EXHIBIT 10.54
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into as of
August 28, 1998, by and between Putnam, Hayes & Xxxxxxxx, Inc., a
Massachusetts corporation (the "Company" or "PHB"), and Xxxx X. Xxxxxx III
("Employee").
WHEREAS, pursuant to that certain Agreement and Plan of Merger (the
"Merger Agreement") dated as of the date hereof among the Company, XXXXXX
XXXXXX, INC., a Delaware corporation ("Xxxxxx Bailly"), and PHB MERGER
CORP., a Massachusetts corporation and wholly-owned subsidiary of Xxxxxx
Xxxxxx ("Merger Sub"), Merger Sub will merge with and into PHB (the
"Merger"), and Xxxxxx Bailly will acquire one hundred percent (100%) of the
common stock of PHB, including the common stock of PHB owned by the
Employee, in exchange for shares of common stock of Xxxxxx Xxxxxx ("Common
Stock");
WHEREAS, after the Merger, certain operating companies of Xxxxxx
Bailly will be merged with and into PHB and the surviving corporation of
such merger will be named PHB Xxxxxx Xxxxxx, Inc. ("PHB Xxxxxx Bailly");
and
WHEREAS, as an inducement to Xxxxxx Xxxxxx to enter into the Merger
Agreement and as a condition precedent to Xxxxxx Bailly's obligations under
the Merger Agreement, Employee has agreed to execute and deliver this
Agreement and to terminate, effective as of the Effective Time of the
Merger (as defined in the Merger Agreement), any prior employment
agreements or arrangements with PHB;
WHEREAS, in consideration of Employee's employment and the
compensation paid to Employee by the Company, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements hereinafter set forth, the parties hereto hereby
agree as follows:
1. Employment. On the terms and conditions set forth in this
Agreement, the Company agrees to employ Employee and Employee agrees to be
employed by the Company for the term set forth in Section 2 hereof and in
the position and with the duties set forth in Section 3 hereof.
2. Term. The term of this Agreement shall commence as of the Effective
Time of the Merger (the "Commencement Date") and shall end on the third
anniversary of the date hereof, unless sooner terminated pursuant to
Section 6 hereof (the "Term").
3. Position and Duties. Employee shall serve as a "Managing Director"
of the Company or such other comparable position as may, from time to time,
be prescribed by the Chief Executive Officer and Board of Directors of the
Company (the "Board of Directors") or any of its affiliates and agreed to
by Employee.
Employee agrees to serve the Company faithfully and to the best of his
ability; to devote his time, energy and skill during regular business hours
(except for illness or incapacity and except for vacation time as provided
herein) to such employment; to use his best efforts, skills and ability to
promote the Company's interests; if elected, to serve as a director of the
Company and its subsidiaries or affiliated corporations or entities; to
perform such duties and responsibilities as from time to time may be
assigned to him by the Chief Executive Officer and the Board of Directors,
which duties shall be consistent with his positions as set forth in the
preceding paragraph.
4. Compensation.
The Company agrees to pay Employee, either directly or through one of
its affiliates, as compensation for all duties performed by him in any
capacity during the period of his employment under this Agreement:
(a) An annual base salary ("Base Salary"), payable in equal installments twice
monthly to Employee, at the annualized rate of $287,664 per year commencing
on the Commencement Date through December 31, 1998. Commencing January 1,
1999 and for the remainder of the Term, the annual rate of Base Salary
shall be determined by management of the Company in accordance with the
compensation policies of the Company for employees of comparable rank but
in no event shall the Base Salary be less than $287,664 at any time during
the term of this Agreement;
(b) A bonus payment ("Bonus") for the calendar year 1998, in an amount, if any,
determined by management of the Company substantially in accordance with
the bonus structure used by PHB as outlined in Appendix A attached hereto;
for calendar year 1999 and each calendar year thereafter during the Term, a
Bonus, in an amount, if any, determined by management of the Company in
accordance with the compensation policies of the Company for employees of
comparable rank;
(c) A grant of options to purchase 30,000 shares of common stock of Xxxxxx
Xxxxxx, Inc. on the Commencement Date, with an exercise price at the fair
market value on the Commencement Date and a term of ten (10) years, vesting
in accordance with the schedule set forth in the Stock Option Agreement to
be executed by and between Xxxxxx Bailly and Employee, and subject to the
terms and conditions of the Xxxxxx Xxxxxx Employee Incentive and
Non-Qualified Stock Option and Restricted Stock Plan or any successor plan;
and
(d) From time to time Employee shall also be eligible to receive options to
purchase Common Stock pursuant to the terms of the Xxxxxx Bailly Employee
Incentive and Non-Qualified Stock Option and Restricted Stock Plan or any
successor plan, and in the amounts determined by, and subject to the terms
and conditions of, the Stock Option Committee of the Board of Directors, or
the Board of Directors, of Xxxxxx Xxxxxx.
5. Benefits; Reimbursement of Expenses; Vacation.
During the Term, Employee shall also be eligible to:
(a) For calendar year 1998, to continue to participate in all of the benefit
programs which are currently provided by PHB; including, without
limitation, all vacation, retirement, health, life and disability insurance
programs ("Benefit Programs") in accordance with policies in effect for
officers of comparable rank; provided, that nothing in this Agreement shall
require the Company to create, continue or refrain from amending,
modifying, revising or revoking any Benefit Programs described herein. For
calendar year 1999 and thereafter, Employee shall be entitled to
participate in all of the Benefit Programs which are then provided by the
Company. For purposes of Employee's participation in the Benefit Programs,
the Company shall treat the full period of Employee's service with PHB, or
any PHB subsidiary; Xxxxxxxxx, O'Brien & Associates, Inc.; and/or Xxxxxxx &
Xxxxx, Incorporated as if it had been service with the Company;
(b) Reimbursement by the Company of all expenses reasonably incurred by him
during the Term in connection with the performance of his duties,
including, without limitation, travel and entertainment expenses reasonably
related to the business or interests of the Company, upon submission by him
of written documentation of such expenses; and
(c) The other benefits set forth in this Agreement.
6. Termination.
This Agreement may be terminated prior to the expiration of its Term as follows:
(a) Automatically upon Employee's death;
(b) By the Company, for "cause," which for purposes of this Agreement shall
mean: (i) failure to comply with material rules, standards, or procedures
reasonably promulgated by the Company in accordance with ordinary and usual
business standards, or dereliction of assigned responsibilities consistent
with Section 3 above, such failure or dereliction remaining uncured by
Employee for thirty (30) days after receiving written notice from the
Company of such failure or dereliction that specifically describes the
nature of such alleged failures;
(ii) substandard performance of assigned responsibilities measured in accordance
with performance standards agreed upon from time to time by Employee and
the Company;
(iii)material violation by Employee, or any other person acting upon his
specific directions, of a federal, state or local statute, rule or
regulation applicable to the Company, to its management, or to the
operation of the Company's business;
(iv) material breach of the terms of this Agreement;
(v) knowing falsification of Company's records or documents;
(vi) gross negligence;
(vii)conviction by Employee, or any other person acting upon Employee's specific
directions, of any misdemeanor that involves fraud or results in a material
loss to the Company or of a felony; or
(viii) any material act of dishonesty or moral turpitude.
The refusal to permanently relocate from Employee's current place of work will
not constitute a "cause" for termination of employment by the Company.
During the Term of the Agreement, the Company shall have no right to terminate
this Agreement without "cause."
