EXECUTION COPY
Exhibit 10.47
-------------
EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT is made as of the 1st day of April, 2000 by
and between Xxxxx X. Xxxxxx, a resident of Commonwealth of Pennsylvania, (the
"Employee"), and ImageMax, Inc., a corporation organized and existing under the
laws of the Commonwealth of Pennsylvania (the "Company").
WHEREAS, the Employee was retained by the Company to serve as a
director in December, 1997;
WHEREAS, the Company desires to continue to employ Employee and
Employee desires to continue to be employed by the Company for a period of time
in the future upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and
obligations contained herein, and intending to be legally bound, the parties,
subject to the terms and conditions set forth herein, agree as follows:
1. Employment and Term. The Company hereby employs and continues to
-------------------
employ Employee and Employee hereby accepts employment with the Company, as (i)
Chairman and (ii) Acting Chief Executive Officer, provided however, at any time
during the Term (as defined below), upon the prior written consent of the
Employee, the Company may hire another individual to serve as the Permanent
Chief Executive Officer and the Employee shall no longer serve as the Acting
Chief Executive Officer but shall continue to serve as Chairman in accordance
with the terms and provisions of this Agreement (the "Position"). The term of
this Agreement shall commence on the date hereof and shall continue until April
1, 2002, subject to early termination pursuant to the provisions of Section 9
hereof (the "Initial Term") and as may be extended from time to time by mutual
consent of Employer and Employee. The Initial Term of employment and any renewal
periods hereunder, subject to the provisions of Section 9 hereof, are
hereinafter referred to as the "Term."
2. Duties. During the Term, the Employee shall serve the Company
------
faithfully and shall devote such time, attention, skill and efforts as are
sufficient to execute the
EXECUTION COPY
performance of the duties required by or appropriate for the Position, provided
that the Company hereby acknowledges that the Employee shall not be a full time
employee of the Company. Employee agrees to assume such duties and
responsibilities as may be customarily incident to such position, and as may be
reasonably assigned to Employee from time to time by the Board of Directors of
the Company. Employee shall report, throughout the Term, to the Executive
Committee of the Board of Directors (the "Executive Committee") of the Company;
it is anticipated that Employee will devote two-thirds of his working time to
service to the Company. Employee shall perform his duties from the Company's
office in Fort Washington, Pennsylvania or in his home office in Tucson,
Arizona, but shall travel to the extent reasonably necessary to perform the
duties hereunder. If the employee is required to travel internationally
(excluding North America), it shall be in business class.
3. Other Business Activities. The Company hereby acknowledges that the
-------------------------
Employee will engage, directly or indirectly, during the Term in other business
activities or pursuits, provided, however, that such activities shall not
interfere with the performance of Employee's responsibilities and obligations
pursuant to this Agreement.
4. Compensation.
------------
4.1 The Company shall pay Employee, and Employee hereby agrees to
accept, as compensation for all services rendered hereunder and for Employee's
covenant not to compete as provided for in Section 8 hereof, a base salary at
the annual rate of One Hundred Thirty One Thousand Two Hundred Fifty Dollars
($131,250) (as the same may hereafter be increased, the "Base Salary"), which
shall continue as such for the remainder of the Term unless otherwise increased
pursuant to this Section 4 of this Agreement. The Base Salary shall be inclusive
of all applicable income, social security and other taxes and charges which are
required by law to be withheld by the Company or which are requested to be
withheld by Employee, and which shall be withheld and paid in accordance with
the Company's normal payroll practice for its similarly situated employees from
time to time in effect. Increases in the Base Salary may be granted from time to
time at the sole discretion of the Company. In addition to the Base Salary, the
Company shall pay Employee, within thirty (30) days after receipt of the final
audit for each fiscal year, a bonus (the "Bonus") in the same manner as for
similarly situated employees. Such Bonus shall be based on the guidelines
established by the Company in advance of each fiscal year under the Company's
formal incentive compensation plan, including, but not limited to, the results
of the Company's operations, achievement of business unit targets, if
applicable, and individual performance as compared to specific management
objectives set prior to each fiscal
-2-
EXECUTION COPY
year. Payment of any Bonus upon termination of Employee shall be paid in
accordance with Section 9 hereof.
