EXHIBIT 10.4
AGREEMENT
This Agreement is made as of the latest date indicated below between
Mastech Systems Corporation, a Pennsylvania corporation (hereinafter called the
"Company") and the undersigned employee (hereinafter called the "Employee").
This Agreement is entered into contemporaneously with Employee's receipt of
certain stock options offered by Company which were not previously made
available to Employee.
WHEREAS, Employee is employed by the Company as an at-will employee whose
employment may be terminated by either party with or without reason or cause and
without any liability for such termination;
WHEREAS, this Agreement is necessary for the protection of Company's
legitimate and protectible business interests in its customers, prospective
customers, accounts and confidential, proprietary and trade secret information;
and
WHEREAS, this Agreement is a term and condition of Employee's employment
and is made in consideration for certain stock options offered to Employee
contemporaneously with this Agreement as well as Employee's continued employment
and access to Company's customers, prospective customers, accounts, and
confidential, proprietary and trade secret information.
NOW THEREFORE, for the consideration set forth herein, the receipt and
sufficiency of which is acknowledged by the parties, Company and Employee agree
as follows:
1. DEFINITIONS. As used herein:
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(a) "Company" shall mean Mastech Systems Corporation and any affiliate
of Mastech Systems Corporation, including any direct or indirect parent or
subsidiary of Mastech Systems Corporation, as well as their respective operating
divisions.
(b) "Confidential Information" shall include, but is not necessarily
limited to, any information which may include, in whole or part, information
concerning the Company's accounts, sales, sales volume, sales methods, sales
proposals, customers and prospective customers, prospect lists, identity of
purchasing personnel in the employ of customers and prospective customers,
amount or kind of customer's purchases from the Company, the Company's source of
supply of products and/or personnel, sources of consultants, Company manuals,
formulae, products, processes, methods, machines, compositions, ideas,
improvements, inventions, research, computer programs, system documentation,
software products, patented products, copyrighted information, know how and
operating methods and any other trade secret or proprietary information
belonging to the Company or relating to the Company's affairs that is not public
information.
(c) "Customer(s)" shall mean any individual, corporation, partnership,
business or other entity (i) whose existence and business is known to Employee
as a result of Employee's access to the Company's customer lists or Customer
account information; or (ii) that
is an entity with whom the Company has contracted or negotiated during the two
(2) year period preceding the termination of Employee's employment.
(d) "Competing Business" shall mean any individual, corporation,
partnership, business or other entity which provides or attempts to provide any
products or services that directly compete with products or services offered by
the Company, i.e., information technology services, including software
applications solutions and services, and which were sold by the Company at any
time and from time to time during the last two (2) years prior to Employee's
termination of employment. Notwithstanding the foregoing, the term Competing
Business does not include a corporation that derives at least $500 million of
its revenues from the sale of information technology services.
2. DUTIES. Employee, who is employed in the position set forth on
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Schedule A hereof as of the date of this Agreement, agrees to be responsible for
such duties as are commensurate with and required by such position and any other
duties as may be assigned to Employee by Company from time to time. Employee
further agrees to perform his or her duties in a diligent, trustworthy, loyal,
businesslike, productive, and efficient manner and to use Employee's best
efforts to advance the business and goodwill of Company. Employee further
agrees to devote all of his or her business time, skill, energy and attention
exclusively to the business of the Company and to comply with all rules,
regulations and procedures of the Company. During the term of this Agreement,
Employee will not engage in any other business for Employee's own account or
accept any employment from any other business entity, or render any services,
give any advice or serve in a consulting capacity, whether gratuitously or
otherwise, to or for any other person, firm or corporation, other than as a
volunteer for charitable organizations, without the prior written approval of
the Company.
3. COMPENSATION. Employee's annual base salary as of the date of this
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Agreement is as set forth on Schedule A hereto. As compensation for Employee's
employment by the Company, the Company will pay the Employee during the period
of employment hereunder such remuneration as is determined to be appropriate by
the Company from time to time in its discretion.
