Contract
EXHIBIT 10.12
000 Xxxxx Xxxx Xxxxx
Xxxxxxxx 000
Xxxxx, XX 00000
000.000.0000
(FAX) 000.000.0000
Xxxxxxxx 000
Xxxxx, XX 00000
000.000.0000
(FAX) 000.000.0000
December 3, 2008
Xx. Xxxxx X. Xxxxx
000 Xxxxxxx Xxxx
Xxxxxxxxxxxx, XX 00000
000 Xxxxxxx Xxxx
Xxxxxxxxxxxx, XX 00000
Dear Xxxxx:
You previously entered into an employment letter, dated August 20, 2007 (the “Prior Agreement”)
with Safeguard Scientifics, Inc. (“Safeguard”) and commenced employment with Safeguard on or after
the date of the Prior Agreement (the actual date your employment began is herein referred to as
your “Commencement Date”). In order to address concerns raised by certain terms of the Prior
Agreement under Section 409A of the Internal Revenue Code of 1986, as amended (“Code”), we hereby
modify your Prior Agreement to incorporate certain changes relating to Section 409A in this letter
(“New Agreement”). This New Agreement replaces the Prior Agreement, which is hereby terminated.
Salary and Cash Incentives. Your current annual salary is $340,000. As a matter of
maintaining competitive employment terms, salaries are reviewed annually against internal and
external peer groups, and individual performance, and, if appropriate, adjusted upwards.
You will also be eligible to participate in the Safeguard annual management incentive program
(MIP), at a minimum target payout of $250,000. Any reduction in your target payout or annual bonus
opportunity will constitute a material breach of this New Agreement by Safeguard. The overall MIP
goals are determined at the beginning of each year, and approved for payment annually, after the
year-end audited results, by the Compensation Committee of the Board. Actual payments of amounts
pursuant to your MIP award will be made to you on or after January 1, but prior to March 15, of the
calendar year next following the calendar year in which the payment is earned, subject to
completion of Safeguard’s audit for the applicable fiscal year. Your individual actual payout
amount will be determined by your performance against your individual objectives and by the overall
performance of Safeguard against established corporate objectives. Per the terms of the Prior
Agreement, you were paid a bonus following the Commencement Date, the net after-tax proceeds of
such bonus amount to be used to purchase Safeguard’s Common Stock in one or more market
transactions.
Fringe Benefits. You are also eligible to participate in Safeguard’s health, dental,
vision, disability, 401(k), deferred compensation program, and other benefit plans generally
available to Safeguard executive employees from time to time. In addition, so long as you are an
employee and Safeguard offers these benefits generally to other principals or executives, you will
be paid a car allowance at the rate of $10,000 per annum; you will receive a non-accountable annual
expense allowance of $8,000 per annum (payable in February of each year; you will be entitled to
participate in Safeguard’s executive medical plan as in effect from time to time; and, subject to
evidence of insurability, you will be entitled to company-paid universal life insurance providing
coverage of $750,000 in addition to Safeguard’s normal group life insurance plans offered to
employees generally. You will also be entitled to vacation at the annual rate of four weeks of
vacation per year and other benefits as outlined on the description of Safeguard benefits
previously provided to you.
Severance. Subject to the terms and conditions set forth below, in the event that (A) your
employment with Safeguard is terminated by Safeguard without “cause” (as defined below) or by you
for “good reason” (as defined below) within 18 months following a “change of control” (as defined
below) of Safeguard (“Change of Control Termination”) or (B) your employment with Safeguard
terminates for any reason other than (i) your death or disability, (ii) Safeguard’s termination of
your employment for cause or (iii) your resignation without good reason (such a termination, a
“Severance Termination”), Safeguard will provide you with the following benefits, which together
with any benefits provided under the applicable terms of any other plan or program sponsored by the
Safeguard (other than any plan, program or arrangement intended to pay severance benefits following
termination of employment), and applicable to you, will be the only severance benefits or other
payments in respect of your employment with Safeguard to which you will be entitled. The benefits
you receive under this New Agreement will be in lieu of all salary, accrued vacation and other
rights that you may have against Safeguard or its affiliates, and, except as otherwise noted below,
will be paid within the later of 45 days after your date of termination or Safeguard’s receipt of
your request for reimbursement, subject to your execution and nonrevocation of the General Release
described below.
