EMPLOYMENT AGREEMENT
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EMPLOYMENT AGREEMENT dated as of July 1, 2000, by and between TOTAL
RESEARCH CORPORATION, a Delaware corporation (the "Company"), and XXXXX XXXXXXX
(the "Employee").
BACKGROUND
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WHEREAS, the Company is engaged in the business of marketing research,
information services and e-marketing services (the "Business");
WHEREAS, the Employee has experience and knowledge in the Business and
wishes to become a full-time employee of the Company;
WHEREAS, the Company and the Employee desire to enter into an agreement to
reflect the terms and conditions of employment; and
NOW THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein and intending, to be legally bound hereby, the
parties hereto agree as follows:
SECTION 1. CAPACITY AND DUTIES
1.1 EMPLOYMENT; ACCEPTANCE OF EMPLOYMENT. Company hereby employs Employee
and Employee hereby accepts employment by Company for the period and upon the
terms and conditions hereinafter set forth.
1.2 CAPACITY AND DUTIES.
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(a) Employee shall be employed by Company as a member of the Executive
Committee of the Company and, subject to the supervision of Company's President
and Board of Directors (the "Board"), shall perform such duties and shall have
such authority consistent with his position as may from time to time be
specified by the President or the Board.
(b) Employee shall devote sufficient working time, energy, skill and
best efforts to the performance of Employee's duties hereunder, in a manner that
will faithfully and diligently further the business and interests of Company.
Company acknowledges that Employee has interests in the management or operation
of other business enterprises and such participation will not constitute a
breach of this Agreement by Employee or constitute grounds for termination for
Cause (as defined herein) as long as such activities do not unreasonably
interfere with the Employee's performance of Employee's duties and
responsibilities hereunder.
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SECTION 2. TERM OF EMPLOYMENT
2.1 TERM. The term of Employee's employment hereunder shall commence on
July 1, 2000 and end on June 30, 2001, unless extended or earlier terminated as
hereinafter provided (the "Term"). Except as hereinafter provided, on June 30,
2001, the Term shall be automatically extended for one additional year unless
Employee shall have given to Company written notice of nonrenewal of this
Agreement on or before January 1, 2001.
SECTION 3. COMPENSATION
3.1 COMPENSATION. As compensation for Employee's services performed during
the Term, Company shall pay to Employee base compensation in the form of salary
of $75,000 per annum.
3.2 EMPLOYEE BENEFITS. In addition to the compensation provided for in
Section 3.1, Employee shall be entitled during the term of his employment to
participate in Company's employee benefit plan(s) and program(s) as may from
time to time be provided for other similarly situated employees of Company as
described in the Company's employee manual.
SECTION 4. TERMINATION OF EMPLOYMENT
4.1 DEATH OF EMPLOYEE. Employee's employment hereunder shall immediately
terminate upon his death, upon which Company shall not thereafter be obligated
to make any further payments hereunder other than amounts accrued under this
Agreement as of the date of Employee's death.
4.2 DISABILITY OF EMPLOYEE. If Employee is totally disabled within the
meaning of the Company's primary disability insurance policy, then the Board
shall have the right to terminate Employee's employment upon written notice to
Employee at any time during the continuation of such disability, in which event
Company shall not thereafter be obligated to make any further payments hereunder
other than amounts accrued under this Agreement as of the date of such
termination.
4.3 TERMINATION FOR CAUSE. Employee's employment hereunder shall terminate
immediately upon notice that the Board is terminating Employee for "Cause" (as
defined herein), in which event Company shall not thereafter be obligated to
make any further payments hereunder other than amounts accrued under this
Agreement as of the date of such termination. As used herein, "Cause" shall mean
the following:
(i) Employee's failure to perform his duties under this Agreement;
(ii) dishonesty, fraud, theft or misappropriation or embezzlement of
Company's funds;
(iii) conviction of any felony, crime involving fraud or
misrepresentation, or of any other crime (whether or not connected with his
employment) the effect of which is likely to adversely affect the Company or its
affiliates;
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(iv) material breach of Employee's obligations under Section 6 of this
Agreement that continues for more than three (3) days after notice thereof by
Company to Employee;
(v) willful violation of any express direction or any rule or
regulation established by the President or the Board relating to the business of
the Company;
(vi) gross incompetence or willful misconduct in the performance of,
or gross neglect of, Employee's duties hereunder;
(vii) illegal possession or use of any controlled substance on Company
premises; or
(viii) use of alcohol or other drugs which materially interferes with
the performance by Employee of his duties.
4.4 EMPLOYEE RESIGNATION. Employee may resign and terminate Employee's
employment hereunder for any reason whatsoever upon ninety (90) days' written
notice to the Company, in which event the Company shall not thereafter be
obligated to make any further payments hereunder other than amounts accrued
under this Agreement as of the last day of Employee's employment with the
Company.
SECTION 5. CHANGE OF CONTROL; COMPENSATION FOR EXCESS "PARACHUTE PAYMENTS".
5.1 CHANGE OF CONTROL. Upon the occurrence of a Change in Control (defined
below) during the Term, (i) Company shall pay Employee a lump sum bonus of One
Hundred Twenty-Five Thousand Dollars ($125,000) and (ii) Company (or its
successor in interest) and Employee shall enter into a two (2) year consulting
agreement providing for consulting payments to Employee equal to $75,000 per
annum.