4.2 In addition to the foregoing Section 4.1, the Company shall
grant to the Employee an incentive stock option (the "Option") to purchase
seventy five thousand (75,000) shares of Common Stock, no par value, of the
Company ("Common Stock"). The Option shall be an incentive stock option. The
Option shall be subject to and in accordance with the provisions of the 1997
Incentive Plan of the Company, as amended (the "Plan") and shall vest in
accordance with the terms set forth in the Incentive Stock Option Agreement
between the Company and the Employee dated as of February 15, 2000. In addition
to the Option, the Company may grant to the Employee additional stock options
under the Plan as determined by the Compensation Committee of the Board from
time to time in its sole discretion.
5. Benefits and Expenses. Except as otherwise provided in this
---------------------
Agreement or in Schedule A attached hereto, the Employee shall be entitled to
(i) all standard benefits for executive level vice-presidents of the Company and
(ii) those benefits set forth on Schedule A hereto (collectively, "Benefits").
6. Confidentiality. Employee recognizes and acknowledges that the
---------------
Proprietary Information (as hereinafter defined) is a valuable, special and
unique asset of the Business of the Company. As a result, both during the Term
and thereafter, Employee shall not, without the prior written consent of the
Company, for any reason, either directly or indirectly, divulge to any third-
party or use for his own benefit, or for any purpose other than the exclusive
benefit of the Company, any confidential, proprietary, business and technical
information or trade secrets of the Company or of any subsidiary or affiliate of
the Company ("Proprietary Information") revealed, obtained or developed in the
course of his employment with the Company. Nothing herein contained shall
restrict Employee's ability to make such disclosures as may be necessary or
appropriate to the effective and efficient discharge of the duties required by
or appropriate for his Position or as such disclosures may be required by law;
and further provided, that nothing herein contained shall restrict Employee from
divulging or using for his own benefit or for any other purpose any Proprietary
Information that is readily available to the general public so long as such
information did not become available to the general public as a direct or
indirect result of Employee's breach of this Section 6. Failure by the Company
to xxxx any of the Proprietary Information as confidential or proprietary shall
not affect its status as Proprietary Information under the terms of this
Agreement.
-3-
EXECUTION COPY
7. Property.
--------
(a) All right, title and interest in and to Proprietary Information
shall be and remain the sole and exclusive property of the Company. During the
Term, Employee shall not remove from the Company's offices or premises any
documents, records, notebooks, files, correspondence, reports, memoranda or
similar materials of or containing Proprietary Information, or other materials
or property of any kind belonging to the Company unless necessary or appropriate
in accordance with the duties and responsibilities required by or appropriate
for his Position and, in the event that such materials or property are removed,
all of the foregoing shall be returned to their proper files or places of
safekeeping as promptly as possible after the removal shall serve its specific
purpose. Employee shall not make, retain, remove and/or distribute any copies of
any of the foregoing for any reason whatsoever except as may be necessary in the
discharge of his assigned duties and shall not divulge to any third person the
nature of and/or contents of any of the foregoing or of any other oral or
written information to which he may have access or with which for any reason he
may become familiar, except as disclosure shall be necessary in the performance
of his duties or as otherwise permitted pursuant to Section 6 hereof; and upon
the termination of his employment with the Company, he shall leave with or
return to the Company all originals and copies of the foregoing then in his
possession, whether prepared by Employee or by others.
(b) (i) Employee agrees that all right, title and interest in and
to any innovations, designs, systems, analyses, ideas for marketing programs,
and all copyrights, patents, trademarks and trade names, or similar intangible
personal property which have been or are developed or created in whole or in
part by Employee (1) at any time and at any place while the Employee is employed
by Company and which, in the case of any or all of the foregoing, are related to
and used in connection with the Business of the Company, (2) as a result of
tasks assigned to Employee by the Company, or (3) from the use of premises or
personal property (whether tangible or intangible) owned, leased or contracted
for by the Company (collectively, the "Intellectual Property"), shall be and
remain forever the sole and exclusive property of the Company. The Employee
shall promptly disclose to the Company all Intellectual Property, and the
Employee shall have no claim for additional compensation for the Intellectual
Property.