4. BENEFITS. Employee will receive the standard Company benefits
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described in the Company Handbook which is incorporated as though fully set
forth in this Agreement and which may be modified at any time by the Company.
5. STOCK OPTIONS. Upon the initial public offering of the Company's
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common stock, Employee shall receive that number of stock options covering the
Company's shares as is set forth on Schedule A hereto. Such options shall be
granted under the Company's Stock Incentive Plan as then in effect and shall be
subject to the Stock Option Agreement evidencing such stock options.
6. POLICIES AND PRACTICES. Employee agrees to abide by all rules,
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regulations and instruments established by the Company including the policies,
practices and procedures contained in the Company Employee Handbook which
Employee has received and which is incorporated by reference as though fully set
forth herein. The Company reserves the
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right to disregard the Company Employee Handbook in the event that a particular
portion of the Company Employee Handbook conflicts with this Agreement or is
deemed by the Company to be incompatible with Employee's position in the
Company, and the Company may amend the Handbook from time to time in its sole
discretion.
7. AGREEMENT NOT TO COMPETE. In order to protect the business interest
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and good will of the Company in respect to customers and accounts, and to
protect Confidential Information, Employee covenants and agrees that for the
entire period of time that this Agreement remains in effect, and for a period of
two (2) years after termination of Employee's employment for any reason he or
she will not:
(a) directly or indirectly contact any Customer of the Company for the
purpose of soliciting such Customer to purchase, lease or license a
product or service that is the same as, similar to, or in competition
with those products and/or services made, rendered, offered or under
development by the Company;
(b) engage in any activity or business as a consultant, independent
contractor, agent, employee, employer, officer, partner, director or
otherwise, alone or in association with any other person, corporation
or other entity, in any Competing Business operating in the United
States of America or any other country where the Company has conducted
business within the two (2) year period prior to the termination of
Employee's employment; provided, however, that this subsection (b)
shall not apply if the Employee is terminated by the Company without
cause after the sale of substantially all of the business or assets of
Mastech Systems Corporation to an unaffiliated third party for fair
value;
(c) directly or indirectly employ, or knowingly permit any company or
business directly or indirectly controlled by Employee to employ, any
person who is employed by the Company at any time during the term of
this Agreement, or in any manner to seek to induce any such person to
leave his or her employment with the Company; or
(d) directly or indirectly interfere with or attempt to disrupt the
relationship, contractual or otherwise, between the Company and any of
its employees or solicit, induce, or attempt to induce employees of
the Company to terminate employment with the Company and become self-
employed or employed with others in the same or similar business or
any product line or service provided by Company.
Employee acknowledges that the Company is engaged in business throughout
the United States as well as in other countries and that the marketplace for the
Company's products and services is worldwide. Employee further covenants and
agrees that the geographic, length of term and types of activities restrictions
(non-competition restrictions) contained in this Agreement are reasonable and
necessary to protect the legitimate business interests of the Company because of
the scope of the Company's business.
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In the event that a court of competent jurisdiction shall determine that
one or more of the provisions of this Section 7 is so broad as to be
unenforceable, then such provision shall be deemed to be reduced in scope or
length, as the case may be, to the extent required to make this Paragraph
enforceable. If the Employee violates the provisions of this Section 7, the
periods described therein shall be extended by that number of days which equals
the aggregate of all days during which at any time any such violations occurred.
8. NONDISCLOSURE AND NONUSE OF CONFIDENTIAL INFORMATION. The Employee
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covenants and agrees during Employee's employment or any time after the
Termination of such employment, not to communicate or divulge to any person,
firm or corporation, either directly or indirectly, and to hold in strict
confidence for the benefit of the Company, all Confidential Information except
that employee may disclose such Information to persons, firms or corporations
who need to know such Information during the course and within the scope of
Employee's employment. Employee will not use any Confidential Information for
any purpose or for his or her personal benefit other than in the course and
within the scope of Employee's employment.