| • | You will receive a payment in respect of your current year’s bonus equal to the product of (i) your annual target bonus (of at least $250,000), multiplied by (ii) Safeguard’s percentage achievement of its annual Management Incentive Plan objectives as determined by the Compensation Committee as of the end of the calendar quarter closest to your date of termination, multiplied by (iii) a fraction, the numerator of which is the number of days in Safeguard’s fiscal year elapsed at the time of the termination and the denominator of which is 365. Payment under this provision will be made within 60 days after the end of the quarter for which the determination in (ii) is made. | |
| • | If (A) there is a Change of Control Termination or (B) a Severance Termination, you will receive a lump sum payment equal to the product of (i) 1.5 multiplied by (ii) your annual salary then in effect (which will not be less than $340,000). | |
| • | Except as provided below, you will only vest in your interests under and you will receive benefits in accordance with the terms and conditions set forth in Safeguard’s various long-term incentive plans. | |
| • | You will receive up to 12 months’ continued coverage under Safeguard’s medical and health plans(not including dental coverage), which coverage will run concurrent with the coverage provided under Section 4980B of the Code. |
-2-
| • | You will receive a lump sum payment equal to the cost that would be incurred by Safeguard, as reasonably determined by Safeguard, to waive the applicable premium otherwise payable for COBRA continuation coverage for you (and, to the extent covered immediately prior to the date of your termination, your spouse and dependents) with respect to dental insurance for a period of 12 months following the date of your termination. | |
| • | You will be entitled to reimbursement of any medical, vision, or dental expenses incurred by you (and, to the extent covered immediately prior to the date of your termination, your spouse and dependents) which are not covered by Safeguard’s medical, vision and/or dental insurance for a period of 12 months following the date of your termination. No such reimbursement will be made to the extent such expenses exceed $5,000, in the aggregate, per calendar year. | |
| • | You will be entitled to reimbursement of the cost of life insurance coverage under the universal life insurance policy which was purchased by Safeguard, in your name, during your employment (“Executive Insurance Policy”) for a period of 12 months, based on Safeguard’s monthly cost of such coverage on your termination date. Such reimbursement will only be made to the extent you continue to pay the premiums for such Executive Insurance Policy and thereafter submit to Safeguard the paid xxxx for your Executive Insurance Policy. | |
| • | On or before the end of the second calendar year beginning after your termination of employment, Safeguard will reimburse you for up to $20,000 for documented outplacement services or office space which you secure within such time period. | |
| • | You will be reimbursed promptly for all your reasonable and necessary business expenses incurred on behalf of Safeguard prior to your termination date in accordance with Safeguard’s customary policies. | |
| • | If you experience a Change of Control Termination as described above, (A) you will become fully vested in all of your outstanding stock options and you may exercise (i) those stock options that were subject to time-based vesting during the 36-month period following your termination of employment (unless any of the options would by their terms expire sooner, in which case you may exercise such options at any time before their expiration), and (ii) those stock options that were subject to market-based vesting during the 24-month period following your termination of employment (unless any of the options would by their terms expire sooner, in which case you may exercise such options at any time before their expiration), and (B) you will become fully vested in all of your outstanding restricted stock awards and deferred stock units, if any. | |
| • | If you experience a Severance Termination as described above, (A) you will become fully vested in your outstanding time-based stock options that were subject to time-based vesting and you may exercise those stock options during the 36-month period following your termination of employment (unless any of the options would by their terms expire sooner, in which case you may exercise such options at any time before their expiration), (B) you may exercise your vested outstanding market-based options during the 12-month period following your termination of employment (unless any of the options would by their terms expire sooner, in which case you may exercise such options at any time before their expiration), and (C) the Board, in its discretion, may accelerate the vesting of any restricted stock grants and deferred stock units, if any. |
-3-
All compensation and benefits described in this New Agreement will be offered in return for and
contingent on your execution, non-revocation and performance of the General Release and Agreement
substantially in the form attached to this New Agreement as Exhibit A.