(c) By Employee, upon the Company's failure to perform or observe any of the
material terms or provisions of this Agreement, and the continued failure
of the Company to cure such default within thirty (30) days after written
demand for performance has been given to the Company by Employee, which
demand shall describe specifically the nature of such alleged failure to
perform or observe such material terms or provisions. Without limiting the
generality of the foregoing, it is acknowledged and agreed that Sections 4
and 5 of this Agreement are material provisions of this Agreement;
(d) By Employee, upon notice from Employee upon the Company's failure
to pay Employee amounts under Section 4 when due and the continued failure
of the Company to make such payment within ten (10) days after written
demand for such payment is made by Employee; and
(e) Upon permanent disability of Employee, as such term is defined in the
disability insurance programs of the Company; and
(f) By Employee at any time, in the Employee's discretion.
7. Effect of Termination.
(a) In the event of the termination of this Agreement pursuant to paragraphs
(a), (b) and (f) of Section 6, the Company shall be under no obligation to
Employee, except to pay his accrued and unpaid Base Salary, Bonus and paid
leave payments to the date of termination, and any vested but unexercised
options under the Option Plan, and Employee shall not be entitled to
receive any Base Salary or Bonus after the date of termination, or any
unvested options under the Option Plan.
(b) In the event of the termination of this Agreement by Employee of the Company
pursuant to paragraphs (c), (d) or (e) of Section 6, Employee shall be entitled
(without regard to any pay received by Employee from a subsequent employer) to
receive all of the compensation and benefits provided herein until the later of
(i) the date the Term would have expired absent any termination of this
Agreement, or (ii) six (6) months from the effective date of such termination
(such later date being herein referred to as the "Final Payment Date"). In the
event of any termination pursuant to Section 6 (e), any payments pursuant to
this Section 7 shall be reduced by any disability benefits received by Employee
pursuant to any disability insurance provided by the Company or purchased by
Employee (the cost of which is reimbursed by the Company). If the Company and
Employee shall become involved in a dispute relating to any alleged breach of
this Agreement by the Company or Employee, and if Employee prevails (by
judgment, settlement or otherwise) in such dispute, the Company shall reimburse
Employee for all reasonable costs (including fees and disbursements of counsel)
incurred by him in connection with such dispute upon presentation to the Company
of evidence of such costs.
8. Non-compete and Other Restrictive Covenants.
(a) Employee acknowledges that, because of the competitive nature of the
Company's business and the Company's repeat transaction with its clients, the
development and enhancement of relationships with clients constitute goodwill,
which is critical to the Company's success and is one of the Company's most
valuable business assets.
(b) Employee agrees that it is Employee's responsibility to generate and develop
goodwill between the Company and its clients. Employee recognizes and hereby
explicitly agrees that all goodwill with the Company's clients generated or
developed by Employee during Employee's employment with the Company belongs
exclusively to the Company, even if such goodwill was generated solely by
Employee's own efforts.
(c) In order to protect the Company's legitimate business interests, including,
without limitation, protecting the Company's goodwill, Employee agrees that
Employee will not solicit or cause any of the clients of the Company set forth
in Schedule A attached hereto (and amended with additional clients on a
quarterly basis) to divert business from the Company without the Company's prior
written consent. It is acknowledged and agreed that Schedule A will be specific
for the "practice area" in which Employee provides consulting services, and will
include only those clients of the Company for which that "practice area" has
provided services from 1 January 1997 forward. The Company agrees that it will
be reasonable in its consideration of such requests for prior written consent,
and that prior written consent will not be withheld in the event the Company
discontinues a "practice area".
(i) Employee further agrees that Employee will not, directly or indirectly,
recruit or otherwise seek to induce any employees of the Company to
terminate their employment or to violate any agreement with the Company or
to assist any third party in so doing.
(d) The covenants contained in this Section 8 shall be construed as a series of
separate and severable covenants. Employee and the Company agree that if in
any proceeding, the tribunal shall refuse to enforce fully any covenants
contained herein because such covenants cover too extensive a geographic
area or too long a period of time or for any other reason whatsoever, any
such covenant shall be deemed amended to the extent (but only to the
extent) required by law. Each party acknowledges and agrees that the
services to be rendered by Employee to the Company hereunder are of a
special and unique character. Each party shall have the right to injunctive
relief, in addition to all of its other rights and remedies at law or in
equity, to enforce the provisions of this Agreement.
(e) The obligations of Employee under this Section 8
shall not survive if this
Agreement is terminated earlier than the Term pursuant to Section 6 (c) and (d),
but in any event these obligations will not survive longer than the third
anniversary of the Agreement.
9. Proprietary Rights.
(a) Employee acknowledges that, in order for Employee to perform Employee's
duties, the Company must entrust Employee with certain trade secrets and
confidential business information belonging to the Company (the "Confidential
Information"). The Confidential Information includes, but is not limited to,
client lists, including the identity of the Company's clients, information
concerning the characteristics of the Company's clients, pricing policies and
practices, negotiating strategies, computer software, financial information,
information about the Company's business plans, and any other information about
or generated by the Company which could, if disclosed, be useful to any
competitors of the Company. The Confidential Information does not include
information that is in the public domain through no fault or action of Employee.
Employee further acknowledges that the Company has developed or acquired such
Confidential Information at great effort and significant expense, that the
Confidential Information is critical to the success and survival of the Company,
and that the unauthorized disclosure or use of the Confidential Information
would cause the Company irreparable harm.
(b) Employee agrees that, during the term of Employee's employment with the
Company and thereafter, Employee will not disclose the Company's Confidential
Information or use it in any way, except on behalf of the Company, whether or
not such Confidential Information was produced by Employee's own efforts.
Employee further agrees, upon termination of Employee's employment, promptly to
deliver to the Company all Confidential Information, including, but not limited
to, all files, books, documents, computer disks or tapes, and other property
prepared on behalf of the Company or purchased with Company funds, including
Confidential Information produced by Employee's own efforts, and to refrain from
making, retaining or distributing any copies thereof.
(c) At all times during the Term, all right, title, and interest in all
copyrightable material which Employee shall conceive or originate, either
individually or jointly with others, in Employee's capacity as an employee
of the Company will be the property of the Company and are by this
Agreement assigned to the Company along with ownership of any and all
copyrights in the copyrightable material. At all times during the Term,
Employee agrees to execute all papers and perform all other acts reasonably
necessary to assist the Company to obtain and register copyrights on such
materials in any and all countries, and the Company agrees to pay expenses
associated with such copyright registration. Works of authorship created by
Employee for the Company in performing his responsibilities under this
Agreement during the Term shall be considered "works made for hire" as
defined in the U.S. Copyright Act. In addition, Employee hereby assigns to
the Company all proprietary rights which originate during Employee's
employment with the Company, including, but not limited to, all patents,
copyrights, trade secrets and trademarks Employee might otherwise have, by
operation of law or otherwise, in all inventions, discoveries, works,
ideas, information, knowledge and data based on Employee's access to
Confidential Information of the Company or developed by Employee in his
capacity as an employee of the Company.
(d) If, during the Term, Employee is engaged in or associated with the planning
or implementing of any project, program or venture involving the Company
and a third party or parties all rights in such project, program or venture
shall belong to the Company. Except as formally approved by the Company's
Board of Directors, Employee shall not be entitled to any interest in such
project, program or venture or to any commission, finder's fee or other
compensation in connection therewith other than the compensation to be paid
to Employee as provided in this Agreement.
(e) At all times during the Term and thereafter, Employee further agrees to
execute and deliver any additional documents, instruments, applications,
oaths or other writings reasonably necessary or desirable to further
evidence the assignments described in this Section 9 ("Supporting
Documents").
(f) The obligations of Employee under this Section 9
shall survive the termination
or expiration of the Term.
10. Notice.
All notices or other communications which may be or are required to be given,
served or sent by any party to any other party pursuant to this Agreement
shall be in writing and shall be mailed by first-class, registered or
certified mail, return receipt requested, postage prepaid, or transmitted
by hand delivery, or a nationally recognized overnight courier service,
addressed as follows:
(a) If to the Company:
Xxxxxx Xxxxxx, Inc.
