Exhibit 10.9
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made this 13th day of
February, 1998, by Healthcare Promotions, LLC, a New Jersey limited liability
company with its principal place of business at 00 Xxxxxxxxx Xxxxxx, Xxxxxxxxx,
Xxx Xxxxxx 00000 (the "Employer"), and Xxxxxxx Xxxxxxx, an individual residing
at 0 Xxx Xxxxx Xxx, Xxxxxxxxxx, Xxx Xxxxxx 00000 (the "Executive").
WHEREAS, the parties wish to set forth the terms and conditions upon which
the Employer will employ the Executive;
NOW THEREFORE, in consideration of the mutual covenants and promises
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
agree as follows:
1. Term of Employment; Title; Duties; Authority.
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The Employer hereby employs the Executive, and the Executive hereby accepts
employment with the Employer, upon the terms set forth in this Agreement,
effective beginning on the date hereof (the "Effective Date") and ending on the
third anniversary of the Effective Date. The Executive shall serve as the Chief
Executive Officer of the Employer, during the term of his employment under this
Agreement. The Executive shall report to the person designated by the Chairman
and Chief Executive Officer of Xxxxxx Communications, Inc. ("Xxxxxx") and the
Executive shall perform such services consistent with his position as may be
reasonably assigned to him from time to time by such person.
2. Extent of Services.
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The Executive agrees to devote his entire business time and attention to the
performance of his duties under this Agreement. He shall perform his duties to
the best of his ability and shall use his best efforts to further the interests
of the Employer. The Executive represents and warrants to the Employer that he
is able to enter into this Agreement and that his ability to enter into this
Agreement and to fully perform his duties hereunder are not limited to or
restricted by any agreements or understandings between the Executive and any
other person. For the purposes of this Agreement, the term "person" means any
natural person, corporation, partnership, limited liability partnership, limited
liability company, or any other entity of any nature.
3. Base Salary.
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The Employer shall pay the Executive a base annual salary of $240,000,
subject to such increases as may be approved by the Board of Directors of the
Employer (the "Base Salary"). The salary shall be payable periodically in
accordance with the Employer's policies for executive personnel, less such
deductions as may be required by law or reasonably requested by the Executive.
The Employer will review the Executive's base salary to determine whether such
base salary should be increased (but not decreased) no less often than annually
in conjunction with its regular review of executive salaries.
4. Stock Options.
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(a) On the Effective Date, as an inducement to enter into this employment
agreement and in consideration of the Executive's services hereunder and
including the Executive's obligations pursuant to Sections 8 and 9 hereof,
Xxxxxx will xxxxx the Executive options to acquire 75,000 shares of Xxxxxx
common stock under and governed by the Xxxxxx 1996 Stock Incentive Plan (the
"Plan") at an exercise price equal to the closing sale price of Xxxxxx'x common
stock on the New York Stock Exchange on the date hereof. The options so granted
shall vest and become exercisable over a four year period with 25% being
exercisable at the end of each completed year of service during such period,
provided that in the event the Executive is terminated by the Employer without
cause prior to the first anniversary of the Effective Date, then 25% of the
options shall vest upon such termination. If the Executive's employment is
terminated for any reason other than death, then that portion of the options
granted to the Executive under this Section 4 which is vested at the time of
such termination may be exercised by the Executive within 90 days of such
termination, and any vested portion which is not timely exercised shall be
forfeited by the Executive and his estate. Any options which have not vested as
of the date of termination of the Executive's employment with the Company for
any reason, including death or disability, shall terminate and be forfeited by
the Executive.
(b) Subject to earlier termination as provided in the Plan or this
Agreement, all options granted pursuant to Section 4(a) shall expire on the
tenth anniversary of the Effective Date.
5. Severance.
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(a) The Executive is an employee "at will" and may be terminated by the
Employer at any time with or without cause.
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(b) If the Executive is terminated by the Employer without cause at any
time during the term hereof or in the event that, while the Executive is
employed by the Employer, the Employer is sold, whether through merger, sale of
substantially all of its assets, stock transfer or otherwise, during the three
year term of this Agreement (an "HCP Divestiture"), the Executive shall receive
from the Employer a severance payment equal to one-half the annual Base Salary
then in effect within ten (10) days of the date of his termination minus such
deductions as may be required by law or reasonably requested by the Executive
(the "Severance Payment"); provided, however, that the Employer shall have no
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obligation to make the Severance Payment to the Executive if, as a result of the
HCP Divestiture, the Executive becomes an employee of the purchaser of the
Employer.
(c) For the purposes of this Agreement, "cause" shall mean any of the
following: (i) gross negligence or willful misconduct in the performance of the
Executive's duties hereunder; (ii) conviction of any felony, or any misdemeanor
involving dishonesty, fraud or moral turpitude; (iii) physical or mental
incapacity for a period of five (5) consecutive months (such period of
incapacity shall be deemed to be continuously consecutive unless Executive has
returned to work on a full-time basis for eight (8) consecutive weeks); (iv) the
occurrence of any wrongful and intentional act or omission by Executive which
has a material adverse impact on the business, properties, results of
operations, condition (financial or otherwise) or prospects of the Employer; or
(v) the failure of the Executive, for any reason, to devote his full time and
efforts in a diligent manner to the performance of his duties and
responsibilities hereunder.