Upon your termination of employment with Safeguard in connection with a change of control, as
discussed above, if it is determined that any payment or distribution by Safeguard of benefits
provided under this New Agreement or any other benefits due upon a change of control (the “Change
of Control Benefits”) would constitute an “excess parachute payment” within the meaning of Section
280G of the Code that would be subject to an excise tax under Section 4999 of the Code (the “Excise
Tax”), the following provisions will apply, unless provided otherwise in the applicable plan,
program or agreement that provides change of control payments that are not paid pursuant to this
New Agreement. If the aggregate present value to you of receiving the Change of Control Benefits
and paying the Excise Tax is not greater than the aggregate present value to you of the Change of
Control Benefits reduced to the safe harbor amount (as defined below), then Safeguard will reduce
the Change of Control Benefits such that the aggregate present value to you of receiving the Change
of Control Benefits is equal to the safe harbor amount. Otherwise you will receive the full amount
of the Change of Control Benefits and you will be responsible for payment of the Excise Tax. For
purposes of this paragraph “present value” will be determined in accordance with Section 280G(d)(4)
of the Code and the term “safe harbor amount” will mean an amount expressed in the present value
that maximizes the aggregate present value
of the Change of Control Benefits without causing any of the Change of Control Benefits to be
subject to the deduction limitations set forth in Section 280G of the Code.
All determinations made pursuant to the foregoing paragraph will be made by a professional advisor
selected by Safeguard (the “Professional Advisor”), which firm will provide its determinations and
any supporting calculations both to Safeguard and to you within 10 days of the termination date.
Any such determination by the Professional Advisor will be binding upon you and Safeguard. You
will then, in your sole discretion, determine which and how much of the Change of Control Benefits
will be eliminated or reduced consistent with the requirements of the foregoing paragraph. All of
the fees and expenses of the Professional Advisor in performing the determinations referred to
above will be borne solely by Safeguard.
Except as otherwise specifically provided in the section entitled “Severance Termination and Change
of Control”, and subject to the requirements of the section entitled “Section 409A Compliance”
below, Safeguard will pay you the lump sum payments described above within 45 days of your date of
termination, subject to your execution and non-revocation of the General Release and Agreement
(which will be substantially in the form attached as Exhibit A to this New Agreement, but with such
changes, if any, as recommended by Safeguard’s counsel) and Non-Competition Agreement and such
agreements have become effective. Safeguard will prepare the final release within five business
days of your termination of employment. You will have 21 days in which to consider the release
although you may execute it sooner. Please note that the release has a rescission period of seven
days after which it becomes effective if not revoked. All other payments will be made to you on
the next regularly scheduled payroll date after the date on which they become due.
-4-
Except with respect to amounts subject to delayed payment because of the application of Section
409A of the Code (as described in the section entitled “Section 409A Compliance” below ), Safeguard
will pay interest on late payments at the prime rate at Safeguard’s agent bank plus two percent
compounded monthly. In addition, Safeguard will pay all reasonable costs and expenses (including
reasonable attorney’s fees and all costs of arbitration) incurred by you to enforce this New
Agreement or any obligation hereunder. Such payments will be made to you within 60 days of the date
the expense is incurred but in no event later than the date which is on or before the last day of
the calendar year following the year in which the expense is incurred.
In this New Agreement, the term “cause” means (a) your failure to adhere to any written Safeguard
policy if you have been given a reasonable opportunity to comply with such policy or cure your
failure to comply (which reasonable opportunity must be granted during the ten-day period preceding
termination of this New Agreement); (b) your appropriation (or attempted appropriation) of a
material business opportunity of Safeguard, including attempting to secure or securing any personal
profit in connection with any transaction entered into on behalf of Safeguard; (c) your
misappropriation (or attempted misappropriation) of any Safeguard fund or property; or (d) your
conviction of, or your entering a guilty plea or plea of no contest with respect to, a felony, the
equivalent thereof, or any other crime with respect to which imprisonment is a possible punishment.
In this New Agreement, the term “good reason” means (i) your assignment (without your consent) to a
position, title, responsibilities, or duties of a materially lesser status or degree of
responsibility than your current position, responsibilities, or duties; provided, however, that a
mere change in your area of responsibilities will not constitute a material change if you are
reasonably suited by your education and training for such responsibilities and you remain Senior
Vice-President and General Counsel of Safeguard; (ii) a reduction of your base salary; (iii) the
relocation of Safeguard’s principal executive offices to a location which is more than 30 miles
away from the location of Safeguard’s principal executive offices on the date of this New
Agreement; or (iv) Safeguard’s material breach of this New Agreement. Notwithstanding the
foregoing, no event or condition described in clauses (i) through (iv) will constitute good reason
unless (a) you give Safeguard written notice of your intention to terminate your employment for
good reason and the grounds for such termination, (b) the
notice described in (a) is provided within 90 days after the event giving rise to the good reason
termination occurs, and (c) such grounds for termination (if susceptible to correction) are not
corrected by Safeguard within 30 days after its receipt of such notice. If Safeguard does not
correct the ground(s) for termination during the 30-day period following your notice of
termination, your termination of employment for good reason must become effective within 90 days
after the end of the cure period in order for your termination to be treated as a “good reason”
termination under this New Agreement. If your termination occurs more than 90 days after the end
of the cure period, such termination will be treated as a voluntary termination other than for
“good reason” and you will not be entitled to severance benefits under this New Agreement.