0000 Xxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telephone No: (000) 000-0000
Attention: Xxxxxxx X.X. Xxxxxxx,
Vice President and General Counsel
(b) If to the Employee:
Xxxx X. Xxxxxx III
Box 65L, Xxxxx 0 Xxxxxx Xxxxx
Xxxxx Xx, XX 00000
Telephone No: (000) 000-0000
And at the Employee's usual place of
business, if known by the Company.
Each party may designate by notice in writing a new address to which any notice
or other communication may thereafter be so given, served or sent. Each notice
or other communication which shall be mailed or transmitted in the manner
described above, shall be deemed sufficiently given, served, sent, delivered and
received for all purposes at such time as it is delivered to the addressee (with
the return receipt, the delivery receipt or the affidavit of messenger being
deemed conclusive evidence of such delivery) or at such time as delivery is
refused by the addressee upon presentation.
11. Severability.
If any part or any provision of this Agreement shall be invalid or
unenforceable under applicable law, such part shall be ineffective to the
extent of such invalidity or unenforceability only, without in any way
affecting the remaining parts of such provision or the remaining provisions
of this Agreement.
12. Survival.
It is the express intention and agreement of the parties hereto that
all covenants, agreements and statements made by any party in this
Agreement shall survive the execution and delivery of this Agreement, and
that certain covenants, agreements and statements shall survive the
termination or expiration of the Term to the extent specified in Sections
7, 8 and 9 hereof.
13. Waiver.
Neither the waiver of any of the parties hereto of any breach of or
default under any of the provisions of this Agreement, nor the failure of
any of the parties, on one or more occasion, to enforce any of the
provisions of this Agreement or to exercise any right or privilege
hereunder, shall thereafter be construed as a waiver of any subsequent
breach or default, or as a waiver of any such provisions, rights, or
privileges hereunder.
14. Binding Effect.
This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and, subject to Section 19 hereof, their respective
heirs, devisees, executors, administrators, legal representatives, and to
the benefit of PHB Xxxxxx Bailly as successor to the Company.
15. Entire Agreement.
As of immediately prior to the Effective Time of the Merger, this
Agreement (a) represents the entire understanding and agreement among the
parties hereto with respect to the subject matter hereof and supersedes,
cancels and terminates all other negotiations, agreements, arrangements and
understandings, oral or written, between such parties with respect thereto,
(b) constitutes the sole agreement between the parties with respect to this
subject matter, and (c) supersedes, cancels and terminates all prior
negotiations, agreements, arrangements and understandings, oral or written,
with respect to (i) the Employee's employment with PHB or any affiliate of
PHB, and (ii) any other obligations or liabilities of PHB or any affiliate
of PHB except as reflected in PHB's audited financials for 1997 or as set
forth in Schedule B hereto.
16. Amendment.
No amendment or modification of this Agreement and no waiver hereunder
or thereunder shall be valid or binding unless set forth in writing, duly
executed by the party against whom enforcement of the amendment,
modification or waiver is sought.
17. Governing Law.
This Agreement shall be subject to and governed by the laws of the
state of California.
18. Forum.
At all times during the Term, (a) Employee irrevocably submits to the
exclusive jurisdiction of any California court or Federal court sitting in
California, in any action or proceeding arising out of or relating to this
Agreement or the transactions contemplated hereby, and Employee irrevocably
agrees that all claims in respect of any such action or proceeding may be
heard and determined in such California or Federal court; (b) Employee
irrevocably consents to the service of any and all process in any such
action or proceeding by the mailing of copies of such process to Employee
at his address specified in Section 10; (c) Employee irrevocably confirms
that service of process out of such courts in such manner shall be deemed
due service upon him for the purposes of such action or proceeding; (d)
Employee irrevocably waives (i) any objection he may have to the laying of
venue of any such action or proceeding in any of such courts, or (ii) any
claim that he may have that any such action or proceeding has been brought
in an inconvenient forum; and (e) Employee irrevocably agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Section 18 shall affect the right
of any party hereto to serve legal process in any manner permitted by law.
19. Assignment.
Except as otherwise provided herein, this Agreement shall not be
assignable by either party hereto without the prior written consent of the
other party hereto.
20. Headings.
Headings contained in this Agreement are inserted for convenience of
reference only, shall not be deemed to be a part of this Agreement for any
purpose, and shall not in any way define or affect the meaning,
construction or scope of any of the provisions hereof.
21. Execution in Counterparts.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original hereof, and all of which together shall
constitute one and the same instrument.
22. Termination of Merger Agreement.
This Agreement shall automatically terminate and be of no force or
effect upon the termination of the Merger Agreement.
IN WITNESS WHEREOF, the undersigned have duly executed this
Employment Agreement, or have caused this Employment Agreement to be duly
executed on their behalf, as of the day and year first hereinabove set forth.
PUTNAM, HAYES & XXXXXXXX, INC.
By:/s/ Xxxxxxx X. Xxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxx
Title: President and Chief Executive Officer
Xxxx X. Xxxxxx III
/s/ Xxxx X. Xxxxxx III
11
EXHIBIT 10.55
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into
as of August 28, 1998, by and between Putnam, Hayes & Xxxxxxxx, Inc., a
Massachusetts corporation (the "Company" or "PHB"), and Xxxxxxx X.
Xxxxxxxxxx ("Employee").
WHEREAS, pursuant to that certain Agreement and Plan of Merger
(the "Merger Agreement") dated as of the date hereof among the Company, XXXXXX
XXXXXX, INC., a Delaware corporation ("Xxxxxx Bailly"), and PHB MERGER CORP., a
Massachusetts corporation and wholly-owned subsidiary of Xxxxxx Xxxxxx ("Merger
Sub"), Merger Sub will merge with and into PHB (the "Merger"), and Xxxxxx Bailly
will acquire one hundred percent (100%) of the common stock of PHB, including
the common stock of PHB owned by the Employee, in exchange for shares of common
stock of Xxxxxx Xxxxxx ("Common Stock");
WHEREAS, after the Merger, certain operating companies of
Xxxxxx Bailly will be merged with and into PHB and the surviving corporation of
such merger will be named PHB Xxxxxx Xxxxxx, Inc. ("PHB Xxxxxx Bailly"); and
WHEREAS, as an inducement to Xxxxxx Xxxxxx to enter into the
Merger Agreement and as a condition precedent to Xxxxxx Bailly's obligations
under the Merger Agreement, Employee has agreed to execute and deliver this
Agreement and to terminate, effective as of the Effective Time of the Merger (as
defined in the Merger Agreement), any prior employment agreements or
arrangements with PHB;
WHEREAS, in consideration of Employee's employment and the
compensation paid to Employee by the Company, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements hereinafter set forth, the parties hereto hereby
agree as follows:
1. Employment.
On the terms and conditions set forth in this Agreement, the Company
agrees to employ Employee and Employee agrees to be employed by the Company
for the term set forth in Section 2 hereof and in the position and with the
duties set forth in Section 3 hereof.
2. Term.
The term of this Agreement shall commence as of the Effective Time of
the Merger (the "Commencement Date") and shall end on the third anniversary
of the date hereof, unless sooner terminated pursuant to Section 6 hereof
(the "Term").
3. Position and Duties.
Employee shall serve as a "Managing Director" of the Company or such
other comparable position as may, from time to time, be prescribed by the
Chief Executive Officer and Board of Directors of the Company (the "Board
of Directors") or any of its affiliates and agreed to by Employee.
Employee agrees to serve the Company faithfully and to the best of his
ability; to devote his time, energy and skill during regular business hours
(except for illness or incapacity and except for vacation time as provided
herein) to such employment; to use his best efforts, skills and ability to
promote the Company's interests; if elected, to serve as a director of the
Company and its subsidiaries or affiliated corporations or entities; to
perform such duties and responsibilities as from time to time may be
assigned to him by the Chief Executive Officer and the Board of Directors,
which duties shall be consistent with his positions as set forth in the
preceding paragraph.
