EXHIBIT 10.3
S.M.A. REAL TIME
AGREEMENT OF EMPLOYMENT
THIS AGREEMENT is entered into this 1st day of April, 1999, by and between
S.M.A. REALTIME ("Company"), a New York corporation, with offices at 100 Avenue
of the Americas, New York, New York, and XXXXXXX XXXXXXXXX ("Employee"), whose
address is 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000.
RECITALS
I. Company desires to employ Employee as its President and Chief
Executive Officer, and Employee is willing to accept such
employment by Company, on the terms and subject to the conditions
set forth in this Agreement.
II. Employee and Company recognize and acknowledge the importance to
Company of protecting Company's rights with respect to its
confidential and proprietary information and know-how as well as
its business relationships and goodwill.
III. In exchange for Employee's agreement to not reveal Company's
confidential information, and to not compete with Company, all as
more fully set forth in this Agreement, Company is willing to
employ Employee and Employee is willing to accept employment upon
all of the terms and conditions set forth in this Agreement as
full and adequate consideration.
NOW, THEREFORE, in consideration of the foregoing and the mutual promises
contained in this Agreement, Employee and Company intending to be legally
bound, agree as follows:
1. Employment. Company agrees to employ Employee as President and Chief
Executive Officer, with such duties as are customary for such position.
Employee shall perform these duties subject to the direction and supervision of
the Board of Directors of the Company. Employee accepts such continued
employment and agrees to devote his full time and skills to the conduct of
Company's business, performing to the best of Employee's ability such duties as
may be reasonably requested by Company. Employee agrees to serve Company
diligently and faithfully so as to advance Company's best interests and agrees
to not take any action in conflict with Company's interests.
2. Term. The term of employment of Employee hereunder shall be five (5)
years, commencing upon the closing of the Company's initial public offering of
2,000,000 shares of common stock. Thereafter, this agreement shall
automatically be renewed for successive one (1) year periods unless terminated
by either party upon ninety (90) days written notice prior to the expiration
of the initial term or any renewal term.
3. Compensation.
(a) Salary. In consideration of the services to be performed under
this Agreement, Employee shall receive as compensation the sum of $250,000
annually. The salary will be paid in bi-
1
weekly installments, from which shall be deducted all Federal, state and city
withholding taxes and such other amounts as may be required by law or agreed
upon between the parties.
(i) Adjustment of base salary. The base salary of $250,000
to be paid to Employee during each year shall be increased by any increase in
the cost of living determined in accordance with the formula set forth in
subparagraph (ii).
(ii) Cost of living increase in base salary. (a) As promptly
as practicable at the end of each year during the original or extended term of
this Agreement, the Company shall compute the increase, if any, in the cost of
living, using as the basis of such computation "The United States Bureau of
Labor Statistics, Consumer Price Index for Urban Wage Earners and Clerical
Workers, all items Xxx Xxxx-Xxxxxxxx X.X.-Xxxx Xxxxxx (0000-0000x000),"
hereinafter called the Index. (b) The Index number in the column for New York,
entitled "all items," for the month of January, 1999, shall be the "base Index
number" (BIN) and the corresponding Index number for the month of January on
each anniversary of this Agreement, or any extension thereof, shall be the
"current Index number" (CIN). (c) The increase in the cost of living on each
anniversary of this Agreement shall be determined by dividing the current Index
number (CIN) by the base Index number (BIN), and subtracting the integer 1 from
the quotient, in accordance with the following formula:
Increase in cost of living = CIN
--- -1
BIN
(d) The percentage of increase in the cost of living, multiplied by $250,000,
shall be the increase required to be determined by subparagraph (b) of this
paragraph 3(a)(ii). Any portion of the increase retroactively due shall be
payable within five working days after the computation hereunder has been made.
(e) Appropriate adjustment shall be promptly made in case there is a published
amendment of the Index figures upon which the computation is based. (f) If
publication of the Consumer Price Index is discontinued, the parties shall
accept comparable statistics on the cost of living for the City of New York, as
computed and published by an agency of the United States or by a responsible
financial periodical of recognized authority to be selected by the parties.
(b) Bonus/ Options. To be determined annually in the discretion of
the Board of Directors.
(c) Reimbursement for Expenses. Employee will receive reimbursement
from the Company for expenses reasonably incurred by Employee on behalf of the
Company.