-5-
A “change of control” will be deemed to have occurred if (i) any “person” or “group” (as such terms
are used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)), other than any Safeguard employee stock ownership plan or an equivalent
retirement plan, becomes the beneficial owner (as such term is used in Section 13(d) of the
Exchange Act), directly or indirectly, of securities of Safeguard representing 50% or more of the
combined voting power of Safeguard’s then outstanding voting securities, (ii) the Board ceases to
consist of a majority of Continuing Directors (as defined below), (iii) the consummation of a sale
of all or substantially all of Safeguard’s assets or a liquidation (as measured by the fair value
of the assets being sold compared to the fair value of all of Safeguard’s assets), or (iv) a merger
or other combination occurs such that a majority of the equity securities of the resultant entity
after the transaction are not owned by those who owned a majority of the equity securities of
Safeguard prior to the transaction. A “Continuing Director” will mean a member of the Board who
either (i) is a member of the Board at the date of this New Agreement or (ii) is nominated or
appointed to serve as a Director by a majority of the then Continuing Directors.
Terms of Employment, Agreements, Miscellaneous. You are an employee-at-will and subject to
the arrangements described in Safeguard’s employee handbook as modified from time to time. In
addition, your continued employment is subject to your compliance with various covenants designed
to protect Safeguard’s confidential information and employee, customer and other relationships, as
set forth in the Non-Competition Agreement executed by you in connection with the Prior Agreement.
We agree that you may continue to serve as a an adjunct professor at the Temple University Fox
School of Business and Management, and as a member of the Board of Overseers of the Annenberg
Center for Performing Arts so long as such service does not interfere with the performance of your
duties to Safeguard and that the activities of these organizations do not compete with the
activities of Safeguard or our subsidiaries, partner companies or affiliates. You will not serve
as a director of any other company that is not affiliated with Safeguard without the consent of our
Board of Directors.
The provisions set forth in this New Agreement will inure to the benefit of your personal
representative, executors and heirs. In the event you die while any amount payable under the New
Agreement remains unpaid, all such amounts will be paid in accordance with the terms and conditions
of this New Agreement.
No term or condition set forth in this New Agreement may be modified, waived or discharged unless
such waiver, modification or discharge is agreed to in writing and signed by you and the Board of
Safeguard or a duly authorized officer of Safeguard.
You will not be required to mitigate the amount of any payment provided for in this New Agreement
by seeking other employment or otherwise.
You acknowledge that the arrangements described in this New Agreement will be the only obligations
of Safeguard or its affiliates in connection with any determination by Safeguard to terminate your
employment with Safeguard. This New Agreement does not terminate, alter or affect your rights
under any plan or program
of Safeguard in which you may participate or under which you are due a benefit, except as
explicitly set forth herein. Your participation in such plans or programs will be governed by the
terms of such plans and programs.
-6-
The provisions set forth in this New Agreement will be construed and enforced in accordance with
the law of the Commonwealth of Pennsylvania without regard to the conflicts of laws rules of any
state.
Any controversy or claim arising out of or relating to this New Agreement, or the breach thereof,
will be settled by arbitration in Philadelphia, Pennsylvania, in accordance with the National Rules
for the Resolution of Employment Disputes of the American Arbitration Association, using one
arbitrator, and judgment upon the award rendered by the arbitrator may be entered in any court of
competent jurisdiction.
The obligations of Safeguard set forth herein are absolute and unconditional and will not be
subject to any right of set-off, counterclaim, recoupment, defense or other right which Safeguard
may have against you, subject to, in the event of your termination of employment, your execution
and performance of the General Release and Agreement substantially in the form attached to this New
Agreement as Exhibit A and your performance of the Non-Competition Agreement in the form
attached to this New Agreement as Exhibit B.
Safeguard may withhold applicable taxes and other legally required deductions from all payments to
be made hereunder.