4. Compensation.
The Company agrees to pay Employee, either directly or through one of
its affiliates, as compensation for all duties performed by him in any
capacity during the period of his employment under this Agreement:
(a) An annual base salary ("Base Salary"), payable in equal installments twice
monthly to Employee, at the annualized rate of $287,664 per year commencing on
the Commencement Date through December 31, 1998. Commencing January 1, 1999 and
for the remainder of the Term, the annual rate of Base Salary shall be
determined by management of the Company in accordance with the compensation
policies of the Company for employees of comparable rank but in no event shall
the Base Salary be less than $287,664 at any time during the term of this
Agreement;
(b) A bonus payment ("Bonus") for the calendar year 1998, in an amount, if any,
determined by management of the Company substantially in accordance with the
bonus structure used by PHB as outlined in Appendix A attached hereto; for
calendar year 1999 and each calendar year thereafter during the Term, a Bonus,
in an amount, if any, determined by management of the Company in accordance with
the compensation policies of the Company for employees of comparable rank;
(c) A grant of options to purchase 12,250 shares of common stock of Xxxxxx
Xxxxxx, Inc. on the Commencement Date, with an exercise price at the fair market
value on the Commencement Date and a term of ten (10) years, vesting in
accordance with the schedule set forth in the Stock Option Agreement to be
executed by and between Xxxxxx Bailly and Employee, and subject to the terms and
conditions of the Xxxxxx Xxxxxx Employee Incentive and Non-Qualified Stock
Option and Restricted Stock Plan or any successor plan; and
(d) From time to time Employee shall also be eligible to receive options to
purchase Common Stock pursuant to the terms of the Xxxxxx Bailly Employee
Incentive and Non-Qualified Stock Option and Restricted Stock Plan or any
successor plan, and in the amounts determined by, and subject to the terms and
conditions of, the Stock Option Committee of the Board of Directors, or the
Board of Directors, of Xxxxxx Xxxxxx.
5. Benefits; Reimbursement of Expenses; Vacation.
During the Term, Employee shall also be eligible to:
(a) For calendar year 1998, to continue to participate in all of the
benefit programs which are currently provided by PHB; including, without
limitation, all vacation, retirement, health, life and disability insurance
programs ("Benefit Programs") in accordance with policies in effect for
officers of comparable rank; provided, that nothing in this Agreement shall
require the Company to create, continue or refrain from amending,
modifying, revising or revoking any Benefit Programs described herein. For
calendar year 1999 and thereafter, Employee shall be entitled to
participate in all of the Benefit Programs which are then provided by the
Company. For purposes of Employee's participation in the Benefit Programs,
the Company shall treat the full period of Employee's service with PHB, or
any PHB subsidiary; Xxxxxxxxx, O'Brien & Associates, Inc.; and/or Xxxxxxx &
Xxxxx, Incorporated as if it had been service with the Company;
(b) Reimbursement by the Company of all expenses reasonably incurred
by him during the Term in connection with the performance of his duties,
including, without limitation, travel and entertainment expenses reasonably
related to the business or interests of the Company, upon submission by him
of written documentation of such expenses; and
(c) The other benefits set forth in this Agreement.
6. Termination.
This Agreement may be terminated prior to the expiration of its Term
as follows:
(a) Automatically upon Employee's death;
(b) By the Company, for "cause," which for purposes of this Agreement
shall mean:
(i) failure to comply with material rules, standards, or procedures
reasonably promulgated by the Company in accordance with ordinary and usual
business standards, or dereliction of assigned responsibilities consistent
with Section 3 above, such failure or dereliction remaining uncured by
Employee for thirty (30) days after receiving written notice from the
Company of such failure or dereliction that specifically describes the
nature of such alleged failures;
(ii) substandard performance of assigned responsibilities measured in
accordance with performance standards agreed upon from time to time by
Employee and the Company;
(iii) material violation by Employee, or any other person acting upon his
specific directions, of a federal, state or local statute, rule or
regulation applicable to the Company, to its management, or to the
operation of the Company's business;
(iv) material breach of the terms of this Agreement;
(v) knowing falsification of Company's records or documents;
(vi) gross negligence;
(vii) conviction by Employee, or any other person acting upon Employee's
specific directions, of any misdemeanor that involves fraud or results in a
material loss to the Company or of a felony; or
(viii) any material act of dishonesty or moral turpitude.
The refusal to permanently relocate from Employee's current place of work
will not constitute a "cause" for termination of employment by the Company.
During the Term of the Agreement, the Company shall have no right to terminate
this Agreement without "cause."
(c) By Employee, upon the Company's failure to perform or observe any
of the material terms or provisions of this Agreement, and the continued
failure of the Company to cure such default within thirty (30) days after
written demand for performance has been given to the Company by Employee,
which demand shall describe specifically the nature of such alleged failure
to perform or observe such material terms or provisions. Without limiting
the generality of the foregoing, it is acknowledged and agreed that
Sections 4 and 5 of this Agreement are material provisions of this
Agreement;
(d) By Employee, upon notice from Employee upon the Company's failure
to pay Employee amounts under Section 4 when due and the continued failure
of the Company to make such payment within ten (10) days after written
demand for such payment is made by Employee; and
(e) Upon permanent disability of Employee, as such term is defined in
the disability insurance programs of the Company; and
(f) By Employee at any time, in the Employee's discretion.
7. Effect of Termination.
(a) In the event of the termination of this Agreement pursuant to
paragraphs (a), (b) and (f) of Section 6, the Company shall be under no
obligation to Employee, except to pay his accrued and unpaid Base Salary,
Bonus and paid leave payments to the date of termination, and any vested
but unexercised options under the Option Plan, and Employee shall not be
entitled to receive any Base Salary or Bonus after the date of termination,
or any unvested options under the Option Plan.
(b) In the event of the termination of this Agreement by Employee of
the Company pursuant to paragraphs (c), (d) or (e) of Section 6, Employee
shall be entitled (without regard to any pay received by Employee from a
subsequent employer) to receive all of the compensation and benefits
provided herein until the later of (i) the date the Term would have expired
absent any termination of this Agreement, or (ii) six (6) months from the
effective date of such termination (such later date being herein referred
to as the "Final Payment Date"). In the event of any termination pursuant
to Section 6 (e), any payments pursuant to this Section 7 shall be reduced
by any disability benefits received by Employee pursuant to any disability
insurance provided by the Company or purchased by Employee (the cost of
which is reimbursed by the Company). If the Company and Employee shall
become involved in a dispute relating to any alleged breach of this
Agreement by the Company or Employee, and if Employee prevails (by
judgment, settlement or otherwise) in such dispute, the Company shall
reimburse Employee for all reasonable costs (including fees and
disbursements of counsel) incurred by him in connection with such dispute
upon presentation to the Company of evidence of such costs.
8. Non-compete and Other Restrictive Covenants.
(a) Employee acknowledges that, because of the competitive nature of the
Company's business and the Company's repeat transaction with its clients,
the development and enhancement of relationships with clients constitute
goodwill, which is critical to the Company's success and is one of the
Company's most valuable business assets.
(b) Employee agrees that it is Employee's responsibility to generate and
develop goodwill between the Company and its clients. Employee recognizes
and hereby explicitly agrees that all goodwill with the Company's clients
generated or developed by Employee during Employee's employment with the
Company belongs exclusively to the Company, even if such goodwill was
generated solely by Employee's own efforts.
