EXHIBIT 10.12
PART-TIME EMPLOYMENT AGREEMENT
This Part-Time Employment Agreement (the "Agreement") is entered
into as of June 15, 1998 between Technology Solutions Company, a Delaware
Corporation (the "Company" or "TSC") and Xxxxxxx X. XxXxxxxxxx (the
"Executive").
WHEREAS, Executive currently serves as an Executive Vice President and
member of the Board of Directors of the Company, and has served in that
capacity since he joined the Company on May 31, 1996;
WHEREAS, Executive entered into an Employment Agreement ("Employment
Agreement") effective May 31, 1996, which is attached as Exhibit A hereto;
WHEREAS, Executive entered into a Stock Option Agreement ("Option
Agreement") with an Option Date of May 31, 1996, which provides, INTER ALIA,
that Executive receives an option to purchase 101,250 shares of Technology
Solutions Company stock at an exercise price of $15.7222.
WHEREAS, the Company and the Executive desire to resolve various matters
by terminating Executive's full-time employment and the Employment Agreement
and simultaneously commencing Executive's employment on a part-time basis in
accordance with the terms of this Agreement;
WHEREAS, Executive is willing and agrees to resign from the Board of
Directors of the Company as provided below;
NOW, THEREFORE, in consideration of the mutual promises and agreements
contained herein, the adequacy and sufficiency of which are hereby
acknowledged, the Company and the Executive hereby agree as follows:
1. TERMINATION OF EMPLOYMENT. The Employment Agreement and
Executive's employment as a TSC Executive Vice President and full-time
employee pursuant to the Employment Agreement will terminate effective June
15, 1998; however, Executive's employment as a part-time employee will
continue pursuant to this Agreement.
2. RESIGNATION FROM BOARD OF DIRECTORS. Executive agrees to resign
from the Board of Directors of the Company, effective no later than July 15,
1998, by executing and submitting the Resignation attached hereto as
Exhibit B.
3. TERMS OF PART-TIME EMPLOYMENT. Executive's employment as a TSC
part-time employee pursuant to this Agreement shall commence effective June
15, 1998. During the period commencing June 15, 1998 and ending on May 31,
1999 (the "Part-Time Employment Period"), Executive shall receive a base
salary of $15,302 for the
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month of June 1998 and $30,604 for each of the eleven full months thereafter,
less applicable deductions for taxes. Executive shall have the title "of
counsel" to TSC. In exchange for his salary, Executive shall perform such
services for TSC as he and TSC's President and Chief Executive Officer may
reasonably agree throughout the Part-Time Employment Period. It is
understood and agreed that Executive shall be required to report only to the
President and Chief Executive Officer, shall be permitted in his reasonable
discretion to provide services orally and not in writing, and shall be free
to provide services from any location and generally at his convenience. TSC
shall pay the full amount of Executive's health benefits throughout the
Part-Time Employment Period. Unless expressly authorized by the Chief
Executive Officer of TSC, Executive shall perform the foregoing duties
without the power to bind, represent, or speak for the Company. TSC may
terminate Employee's part-time employment and this Agreement immediately
without notice and with no salary and benefit continuation if Employee
engages in "Serious Misconduct." For purposes of this Agreement, "Serious
Misconduct" means embezzlement or misappropriation of corporate funds, other
acts of dishonesty, or any of the following after reasonable notice to
Executive and opportunity to cure: significant activities materially harmful
to TSC's reputation; willful refusal to perform or substantial disregard of
Employee's assigned duties; or any significant violation of any statutory or
common law duty of loyalty to TSC; provided, however, that it is expressly
understood and agreed that for purposes of this Agreement any activity
contemplated in Section 5 below shall be deemed not to involve a violation of
any such duty of loyalty.
4. WAIVER OF SEVERANCE. Executive hereby expressly waives his rights
and releases TSC from its obligations pursuant to Section 3 (a) of the
Employment Agreement pertaining to severance compensation, and the parties
agree that in lieu thereof Executive shall be entitled to receive the
compensation set forth in Section 3 of this Agreement.
5. WAIVER OF NON-COMPETITION. TSC hereby expressly waives its rights
and releases Executive from all non-competition agreements or provisions in
the Employment Agreement, including without limitation, Section 8(c) thereof.
During the Part-Time Employment Period, Executive need not provide his
undivided business time to provide consulting services for TSC, and Executive
shall be permitted to perform consulting work outside of TSC on his own
behalf for third parties that are not clients of TSC when the services are
being performed; provided however, that throughout the Part-Time Employment
Period, Executive shall pay to TSC ten percent (10%) of all revenue derived
by Executive, directly or indirectly, from providing such outside consulting
services. Such payment to TSC shall be made by Executive quarterly within 30
days after the end of each calendar quarter. Each payment shall be
accompanied by reasonably detailed information regarding the nature and
source of all outside consulting work and the revenue derived therefrom as
Executive and TSC may agree.