(ii) The Employee acknowledges that all the Intellectual
Property that is copyrightable shall be considered a work made for hire under
United States Copyright Law. To the extent that any copyrightable Intellectual
Property may not be considered a work made for hire under the applicable
provisions of the United States Copyright Law, or to the extent that,
notwithstanding the foregoing provisions, the Employee may retain an interest in
-4-
EXECUTION COPY
any Intellectual Property that is not copyrightable, the Employee hereby
irrevocably assigns and transfers to the Company any and all right, title, or
interest that the Employee may have in the Intellectual Property under
copyright, patent, trade secret and trademark law, in perpetuity or for the
longest period otherwise permitted by law, without the necessity of further
consideration. The Company shall be entitled to obtain and hold in its own name
all copyrights, patents, trade secrets, and trademarks with respect thereto.
(iii) Employee further agrees to reveal promptly all
information relating to the same to an appropriate officer of the Company and to
cooperate with the Company and execute such documents as may be necessary or
appropriate (1) in the event that the Company desires to seek copyright, patent
or trademark protection, or other analogous protection, thereafter relating to
the Intellectual Property, and when such protection is obtained, to renew and
restore the same, or (2) to defend any opposition proceedings in respect of
obtaining and maintaining such copyright, patent or trademark protection, or
other analogous protection.
(iv) In the event the Company is unable after reasonable effort
to secure Employee's signature on any of the documents referenced in Section
7(b)(iii) hereof, whether because of Employee's physical or mental incapacity or
for any other reason whatsoever, Employee hereby irrevocably designates and
appoints the Company and its duly authorized officers and agents as Employee's
agent and attorney-in-fact, to act for and in his behalf and stead to execute
and file any such documents and to do all other lawfully permitted acts to
further the prosecution and issuance of any such copyright, patent or trademark
protection, or other analogous protection, with the same legal force and effect
as if executed by Employee.
8. Noncompetition.
--------------
8.1 Covenant Not to Compete. The Employee shall not, during the
-----------------------
Term, including any extensions of the Term, and during the Restricted Period, as
hereinafter defined, do any of the following directly or indirectly without the
prior written consent of the Company:
(a) compete with the Company or any of its respective
affiliates or subsidiaries, or any of their respective successors or assigns,
whether now existing or hereafter created or acquired (collectively, the
"Related Companies"), in any document management business conducted during the
Term or, as of the date of this Agreement, contemplated to be conducted during
the Term of this Agreement (as has been determined by the
-5-
EXECUTION COPY
Board) or in any other business conducted by the Company in which the Employee
is or has been actively engaged (the "Restricted Business") within any
geographic area located within the United States of America, its possessions or
territories (the "Restricted Area");
(b) become interested (whether as owner, stockholder, lender,
partner, co-venturer, director, officer, employee, agent, consultant or
otherwise) in any person, firm, corporation, association or other entity that
competes with the Related Companies in the Restricted Business within the
Restricted Area; provided, however, that nothing contained in this Section 8(b)
shall prohibit Employee from owning, as a passive investor, not more than five
percent (5%) of the outstanding securities of any class of any publicly-traded
securities of any publicly held company listed on a well-recognized national
securities exchange or on an interdealer quotation system of the National
Association of Securities Dealers, Inc;
(c) influence or attempt to influence any supplier, customer
or prospective customer of the Company or any of the Related Companies to
terminate or modify any written or oral agreement or course of dealing with the
Company or the Related Companies; or
(d) influence or attempt to influence any person (other than a
family member) to either (i) terminate or modify his employment, consulting,
agency, distributorship or other arrangement with the Company or any of the
Related Companies, or (ii) employ or retain, or arrange to have any other person
or entity employ or retain, any person who has been employed or retained by the
Company or any of the Related Companies as an employee, consultant, agent or
distributor of the Company or the Related Companies at any time during the one-
year period immediately preceding the termination of Employee's employment
hereunder.
8.2 Restricted Period. Other than as specifically provided in
-----------------
this Section 8.2, the Restricted Period shall begin on the date of the
termination of this Agreement and shall continue for a period of twelve (12)
months thereafter, provided, however, that if this Agreement is not renewed upon
the expiration of the Initial Term, the Restricted Period shall begin on the
date of such expiration and shall continue for a period of six (6) months
thereafter.
8.3 Forfeiture of Options. Notwithstanding any other provision
---------------------
of this Agreement, any unexercised stock options or unvested stock award shall
become nonexercisable and shall be forfeited if the Employee is terminated
pursuant to Section 8.1 hereof.
