EXHIBIT 10.24
EXECUTION COPY
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "Agreement") dated as of February 28, 1999,
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by and between SYNETIC, INC., a Delaware corporation (the "Company"), and XXXXX
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LOVE ("Executive").
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WHEREAS, the Company desires to employ the Executive on a full-time
basis and the Executive desires to be so employed by the Company;
NOW, THEREFORE, in consideration of the mutual covenants in this
Agreement, the parties agree as follows:
1. Effectiveness of Agreement and Employment of Executive.
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1.1. Effectiveness of Agreement. This Agreement shall become
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effective as of February 28, 1999 (the "Effective Date").
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1.2. Employment by the Company. The Company hereby employs Executive
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as the Executive Vice President - Chief Financial Officer of the Company and
Executive hereby accepts such employment with the Company. Executive shall
report to the Chairman of the Board (the "Chairman") or Chief Executive Officer
(the "CEO") of the Company or their designee(s), and perform such duties and
services for the Company and its subsidiaries and affiliates (such subsidiaries
and affiliates collectively, "Affiliates"), and at such locations, as may be
designated from time to time, by any such person. Executive shall use his best
and most diligent efforts to promote the interests of the Company and the
Affiliates, and shall devote all of his business time and attention to his
employment under this Agreement.
1.3. Confidentiality. (a) Executive understands and acknowledges that
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in the course of his employment, he will have access to and will learn
information that is proprietary to, or confidential to the Company and its
Affiliates that concerns the operation, methodology and plans of the Company and
its Affiliates, including, without limitation, business strategy and plans,
financial information, protocols, proposals, manuals, clinical procedures and
guidelines, technical data, computer source codes, programs, software, know-how
and specifications, copyrights, trade secrets, market information, Developments
(as hereinafter defined), information regarding acquisition and other strategic
partner candidates, and customer information (collectively, "Proprietary
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Information"). Executive agrees that, at all times (including following
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termination of this Agreement), he will keep confidential and will not disclose
directly or indirectly any such Proprietary Information to any third party,
except as required to fulfill his duties hereunder, and will not misuse,
misappropriate or exploit such Proprietary Information in any way. The
restrictions contained herein shall not apply to any information which Executive
can demonstrate (a) was already available to the public at the time
of disclosure, or subsequently becomes available to the public, otherwise than
by breach of this Agreement by Executive or (b) was the subject of a court order
for Executive to disclose. Upon any termination of this Agreement, Executive
shall immediately return to the Company all copies of any Proprietary
Information in his possession.
(b) Executive agrees that at no time during his employment by the
Company or thereafter, shall he make, or cause or assist any other person to
make, any statement or other communication to any third party which impugns or
attacks, or is otherwise critical of, the reputation, business or character of
the Company, its Affiliates or any of their respective officers or employees.
1.4. Restrictions on Solicitation. During the period beginning on
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the Effective Date and ending on the second anniversary of the date of cessation
of the employment of the Executive for any reason whatsoever (the "Restricted
Period"), Executive shall not, directly or indirectly, without the prior written
approval of the Company, solicit or contact any customer, or any prospective
customer, of the Company or any of the Affiliates for any commercial pursuit
which is in competition with the Company or any of the Affiliates, or that is
contemplated from time to time by the Business Plan (as defined below) or take
away or interfere or attempt to interfere with any custom, trade, business or
patronage of the Company or any of the Affiliates. During the Restricted
Period, Executive shall not, directly or indirectly, without the prior written
approval of the Company, solicit or induce, or attempt to solicit or induce, any
employees, agents or consultants of or to the Company or any of the Affiliates
to leave the employ of the Company or such Affiliate or do anything from which
Executive is restricted by reason of this Agreement nor shall Executive,
directly or indirectly, offer or aid others to offer employment to or interfere
or attempt to interfere with any employees, agents or consultants of the Company
or any of the Affiliates. For purposes of this Agreement, "Business Plan" shall
mean, at any point in time, the then current business plan of the Company and
any business plans of the Company in effect during the prior 18 months.