6. TREATMENT OF STOCK OPTIONS. Executive's Option Agreement (attached
hereto as Exhibit A) shall remain in full force and effect throughout the
Part-Time Employment Period. For purposes of the Option Agreement,
Executive's employment with TSC shall terminate on May 31, 1999.
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7. CONFIDENTIALITY. Executive acknowledges that the successful
development and marketing of Company's professional services and products
require substantial time and expense. Such efforts generate for Company
valuable and proprietary information ("Confidential Information") which gives
Company a business advantage over others who do not have such information.
Confidential Information of Company and its clients and prospects includes
but is not limited to the following: business strategies and plans,
proposals, deliverables, prospects and customer lists, methodologies,
training materials, and computer software. Executive acknowledges that
during the course of his employment he has and during the Part-Time
Employment Period he will continue to obtain knowledge of such Confidential
Information. Accordingly, Executive agrees during the Part-Time Employment
Period and thereafter to undertake the following obligations which he
acknowledges to be reasonably designed to protect Company's legitimate
business interests without unnecessarily or unreasonably restricting
Executive's post-employment opportunities:
(a) Promptly following the Part-Time Employment Period, Executive shall
return all Company property, including but not limited to all computer
equipment owned by the Company, all computer programs, files, notes, records,
charts, or other documents or things containing in whole or in part any of
Company's Confidential Information;
(b) Executive agrees that during the Part-Time Employment Period and
subsequent thereto, he will continue to treat all such information as
confidential and to take all necessary precautions against disclosure of such
information to third parties. Executive shall refrain from using or
disclosing to any person, without the prior written approval of TSC's Chief
Executive Officer any Confidential Information unless at that time the
information has become generally and lawfully known to Company's competitors;
(c) During the Part-Time Employment Period, Executive shall not without
the approval of the Company's Chief Executive Officer induce or assist in the
inducement of any TSC employee away from TSC's employ or from the faithful
discharge of such employee's contractual and fiduciary obligations to serve
TSC's interests with undivided loyalty;
Executive recognizes and agrees that a breach of any or all of the provisions
of this Section 7 may constitute immediate and irreparable harm to the
Company's business advantage, including but not limited to the Company's
valuable business relations, for which damages cannot be readily calculated
and for which damages are an inadequate remedy. Accordingly, the Executive
acknowledges that the Company shall therefore be entitled to an order
enjoining any further breaches by the Executive.
8. COVENANT NOT TO XXX THE COMPANY. The Executive releases and
forever discharges the Company and any of its divisions, affiliates, or other
related entities (whether or not such entities are wholly owned), any of
their respective shareholders, officers, directors, employees, agents,
attorneys and representatives, and the predecessors, successors, and assigns
of each of them (hereinafter jointly referred to as the "Company Parties"),
with respect to any and all known or unknown claims which the Executive now
has, has ever had, or may in the future have, against any of the Company
Parties for or
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related in any way to anything occurring up to and including the date hereof,
including those for or related in any way to any contract or tort law
relating to his rights as an employee to compensation, benefits, or rights to
employment, fair employment, or any other federal, state, or local law,
regulation, or ordinance, such as Title VII of the Civil Rights Act of 1964,
the Employee Retirement Income Security Act, the Americans with Disabilities
Act, the Age Discrimination in Employment Act, or under any compensation,
bonus, severance, retirement, or other benefit plan or arrangement.
Notwithstanding these provisions, the Executive does not release any claims
against the Company Parties that he has or may have arising out of any claim
by him for indemnification under the Company's charter and by-laws because of
any claim by any person. Nothing contained in this Section 7, however, shall
apply to, or release any of the Company Parties from, any obligation
contained in this Agreement.
9. COVENANT NOT TO XXX EXECUTIVE. The Company, its affiliates and
related entities, and their past, present, and future partners, trustees,
fiduciaries, administrators, directors, officers, agents, and the
predecessors, successors, and assigns of each of them, hereby release and
forever discharge the Executive, his past, present, and future agents,
attorneys, representatives, heirs, executors, administrators, spouses,
family, and the predecessors, successors, and assigns of each of them with
respect to any and all claims, whether known or unknown, which the Company
has, or has ever had or may have in the future, against him for or related in
any way to anything occurring up to and including the date hereof. Nothing
contained in this Section 9, however, shall apply to or release the Executive
from any obligation contained in this Agreement.