-6-
EXECUTION COPY
9. Termination. Employee's employment hereunder may be terminated
-----------
during the Term upon the occurrence of any one of the events described in this
Section 9. Upon termination, Employee shall be entitled only to such
compensation and benefits as described in this Section 9.
9.1 Termination for Disability.
--------------------------
(a) In the event of the disability of the Employee such that
Employee is unable to perform his duties and responsibilities hereunder to the
full extent required by this Agreement by reasons of illness, injury or
incapacity for a period of more than one hundred eighty (180) consecutive days
or more than two hundred seventy (270) days, in the aggregate, during any seven
hundred thirty (730) day period ("Disability"), Employee's employment hereunder
may be terminated by the Company by notice to Employee pursuant to a
determination by the Executive Committee. For purposes of this Agreement, except
as hereinafter provided, the determination as to whether the Employee is ill,
injured or incapacitated shall be made by a licensed physician selected by
Employee and shall be based upon a full physical examination and good faith
opinion by such physician. In the event that the Executive Committee disagrees
with such physician's conclusion, the Executive Committee may require that
Employee submit to a full physical examination by another licensed physician
selected by Employee and approved by the Company. If the two opinions shall be
inconsistent, a third opinion shall be obtained after full physical examination
by a third licensed physician selected by Employee and approved by the Company.
The majority of the three opinions shall be conclusive.
(b) In the event of a termination of Employee's employment
hereunder pursuant to Section 9.1(a), Employee will be entitled to receive all
accrued and unpaid (as of the date of such termination) Base Salary, Benefits,
Earned Bonus (as defined in the Plan) and other forms of compensation and
benefits payable or provided in accordance with the terms of any then existing
compensation or benefit plan or arrangement ("Other Compensation"), including
payment prescribed under any disability or life insurance plan or arrangement in
which he is a participant or to which he is a party as an employee of the
Company. Except as specifically set forth in this Section 9.1(b), the Company
shall have no liability or obligation to Employee for compensation or benefits
hereunder by reason of such termination.
9.2 Termination by Death. In the event that Employee dies during
--------------------
the Term, Employee's employment hereunder shall be terminated thereby and the
Company shall
-7-
EXECUTION COPY
pay to Employee's executors, legal representatives or administrators an amount
equal to the accrued and unpaid portion of his Base Salary, Benefits, Earned
Bonus and Other Compensation through the end of the month in which he dies.
Except as specifically set forth in this Section 9.2, the Company shall have no
liability or obligation pursuant to this Agreement or any amendment hereto to
Employee's executors, legal representatives, administrators, heirs or assigns or
any other person claiming under or through him by reason of Employee's death,
except that Employee's executors, legal representatives, administrators or
beneficiaries designated by the Employee will be entitled to receive the payment
prescribed under any death or disability benefits plan in which he is a
participant as an employee of the Company, and to exercise any rights afforded
under any compensation or benefit plan then in effect.
9.3 Termination By Company for Cause.
--------------------------------
(a) The Company may terminate Employee's employment hereunder
at any time for "cause" upon written notice to Employee based upon a good faith
determination by the Executive Committee. The good-faith nature of the
determination shall not in and of itself mean that "cause" exists. For purposes
of this Agreement, "cause" shall mean: (i) any material breach by Employee of
any of his obligations under Section 6, 7, or 8 of this Agreement, if not cured
within 30 days notice from the company, (ii) gross incompetence in the
performance by Employee of the duties required by or appropriate for his
Position, if not cured within thirty (30) days notice from the Company, (iii) a
material violation, that is not cured within 30 days notice from the company, of
the Company's employee policies, as may be amended from time to time, or (iv)
other conduct of Employee involving any type of willful misconduct with respect
to the Company, including without limitation fraud, embezzlement, theft or
proven dishonesty in the course of his employment or conviction of a felony.
(b) In the event of a termination of Employee's employment
hereunder pursuant to Section 9.3(a), Employee shall be entitled to receive all
accrued but unpaid (as of the effective date of such termination) Base Salary,
Benefits and Other Compensation. All Base Salary and Benefits shall cease at the
time of such termination, subject to the terms of any benefit or compensation
plan then in force and applicable to Employee. Except as specifically set forth
in this Section 9.3, the Company shall have no liability or obligation hereunder
by reason of such termination.
9.4 Termination By Company Without Cause.
------------------------------------
-8-
EXECUTION COPY
(a) The Company may terminate Employee's employment hereunder
at any time, for any reason, without cause, effective upon the date designated
by the Company upon fifteen (15) days notice to Employee.