(a) Work Made For Hire. Employee recognizes and understands that his
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or her duties at Company have included and may continue to include the
preparation of materials, including computer software and other written or
graphic materials, and that any such materials conceived or written by him or
her were done and shall continue to be done as "work made for hire" as defined
and used in the Copyright Act of 1976, 17 USC 1 et seq. In the event of
publication of such materials, Employee understands that since the work is a
"work made for hire," the Company will solely retain and own all rights in all
such materials, including the right to copyright.
(b) Disclosure of Discoveries, Ideas and Inventions. Employee
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represents that he does not have any right, title or interest in, nor has he
made or conceived wholly or in part prior to the commencement of his employment
by the Company any discovery, idea and invention.
(c) Disclosure of Other Discoveries, Ideas and Inventions/Assignment
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of Patents. Employee shall disclose promptly to the Company, any and all works,
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inventions, discoveries and improvements authored, conceived or made by Employee
during the period of employment and related to the business or activities of the
Company, solely or jointly with others, which is related to the lines of
business, work or investigation of the Company at the time of such discovery,
idea or invention or which results from, or is suggested by, any work which the
Employee may do for or on behalf of the Company, and hereby assigns and agrees
to assign all his interest therein to the Company or its nominee. Whenever
requested to do so by the Company, Employee shall execute any and all
applications, assignments or other instruments which the Company shall deem
necessary to apply for and obtain Letters Patent or Copyrights of the United
States or any foreign country or to otherwise protect the interest therein and
shall assist the Company in every proper way (entirely at the Company's expense,
including reimbursement to him for all expense and loss of income) to obtain
such patents and copyrights and to enforce them. Such obligations shall
continue beyond the termination of employment
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with respect to works, inventions, discoveries and improvements authored,
conceived or made by Employee during the period of employment, and shall be
binding upon Employee's assigns, executors, administrators and other legal
representatives. All such works, inventions, discoveries and improvements shall
remain the sole and exclusive property of the Company, whether patentable or
not.
9. RETURN OF MATERIALS. Upon termination of employment with Company for
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any reason, Employee shall promptly deliver to Company the originals and copies
of all correspondence, drawings, manuals, computerized information, letters,
notes, notebooks, reports, prospect lists, flow charts, programs, proposals, and
any documents concerning Company's customers or suppliers and, without limiting
the foregoing, will promptly deliver to Company any and all other documents or
materials containing or constituting Confidential Information.
10. TERMINATION. This Agreement may be terminated with or without cause
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by either party without any liability for such termination by giving to the
other party at least fifteen (15) days prior written notice, except that the
covenants of Sections 6, 7, 8, 9, 11, 12, 13, 14, 15, 16 and 18 hereof shall
survive the termination of this Agreement. All payments due as of the date of
termination shall be paid in full within thirty (30) days of this date.
11. SEVERANCE. If the Employee's employment is at any time terminated by
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the Company without cause, then the Company shall pay the Employee a severance
payment equal to three (3) times the monthly base salary of the Employee then in
effect, payable in the form of salary continuation in accordance with the
Company's then existing payroll practices; provided, however, if the Employee's
employment is terminated by the Company without cause within 90 days after the
sale of substantially all of the business or assets of Mastech Systems
Corporation to an unaffiliated third party for fair value, then the Company (or
its successor) shall pay the Employee a severance payment equal to six (6) times
the monthly base salary of the Employee then in effect in accordance with the
Company's then existing payroll practices.
12. ENTIRE AGREEMENTS. This Agreement supersedes all prior agreements,
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written or oral, between the parties hereto concerning the subject matter
hereof.
13. CHOICE OF LAW, JURISDICTION AND VENUE. The parties agree that this
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Agreement shall be deemed to have been made and entered into in Pennsylvania and
that the Law of the Commonwealth of Pennsylvania shall govern this Agreement.