4. Other Benefits During the Employment Period.
(a) The Company will provide medical coverage for the Employee to
the extent of medical coverage in effect for the Company's employees in
accordance with its health plan (the benefits may change based upon a
number of factors and no guarantee is made as to the extent of the
benefits or that the medical plan at any time shall be the best coverage
available), as well as all other benefits made available to executive
employees of the Company, from time to time, at its discretion
("Benefits").
2
(b) The Company shall furnish Employee with such working
facilities and other services as are suitable to Employee's position with
the Company and adequate to the performance of his duties under this
Agreement.
(c) Employee shall be entitled to paid sick days, personal days
and vacation periods in accordance with SMA's policy.
(d) At the end of any term of this Agreement, should the Company
choose not to renew or require the services of Employee, the Company will
notify Employee in writing ninety (90) days prior to the end of the term of
this Agreement. Employee shall receive a severance consideration equal to three
(3) months' salary.
5. Termination. This Agreement is subject to termination prior to the
expiration of its initial term or any extended term as follows:
(a) Termination for Cause. Company and Employee agree that no
additional salary or other benefits will be payable to the Employee by the
Company and the employment relationship between the parties will terminate
immediately following the occurrence of any one or more of the following
events:
(i) Employee violates any material term or condition
of this Agreement;
(ii) Employee commits a felony, gross misdemeanor or
act of dishonesty or engages in a material violation of the
established rules, regulations and policies of Company;
(iii) Employee engages in a general course of conduct
of non-cooperation, disorganization, gross negligence or other gross
misconduct adversely affecting the welfare, continuity or future of
Company's business.
(b) Death or Disability. If Employee should die or become
totally and permanently disabled during the term of employment, the
parties agree that the employment relationship and this Agreement will
terminate automatically. "Total disability" means the continuous inability
of Employee, resulting from disease or injury, to perform substantially
all the services pertaining to his employment under this Agreement. Such
total disability will be deemed "permanent" if Employee has not recovered
and returned to render the full services of his employment hereunder
within six (6) months of becoming totally disabled.
6. Confidential Information/Trade Secrets. Employee acknowledges that
during the course and as a result of his employment, Employee may receive or
otherwise have access to, or contribute to the production of, Confidential
Information or Trade Secrets. Confidential Information or Trade Secrets means
information that is proprietary to or in the unique knowledge of Company
(including information discovered or developed in whole or in part by
Employee); or information that derives independent economic value, actual or
potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use, and is the subject of efforts that are reasonable
under the circumstances to
3
maintain its secrecy. In particular, Employee agrees that this information
includes among other things, procedures, manuals, confidential reports, lists
of clients, customers, suppliers, or products, and information concerning the
prices of charges paid by the Company's customers to the Company, or by the
Company to its suppliers.
Employee further acknowledges and appreciates that any Confidential
Information or Trade Secrets constitutes a valuable asset of Company and that
Company intends any such information to remain secret and confidential.
Employee therefore specifically agrees that except to the extent required by
Employee's duties to Company, Employee shall never, either during employment
with Company or at any time thereafter, directly or indirectly use, discuss or
disclose any Confidential Information or Trade Secrets of Company or otherwise
use such information to his own or a third party's benefit.
7. Return of Property. Employee agrees that upon the termination of
his employment with Company that he will immediately return to Company the
originals and all copies of any and all documents (including computer data,
disks, programs, or printouts) that contain any customer information, financial
information, product information, or other information that in any way relates
to Company, its products or services, its clients, its suppliers, or other
aspects of its business. Employee further agrees to not retain any summary of
such information.
8. Non-competition. Employee understands and agrees that, in addition
to Employee's above-described exposure to Company's Confidential Information or
Trade Secrets, Employee may, in his capacity as an employee, at times meet with
Company's customers and/or suppliers on behalf of Company, and that as a
consequence of using or associating himself with Company's name, goodwill, and
professional reputation, Employee's employment will place him in a position
where Employee can further develop personal and professional relationships with
Company's current and prospective customers and/or suppliers. Employee further
acknowledges that during the course and as a result of his employment Employee
may be provided certain specialized training or know-how. Employee understands
and agrees that this goodwill and reputation, as well as Employee's knowledge
of Confidential Information or Trade Secrets and specialized training and
know-how, could be used unfairly in competition against Company.
Accordingly, Employee agrees that, during the course of Employee's
employment with Company and for twelve (12) months from the date of Employee's
voluntary termination of employment or involuntary termination of employment
for cause, Employee shall not:
(a) Directly or indirectly, individually or collectively in
conjunction with others, engage in competition with the Company or any of
its subsidiaries.