(b) In the event of a termination of Employee's employment
hereunder pursuant to Section 9.4(a), Employee shall be entitled to receive all
accrued but unpaid (as of the effective date of such termination) Base Salary,
Benefits, Earned Bonus and Other Compensation, plus continuation of the then
current Base Salary and Benefits (including vesting of options and other
Benefits) for a period of twelve (12) months thereafter. Except as specifically
set forth in this Section 9.4, the Company shall have no liability or obligation
hereunder by reason of such termination.
9.5 Termination By Employee
------------------------
(a) Without Cause.
-------------
(i) Employee may terminate Employee's employment
hereunder upon sixty (60) days notice of the termination of his employment
hereunder pursuant to this Section 9.5(a) (the date the Employee gives such
notice shall be herein referred to as the "Request Date"). The date set forth in
such notice as the date of termination of Employee's employment pursuant to this
Agreement, shall be referred to herein as the "Termination Date".
Notwithstanding the foregoing, upon receipt by the Company of such written
notice of termination, the Company in its sole discretion, may deem such
termination effective immediately (the "Accelerated Termination Date"). In the
event the parties mutually agree to an alternative date of termination, that
date shall be considered the Termination Date.
(ii) In the event of a termination of Employee's
employment hereunder pursuant to Section 9.5(a)(i) hereof, Employee shall be
entitled to receive all accrued but unpaid (as of the earlier of the Termination
Date or the Accelerated Termination Date), Base Salary and Benefits. In
addition, if the Company does not deem such termination to be effective
immediately, upon receipt of the termination notice and Employee performs his
duties in a satisfactory manner, as determined in the reasonable judgement of
the Board, until the Termination Date, Employee shall also be entitled to an
amount equal to one month's Base Salary (in effect at such time). In addition,
in the event of a termination of Employee's employment pursuant to Section
9.5(a) at the end of the Term upon sixty days (60) prior written notice and upon
the satisfactory completion, in the reasonable judgement of the Board, of
Employee's duties during the 60-day period after receipt of such termination
notice, Employee shall be entitled to receive an amount equal to one month's
Base Salary (in effect at such time)
-9-
EXECUTION COPY
multiplied by the number of the complete 12-month periods of ImageMax service
(whether or not pursuant to this Agreement) completed prior to giving notice of
termination. Except as specifically set forth in this Section 9.5(a), all Base
Salary, Benefits and Bonuses shall cease at the time of such termination,
subject to the terms of any benefit or compensation plan then in force and
applicable to Employee. Except as specifically set forth in this Section 9.5,
the Company shall have no liability or obligation hereunder by reason of such
termination.
(b) Good Reason.
-----------
(i) The Employee may terminate his employment hereunder
at any time in the event that the Company fails to perform its duties and
obligations hereunder effective upon the date designated by the Employee in a
written notice of the termination of employment hereunder pursuant to this
Section 9.5(b); provided that, such date shall be at least thirty (30) days
after the date of such notice.
(ii) In the event of a termination of the Employee's
employment hereunder pursuant to Section 9.5(b) hereof, the Employee shall be
entitled to receive all of the benefits and compensation pursuant to this
Agreement for the remainder of the term hereunder.
9.6 Sale of Company/Change of Control.
---------------------------------
(a) If there is a Sale of the Company or a Change of Control
during the Term, then the Company or the successor to all or substantially all
of the Company's assets, capital stock or business (the "Successor Entity"), as
the case may be, must offer Employee employment pursuant to a written contract
offer (the "Offer") within five (5) days of such Sale of the Company or Change
of Control. Employee shall, within fifteen (15) days after receipt of such
Offer, either (i) accept the terms of the Offer, such acceptance indicated by
return of a copy of the Offer duly executed, (ii) elect in writing, provided to
the Company or the Successor Entity, as the case may be, to remain employed
under this Agreement for the remainder of the Term, or (iii) elect to terminate
Employee's employment hereunder upon sixty (60) days prior notice, such
termination to be effective at the expiration of said sixty (60) day period, or
sooner, if desired by the Company or the Successor Entity.