Safeguard’s obligations to make payments under this New Agreement are unfunded and unsecured and
will be paid out of the general assets of Safeguard.
This New Agreement constitutes the entire agreement and understanding with respect to your
severance arrangements, and supersedes any and all prior agreements and understandings whether oral
or written, relating thereto.
Compliance with Section 409A of the Code.
This New Agreement will be interpreted to avoid any penalty sanctions under Section 409A of the
Code. If any payment or benefit cannot be provided or made at the time specified herein without
incurring sanctions under Section 409A, then such benefit or payment will be provided in full at
the earliest time thereafter when such sanctions will not be imposed. For purposes of Section 409A
of the Code, all payments to be made upon your termination of employment under this New Agreement
may only be made upon a “separation from service” within the meaning of such term under Section
409A of the Code, each payment made under this New Agreement will be treated as a separate payment
and the right to a series of installment payments under this New Agreement is to be treated as a
right to a series of separate payments. In no event will you, directly or indirectly, designate
the calendar year of any payments to be made to you under this New Agreement. All reimbursements
and in-kind benefits provided under this New Agreement will be made or provided in accordance with
the requirements of Section 409A, including, where applicable, the requirement that (i) any
reimbursement is for expenses incurred during your lifetime (or during a shorter period of time
specified in this Agreement), (ii) the amount of expenses eligible for reimbursement, or in-kind
benefits provided, during a calendar year may not affect the expenses eligible for reimbursement,
or in-kind benefits to be provided, in any other calendar year, (iii) the reimbursement of an
eligible expense will be made on or before the last day of the calendar year following the year in
which the expense is incurred, and (iv) the right to reimbursement or in-kind benefits is not
subject to liquidation or exchange for another benefit.
-7-
Notwithstanding any provision in this New Agreement to the contrary, if at the time of your
separation from service with Safeguard, Safeguard has securities which are publicly traded on an
established securities market and you are a “specified employee” (as defined in Section 409A of
the Code) and it is necessary to postpone
the commencement of any severance payments otherwise payable pursuant to this New Agreement as a
result of such termination of employment to prevent any accelerated or additional tax under Section
409A of the Code, then Safeguard will postpone the commencement of the payment of any such payments
or benefits hereunder (without any reduction in such payments or benefits ultimately paid or
provided to you) that are not otherwise paid within the short-term deferral exception under Section
409A of the Code and are in excess of the lesser of two times your then-annual compensation or (ii)
the limit on compensation then set forth in Section 401(a)(17) of the code, until the first payroll
date that occurs after the date that is six months following the your “separation from service”
with Safeguard (as defined under Section 409A of the Code). If any payments are postponed due to
such requirements, such postponed amounts will be paid in a lump sum to you on the first payroll
date that occurs after the date that is six months following your “separation from service” with
Safeguard. If you die during the postponement period prior to the payment of the postponed amount,
the amounts withheld on account of Section 409A of the Code will be paid to the personal
representative of your estate within 60 days after the date of your death.
If this New Agreement sets forth our agreement on the subject matter hereof, kindly sign and return
to us the enclosed copy of this New Agreement which will then constitute our legally binding
agreement.
Sincerely,
Safeguard Scientifics, Inc.
By:
|
/s/ Xxxxx X. Xxxx
|
|||
| Xxxxx X. Xxxx | ||||
| President and Chief Executive Officer |
I agree to be bound by the terms and conditions of this New Agreement.
/s/ Xxxxx X. Xxxxx
|
||
Xxxxx X. Xxxxx |
-8-
EXHIBIT A
GENERAL RELEASE AND AGREEMENT
This GENERAL RELEASE AND AGREEMENT (hereinafter the “Agreement”) is made and entered into as
of this _____ day of _____, 20 _____, by and between Safeguard Scientifics, Inc. (“Safeguard”) and
Xxxxx X. Xxxxx (“Employee”).
1. Background. The parties hereto acknowledge that this Agreement is being entered
into pursuant to the terms of the employment letter agreement, dated December 3, 2008 between
Safeguard and Employee (the “Employment Agreement”). As used in this Agreement, any reference to
Safeguard shall include its predecessors and successors and, in their capacities as such, all of
its present, past, and future directors, officers, employees, attorneys, insurers, agents and
assigns; and any reference to Employee shall include, in their capacities as such, his attorneys,
heirs, administrators, representatives, agents and assigns.
