxxxx
International, Inc., shares shall vest;
(ii) on January 2, 1997, option to purchase 6,250 Xxxxxx
International, Inc., shares shall vest;
(iii) on January 2, 1998, option to purchase 6,250 Xxxxxx
International, Inc., shares shall vest; and
(iv) on January 2, 1999, option to purchase 6,250 of Xxxxxx
International, Inc., shares shall vest.
Options will be granted and will vest only if, on the vesting date
referenced above Employee has been continuously employed by Employer since April
10, 1995. Employee will have ten (10) years from vesting to exercise the
options. This Paragraph is expressly subject to Xxxxxx'x Stock Option Plan.
(F) Employer agrees to pay Employee a Management Objective Bonus
(prorated for the calendar year 1995 and any other year in which Employee is
employed by Employer for less than one (1) full year in accordance with Addendum
A attached hereto.
4. The Employee agrees as follows:
(A) To devote his entire skill, labor, and attention to said employment
during the term of his employment and that he will promptly and faithfully do
and perform all services pertaining to said position that are or may hereafter
be required of him by the Employer during said term.
(B) That any inventions, discoveries, improvements, or works which are
conceived, first reduced to practice, made, developed, suggested by, or created
in anticipation of, in the course of, or as a result of work done under this
Agreement by the Employee shall become the absolute property of the Employer;
and the Employee further agrees that all such inventions, discoveries,
improvements, creations, or works, and all letters, patents, or copyrights that
may be obtained therefore, shall be property of the Employer; and the Employee
agrees to do every act and thing requisite to vest said patents or copyrights in
the Employer without any other or additional compensation or consideration to
the Employee than herein expressed.
(C) That Employer may set-off against any wages, benefits, securities,
or other compensation due the Employee, any amounts owed to the Employer because
of salary, bonus, or incentive advances, excess payments, damage to, or loss of
the Employer's property.
5. The payment of salary, bonus, commission, or incentive hereunder shall
be paid only in the event that the Employee actually works for the Employer so
that the Employer will not be obligated to pay the Employee during periods of
disability or sickness (except as per the required relevant law and corporate
policy), leave of absence, suspension, or similar circumstances. It is not the
intention of this provision to cease payments during the Notification Period.
6. From April 10, 1995 to April 9, 1996, this Agreement may be terminated
by either party for any reason whatsoever by giving the other party twelve (12)
months prior notice. At anytime thereafter this Agreement may be terminated by
either party for any reason whatsoever by giving the other party six (6) months
prior notice. Notwithstanding the above, Employer may terminate Employee and
this Agreement at any time upon notice to Employee for just cause. For purposes
of this Agreement, "just cause" shall be defined to mean the Employee's: (i),
breach of fiduciary duty owed to the Employer; (ii), breach of any
representation, warranty, or covenant in the Employment Agreement; (iii), any
dishonest, or illegal conduct of Employee; or (iv), if the Employee performs,
participates in, or knowingly permits any act of moral turpitude.
In the event of termination by either party; salary, commissions, bonuses,
Incentive Performance Bonus, stock option plans, benefits or rights thereto, and
any other compensation cease as of the date of the termination date except as
required by Paragraphs 18, 19, 20, or 21 herein.
7. The Employee represents and warrants that at the time of the signing of
this Agreement, there is no written or oral contract or of any legal or other
impediment which would inhibit or prohibit the employment herein provided for.
The Employee will not knowingly utilize any trade secret, company confidential
information, or other intellectual property right of another party in the
performance of the Employee's duties hereunder.
8. The Employer will pay the Employee an allowance for the Employee to
provide a car for use on company business. Such allowance shall be Five Hundred
Fifty ($550.00) Dollars per month, and shall cover all costs (except those noted
below) of such car, including but not limited to, purchase, rental, repairs,
insurance, and depreciation. Payments shall be pro-rated in the event of
Employee's termination. Payments are subject to withholding for income tax and
associated payroll deductions pursuant to the current Internal Revenue Code and
regulations promulgated thereunder. The sole additional allowance to be paid by
the Employer with respect to the use of said car on company business shall be
reimbursement for such actual fuel costs incurred on company business at a rate
to be determined in accordance with company policy.