1.5. Restrictions on Competitive Employment. During the Restricted
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Period, Executive shall not (as principal, agent, employee, consultant or
otherwise), anywhere in the United States, directly or indirectly, without the
prior written approval of the Company, (i) engage in direct or indirect
competition with the Company or any Affiliates, (ii) conduct a business of the
type and character engaged in by the Company or any Affiliates (or contemplated
by the Business Plan), or (iii) develop products or services competitive with
those of the Company or any Affiliates (collectively, "Competitive Business").
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In addition, during the period beginning on the Effective Date and ending on the
first anniversary of the date of cessation of the employment of the Executive
for any reason whatsoever (the "IB Restricted Period"), Executive shall not,
directly or indirectly (as principal, agent or representative of an investment
banking, financial advisory or consulting firm or otherwise),
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provide investment banking, financial advisory, consulting or related services
to any company or persons engaged in a Competitive Business. Notwithstanding the
foregoing, Executive may have an interest consisting of publicly traded
securities constituting less than 1 percent of any class of publicly traded
securities in any public company engaged in a Competitive Business so long as he
is not employed by and does not consult with, or become a director of or
otherwise engage in any activities for, such company.
1.6. Extension of Restricted Periods. The Restricted Period and the
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IB Restricted Period shall be extended by the length of any period during which
Executive is in breach of the terms of this Section 1.
1.7. Assignment of Developments. All Developments that are at any
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time made, conceived or suggested by Executive, whether acting alone or in
conjunction with others, arising out of or as a result of Executive's
employment with the Company shall be the sole and absolute property of the
Company and the Affiliates, free of any reserved or other rights of any kind on
Executive's part. During Executive's employment and, if such Developments were
made, conceived or suggested by Executive during or as a result of Executive's
employment under this Agreement or any other employment with the Company or the
Affiliates, thereafter, Executive shall promptly make full disclosure of any
such Developments to the Company and, at the Company's cost and expense, do all
acts and things (including, among others, the execution and delivery under oath
of patent and copyright applications and instruments of assignment) deemed by
the Company to be necessary or desirable at any time in order to effect the full
assignment to the Company and the Affiliates of Executive's right and title, if
any, to such Developments. For purposes of this Agreement, the term
"Developments" shall mean all data, discoveries, findings, reports, designs,
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inventions, improvements, methods, practices, techniques, developments,
programs, concepts, and ideas, whether or not patentable, relating to the
present or planned activities, or future activities, or the products and
services of the Company or any of the Affiliates.
1.8. Remedies. Executive acknowledges and agrees that damages for a
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breach or threatened breach of any of the covenants set forth in Sections 1.1
through 1.7 will be difficult to determine and will not afford a full and
adequate remedy, and therefore agrees that the Company, in addition to seeking
actual damages in connection therewith, may seek specific enforcement of any
such covenant in any court of competent jurisdiction, including, without
limitation, by the issuance of a temporary or permanent injunction.
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2. Compensation and Benefits.
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2.1. Salary. The Company shall pay Executive for services during the
term of this Agreement a base salary at the annual rate of $175,000.00 ("Base
Salary"). Any and all increases to Executive's Base Salary shall be determined
by the Board in its sole discretion. Such Base Salary shall be payable in equal
installments, no less frequently than monthly, pursuant to the Company's
customary payroll policies in force at the time of payment, less any required or
authorized payroll deductions. Executive may receive bonus compensation in
addition to his Base Salary. Whether Executive shall receive such bonus
compensation and the amounts, if any, that may from time to time be granted to
Executive shall be in the absolute discretion of the Board, whose determination
shall be conclusive.
2.2. Benefits. During the term of this Agreement, Executive shall be
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entitled to participate, on the same basis and at the same level as other
similarly situated executives of the Company, in any group insurance,
hospitalization, medical, health and accident, disability, fringe benefit and
tax-qualified retirement plans or programs or vacation leave of the Company now
existing or hereafter established to the extent that he is eligible under the
general provisions thereof.
2.3. Expenses. Pursuant to the Company's customary policies in force
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at the time of payment, Executive shall be promptly reimbursed, against
presentation of vouchers or receipts therefor, for all authorized expenses
properly and reasonably incurred by him on behalf of the Company or its
Affiliates in the performance of his duties hereunder.
3. Employment Period.
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Executive's employment under this Agreement shall commence as of the
Effective Date, and shall terminate on the fifth anniversary thereof (the
"Initial Employment Period"), unless terminated earlier pursuant to Section 4.