6. Fringe Benefits.
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(a) The Executive shall be entitled to all benefits generally available to
employees of the Employer of similar levels of authority.
(b) The Executive shall be eligible to receive annual discretionary
bonuses determined by the Board of Directors of Employer based on the
Executive's performance.
(c) The Executive shall be entitled to three (3) weeks of vacation during
each year of employment. Such vacation shall be taken at such times as the
Executive and his designated superior shall agree. The Executive shall be
entitled to sick leave and holidays in accordance with the policy of the
Employer as to its executive employees.
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7. Reimbursement of Business Expenses.
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The Employer shall reimburse the Executive in accordance with Employer's
policies for all reasonable out-of-pocket costs incurred or paid by the
Executive in connection with, or related to, the performance of his duties,
responsibilities or services under this Agreement, upon presentation by the
Executive of documentation, expense statements, vouchers, and/or such other
supporting information as the Employer may reasonably request.
8. Non-Solicitation and Non-Competition.
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(a) The Executive agrees that while the Executive is employed pursuant to
this Agreement and for a period of (i) one year following termination of the
Executive by the Employer without cause, or (ii) two years following termination
of the Executive's employment with the Employer for any other reason (the
"Non-Competition Period"), whether by action of the Executive or the Employer,
the Executive will not, except as otherwise provided herein, engage or
participate, directly or indirectly, as principal, agent, executive, director,
proprietor, joint venturer, trustee, employee, employer, consultant,
stockholder, partner or in any other capacity whatsoever, in the conduct or
management of, or own any stock or any other equity investment in or debt of,
any business which is competitive with any business conducted by the Employer,
including without limitation any business involving marketing consulting to, or
contract sales, detailing and marketing support or any other marketing services
for, pharmaceutical companies (collectively, "Employer's Current Business"); it
being agreed that employment directly by a pharmaceutical company shall not
violate the provisions of this Section 8(c).
(b) During the Non-Competition Period, the Executive will not, for his own
benefit or for the benefit of any person or entity other than the Employer, (i)
solicit, or assist any person or entity other than the Employer to solicit, any
officer, director, executive or employee of the Employer to leave his
employment, (ii) hire or cause to be hired any present or former officer,
director, executive or employee of the Employer, or (iii) engage any present or
former officer, director, executive or employee of the Employer as a partner,
contractor, sub-contractor, employee or consultant.
(c) During the Non-Competition Period, the Executive will not knowingly
and willfully (i) solicit, or assist any person or entity other than the
Employer to solicit, any person or entity that is a client of the Employer, or
has been a client of the Employer during the prior twelve (12) months, to
furnish marketing consulting services or contract sales, detailing and marketing
support or any other marketing services for
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pharmaceutical companies or any other products or services the Employer provides
to a client, or (ii) interfere with any of Employer's business relationships.
(d) The Executive acknowledges that (i) the markets served by the Employer
are national in scope and are not dependent on the geographic location of the
executive personnel or the businesses by which they are employed; and (ii) the
above covenants are manifestly reasonable on their face, and the parties
expressly agree that such restrictions have been designed to be reasonable and
no greater than is required for the protection of the Employer.
(e) Nothing in this Agreement shall be deemed to prohibit the Executive
from owning, solely as an investment, securities of any person which are traded
on a national securities exchange or quoted on a inter-dealer quotation system,
provided that such securities constitute two percent (2%) or less of the
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outstanding equity securities of any such person and the Executive is not a
controlling person of, or a member of a group which controls, such person.
9. Confidential Information.
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(a) The Executive shall not (for his own benefit or the benefit of any
person or entity other than the Employer) use or disclose any of the Employer's
trade secrets or other confidential information. The term "trade secrets or
other confidential information" includes, by way of example, matters of a
technical nature, "know-how," computer programs (including documentation of
such programs), research projects, and matters of a business nature, such as
proprietary information about costs, profits, markets, sales, lists of
customers, and other information of a similar nature to the extent not available
to the public and to the extent not independently generated by the Executive or
others without any reference to any of the Employer's trade secrets or other
confidential information, and such materials constituting plans for future
development. After termination of this Agreement, the Executive shall not use or
disclose trade secrets or other confidential information unless such information
becomes a part of the public domain other than through a breach of this
Agreement or is disclosed to the Executive by a third party who is entitled to
receive and disclose such information or such disclosure is required by law.
(b) Upon the effective date of notice of the Executive's or the Employer's
election to terminate this Agreement, or at any time upon the request of the
Employer, the Executive (or his heirs or personal representatives) shall deliver
to the Employer all documents and materials containing trade secrets and
confidential information relating to the Employer's business and all documents,
materials and other property
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belonging to the Employer, which in either case are in the possession or under
the control of the Executive (or his heirs or personal representatives).
