BPO MANAGEMENT SERVICES, INC.
Exhibit
10.1
BPO
MANAGEMENT SERVICES, INC.
0000
X. XXXXXXX, XXXXX 000, XXXXXXX, XXXXXXXXXX 00000
January
26, 0000
Xxxxxx
X.
Xxxxxxxxxx
00000
Xxxxx Xxxx,
Xxxx
Xxxxxx XX 00000
Dear
Don:
Please
allow this letter to serve as the entire agreement between BPO Management
Services, Inc. (the "Company") and you, Xxxxxx Xxxxxxxxxx (the "Employee")
with
respect to certain aspects of your employment with the Company. The Company
acknowledges and agrees that the Employee is and will remain a partner of,
and
has and will retain an interest in, Xxxxx, LLC ("Xxxxx"), which will benefit
the
Company in that the Employee will have access to certain Xxxxx
resources.
The
Employee will work for the Company beginning on January 29, 2007.
Salary:
$104,167.00 annually ("Salary"), for which Employee will provide at least 50%
of
his available time; provided however, that on June 1, 2007, or sooner if
required by the Company, the annual Salary shall increase to $166, 667 and
Employee shall devote his full time services to the Company. Employee's Salary
may be increased from time to time by the Company in its
discretion.
Annual
Cash Bonus:
to be
determined within first 30 days of employment. Employee acknowledges that the
Company entered into an agreement (the “Xxxxx Agreement”) with Xxxxx, whereby
Xxxxx is to provide certain resources to the Company. Employee agrees that
the
Company will tender directly to Xxxxx 20% of any cash bonuses otherwise payable
to Xx. Xxxxxxxxxx during the term of the Xxxxx Agreement.
Employee
agrees that 20% of such cash bonus shall be paid directly to Xxxxx, LLC as
a fee
in connection with a Resources Agreement entered into between the Company and
Xxxxx, LLC (the “Resources Agreement”)
Equity:
Option
grant on start date to purchase 400,000 shares of common stock at $1.50 per
share vesting half-yearly equally over a four-year period, and otherwise subject
to the terms of the Company’s 2003 Stock Option Plan.
During
the course of the Employee's engagement hereunder, the Employee will remain
a
partner of Xxxxx. As a partner of Xxxxx, Employee will
share with Xxxxx a portion of his or her economic interest in any stock options
or equity bonus that the Company may grant the Employee and may also share
with
Xxxxx a portion of any cash bonus and severance the Company may pay the
Employee, to the extent specified in that certain Part-Time Engagement Resources
Agreement between the Company and Xxxxx (the "Resources Agreement"). The Company
acknowledges and consents to such arrangement.
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The
Employee will be eligible for any Company employment retirement and/or 401(k)
plan and for vacation and holidays consistent with the Company's policy as
it
applies to senior management, and the Employee will be exempt from any delay
periods required for eligibility.
In
lieu
of the Employee participating in the Company-sponsored employee medical
insurance benefit, the Employee will remain on his or her current medical plan.
The Company will reimburse the Employee for amounts paid by the Employee for
such medical insurance for him and (where applicable) his/her family of up
to
such amount per month that the Company would have incurred to provide such
insurance to other executives. To the extent permitted under applicable U.S.
federal tax law, such amount will not be considered reportable W-2 income,
but
instead non-taxable benefits expense.
The
Employee must receive written evidence that the Company maintains directors'
and
officers' insurance to cover in an amount reasonably acceptable to the Employee
at no additional cost to the Employee, and the Company will maintain such
insurance at all times while this agreement remains in effect.
Furthermore,
the Company will maintain such insurance coverage with respect to occurrences
arising during the term of this agreement for at least three years following
the
termination or expiration of this agreement or will purchase a directors' and
officers' extended reporting period, or "tail," policy to cover the Xxxxx
Partner.
The
Company agrees to indemnify the Employee to the full extent permitted by the
Company’s Certificate of Incorporation (as amended) for any losses, costs,
damages, and expenses, including reasonable attorneys' fees, as they are
incurred, in connection with any cause of action, suit, or other proceeding
arising in connection with the Employee's employment with the Company
The
Company may terminate the Employee's employment for any reason upon at least
30
days' prior written notice to the Employee, such termination to be effective
on
the date specified in the notice, provided that such date is no earlier than
30
days from the date of delivery of the notice. Likewise, the Employee may
terminate his or her employment for any reason upon at least 30 days' prior
written notice to the Company, such termination to be effective on the date
30
days following the date of the notice. The Employee will continue to render
services and to be paid during such 30-day period, regardless of who gives
such
notice. The Employee may terminate this agreement immediately if the Company
has
not remained current in its obligations under this letter or the Resources
Agreement between the Company and Xxxxx or if the Company engages in or asks
the
Employee to engage in or to ignore any illegal or unethical conduct.
This
agreement will terminate immediately upon the death or disability of the
Employee or upon termination by the Company of Employee’s employment for cause.
For purposes of this agreement, disability will be as defined by the applicable
policy of disability insurance or, in the absence of such insurance, by the
Company's Board of Directors acting in good faith.
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The
Employee's salary will be prorated for the final pay period based on the number
of days in the final pay period up to the effective date of termination or
expiration.
If
the
termination of this agreement is within 90 days of the Beginning Date, the
Employee will be entitled to receive a Severance Payment (as defined below)
equal to one month's salary. After 90 days of employment, the Employee will
be
entitled to receive a Severance Payment equal to two months' salary. For each
six month period of employment commencing on the 91st
day of
employment, the Employee will receive an additional month's salary as Severance
Payment, provided that the total aggregate Severance Payment will be limited
to
a maximum of six months' salary. If this agreement is terminated by the Company
without cause or the required notice, or by the Employee for cause, the Employee
will be entitled to receive the termination payments noted in this paragraph,
plus one additional month's compensation for early termination, plus all cash
bonuses, equity, and other compensation covered by this agreement will vest
immediately and become payable at the date of termination. Notwithstanding
any
provisions herein to the contrary, no severance payments shall be payable if
the
Company terminates the Employee’s employment for cause.
This
agreement contains the entire agreement between the parties with respect to
the
matters contained herein, superseding any prior oral or written statements
or
agreements.
The
Company agrees to allow Xxxxx to use the Company’s logo and name on Xxxxx’x
website and other marketing materials for the sole purpose of identifying the
Company as a client of Xxxxx. Xxxxx will not use the Company’s logo or name in
any press release or general circulation advertisement without the Company’s
prior written consent.
The
provisions in this agreement concerning the payment of salary and bonuses and
severance will survive any termination or expiration of this
agreement.
The
terms
of this agreement are severable and may not be amended except in a writing
signed by the parties. If any portion of this agreement is found to be
unenforceable, the rest of this agreement will be enforceable except to the
extent that the severed provision deprives either party of a substantial portion
of its bargain.
This
agreement will be governed by and construed in all respects in accordance with
the
laws of
the State of California,
without
giving effect to conflicts-of-laws principles.
Each
person signing below is authorized to sign on behalf of the party indicated,
and
in each case such signature is the only one necessary.
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Please
sign below and return a signed copy of this letter to indicate your agreement
with its terms and conditions.
Sincerely
yours,
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BPO
Management Services, Inc.
By:
Xxxxxxx Xxxxx
Signature_________________________
Name:
Xxxxxxx
Xxxxx
Title:
Chairman & CEO
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Acknowledged
and agreed by:
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EMPLOYEE:
______________________________
(Signature)
Xxxxxx
X Xxxxxxxxxx
Date:________________
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