(b) Cause or attempt to cause any existing or prospective
customer, client, or account who then has a relationship with the Company
or any of its subsidiaries, for current or prospective business, to
divert, terminate, limit or in any manner modify, or fail to enter into
any actual or potential business relationship with Company or any of its
subsidiaries.
4
(c) Directly or indirectly solicit, employ or conspire with
others to employ any of Company's or Company's subsidiary's employees or
subcontractors. The term "employ" for purposes of this paragraph means to
enter into an arrangement for services as a full-time or part-time
employee, independent contractor, agent or otherwise.
Employee further agrees during the above-stated twelve (12) month period
to inform any new employer or other person or entity with whom Employee enters
into a business relationship, before accepting employment or entering into a
business relationship, of the existence of this Agreement and give such
employer, person or other entity a copy of this Paragraph 8, Non-competition.
9. Consideration. Employee and Company agree that the provisions of
this Agreement are reasonable and necessary for the protection of Company.
10. Remedies for Breach. Employee acknowledges that breach by him of the
provisions of this Agreement will cause Company irreparable harm that cannot be
fully remedied by monetary damages. Accordingly, Employee agrees that Company
shall, in addition to any relief afforded by law, be entitled to injunctive
relief. Employee agrees that both damages at law and injunctive relief shall be
proper modes of relief and are not to be considered alternative remedies.
Employee further agrees that Company shall be entitled to recover costs of
litigation and reasonable attorney fees incurred in enforcing this Agreement.
11. General Provisions. Employee and Company acknowledge and agree as
follows:
(a) This Agreement contains the entire understanding of the
parties with regard to all matters contained herein. There are no other
agreements, conditions, or representations, oral or written, express or
implied, with regard to such matters. This Agreement supersedes and
replaces any prior agreement between the parties generally relating to the
same subject matter.
(b) This Agreement may be amended or modified only by a writing
signed by both parties.
(c) Waiver by either Company or Employee of a breach of any
provision, term or condition hereof shall not be deemed or construed as a
further or continuing waiver thereof or a waiver of any breach of any
other provision, term or condition of this Agreement.
(d) The rights and obligations of Company hereunder may be
transferred or assigned to any successor, representative or assign of
Company. The term "Company" as used herein is intended to include S.M.A.
Real Time, Inc., its successors, affiliates, or assigns, if any. No
assignment of this Agreement shall be made by Employee, and any purported
assignment shall be null and void.
(e) Except as set forth herein, Employee's obligations under
paragraphs 6, 7 and 8 of this Agreement shall survive any change in
Employee's employment status with
5
Company, by promotion or otherwise, or the termination of Employee's
employment with Company.
(f) If any Court finds any provision or part of this Agreement
to be unreasonable, in whole or in part, such provision shall be deemed
and construed to be reduced to the maximum duration, scope or subject
matter allowable under applicable law. Any invalidation of any provision
or part of this Agreement will not invalidate any other part of this
Agreement.
(g) This Agreement will be construed and enforced in accordance
with the laws and legal principles of the State of New York.
(h) This Agreement may be executed in any number of
counterparts, including counterparts transmitted by telecopier or FAX,
any one of which shall constitute an original of this Agreement. When
counterparts of facsimile copies have been executed by all parties, they
shall have the same effect as if the signatures to each counterpart or
copy were upon the same document and copies of such documents shall be
deemed valid as originals. The parties agree that all such signatures may
be transferred to a single document upon the request of any party.
(i) Any dispute under this Agreement shall be determined by
arbitration. Each party shall appoint one arbitrator and notify the other
of such appointment within ten days after written request from the other.
If the party so requested fails to appoint an arbitrator, the party making
the request shall be entitled to designate two arbitrators. The two
arbitrators shall select a third. The written decision of a majority of
the arbitrators shall be binding upon the Company and Employee and
enforceable at law. The arbitrators shall, by majority vote, determine the
place for hearing, the rules of procedure, and allocation of the expenses
of the arbitration.
(j) This Agreement shall be binding upon and inure to the
benefit of the parties hereto, their successors, legal representatives,
and assigns.
This Agreement is intended to be a legally binding document fully
enforceable in accordance with its terms.
S.M.A. REAL TIME, INC.
----------------------------------
By:
/s/ Xxxxxxx Xxxxxxxxx
----------------------------------
Xxxxxxx Morrisssey
6