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Unless written notice of either party's desire to terminate this Agreement has
been given to the other party prior to the expiration of the Initial Employment
Period (or any one-month renewal thereof contemplated by this sentence), the
term of this Agreement shall be automatically renewed for successive one-month
periods.
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4. Termination.
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4.1. Termination by the Company for Cause. (a) This Agreement and
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Executive's employment with the Company may be terminated at any time by the
Company for Cause. Upon such a termination, the Company shall have no
obligation to Executive other than the payment of Executive's earned and unpaid
compensation to the effective date of such termination.
(b) For purposes of this section of the Agreement, the term "Cause"
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shall mean any of the following:
1. A willful failure of Executive to perform his duties in any
material respect which failure is not cured by Executive within 20 days
following written notice from the Company detailing such failure;
2. Any willful misconduct by Executive relating, directly or
indirectly, to the Company or any of its Affiliates, which breach, if
susceptible to cure, is not cured by Executive within 20 days following
written notice from the Company detailing such breach;
3. Any breach by Executive of any material provision contained
in this Agreement, which breach, if susceptible to cure, is not cured by
Executive within 20 days following written notice from the Company
detailing such breach; or
4. Executive's conviction of a felony or crime involving moral
turpitude.
4.2. Permanent Disability. If during the term of this Agreement,
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Executive shall become ill, mentally or physically disabled, or otherwise
incapacitated so as to be unable regularly to perform the duties of his position
for a period in excess of 90 consecutive days or more than 120 days in any
consecutive 12 month period, then the Company shall have the right to terminate
this Agreement and Executive's employment with the Company upon written notice
to Executive. Upon such a termination, the Company shall have no obligation to
Executive other than (i) the payment of Executive's earned and unpaid
compensation to the effective date of such termination, (ii) the payment of a
monthly severance payment equal to one-twelfth (1/12th) of his then applicable
Base Salary, less all required payroll deductions, for a period ending six (6)
months from the date of such termination, and (iii) as provided in the Stock
Option Agreement (as defined below).
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4.3. Death. This Agreement shall be deemed terminated by the Company
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upon the death of Executive and the Company shall have no obligation to
Executive or Executive's estate other than (i) the payment of Executive's earned
and unpaid compensation to the effective date of such termination, (ii) the
payment of a monthly severance payment equal to one-twelfth (1/12th) of his then
applicable Base Salary, less all required payroll deductions, for a period
ending six (6) months from the date of such termination, and (iii) as provided
in the Stock Option Agreement.
4.4. Termination by the Company Without Cause. This Agreement and
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Executive's employment with the Company may be terminated at any time by the
Company without Cause. If the Company terminates this Agreement and Executive's
employment without Cause (not including by notice of the Company pursuant to
Section 3 of its desire to not renew this Agreement), the Company shall have no
obligation to Executive other than (i) the payment of Executive's earned and
unpaid compensation to the effective date of such termination, (ii) the payment
of a monthly severance payment equal to one-twelfth (1/12th) of his then
applicable Base Salary, less all required payroll deductions, for a period
ending six (6) months from the date of such termination, and (iii) as provided
in the Stock Option Agreement.
4.5. Liquidated Damages. Executive acknowledges that any payments
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and benefits under Sections 4 and 5 resulting from a termination of this
Agreement and Executive's employment with the Company are in lieu of any and all
claims that the Executive may have against the Company (other than benefits
under the Company's employee benefit plans that by their terms survive
termination of employment and benefits under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended and rights to indemnification under
certain indemnification arrangements for officers of the Company), and represent
liquidated damages (and not a penalty). The Company may direct that the
Executive confirm such acknowledgment in writing prior to the receipt of such
benefits.
5. Stock Options.
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Executive will be granted (i) an option to purchase up to 250,000
shares of the Company's common stock, par value $.01 per share ("Common Stock"),
and (ii) an option to purchase up to 275,000 shares of Common Stock.
Notwithstanding the foregoing, all of the terms and conditions of such option
grants shall be governed exclusively by the express provisions of the stock
option agreements to be executed by the Executive evidencing such grants
(collectively, the "Stock Option Agreement").
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6. Notices.
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Any notice or communication given by either party hereto to the other
shall be in writing and personally delivered or mailed by registered or
certified mail, return receipt requested, postage prepaid, to the following
addresses:
(a) if to the Company:
Synetic, Inc.