(c) In order to protect the Company's legitimate business interests, including,
without limitation, protecting the Company's goodwill, Employee agrees that
Employee will not solicit or cause any of the clients of the Company set
forth in Schedule A attached hereto (and amended with additional clients on
a
----------
quarterly basis) to divert business from the Company without the
Company's prior written consent. It is acknowledged and agreed that
Schedule A will be specific for the "practice area" in which Employee
provides
----------
consulting services, and will include only those clients of the
Company for which that "practice area" has provided services from 1 January
1997 forward. The Company agrees that it will be reasonable in its
consideration of such requests for prior written consent, and that prior
written consent will not be withheld in the event the Company discontinues
a "practice area".
(i) Employee further agrees that Employee will not, directly or
indirectly, recruit or otherwise seek to induce any employees of the
Company to terminate their employment or to violate any agreement with the
Company or to assist any third party in so doing.
(d) The covenants contained in this Section 8 shall be construed as a
series of separate and severable covenants. Employee and the Company agree
that if in any proceeding, the tribunal shall refuse to enforce fully any
covenants contained herein because such covenants cover too extensive a
geographic area or too long a period of time or for any other reason
whatsoever, any such covenant shall be deemed amended to the extent (but
only to the extent) required by law. Each party acknowledges and agrees
that the services to be rendered by Employee to the Company hereunder are
of a special and unique character. Each party shall have the right to
injunctive relief, in addition to all of its other rights and remedies at
law or in equity, to enforce the provisions of this Agreement.
(e) The obligations of Employee under this Section 8 shall not survive
if this Agreement is terminated earlier than the Term pursuant to Section 6
(c) and (d), but in any event these obligations will not survive longer
than the third anniversary of the Agreement.
9. Proprietary Rights.
(a) Employee acknowledges that, in order for Employee to perform Employee's
duties, the Company must entrust Employee with certain trade secrets and
confidential business information belonging to the Company (the "Confidential
Information"). The Confidential Information includes, but is not limited to,
client lists, including the identity of the Company's clients, information
concerning the characteristics of the Company's clients, pricing policies and
practices, negotiating strategies, computer software, financial information,
information about the Company's business plans, and any other information about
or generated by the Company which could, if disclosed, be useful to any
competitors of the Company. The Confidential Information does not include
information that is in the public domain through no fault or action of Employee.
Employee further acknowledges that the Company has developed or acquired such
Confidential Information at great effort and significant expense, that the
Confidential Information is critical to the success and survival of the Company,
and that the unauthorized disclosure or use of the Confidential Information
would cause the Company irreparable harm.
(b) Employee agrees that, during the term of Employee's employment with the
Company and thereafter, Employee will not disclose the Company's Confidential
Information or use it in any way, except on behalf of the Company, whether or
not such Confidential Information was produced by Employee's own efforts.
Employee further agrees, upon termination of Employee's employment, promptly to
deliver to the Company all Confidential Information, including, but not limited
to, all files, books, documents, computer disks or tapes, and other property
prepared on behalf of the Company or purchased with Company funds, including
Confidential Information produced by Employee's own efforts, and to refrain from
making, retaining or distributing any copies thereof.
(c) At all times during the Term, all right, title, and interest in all
copyrightable material which Employee shall conceive or originate,
either individually or jointly with others, in Employee's capacity as
an employee of the Company will be the property of the Company and are
by this Agreement assigned to the Company along with ownership of any
and all copyrights in the copyrightable material. At all times during
the Term, Employee agrees to execute all papers and perform all other
acts reasonably necessary to assist the Company to obtain and register
copyrights on such materials in any and all countries, and the Company
agrees to pay expenses associated with such copyright registration.
Works of authorship created by Employee for the Company in performing
his responsibilities under this Agreement during the Term shall be
considered "works made for hire" as defined in the U.S. Copyright Act.
In addition, Employee hereby assigns to the Company all proprietary
rights which originate during Employee's employment with the Company,
including, but not limited to, all patents, copyrights, trade secrets
and trademarks Employee might otherwise have, by operation of law or
otherwise, in all inventions, discoveries, works, ideas, information,
knowledge and data based on Employee's access to Confidential
Information of the Company or developed by Employee in his capacity as
an employee of the Company.
(d) If, during the Term, Employee is engaged in or associated with the
planning or implementing of any project, program or venture involving the
Company and a third party or parties all rights in such project, program or
venture shall belong to the Company. Except as formally approved by the
Company's Board of Directors, Employee shall not be entitled to any
interest in such project, program or venture or to any commission, finder's
fee or other compensation in connection therewith other than the
compensation to be paid to Employee as provided in this Agreement.
(e) At all times during the Term and thereafter, Employee further agrees to
execute and deliver any additional documents, instruments, applications,
oaths or other writings reasonably necessary or desirable to further
evidence the assignments described in this Section 9 ("Supporting
Documents").
(f) The obligations of Employee under this Section 9 shall survive the
termination or expiration of the Term.
10. Notice.
All notices or other communications which may be or are required to be
given, served or sent by any party to any other party pursuant to this
Agreement shall be in writing and shall be mailed by first-class,
registered or certified mail, return receipt requested, postage prepaid, or
transmitted by hand delivery, or a nationally recognized overnight courier
service, addressed as follows:
(a) If to the Company:
Xxxxxx Xxxxxx, Inc.
0000 Xxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telephone No: (000) 000-0000
Attention: Xxxxxxx X.X. Xxxxxxx,
Vice President and General Counsel
(b) If to the Employee:
Xxxxxxx X. Xxxxxxxxxx
00 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Telephone No: (000) 000-0000
And at the Employee's usual place of
business, if known by the Company.
Each party may designate by notice in writing a new address to which any notice
or other communication may thereafter be so given, served or sent. Each notice
or other communication which shall be mailed or transmitted in the manner
described above, shall be deemed sufficiently given, served, sent, delivered and
received for all purposes at such time as it is delivered to the addressee (with
the return receipt, the delivery receipt or the affidavit of messenger being
deemed conclusive evidence of such delivery) or at such time as delivery is
refused by the addressee upon presentation.
11. Severability.
If any part or any provision of this Agreement shall be invalid or
unenforceable under applicable law, such part shall be ineffective to the
extent of such invalidity or unenforceability only, without in any way
affecting the remaining parts of such provision or the remaining provisions
of this Agreement.
12. Survival.
It is the express intention and agreement of the parties hereto that
all covenants, agreements and statements made by any party in this
Agreement shall survive the execution and delivery of this Agreement, and
that certain covenants, agreements and statements shall survive the
termination or expiration of the Term to the extent specified in Sections
7, 8 and 9 hereof.
13. Waiver.
Neither the waiver of any of the parties hereto of any breach of or
default under any of the provisions of this Agreement, nor the failure of
any of the parties, on one or more occasion, to enforce any of the
provisions of this Agreement or to exercise any right or privilege
hereunder, shall thereafter be construed as a
waiver of any subsequent breach or default, or as a waiver of any such
provisions, rights, or privileges hereunder.
14. Binding Effect.
This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and, subject to Section 19 hereof, their respective
heirs, devisees, executors, administrators, legal representatives, and to
the benefit of PHB Xxxxxx Xxxxxx as successor to the Company.
15. Entire Agreement.
As of immediately prior to the Effective Time of the Merger, this
Agreement (a) represents the entire understanding and agreement among the
parties hereto with respect to the subject matter hereof and supersedes,
cancels and terminates all other negotiations, agreements, arrangements and
understandings, oral or written, between such parties with respect thereto,
(b) constitutes the sole agreement between the parties with respect to this
subject matter, and (c) supersedes, cancels and terminates all prior
negotiations, agreements, arrangements and understandings, oral or written,
with respect to (i) the Employee's employment with PHB or any affiliate of
PHB, and (ii) any other obligations or liabilities of PHB or any affiliate
of PHB except as reflected in PHB's audited financials for 1997 or as set
forth in Schedule B hereto.