(b) For purposes of this Agreement, a "Change of Control"
means either (i) the sale, transfer, assignment or other disposition by
stockholders of the Company, in one transaction or a series of related
transactions, of more than thirty percent (30%) of either the outstanding shares
of common stock or the combined voting power represented by
-10-
EXECUTION COPY
the Company's then outstanding voting securities entitled to vote generally or
the approval by the stockholders of the Company of a reorganization, merger or
consolidation, in each case, with respect to which persons who were stockholders
of the Company immediately prior to such reorganization, merger or consolidation
do not, immediately thereafter, own more than fifty percent (50%) of the
combined voting power entitled to vote generally in the election of directors of
the reorganized, merged or consolidated company's then outstanding securities,
in a liquidation or dissolution of Company or of the sale of all or
substantially all of Company's assets, other than (A) any such sales, transfers,
assignments or other dispositions by such stockholders to their respective
Affiliates or (B) any such transaction effected primarily to reincorporate the
Company in another jurisdiction; or (ii) a majority of members of the Company's
Board of Directors is replaced during any 12-month period by directors whose
appointment or election is not advised by a majority of the members of the
Company's Board of Directors prior to the date of the appointment or election.
(c) For purposes of this Agreement, "Affiliate" means, with
respect to any stockholder of the Company, (i) any Person directly or indirectly
controlling, controlled by or under common control with such stockholder, (ii)
any Person owning or controlling ten percent (10%) or more of the outstanding
voting securities of such stockholder, (iii) any officer, director or general
partner of such stockholder, or (iv) any Person who is an officer, director,
general partner, trustee or holder of ten percent (10%) or more of the
outstanding voting securities of any Person described in clauses (i) through
(iv) of this paragraph (c).
(d) For purposes of this Agreement, "Person" means an
individual, partnership, corporation, joint venture, association, trust,
unincorporated association, other entity or association.
(e) For purposes of this Agreement, a "Sale of the Company"
means a sale, transfer, assignment or other disposition (including by merger or
consolidation), of all of the outstanding stock of the Company, or of all or
substantially all of the assets of the Company, a liquidation or dissolution of
the Company. A "Sale of the Company" shall not include the consummation of a
public offering of Common Stock of the Company or its affiliate pursuant to a
registration statement or any transaction effected primarily to reincorporate
the Company in another jurisdiction.
(f) In the event of termination of Employee's employment by
Employee hereunder pursuant to clause (iii) in paragraph (a) above, Employee
shall be entitled to receive all accrued but unpaid (as of the effective date of
such termination) Base Salary, Benefits
-11-
EXECUTION COPY
and Earned Bonus and Other Compensation. In addition, in such case Employee
shall be entitled to receive Base Salary and Benefits for the twelve (12) months
following the effective date of such termination (the "Additional Amount"). At
his sole option, Employee may receive the Additional Amount paid either (i)
monthly for twelve (12) months, or (ii) in one payment on the effective date of
such termination, in which case the value of the Benefits otherwise payable will
be monetized, and such payment of the Additional Amount will be discounted at
the then current Federal Short Term Rate as defined in the Internal Revenue Code
of 1986, as amended.
(g) In the event Employee chooses to continue employment
hereunder pursuant to clause (i) or (ii) in paragraph (a) above and Employee's
employment is thereafter terminated prior to the expiration of the Term for any
reason other than Death, Disability or termination pursuant to clause (iii) in
paragraph (a) above, Employee shall be entitled to receive all the benefits and
compensation referred to in paragraph (f) above. In the event Employee chooses
to continue employment hereunder pursuant to clause (ii) in paragraph (a) above,
at the expiration of the Term, Employee shall be entitled to receive an amount
equal to two months' Base Salary (in effect at such time) multiplied by the
number of complete 12-month periods of service completed prior to such
termination
(h) If this Agreement is assumed by any Successor Entity, any
payments set forth herein shall be the obligation of such Successor Entity.
(i) Except as specifically set forth in this Agreement, (i)
all Base Salary, Benefits and Bonuses shall cease at the time of such
termination, subject to the terms of any benefit or compensation plans then in
force and applicable to Employee, and (ii) the Company shall have no liability
or obligation hereunder by reason of such termination.
(j) If the Successor Entity fails to make the Offer, Employee
shall be entitled to receive all of the benefits and compensation for either (i)
the time period referred to in paragraph (f) above or (ii) the remainder of the
term of this Agreement, whichever is greater.