2. General Release.
(a) Employee, for and in consideration of the special benefits offered to him by Safeguard
specified in the Employment Agreement and intending to be legally bound, does hereby REMISE,
RELEASE AND FOREVER DISCHARGE Safeguard, of and from any and all waivable causes of actions, suits,
debts, claims and demands whatsoever in law or in equity, which Employee ever had, now has, or
hereafter may have or which Employee’s heirs, executors or administrators may have, by reason of
any matter, cause or thing whatsoever, from the beginning of Employee’s employment with Safeguard
to the date of this Agreement, and particularly, but without limitation, any claims arising from or
relating in any way to Employee’s employment or the termination of Employee’s employment
relationship with Safeguard, including, but not limited to, any claims arising under any federal,
state, or local laws, including Title VII of the Civil Rights Act of 1964, as amended, 42
U.S.C. § 2000e et seq., (“Title VII”), the Age Discrimination in Employment Act, 29 U.S.C.
§ 621 et seq. (the “ADEA”), the Americans with Xxxxxxxxxxxx Xxx, 00 X.X.X. § 00000 et
seq. (“ADA”), Employee Retirement Income Security Act of 1974, as amended 29 U.S.C. § 301,
et seq., as amended (“ERISA”), the Pennsylvania Wage Payment and Collection Law, Pa. Stat.
Xxx. tit. 43 §§ 260.1-260.11a (“WPCL”), the Pennsylvania Human Relations Act, 43 P.S. § 951 et
seq. (the “PHRA”), and any and all other federal, state or local laws, regulations, ordinances
or public policies and any common law claims now or hereafter recognized, including claims for
wrongful discharge, slander and defamation, as well as all claims for counsel fees and
costs; provided, however, that the Employee does not release or discharge Safeguard from
any of its continuing obligations to him expressly set forth in this Agreement and the
Employment Agreement.
(b) By signing this Agreement, Employee represents that Employee has not commenced any
proceeding against Safeguard in any forum (administrative or judicial) concerning Employee’s
employment or the termination thereof. If Employee’s employment with Safeguard has been
terminated on or before the date of this Agreement, Employee further acknowledges that Employee was
given sufficient notice under the Worker Adjustment and Retraining Notification Act (the “WARN
Act”) and that the termination of Employee’s employment does not give rise to any claim or right to
notice, or pay or benefits in lieu of notice under the WARN Act. In the event any WARN Act issue
does exist or arises in the future, Employee agrees and acknowledges that the payments and benefits
set forth in this Agreement shall be applied to any compensation or benefits in lieu of notice
required by the WARN Act, provided that any such offset shall not impair or affect the validity of
any provision of this Agreement or the Employment Agreement.
(c) Employee agrees that in the event of a breach of any of the terms of this Agreement,
Safeguard shall be entitled to recover attorneys’ fees and costs in an action to prosecute such
breach, in addition to
compensatory damages, and may cease to make any payments then due under this Agreement or the
Employment Agreement.
(d) Employee acknowledges that Safeguard’s obligations under the Employment Agreement and this
Agreement are the only obligations of Safeguard or its parent organizations or affiliates in
connection with the matters described herein and therein.
(e) Employee agrees and acknowledges that this Agreement is not and shall not be construed to
be an admission by Safeguard of any violation of any federal, state or local statue, ordinance or
regulation or of any duty owed by Safeguard to Employee.
4. Confidentiality; Non-Disparagement.
(a) Except to the extent required by law, including SEC disclosure requirements, Safeguard and
Employee agree that the terms of this Agreement will be kept confidential by both parties, except
that Employee may advise his family and confidential advisors, and Safeguard may advise those
people needing to know to implement the above terms.
(b) Employee acknowledges and agrees that he is bound by the confidentiality provisions of the
Employment Agreement and that such terms remain in full force and effect.
(c) Employee represents that Employee has not taken, used or knowingly permitted to be used
any notes, memorandum, reports, list, records, drawings, sketches, specifications, software
programs, data, documentation or other materials of any nature relating to any matter within the
scope of the business of Safeguard or its affiliated or parent companies or concerning any of its
dealings or affairs otherwise than for the benefit of Safeguard. Employee shall not, after the
termination of Employee’s employment, use or knowingly permit to be used any such notes, memoranda,
reports, lists, records, drawings, sketches, specifications, software programs, data, documentation
or other materials, it being agreed that all of the foregoing shall be and remain the sole and
exclusive property of Safeguard and that immediately upon the termination of Employee’s employment,
Employee shall deliver all of the foregoing, and all copies thereof, to Safeguard, at its main
office.