River Drive Center 2
000 Xxxxx Xxxxx
Xxxxxxx Xxxx, Xxx Xxxxxx 00000-0000
Facsimile No.: (000) 000-0000
Attention: General Counsel
(b) if to the Executive at the address set forth below.
Any notice shall be deemed given when actually delivered to such address (by
mail, courier service, facsimile or otherwise), or two days after such notice
has been mailed or sent by overnight express courier, whichever comes earliest.
Any person entitled to receive notice may designate in writing, by notice to the
other, such other address to which notices to such person shall thereafter be
sent.
7. Miscellaneous.
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7.1 Representations and Covenants. In order to induce the
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Company to enter into this Agreement, the Executive makes the following
representations and covenants to the Company and acknowledges that the Company
is relying upon such representations and covenants:
(a) No agreements or obligations exist to which the Executive is a
party or otherwise bound, in writing or otherwise, that in any way interfere
with, impede or preclude him from fulfilling all of the terms and conditions of
this Agreement.
(b) The Executive, during the Employment Period, shall use his best
efforts to disclose to the Chairman of the Board in writing or by other
effective method any bona fide information known by him that he reasonably
believes would have any material negative impact on the Company or an Affiliate.
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7.2. Entire Agreement. This Agreement and the agreements and/or
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plans relating to the stock option grants described in Section 5 contain the
entire understanding of the parties in respect of their subject matter and
supersede upon their effectiveness all other prior agreements and understandings
between the parties with respect to such subject matter.
7.3. Amendment; Waiver. This Agreement may not be amended,
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supplemented, canceled or discharged, except by written instrument executed by
the party against whom enforcement is sought. No failure to exercise, and no
delay in exercising, any right, power or privilege hereunder shall operate as a
waiver thereof. No waiver of any breach of any provision of this Agreement
shall be deemed to be a waiver of any preceding or succeeding breach of the same
or any other provision.
7.4. Binding Effect; Assignment. The rights and obligations of this
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Agreement shall bind and inure to the benefit of any successor of the Company by
reorganization, merger or consolidation, or any assignee of all or substantially
all of the Company's business and properties. The Company may assign its rights
and obligations under this Agreement to any of its Affiliates without the
consent of the Executive. Executive's rights or obligations under this
Agreement may not be assigned by Executive, except that the rights specified in
Section 4.3 shall pass upon the Executive's death to Executive's executor or
administrator.
7.5. Headings. The headings contained in this Agreement are for
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reference purposes only and shall not affect the meaning or interpretation of
this Agreement.
7.6. Governing Law; Interpretation. This Agreement shall be
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construed in accordance with and governed for all purposes by the laws and
public policy (other than conflict of laws principles) of the State of New
Jersey applicable to contracts executed and to be wholly performed within such
State.
7.7. Further Assurances. Each of the parties agrees to execute,
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acknowledge, deliver and perform, and cause to be executed, acknowledged,
delivered and performed, at any time and from time to time, as the case may be,
all such further acts, deeds, assignments, transfers, conveyances, powers of
attorney and assurances as may be reasonably necessary to carry out the
provisions or intent of this Agreement.
7.8. Severability. The parties have carefully reviewed the
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provisions of this Agreement and agree that they are fair and equitable.
However, in light of the possibility of differing interpretations of law and
changes in circumstances, the parties agree that if any one or more of the
provisions of this Agreement shall be determined by a court of competent
jurisdiction to be invalid, void or unenforceable, the remainder of the
provisions of this
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Agreement shall, to the extent permitted by law, remain in full force and effect
and shall in no way be affected, impaired or invalidated. Moreover, if any of
the provisions contained in this Agreement are determined by a court of
competent jurisdiction to be excessively broad as to duration, activity,
geographic application or subject, it shall be construed, by limiting or
reducing it to the extent legally permitted, so as to be enforceable to the
extent compatible with then applicable law.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
SYNETIC, INC.
By:_________________________
Name: Xxxx X. Xxxxxxx
Title: President and Chief
Executive Officer
EXECUTIVE
_____________________________
Xxxxx Xxxx
_____________________________
Street
_____________________________
City, State, Zip Code
_____________________________
Facsimile No.
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