9. The Employer and Employee recognize and agree that the methods employed
in the Employer's business are such as would place the Employee in close
business and personal relationship with the Employer's customers and clients.
It is therefore agreed that in the event of a termination of this Agreement for
any reason whatsoever, the Employee will not for a period of one (1) year from
the date of the termination of this Agreement, either directly or indirectly, on
his account, or as agent, stockholder, owner, employer, employee (or otherwise)
of another, solicit any business from the then customers of the Employer or from
customers of Employer's affiliate or subsidiary corporations that Employee or
any of Employer's employees supervised, directly or indirectly, by Employee may
have contacted at any time during his period of employment. For purposes of
this Clause nine (9), the term "Client" and the term "Customer" includes any and
all affiliates, customers and clients of Employer's client.
10. The Employer and Employee recognize and agree that due to the nature
of the Employer's business, there is generally a lengthy development period
between the time a potential customer or client is actually contacted and the
time when such potential customer or client becomes an actual customer or
client. During this developmental period, Employer generally invests money and
resources and, through its employees, makes numerous contacts, personal and
otherwise, with the potential customers and clients. In light of the foregoing
relationship nurtured during the developmental period and the good will of the
Employer generated during this period, the Employee further agrees that in the
event of a termination of this Agreement for any reason whatsoever, the Employee
will not for a period of one (1) year from the date of termination of this
Agreement, either directly or indirectly, on his own account or as agent,
stockholder, owner, employer, employee (or otherwise) of another, solicit any
business from any potential customers of the Employer or from any potential
customers of Employer's affiliate or subsidiary corporations that the Employee
has contacted or been responsible for, directly or indirectly, at any time
during his period of employment. For purposes of this Clause ten (10), the term
"Client" and the term "Customer" includes any and all affiliates, customers and
clients of Employer's client.
11. The Employee agrees that he will not for a period of one (1) year from
the date of
termination of this Agreement engage in a business similar to that of Employer
in the United States of America. Inasmuch as the Employee is employed for the
wide-ranging responsibility of being the Senior Vice President and Chief
Information Officer of the Employer, the activities proscribed in this Paragraph
Eleven (11) are those services which the Employee provides to the Employer
during the term of this Agreement, services which encompass executive,
management, sales, and marketing functions. The geographical territories
applicable to this Paragraph Eleven (11) are the states and regions where the
Employee or other employees of the Employer who Employee has direct or indirect
responsibility, render the services contemplated by this Agreement. The
boundaries of this Region are as defined by the Employer and are subject to
change from time to time. For purposes of this Clause eleven (11), Employer's
business is defined as ___________________________.
12. Employee agrees that he shall not for the period of one (1) year after
termination of this Agreement, contact or approach, directly or indirectly, for
his own individual purpose or those of another, any employee of Employer or any
employee of Employer's parent, affiliate, or subsidiary corporations with whom
the Employee has personally worked or has knowledge by virtue of his employment
without regard to his/her location, for the purpose of attempting to or actually
soliciting or hiring that employee on his own account or for the account of
another.
13. The Employee acknowledges that all information of the type hereinafter
described, directly or indirectly, disclosed or made available to the Employee
as a result of this employment is valuable property and a trade or business
secret and under the exclusive ownership of the Employer and its affiliate, or
subsidiary corporations, and Employee agrees not to divulge such information to
any individual or business entity. Such valuable proprietary business and trade
secrets are defined for the purposes of this Agreement as Employer and
Employer's affiliate, or subsidiary corporations' methodologies, data, data
bases, procedures, software and software application, source and object codes,
and other programs and designs, marketing information, plans and surveys,
customer or client lists, sales leads, contracts, customer feedback, employee
qualifications, benefits and remuneration, pricing and bid information,
profitability, production techniques, financial and profit plans, and
methodologies, and performance tests.
14. In the event this Agreement shall be terminated for any reason
whatsoever, Employee shall upon such termination deliver immediately to the
Employer's representative all correspondence, letters, copies thereof, software,
code, system information, formulas, designs, techniques, call reports, price
lists, manuals, mailing lists, customer lists, marketing information and plans,
contractor lists, advertising materials, ledgers, supplies, equipment, checks,
xxxxx cash, credit cards, any physical embodiments of a trade or business
secret, as referenced in Paragraph Thirteen (13) above, and all other material,
property and records of any kind that may be in Employee's possession or
control.