11. GOVERNING LAW; VALIDITY. The interpretation, construction, and
performance of this Agreement shall be governed by and construed and enforced
in accordance with the internal laws of the State of Illinois without regard
to the principle of conflicts of laws. The invalidity or unenforceability of
any provision of this Agreement shall not affect the validity or
enforceability of any of the other provisions of this Agreement, which other
provisions shall remain in full force and effect.
12. SUBMISSION TO ARBITRATION. Any controversy or claim arising out of
or relating to this contract, or the breach thereof, shall be settled by
binding arbitration in accordance with the Commercial Arbitration Rules of
the American Arbitration Association, and judgment upon the award rendered by
the arbitrator may be entered in any court having jurisdiction thereof.
13. MISCELLANEOUS. No provision of this Agreement may be modified or
waived unless such modification or waiver is agreed to in writing and signed
by the Executive and by a duly authorized officer of the Company. No waiver
by either party hereto at any time of any breach by the other party hereto
of, or compliance with, any condition or provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time. Failure by the Executive or the Company to insist upon strict
compliance with any provision of this Agreement or to assert any right which
the
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Executive or the company may have hereunder shall not be deemed to be a
waiver of such provision or right or any other provision or right of this
Agreement.
14. REVOCATION PERIOD. In signing below, Executive expressly
acknowledges that he has read this Agreement carefully, that he fully
understands its terms and conditions, that he has been advised of his rights
and has consulted an attorney prior to executing this Agreement, that he has
had at least 21 days to decide whether or not to release any claims under
the Age Discrimination in Employment Act, and that he intends to be legally
bound by it. During a period of seven days following the date of his
execution of this Agreement, Executive shall have the right to revoke this
Agreement by serving within such period written notice of revocation. Upon
any such revocation, neither the Executive nor the Company shall have any
further rights or obligations under the Agreement, except that Executive
shall within two business days return all payments made to the Executive by
the Company.
15. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original and all of
which together shall constitute one and the same instrument.
16. SECTION HEADINGS. The section headings used herein are for
convenience of reference only, are not part of this Agreement, and are not to
affect the construction of or be taken into consideration in interpreting
this Agreement.
17. ANNOUNCEMENT. The parties agree that any internal or external
Company announcement that is made (if such an announcement is made) will
contain substantially the language attached hereto as Exhibit C. The parties
further agree that any significant changes to the proposed language on
Exhibit C will only be made by mutual agreement of the parties.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by a duly authorized officer of the Company and the Executive has executed
this Agreement as of the day and year first above written.
XXXXXXX X. XxXXXXXXXX TECHNOLOGY SOLUTIONS COMPANY
Xxxxxxx X. XxXxxxxxxx By: Xxxx X. Xxxxxx
_____________________ _______________
Xxxxxxx X. XxXxxxxxxx Xxxx X. Xxxxxx
President and Chief Executive Officer
Date: June 18, 1998 Date: June 18, 1998
_____________ _____________
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EXHIBIT A
EMPLOYEE: Xxxxxxx X. XxXxxxxxxx
POSITION: Executive Vice President
BASE SALARY: $400,000.00
EFFECTIVE DATE: June 1, 1996
Employee: Xxxxxxx X. XxXxxxxxxx
_____________________
Xxxxxxx X. XxXxxxxxxx
Date: May 31, 1996
_____________________
TSC: Xxxxxx X. Xxxxxxx
_____________________
Xxxxxx X. Xxxxxxx
Date: May 31, 1996
_____________________
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EXHIBIT B
RESIGNATION
June 18, 1998
To the Board of Directors of
Technology Solutions Company
The undersigned, Xxxxxxx X. XxXxxxxxxx, hereby resigns as a member of
the Board of Directors of Technology Solutions Company effective July 15,
1998 (or such earlier time as I may indicate to you in writing).
Xxxxxxx X. XxXxxxxxxx
_____________________
Xxxxxxx X. XxXxxxxxxx
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EXHIBIT C
Effective June 15, 1998, Executive Vice President Xxxxxxx XxXxxxxxxx has
transitioned to a consulting role to TSC. "Working together, TSC's management
team has focused on attractive, high growth markets," said Xx. XxXxxxxxxx.
"Now, with the transition of our business strategy capabilities into our core
technology practices, TSC is even better positioned for profitable growth.
Many of our objectives have been completed, and new challenges call,"
continued Xx. XxXxxxxxxx. "Thus, with the company's concurrence, I am
returning to my prior relationship of being of counsel to TSC."
Xx. XxXxxxxxxx has served as Executive Vice President of TSC since it
acquired his company, XxXxxxxxxx & Associates, Inc., two years ago. "The
XxXxxxxxxx acquisition has been strategically important for TSC and will
continue to be so in the future," said Xxxx Xxxxxx, President and CEO of TSC.
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