9.7 Severance Upon Expiration of the Initial Term. If this
---------------------------------------------
Agreement is not renewed by the parties upon the expiration of the Initial Term,
Employee shall be entitled to receive all accrued but unpaid (as of the
effective date of such termination) Base Salary, Benefits, Earned Bonus and
Other Compensation, plus continuation of the then current Base Salary and
Benefits (including vesting of options and other Benefits) for a period of six
(6) months after termination of employment hereunder. Except as specifically set
forth in this
-12-
EXECUTION COPY
Section 9.7, the Company shall have no liability or obligation hereunder by
reason of such termination.
10. Other Agreements. Employee represents and warrants to the
----------------
Company that:
(a) There are no restrictions, agreements or understandings
whatsoever to which Employee is a party which would prevent or make unlawful
Employee's execution of this Agreement or Employee's employment hereunder, or
which is or would be inconsistent or in conflict with this Agreement or
Employee's employment hereunder, or would prevent, limit or impair in any way
the performance by Employee of his obligations hereunder,
(b) That Employee's execution of this Agreement and Employee's
employment hereunder shall not constitute a breach of any contract, agreement or
understanding, oral or written, to which Employee is a party or by which
Employee is bound, and
(c) That Employee is free to execute this Agreement and to
enter into the employ of the Company pursuant to the provisions set forth
herein.
(d) In the event that they are still in effect, that Employee
shall disclose the existence and terms of the restrictive covenants set forth in
this Agreement to any employer that the Employee may work for during the term of
this Agreement (which employment is not hereby authorized) or after the
termination of the Employee's employment at the Company.
11. Survival of Provisions. The provisions of this Agreement set
----------------------
forth in Sections 6, 7, 8, 9, 21 and 22 hereof shall survive the termination of
Employee's employment hereunder.
12. Indemnification and Insurance.
-----------------------------
12.1 The Company shall indemnify the Employee to the maximum
extent permitted under the Business Corporation Law of Pennsylvania of 1988, as
amended, from and against any and all losses, costs, damages or expenses the
Employee may sustain by
-13-
EXECUTION COPY
reason of his employment hereunder in the same manner and to the same extent as
the executive officers of the Company.
12.2 Insurance. The Company shall preserve and maintain
---------
insurance for Employee's benefit on account of Employee's employment pursuant to
this Agreement and Employee's service as a director, whether in a separate
policy or under any other policy covering the errors and omissions of the
Company's employees or directors.
13. Successors and Assigns. This Agreement shall inure to the
----------------------
benefit of and be binding upon the Company and Employee and their respective
successors, executors, administrators, heirs and/or permitted assigns; provided,
however, that neither Employee nor the Company may make any assignments of this
Agreement or any interest herein, by operation of law or otherwise, without the
prior written consent of the other party hereto, except that, without such
consent, the Company may assign this Agreement to any successor to all or
substantially all of its assets and business by means of liquidation,
dissolution, merger, consolidation, transfer of assets, or otherwise, provided
that such successor assumes in writing all of the obligations of the Company
under this Agreement, subject, however, to Employee's rights as to termination
as provided in Section 9.6 hereof.
14. Notice. Any notice or communication required or permitted
------
under this Agreement shall be made in writing and sent by certified or
registered mail, return receipt requested, addressed as follows:
If to Employee:
[_______________________]
If to Company:
Xxxx Xxxxxxxx
ImageMax, Inc.
000 Xxxxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxxxxxxxxxxx 00000
or to such other address as either party may from time to time duly specify by
notice given to the other party in the manner specified above.
-14-
EXECUTION COPY
15. Entire Agreement; Amendments. This Agreement contains the
----------------------------
entire agreement and understanding of the parties hereto relating to the subject
matter hereof, and merges and supersedes all prior and contemporaneous
discussions, agreements and understandings of every nature between the parties
hereto relating to the employment of Employee with the Company. This Agreement
may not be changed or modified, except by an agreement in writing signed by each
of the parties hereto.
16. Waiver. The waiver of the breach of any term or provision of
------
this Agreement shall not operate as or be construed to be a waiver of any other
or subsequent breach of this Agreement.
17. Governing Law. This Agreement shall be construed and enforced
-------------
in accordance with the laws of the Commonwealth of Pennsylvania.
18. Invalidity. In case any one or more of the provisions
----------
contained in this Agreement shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect the validity of any other provision of this
Agreement, and such provision(s) shall be deemed modified to the extent
necessary to make it enforceable.