15. Employee further agrees not to utilize or make available any such
knowledge or
information, either directly or indirectly, in connection with the establishment
of an enterprise similar to that of the Employer or that which will compete with
Employer, or in connection with the solicitation, acceptance, or conduct of
employment with any other employer.
16. Notwithstanding the above, the Employee will not be prohibited from
utilizing the knowledge and information gained from his general experience
obtained prior to or during his employment with Employer.
17. Employee agrees that should either party seek to enforce or determine
its rights through legal or judicial proceedings because of an act of Employee
which the Employer believes to be in contravention of Paragraphs 9, 10, 11, 12,
13, 14, and/or 15, the covenant period shall be extended for a time period equal
to the period necessary to obtain Judicial enforcement of the Employer's rights
hereunder. In the event of Employee's breach of said Paragraphs, the Employer
may be entitled to a preliminary restraining order and injunction restraining
the Employee from violating the provisions. In addition to the above, Employer
may pursue all other remedies available to Employer for such breach or
threatened breach, including seeking damages and other monetary relief
18. In the event of termination by the Employer, in recognition of
Paragraphs 9, 10, 11, and 12, the Employer will pay Employee fifty (50%) percent
of his weekly Base Salary at the rate as delineated in Paragraph 3 (A) for a
period of one (1) year from the date of termination, payable in equal weekly
installments.
19. In the event of termination by the Employee, in recognition of
Paragraphs 9, 10, 11, and 12, the Employer will pay Employee twenty five (25%)
percent of his weekly salary, at the rate delineated in Paragraph 3 (A) for a
period of one (1) year from date of termination, payable in equal weekly
installments.
20. In the event of termination due to retirement as contemplated under
Employer's retirement policy, in recognition of Paragraphs 9, 10, 11, and 12,
the Employer will pay Employee twenty-five (25%) percent of his weekly salary at
the rate delineated in Paragraph 3 (A) for a period of one (1) year from date of
termination, payable in equal weekly installments.
21. The provisions of Paragraphs 18, 19, and 20 above, are expressly
conditioned upon compliance of said Paragraphs 9, 10, 11, and 12, provided
however, that Employer, at its sole option and discretion, may waive, in whole
or in part, the requirement that the Employee comply with Paragraphs 9, 10, 11,
and 12. In the event that Employer so exercises its option to waive enforcement
of all of said Paragraphs, the payments required pursuant to Paragraphs 18, 19,
and 20 shall be canceled and said Paragraphs shall be rendered void and of no
further force and effect.
22. Should a court of competent jurisdiction determine that any of the
covenants contained in this Paragraph are overbroad or unenforceable because it
determines that the restrictions are unreasonable for reasons including but not
limited to overbroad restrictions as to geographic scope, time, or activity, the
parties agree that the covenants should be enforced to the maximum extent deemed
reasonable by any such court.
23. This Agreement supersedes all prior agreements between the parties and
constitutes and expresses the whole agreement of the parties hereto in reference
to any employment of the Employee by the Employer and in reference to any of the
matters or things herein provided for or hereinafter discussed or mentioned in
reference to such employment, all promises, representations, and understandings
relative thereto being herein merged.
24. No oral arrangements have been made between the parties hereto and
this Agreement may be amended only in writing and signed by both parties.
25. This Agreement shall be construed in accordance with the laws of the
state of New Jersey and any action brought to enforce this Agreement or by
reason of an alleged breach thereof shall be brought on in the state of New
Jersey.
26. The rights and obligations of the Employee and the Employer under this
Agreement shall inure to the benefit of and shall be binding upon their
successors and assigns. The Employee may not assign his obligations under this
Agreement.
27. Those paragraphs which by their nature are intended to survive
termination of this Agreement, including without limitation Paragraphs 4 (B) and
(C), 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, and 22 shall survive
termination of this Agreement.
IN WITNESS WHEREOF, the parties hereto have set their hands and seals the
day and year first above written.
EMPLOYEE XXXXXX INTERNATIONAL, INC.
/s/ Xxxxxx X. Xxxxxxxx /s/ Xxxxxx X. Xxxxx
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XXXXXX X. XXXXXXXX XXXXXX X. XXXXX as its President
and Chief Executive Officer
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WITNESS