(d) In accordance with normal ethical and professional standards, Safeguard and Employee agree
that they shall not in any way engage in any conduct or make any statement that would defame or
disparage the other, or make to, or solicit for, the media or others, any comments, statements
(whether written or oral), and the like that may be considered to be derogatory or detrimental to
the good name or business reputation of either party. It is understood and agreed that Safeguard’s
obligation under this paragraph extends only to the conduct of Safeguard’s executive officers. The
only exception to the foregoing shall be in those circumstances in which Employee or Safeguard is
obligated to provide information in response to an investigation by a duly authorized governmental
entity or in connection with legal proceedings.
A-2
5. Indemnity and Assistance.
(a) This Agreement shall not release Safeguard, or any of its insurance carriers from any
obligation it or they might otherwise have to defend and/or indemnify Employee and hold harmless
any other director or officer and Safeguard hereby affirms its obligation to provide
indemnification to Employee as a director, officer or former director or officer of Safeguard, as
the case may be, as set forth in Safeguard’s bylaws and charter documents.
(b) Employee agrees that Employee will personally provide reasonable assistance and
cooperation to Safeguard in activities related to the prosecution or defense of any pending or
future lawsuits or claims involving Safeguard.
6. General.
(a) Employee acknowledges and agrees that he has 21 days to consider this Agreement, and that
Employee has been advised by Safeguard, in writing, to consult with his attorney before signing
this Agreement, and that Employee had discussed this matter with his attorney before signing it.
Employee further acknowledges that Safeguard has advised him that he may revoke this Agreement for
a period of seven calendar days after it has been executed, with the understanding that Safeguard
has no obligations under this Agreement until the seven day period has passed. If the seventh day
is a weekend or national holiday, Employee will have until the next business day to revoke. Any
revocation must be in writing and received by Safeguard at its facility located at 000 Xxxxx Xxxx
Xxxxx, 000 Xxxxxxxx, Xxxxx, XX 00000, Attention: President, with a copy to the General Counsel,
Safeguard Scientifics, Inc., 800 Building, 000 Xxxxx Xxxx Xxxxx, Xxxxx, XX 00000.
(b) Employee has carefully read and fully understands all of the provisions of this Agreement
which set forth the entire agreement between him and Safeguard with respect to the subject matter
hereto, and he acknowledges that he has not relied upon any representation or statement, written or
oral, not set forth in this document.
(c) This Agreement is made in the Commonwealth of Pennsylvania and shall be interpreted under
the laws thereof. Its language shall be construed as a whole, to give effect to its fair meaning
and to preserve its enforceability.
(d) Employee agrees that any breach of this Agreement by Employee will cause irreparable
damage to Safeguard and that in the event of such breach Safeguard shall have, in addition to any
and all remedies of law, the right to an injunction, specific performance or other equitable relief
to prevent the violation of Employee’s obligations hereunder.
A-3
(e) No term or condition set forth in this Agreement may be modified, waived or discharged
unless such waiver, modification or discharge is agreed to in writing and signed by Employee and an
officer of Safeguard specifically and duly authorized by the Board of Directors of Safeguard.
(f) Any waiver by Safeguard of a breach of any provision of this Agreement shall not operate
or be construed as a waiver of any subsequent breach of such provision or any other provision
hereof.
(g) Each covenant, paragraph and division of this Agreement is intended to be severable and
distinct, and if any paragraph, subparagraph, provision or term of this Agreement is deemed to be
unlawful or unenforceable, such a determination will not impair the legitimacy or enforceability of
any other aspect of the Agreement.
(h) This Agreement is intended to be for the benefit of, and shall be enforceable by,
Safeguard. Except as provided in the prior sentence, this Agreement is not intended to confer any
rights, benefits, remedies, obligations or liabilities hereunder upon any person or entity other
than the parties hereto and their respective heirs, representatives, successors and permitted
assigns.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date written above.
Date:
|
, 20 | |||||||||||
| Xxxxx X. Xxxxx | ||||||||||||
| Safeguard Scientifics, Inc. | ||||||||||||
Date
|
, 20 | By: | ||||||||||
| Name: | ||||||||||||
| Title: | ||||||||||||
A-4