19. Section Headings. The section headings in this Agreement are
----------------
for convenience only; they form no part of this Agreement and shall not affect
its interpretation.
20. Number of Days. In computing the number of days for purposes
--------------
of this Agreement, all days shall be counted, including Saturdays, Sundays and
legal holidays; provided, however, that if the final day of any time period
falls on a Saturday, Sunday or day which is a holiday in Philadelphia,
Pennsylvania, then such final day shall be deemed to be the next day which is
not a Saturday, Sunday or legal holiday.
21. Specific Enforcement; Extension of Period.
-----------------------------------------
(a) Employee acknowledges that the restrictions contained in
Sections 6, 7, and 8 hereof are reasonable and necessary to protect the
legitimate interests of the Company and its affiliates and that the Company
would not have entered into this Agreement in the absence of such restrictions.
Employee also acknowledges that any breach by him of Sections 6, 7, or 8 hereof
will cause continuing and irreparable injury to the Company for which monetary
damages would not be an adequate remedy. The Employee shall not, in any action
or
-15-
EXECUTION COPY
proceeding to enforce any of the provisions of this Agreement, assert the claim
or defense that an adequate remedy at law exists. In the event of such breach by
Employee, the Company shall have the right to enforce the provisions of Sections
6, 7, and 8 of this Agreement by seeking injunctive or other relief in any
court, and this Agreement shall not in any way limit remedies of law or in
equity otherwise available to the Company. If an action at law or in equity is
necessary to enforce or interpret the terms of this Agreement, the prevailing
party shall be entitled to recover, in addition to any other relief, reasonable
attorneys' fees, costs and disbursements. In the event that the provisions of
Sections 6, 7, or 8 hereof should ever be adjudicated to exceed the time,
geographic, or other limitations permitted by applicable law in any applicable
jurisdiction, then such provisions shall be deemed reformed in such jurisdiction
to the maximum time, geographic, or other limitations permitted by applicable
law.
(b) In the event that Employee shall be in breach of any of
the restrictions contained in Section 8 hereof, then the Restricted Period shall
be extended for a period of time equal to the period of time that Employee is in
breach of such restriction.
22. Arbitration. In the event that the parties are unable to
-----------
resolve any disputes arising hereunder, such dispute shall be submitted for a
binding determination by a neutral third party designated by the President of
the Philadelphia office of the American Arbitration Association.
23. Expenses. Each party shall pay all costs and expenses that it
--------
incurs withrespect to the negotiation, execution, delivery and performance of
this Agreement; provided, however, that the Company shall reimburse the Employee
or its designee for its reasonable fees and expenses incurred in connection with
the negotiation, execution, delivery, performance and modification of this
Agreement.
24. Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed an original, and all of which
together shall be deemed to be one and the same instrument.
[SIGNATURE PAGE FOLLOWS]
-16-
EXECUTION COPY
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed the day and year first written above.
IMAGEMAX, INC.
By: /s/ Xxxx X. Xxxxxxxx
____________________________________
Name: Xxxx X. Xxxxxxxx
Title: Chief Financial Officer
/s/ Xxxxx X. Xxxxxx
________________________________________
Xxxxx X. Xxxxxx, Chairman and Acting Chief
Executive Officer
-17-
EXECUTION COPY
SCHEDULE A
1. Life Insurance. Company will provide Employee, at no expense to the
--------------
Employee, life insurance coverage in an amount equal to three (3) times
Employee's initial Base Salary.
2. Vacation. The Employee shall be entitled to fifteen (15) days per year of
--------
paid vacation.
3. Business Travel Accident Insurance. Company will provide Employee, at no
----------------------------------
expense to the Employee, business travel accident insurance coverage in an
amount equal to six (6) times Employee's base salary through either: (i) a
group policy covering similarly situated employees, or (ii) a policy
specific to Employee, depending on the cost and availability of coverage.
4. Disability Insurance. The Employee shall be entitled to participate under
--------------------
any Company plan related to providing disability benefits, provided that
Employee is eligible for participation pursuant to the terms of such plan.
5. Reimbursement of Expenses. The Company shall reimburse the Employee for all
-------------------------
of his ordinary and necessary expenses incurred in connection with
performing his duties and obligations under the Agreement.
-18-