16. Amendment.
No amendment or modification of this Agreement and no waiver hereunder
or thereunder shall be valid or binding unless set forth in writing, duly
executed by the party against whom enforcement of the amendment,
modification or waiver is sought.
17. Governing Law.
This Agreement shall be subject to and governed by the laws of the
Commonwealth of Massachusetts.
18. Forum.
At all times during the Term, (a) Employee irrevocably submits to the
exclusive jurisdiction of any Massachusetts court or Federal court sitting
in Massachusetts, in any action or proceeding arising out of or relating to
this Agreement or the transactions contemplated hereby, and Employee
irrevocably agrees that all claims in respect of any such action or
proceeding may be heard and determined in such Massachusetts or Federal
court; (b) Employee irrevocably consents to the service of any and all
process in any such action or proceeding by the mailing of copies of such
process to Employee at his address specified in Section 10; (c) Employee
irrevocably confirms that service of process out of such courts in such
manner shall be deemed due service upon him for the purposes of such action
or proceeding; (d) Employee irrevocably waives (i) any objection he may
have to the laying of venue of any such action or proceeding in any of such
courts, or (ii) any claim that he may have that any such action or
proceeding has been brought in an inconvenient forum; and (e) Employee
irrevocably agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law. Nothing in this
Section 18 shall affect the right of any party hereto to serve legal
process in any manner permitted by law.
19. Assignment.
Except as otherwise provided herein, this Agreement shall not be
assignable by either party hereto without the prior written consent of the
other party hereto.
20. Headings.
Headings contained in this Agreement are inserted for convenience of
reference only, shall not be deemed to be a part of this Agreement for any
purpose, and shall not in any way define or affect the meaning,
construction or scope of any of the provisions hereof.
21. Execution in Counterparts.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original hereof, and all of which together shall
constitute one and the same instrument.
22. Termination of Merger Agreement.
This Agreement shall automatically terminate and be of no force or
effect upon the termination of the Merger Agreement.
IN WITNESS WHEREOF, the undersigned have duly executed this
Employment Agreement, or have caused this Employment Agreement to be duly
executed on their behalf, as of the day and year first hereinabove set forth.
PUTNAM, HAYES & XXXXXXXX, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxx
Title: President and Chief Executive Officer
Xxxxxxx X. Xxxxxxxxxx
/s/ Xxxxxxx X. Xxxxxxxxxx
11
EXHIBIT 10.56
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into
as of August 28, 1998, by and between Putnam, Hayes & Xxxxxxxx, Inc., a
Massachusetts corporation (the "Company" or "PHB"), and Xxxxxx X. X.
Xxxxxxxx ("Employee").
WHEREAS, pursuant to that certain Agreement and Plan of Merger
(the "Merger Agreement") dated as of the date hereof among the Company, XXXXXX
BAILLY, INC., a Delaware corporation ("Xxxxxx Xxxxxx"), and PHB MERGER CORP., a
Massachusetts corporation and wholly-owned subsidiary of Xxxxxx Bailly ("Merger
Sub"), Merger Sub will merge with and into PHB (the "Merger"), and Xxxxxx Xxxxxx
will acquire one hundred percent (100%) of the common stock of PHB, including
the common stock of PHB owned by the Employee, in exchange for shares of common
stock of Xxxxxx Bailly ("Common Stock");
WHEREAS, after the Merger, certain operating companies of
Xxxxxx Xxxxxx will be merged with and into PHB and the surviving corporation of
such merger will be named PHB Xxxxxx Bailly, Inc. ("PHB Xxxxxx Xxxxxx"); and
WHEREAS, as an inducement to Xxxxxx Bailly to enter into the
Merger Agreement and as a condition precedent to Xxxxxx Bailly's obligations
under the Merger Agreement, Employee has agreed to execute and deliver this
Agreement and to terminate, effective as of the Effective Time of the Merger (as
defined in the Merger Agreement), any prior employment agreements or
arrangements with PHB;
WHEREAS, in consideration of Employee's employment and the
compensation paid to Employee by the Company, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements hereinafter set forth, the parties hereto hereby
agree as follows:
1. Employment.
On the terms and conditions set forth in this Agreement, the Company
agrees to employ Employee and Employee agrees to be employed by the Company
for the term set forth in Section 2 hereof and in the position and with the
duties set forth in Section 3 hereof.
2. Term.
The term of this Agreement shall commence as of the Effective Time of
the Merger (the "Commencement Date") and shall end on the third anniversary
of the date hereof, unless sooner terminated pursuant to Section 6 hereof
(the "Term").
3. Position and Duties.
Employee shall serve as a "Managing Director" of the Company or such
other comparable position as may, from time to time, be prescribed by the
Chief Executive Officer and Board of Directors of the Company (the "Board
of Directors") or any of its affiliates and agreed to by Employee.
Employee agrees to serve the Company faithfully and to the best of his
ability; to devote his time, energy and skill during regular business hours
(except for illness or incapacity and except for vacation time as provided
herein) to such employment; to use his best efforts, skills and ability to
promote the Company's interests; if elected, to serve as a director of the
Company and its subsidiaries or affiliated corporations or entities; to
perform such duties and responsibilities as from time to time may be
assigned to him by the Chief Executive Officer and the Board of Directors,
which duties shall be consistent with his positions as set forth in the
preceding paragraph.
4. Compensation.
The Company agrees to pay Employee, either directly or through one of
its affiliates, as compensation for all duties performed by him in any
capacity during the period of his employment under this Agreement:
(a) An annual base salary ("Base Salary"), payable in equal installments twice
monthly to Employee, at the annualized rate of $287,664 per year commencing on
the Commencement Date through December 31, 1998. Commencing January 1, 1999 and
for the remainder of the Term, the annual rate of Base Salary shall be
determined by management of the Company in accordance with the compensation
policies of the Company for employees of comparable rank but in no event shall
the Base Salary be less than $287,664 at any time during the term of this
Agreement;
(b) A bonus payment ("Bonus") for the calendar year 1998, in an amount, if any,
determined by management of the Company substantially in accordance with the
bonus structure used by PHB as outlined in Appendix A attached hereto; for
calendar year 1999 and each calendar year thereafter during the Term, a Bonus,
in an amount, if any, determined by management of the Company in accordance with
the compensation policies of the Company for employees of comparable rank;
(c) A grant of options to purchase 30,000 shares of common stock of Xxxxxx
Xxxxxx, Inc. on the Commencement Date, with an exercise price at the fair market
value on the Commencement Date and a term of ten (10) years, vesting in
accordance with the schedule set forth in the Stock Option Agreement to be
executed by and between Xxxxxx Bailly and Employee, and subject to the terms and
conditions of the Xxxxxx Xxxxxx Employee Incentive and Non-Qualified Stock
Option and Restricted Stock Plan or any successor plan; and
(d) From time to time Employee shall also be eligible to receive options to
purchase Common Stock pursuant to the terms of the Xxxxxx Bailly Employee
Incentive and Non-Qualified Stock Option and Restricted Stock Plan or any
successor plan, and in the amounts determined by, and subject to the terms and
conditions of, the Stock Option Committee of the Board of Directors, or the
Board of Directors, of Xxxxxx Xxxxxx.