Jurisdiction and venue is proper in any proceeding by the Company to enforce its
rights hereunder filed in any court geographically located in Allegheny County,
Pennsylvania.
14. ACKNOWLEDGMENTS OF EMPLOYEE. Employee hereby acknowledges and agrees
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that:
(a) This Agreement is necessary for the protection of the legitimate
business interests of the Company.
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(b) the restrictions contained in this Agreement may be enforced in a
court of law whether or not Employee is terminated with or
without cause or for performance related reasons;
(c) The execution and delivery of this Agreement is a mandatory
condition precedent to the Employee's receipt of the
consideration provided herein;
(d) Employee has no intention of competing with the Company within
the limitations set forth above;
(e) Employee has received adequate and valuable consideration for
entering into this Agreement;
(f) Employee's covenants shall be construed as independent of any
other provision in this Agreement and the existence of any claim
or cause of action Employee may have against the Company, whether
predicated on this Agreement or not, shall not constitute a
defense to the enforcement by Company of these covenants;
(g) this Agreement does not prevent Employee from earning a
livelihood after termination of employment; and
(h) Employee further acknowledges that his or her education and
experience enables Employee to work for different types of
employers, so that it will not be necessary for Employee to
violate the provisions of this covenant not to compete in order
to remain economically viable.
15. FULL UNDERSTANDING. Employee acknowledges that Employee has carefully
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read and fully understands all of the provisions of this Agreement and that
Employee, in consideration for the compensation set forth herein, is voluntarily
entering into this Agreement.
16. EQUITABLE RELIEF; FEES AND EXPENSES. Employee stipulates and agrees
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that any breach of this Agreement by Employee will result in immediate and
irreparable harm to the Company, the amount of which will be extremely difficult
to ascertain, and that the Company could not be reasonably or adequately
compensated by damages in an action at law. For these reasons, the Company
shall have the right, without objection from Employee, to obtain such
preliminary, temporary or permanent injunctions or restraining orders or decrees
as may be necessary to protect the Company against, or on account of, any breach
by Employee of the provisions of this Agreement. Such right to equitable relief
is in addition to all other legal remedies the Company may have to protect its
rights. In the event the Company obtains any such injunction, order, decree or
other relief, in law or in equity, Employee shall be responsible for reimbursing
the Company for all costs associated with obtaining the relief, including
reasonable attorneys' fees, and expenses and costs of suit. Employee further
covenants and agrees that any order of court or judgment obtained by the Company
which enforces the Company's rights under this Agreement may be transferred,
without objection or opposition by
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Employee, to any court of law or other appropriate law enforcement body located
in any other country in the world where Company does business, and that said
court or body will give full force and effect to said order and or judgment.
17. AMENDMENTS. No supplement, modification, amendment or waiver of the
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terms of this Agreement shall be binding on the parties hereto unless executed
in writing by the party to be bound thereby. No waiver of any of the provisions
of this Agreement shall be deemed to or shall constitute a waiver of any other
provisions hereof (whether or not similar), nor shall such waiver constitute a
continuing waiver unless otherwise expressly provided. Any failure to insist
upon strict compliance with any of the terms and conditions of this Agreement
shall not be deemed a waiver of any such terms or conditions.
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18. SUCCESSORS IN INTEREST. This Agreement shall be binding upon and
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shall inure to the benefit of the successors, assigns, heirs and legal
representatives of the parties hereto. The Company shall have the right to
assign this Agreement in connection with a merger involving the Company or a
sale or transfer of substantially all of the business and assets of the Company,
and Employee agrees to be obligated by this Agreement to any successor, assign
or surviving entity.
19. HEADINGS. The headings used in this Agreement are for convenience
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only and are not to be considered in construing or interpreting this Agreement.
MASTECH SYSTEMS
CORPORATION (COMPANY)
By: __________________________________ ______________________________________
(Employee)
Date: ________________________________ Date: ________________________________
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