(c) All discoveries and works made or conceived by the Executive during
and in the course of his employment by the Employer, jointly or with others,
that relate to the Employer's activities shall be owned by the Employer. The
terms "discoveries and works" include, by way of example, inventions, computer
programs (including documentation of such programs), technical improvements,
processes, drawings, and works of authorship, including sales materials which
relate to direct sales, telemarketing, wall media products, sampling/comparing
or services. The Executive shall promptly notify and make full disclosure to,
and execute and deliver any documents requested by, the Employer to evidence or
better assure title to such discoveries and works by the Employer, assist the
Employer in obtaining or maintaining for itself at its own expense United States
and foreign patents, copyrights, trade secret protection and other protection of
any and all such discoveries and works, and promptly execute, whether during his
employment or thereafter, all applications or other endorsements necessary or
appropriate to maintain patents and other rights for the Employer and to protect
its title thereto. Any discoveries and works which, within six months after the
termination of the Executive's employment by the Employer, are made, disclosed,
reduced to a tangible or written form or description, or are reduced to practice
by the Executive and which pertain to work performed by the Executive while
with, and in his capacity as an employee of, the Employer shall, as between the
Executive and the Employer, be presumed to have been made during the Executive's
employment by the Employer.
10. Enforcement.
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The parties to this Agreement mutually agree that, in recognition of
Employer's dependence on Executive's experience to carry out its business plan
and Executive's senior and key position in the Employer, the restrictions
detailed in Sections 8 and 9 of this Agreement are necessary and appropriate to
give effect to the intended relationships of the parties. Executive agrees that
because damages arising from violations of Sections 8 and 9 of this Agreement
are extremely difficult to quantify with certainty, injunctive relief will be
necessary to effect the intent of such Sections. Accordingly, Executive hereby
consents to the imposition of a preliminary or permanent injunction as a remedy
to his breach of Sections 8 and 9 of this Agreement.
It is the desire and intent of the parties hereto that the restrictions set
forth in Sections 8 and 9 of this Agreement shall be enforced and adhered to in
every particular, and in the event that any provision, clause or phrase shall be
declared by a court of competent
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jurisdiction to be judicially unenforceable either in whole or in part --
whether the fault be in duration, geographic coverage or scope of activities
precluded -- the parties agree that they will mutually petition the court to
sever or limit the unenforceable provision so as to retain and effectuate to the
greatest extent legally permissible the intent of the parties as expressed in
Sections 8 and 9 of this Agreement.
11. Miscellaneous.
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(a) All notices required or permitted under this Agreement shall be in
writing and shall be deemed effective upon personal delivery or upon deposit
with the United States Postal Service, by registered or certified mail, postage
prepaid, addressed to the other party at the address shown above, or at such
other address or addresses as either party shall designate to the other in
writing from time to time.
(b) Whenever the context may require, any pronouns used in this Agreement
shall include the corresponding masculine, feminine or neuter forms, and the
singular forms of nouns and pronouns shall include the plural, and vice versa.
(c) This Agreement constitutes the entire agreement between the parties
and supersedes all prior agreements and understandings, whether written or oral,
relating to the subject matter of this Agreement.
(d) This Agreement may be amended or modified only by a written
instrument executed by both the Employer and the Executive.
(e) This Agreement shall be construed, interpreted and enforced in
accordance with the laws of the State of New Jersey, without regard to its
conflicts of laws principles.
(f) This Agreement shall be binding upon and inure to the benefit of both
parties and their respective successors and assigns; provided, however, that the
obligations of the Executive are personal and shall not be assigned or delegated
by him.
(g) No delays or omission by the Employer or the Executive in exercising
any right under this Agreement shall operate as a waiver of that or any other
right. A waiver or consent given by the Employer or the Executive on any one
occasion shall be effective only in that instance and shall not be construed as
a bar or waiver of any right on any other occasion.
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(h) The captions appearing in this Agreement are for convenience of
reference only and in no way define, limit or affect the scope or substance of
any section of this Agreement.
(i) In case any provision of this Agreement shall be held by a court with
jurisdiction over the parties to this Agreement to be invalid, illegal or
otherwise unenforceable, the validity, legality and enforceable1ity of the
remaining provisions shall in no way be affected or impaired thereby.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
EMPLOYER EXECUTIVE
HEALTHCARE PROMOTIONS, LLC
By: /s/ Xxxxxxx Xxxxxxx /s/ Xxxxxxx Xxxxxxx
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Name: Xxxxxxx Xxxxxxx XXXXXXX XXXXXXX
Title: President
AGREED:
XXXXXX COMMUNICATIONS, INC.
By: /s/ A. Xxxxxxx Xxxxxxx
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Name: A. Xxxxxxx Xxxxxxx
Title: CFO
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