5. Benefits; Reimbursement of Expenses; Vacation.
During the Term, Employee shall also be eligible to:
(a) For calendar year 1998, to continue to participate in all of the
benefit programs which are currently provided by PHB; including, without
limitation, all vacation, retirement, health, life and disability insurance
programs ("Benefit Programs") in accordance with policies in effect for
officers of comparable rank; provided, that nothing in this Agreement shall
require the Company to create, continue or refrain from amending,
modifying, revising or revoking any Benefit Programs described herein. For
calendar year 1999 and thereafter, Employee shall be entitled to
participate in all of the Benefit Programs which are then provided by the
Company. For purposes of Employee's participation in the Benefit Programs,
the Company shall treat the full period of Employee's service with PHB, or
any PHB subsidiary; Xxxxxxxxx, X'Xxxxx & Associates, Inc.; and/or Xxxxxxx &
Xxxxx, Incorporated as if it had been service with the Company;
(b) Reimbursement by the Company of all expenses reasonably incurred
by him during the Term in connection with the performance of his duties,
including, without limitation, travel and entertainment expenses reasonably
related to the business or interests of the Company, upon submission by him
of written documentation of such expenses; and
(c) The other benefits set forth in this Agreement.
6. Termination.
This Agreement may be terminated prior to the expiration of its Term
as follows:
(a) Automatically upon Employee's death;
(b) By the Company, for "cause," which for purposes
of this Agreement shall mean:
(i) failure to comply with material rules,
standards, or procedures reasonably
promulgated by the Company in accordance
with ordinary and usual business standards,
or dereliction of assigned responsibilities
consistent with Section 3 above, such
failure or dereliction remaining uncured by
Employee for thirty (30) days after
receiving written notice from the Company of
such failure or dereliction that
specifically describes the nature of such
alleged failures;
(ii) substandard performance of assigned
responsibilities measured in accordance with
performance standards agreed upon from time
to time by Employee and the Company;
(iii) material violation by Employee, or any
other person acting upon his specific
directions, of a federal, state or local
statute, rule or regulation applicable to
the Company, to its management, or to the
operation of the Company's business;
(iv) material breach of the terms of this Agreement;
(v) knowing falsification of Company's records or documents;
(vi) gross negligence;
(vii) conviction by Employee, or any other person acting upon
Employee's specific directions, of any misdemeanor that involves fraud or
results in a material loss to the Company or of a felony; or
(viii) any material act of dishonesty or moral turpitude.
The refusal to permanently relocate from Employee's current place of
work will not constitute a "cause" for termination of employment by the
Company.
During the Term of the Agreement, the Company shall have no right to terminate
this Agreement without "cause."
(c) By Employee, upon the Company's failure to perform or observe any
of the material terms or provisions of this Agreement, and the continued
failure of the Company to cure such default within thirty (30) days after
written demand for performance has been given to the Company by Employee,
which demand shall describe specifically the nature of such alleged failure
to perform or observe such material terms or provisions. Without limiting
the generality of the foregoing, it is acknowledged and agreed that
Sections 4 and 5 of this Agreement are material provisions of this
Agreement;
(d) By Employee, upon notice from Employee upon the Company's failure
to pay Employee amounts under Section 4 when due and the continued failure
of the Company to make such payment within ten (10) days after written
demand for such payment is made by Employee; and
(e) Upon permanent disability of Employee, as such term is defined in
the disability insurance programs of the Company; and
(f) By Employee at any time, in the Employee's discretion.
7. Effect of Termination.
(a) In the event of the termination of this Agreement pursuant to
paragraphs (a), (b) and (f) of Section 6, the Company shall be under no
obligation to Employee, except to pay his accrued and unpaid Base Salary,
Bonus and paid leave payments to the date of termination, and any vested
but unexercised options under the Option Plan, and Employee shall not be
entitled to receive any Base Salary or Bonus after the date of termination,
or any unvested options under the Option Plan.
(b) In the event of the termination of this Agreement by Employee of
the Company pursuant to paragraphs (c), (d) or (e) of Section 6, Employee
shall be entitled (without regard to any pay received by Employee from a
subsequent employer) to receive all of the compensation and benefits
provided herein until the later of (i) the date the Term would have expired
absent any termination of this Agreement, or (ii) six (6) months from the
effective date of such termination (such later date being herein referred
to as the "Final Payment Date"). In the event of any termination pursuant
to Section 6 (e), any payments pursuant to this Section 7 shall be reduced
by any disability benefits received by Employee pursuant to any disability
insurance provided by the Company or purchased by Employee (the cost of
which is reimbursed by the Company). If the Company and Employee shall
become involved in a dispute relating to any alleged breach of this
Agreement by the Company or Employee, and if Employee prevails (by
judgment, settlement or otherwise) in such dispute, the Company shall
reimburse Employee for all reasonable costs (including fees and
disbursements of counsel) incurred by him in connection with such dispute
upon presentation to the Company of evidence of such costs.
8. Non-compete and Other Restrictive Covenants.
(a) Employee acknowledges that, because of the competitive nature of the
Company's business and the Company's repeat transaction with its clients, the
development and enhancement of relationships with clients constitute goodwill,
which is critical to the Company's success and is one of the Company's most
valuable business assets. (b) Employee agrees that it is Employee's
responsibility to generate and develop goodwill between the Company and its
clients. Employee recognizes and hereby explicitly agrees that all goodwill with
the Company's clients generated or developed by Employee during Employee's
employment with the Company belongs exclusively to the Company, even if such
goodwill was generated solely by Employee's own efforts.
(c) In order to protect the Company's legitimate business interests, including,
without limitation, protecting the Company's goodwill, Employee agrees that
Employee will not solicit or cause any of the clients of the Company set forth
in Schedule A attached hereto (and amended with additional clients on a
quarterly basis) to divert business from the Company without the Company's prior
written consent. It is acknowledged and agreed that Schedule A will be specific
for the "practice area" in which Employee provides consulting services, and will
include only those clients of the Company for which that "practice area" has
provided services from 1 January 1997 forward. The Company agrees that it will
be reasonable in its consideration of such requests for prior written consent,
and that prior written consent will not be withheld in the event the Company
discontinues a "practice area".
(i) Employee further agrees that Employee will not, directly or
indirectly, recruit or otherwise seek to induce any employees of the
Company to terminate their employment or to violate any agreement with the
Company or to assist any third party in so doing.
(d) The covenants contained in this Section 8 shall be construed as a
series of separate and severable covenants. Employee and the Company agree
that if in any proceeding, the tribunal shall refuse to enforce fully any
covenants contained herein because such covenants cover too extensive a
geographic area or too long a period of time or for any other reason
whatsoever, any such covenant shall be deemed amended to the extent (but
only to the extent) required by law. Each party acknowledges and agrees
that the services to be rendered by Employee to the Company hereunder are
of a special and unique character. Each party shall have the right to
injunctive relief, in addition to all of its other rights and remedies at
law or in equity, to enforce the provisions of this Agreement.
(e) The obligations of Employee under this Section 8
shall not survive if this
Agreement is terminated earlier than the Term pursuant to Section 6 (c) and (d),
but in any event these obligations will not survive longer than the third
anniversary of the Agreement.
9. Proprietary Rights.
(a) Employee acknowledges that, in order for Employee to perform Employee's
duties, the Company must entrust Employee with certain trade secrets and
confidential business information belonging to the Company (the "Confidential
Information"). The Confidential Information includes, but is not limited to,
client lists, including the identity of the Company's clients, information
concerning the characteristics of the Company's clients, pricing policies and
practices, negotiating strategies, computer software, financial information,
information about the Company's business plans, and any other information about
or generated by the Company which could, if disclosed, be useful to any
competitors of the Company. The Confidential Information does not include
information that is in the public domain through no fault or action of Employee.
Employee further acknowledges that the Company has developed or acquired such
Confidential Information at great effort and significant expense, that the
Confidential Information is critical to the success and survival of the Company,
and that the unauthorized disclosure or use of the Confidential Information
would cause the Company irreparable harm.
(b) Employee agrees that, during the term of Employee's employment with the
Company and thereafter, Employee will not disclose the Company's Confidential
Information or use it in any way, except on behalf of the Company, whether or
not such Confidential Information was produced by Employee's own efforts.
Employee further agrees, upon termination of Employee's employment, promptly to
deliver to the Company all Confidential Information, including, but not limited
to, all files, books, documents, computer disks or tapes, and other property
prepared on behalf of the Company or purchased with Company funds, including
Confidential Information produced by Employee's own efforts, and to refrain from
making, retaining or distributing any copies thereof.
(c) At all times during the Term, all right, title, and interest in
all copyrightable material which Employee shall conceive or originate,
either individually or jointly with others, in Employee's capacity as an
employee of the Company will be the property of the Company and are by this
Agreement assigned to the Company along with ownership of any and all
copyrights in the copyrightable material. At all times during the Term,
Employee agrees to execute all papers and perform all other acts reasonably
necessary to assist the Company to obtain and register copyrights on such
materials in any and all countries, and the Company agrees to pay expenses
associated with such copyright registration. Works of authorship created by
Employee for the Company in performing his responsibilities under this
Agreement during the Term shall be considered "works made for hire" as
defined in the U.S. Copyright Act. In addition, Employee hereby assigns to
the Company all proprietary rights which originate during Employee's
employment with the Company, including, but not limited to, all patents,
copyrights, trade secrets and trademarks Employee might otherwise have, by
operation of law or otherwise, in all inventions, discoveries, works,
ideas, information, knowledge and data based on Employee's access to
Confidential Information of the Company or developed by Employee in his
capacity as an employee of the Company.
(d) If, during the Term, Employee is engaged in or associated with the
planning or implementing of any project, program or venture involving the
Company and a third party or parties all rights in such project, program or
venture shall belong to the Company. Except as formally approved by the
Company's Board of Directors, Employee shall not be entitled to any
interest in such project, program or venture or to any commission, finder's
fee or other compensation in connection therewith other than the
compensation to be paid to Employee as provided in this Agreement.
(e) At all times during the Term and thereafter, Employee further
agrees to execute and deliver any additional documents, instruments,
applications, oaths or other writings reasonably necessary or desirable to
further evidence the assignments described in this Section 9 ("Supporting
Documents").
(f) The obligations of Employee under this Section 9
shall survive the termination
or expiration of the Term.
10. Notice.
All notices or other communications which may be or are required to be
given, served or sent by any party to any other party pursuant to this
Agreement shall be in writing and shall be mailed by first-class,
registered or certified mail, return receipt requested, postage prepaid, or
transmitted by hand delivery, or a nationally recognized overnight courier
service, addressed as follows:
(a) If to the Company:
Xxxxxx Xxxxxx, Inc.
0000 Xxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telephone No: (000) 000-0000
Attention: Xxxxxxx X.X. Xxxxxxx,
Vice President and General Counsel
(b) If to the Employee:
Xxxxxx X. Xxxxxxxx
0000 00xx Xxxxxx, XX
Xxxxxxxxxx, XX 00000
Telephone No: (000) 000-0000
And at the Employee's usual place of
business, if known by the Company.
And a courtesy copy to:
Xxxxxxx Xxxxxxxxxxx, Esq.
Xxxxxx, Flyer & Xxxxx
0000 X Xxxxxx X.X., Xxxxx 000
Xxxxxxxxxx, XX 00000
Each party may designate by notice in writing a new address to which any notice
or other communication may thereafter be so given, served or sent. Each notice
or other communication which shall be mailed or transmitted in the manner
described above, shall be deemed sufficiently given, served, sent, delivered and
received for all purposes at such time as it is delivered to the addressee (with
the return receipt, the delivery receipt or the affidavit of messenger being
deemed conclusive evidence of such delivery) or at such time as delivery is
refused by the addressee upon presentation.
11. Severability.
If any part or any provision of this Agreement shall be invalid or
unenforceable under applicable law, such part shall be ineffective to the
extent of such invalidity or unenforceability only, without in any way
affecting the remaining parts of such provision or the remaining provisions
of this Agreement.
12. Survival.
It is the express intention and agreement of the parties hereto that
all covenants, agreements and statements made by any party in this
Agreement shall survive the execution and delivery of this Agreement, and
that certain covenants, agreements and statements shall survive the
termination or expiration of the Term to the extent specified in Sections
7, 8 and 9 hereof.
13. Waiver.
Neither the waiver of any of the parties hereto of any breach of or
default under any of the provisions of this Agreement, nor the failure of
any of the parties, on one or more occasion, to enforce any of the
provisions of this Agreement or to exercise any right or privilege
hereunder, shall thereafter be construed as a waiver of any subsequent
breach or default, or as a waiver of any such provisions, rights, or
privileges hereunder.
14. Binding Effect.
This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and, subject to Section 19 hereof, their respective
heirs, devisees, executors, administrators, legal representatives, and to
the benefit of PHB Xxxxxx Bailly as successor to the Company.
15. Entire Agreement.
As of immediately prior to the Effective Time of the Merger, this
Agreement (a) represents the entire understanding and agreement among the
parties hereto with respect to the subject matter hereof and supersedes,
cancels and terminates all other negotiations, agreements, arrangements and
understandings, oral or written, between such parties with respect thereto,
(b) constitutes the sole agreement between the parties with respect to this
subject matter, and (c) supersedes, cancels and terminates all prior
negotiations, agreements, arrangements and understandings, oral or written,
with respect to (i) the Employee's employment with PHB or any affiliate of
PHB, and (ii) any other obligations or liabilities of PHB or any affiliate
of PHB except as reflected in PHB's audited financials for 1997 or as set
forth in Schedule B hereto.
16. Amendment.
No amendment or modification of this Agreement and no waiver hereunder
or thereunder shall be valid or binding unless set forth in writing, duly
executed by the party against whom enforcement of the amendment,
modification or waiver is sought.
17. Governing Law.
This Agreement shall be subject to and governed by the laws of the
District of Columbia.
18. Forum.
At all times during the Term, (a) Employee irrevocably submits to the
exclusive jurisdiction of any District of Columbia court or Federal court
sitting in the District of Columbia, in any action or proceeding arising
out of or relating to this Agreement or the transactions contemplated
hereby, and Employee irrevocably agrees that all claims in respect of any
such action or proceeding may be heard and determined in such District of
Columbia or Federal court; (b) Employee irrevocably consents to the service
of any and all process in any such action or proceeding by the mailing of
copies of such process to Employee at his address specified in Section 10;
(c) Employee irrevocably confirms that service of process out of such
courts in such manner shall be deemed due service upon him for the purposes
of such action or proceeding; (d) Employee irrevocably waives (i) any
objection he may have to the laying of venue of any such action or
proceeding in any of such courts, or (ii) any claim that he may have that
any such action or proceeding has been brought in an inconvenient forum;
and (e) Employee irrevocably agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Section 18 shall affect the right of any party hereto
to serve legal process in any manner permitted by law.
19. Assignment.
Except as otherwise provided herein, this Agreement shall not be
assignable by either party hereto without the prior written consent of the
other party hereto.
20. Headings.
Headings contained in this Agreement are inserted for convenience of
reference only, shall not be deemed to be a part of this Agreement for any
purpose, and shall not in any way define or affect the meaning,
construction or scope of any of the provisions hereof.
21. Execution in Counterparts.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original hereof, and all of which together shall
constitute one and the same instrument.
22. Termination of Merger Agreement.
This Agreement shall automatically terminate and be of no force or
effect upon the termination of the Merger Agreement.
IN WITNESS WHEREOF, the undersigned have duly executed this
Employment Agreement, or have caused this Employment Agreement to be duly
executed on their behalf, as of the day and year first hereinabove set forth.
PUTNAM, HAYES & XXXXXXXX, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxx
Title:President and Chief Executive Officer
Xxxxxx X. X. Xxxxxxxx
/s/ Xxxxxx X. X. Xxxxxxxx