(a) A "Change in Control" of Company shall be deemed to have occurred
if:
(1) at any time after the date hereof, there shall occur (i) any
consolidation or merger of Company in which Company is not the continuing or
surviving corporation or pursuant to which the shares of common stock of Company
("Common Stock") would be converted into cash, securities or other property, or
(ii) any sale, lease, exchange or other transfer (in one transaction or a series
of related transactions) of assets accounting for 50% or more of total assets or
50% or more of the total revenues of Company, other than, in case of either (i)
or (ii), a consolidation or merger with, or transfer to, a corporation or other
entity of which, or of the parent entity of which, immediately following such
consolidation, merger or transfer, (x) more than 50% of the combined voting
power of the then outstanding voting securities of such entity entitled to vote
generally in the election of directors (or other determination of governing
body) is then beneficially owned (within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934) by all or substantially all of the individuals
and entities who were such owners of Common Stock immediately prior to such
consolidation,
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merger or transfer in substantially the same proportion, as among themselves, as
their ownership of Common Stock immediately prior to such consolidation, merger
or transfer, or (y) a majority of the directors (or other governing body)
consists of members of the Board of Directors of Company in office on the date
hereof for purposes of (2) below or approved as provided in (2) below;
(2) at any time after the date hereof, (x) members of the Board
of Directors of Company in office on the date hereof (including any designated
as contemplated by Section 4.2 of the Stock Purchase Agreement made as of April
16, 1998 between Company and Xxxxx Xxxxxxx) plus (y) any new director (excluding
a director designated by a person or group who has entered into an agreement
with Company to effect a transaction described in Section 5.1(a)(1)) whose
election by the Board of Directors of Company or nomination for election by
Company's stockholders was approved by (i) Employee (if a director) or (ii) a
vote of at least a majority of the directors then still in office who either
were directors on the date hereof or whose election or nomination for election
was previously so approved, shall cease for any reason to constitute a majority
of the Board; or
(3) at any time after the date hereof, the stockholders of
Company approve a complete liquidation or dissolution of Company, except in
connection with a recapitalization or other transaction which does not otherwise
constitute a Change of Control for purposes of Section 5.1(a)(1) above.
5.2 COMPENSATION FOR EXCESS "PARACHUTE PAYMENTS". If all or any portion of
the payments or other benefits provided under this Agreement to Employee, either
alone or together with other payments and benefits which Employee receives or is
entitled to receive from Company, constitutes an excess "parachute payment"
within the meaning of section 280G of the Internal Revenue Code of 1986, as
amended, and as it may be amended on or after the date of this Agreement (the
"Code"), and results in the imposition on Employee of an excise tax under
section 4999 of the Code, then, in addition to any other benefits to which
Employee is entitled under this Agreement, Company shall pay Employee an amount
equal to the sum of (i) the excise taxes payable by Employee by reason of
receiving excess parachute payments; and (ii) a gross-up amount necessary to
offset any and all applicable federal, state, and local excise, income, or other
taxes incurred by Employee by reason of Company's payment of the excise tax
described in (i) above on or after the date of this Agreement.
SECTION 6. RESTRICTIVE COVENANTS
In addition to the restrictive covenants that apply to all employees of the
Company as set forth in the Company's employee manual, the following restrictive
covenants shall apply to the Employee:
6.1 CONFIDENTIALITY. Employee acknowledges a duty of confidentiality owed
to Company and shall not, at any time during or after his employment by Company,
retain in writing, use, divulge, furnish, or make accessible to anyone, without
the express authorization of the President or the Board, any trade secret,
private or confidential information or knowledge of Company obtained or acquired
by him while so employed. All computer software, address books, rolodexes,
business cards, telephone lists, customer lists, price lists, contract forms,
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catalogs, books, records, and files while an employee of Company, are
acknowledged to be the property of Company and shall not be duplicated, removed
from Company's possession or made use of other than in pursuit of Company's
business and, upon termination of employment for any reason, Employee shall
deliver to Company, without further demand, all originals and copies thereof
which are then in his possession or under his control.
6.2 INVENTIONS AND IMPROVEMENTS. During the term of his employment,
Employee shall promptly communicate to Company all ideas, discoveries and
inventions relating to Company or its business which are or may be useful to
Company or its business. Employee acknowledges that all ideas, discoveries,
inventions, and improvements which are made, conceived, or reduced to practice
by him and every item of knowledge relating to Company's business interests
(including potential business interests) gained by him during his employment
hereunder are the property of Company, and Employee hereby irrevocably assigns
all such ideas, discoveries, inventions, improvements, and knowledge to Company
for its sole use and benefit, without additional compensation. The provisions of
this Section 6.2 shall apply whether such ideas, discoveries, inventions,
improvements or knowledge are conceived, made or gained by him alone or with
others, whether during or after usual working hours, whether on or off the job,
whether applicable to matters related to Company's business interests (including
potential business interests), and whether or not within the specific realm of
his duties. It shall be conclusively presumed that ideas, inventions, and
improvements relating to Company's specific business interests conceived during
the twelve (12) months following termination of employment are, for the purposes
of this Agreement, conceived prior to termination of employment. Employee shall,
upon request of Company, at any time during or after his employment with
Company, sign all instruments and documents requested by Company and otherwise
cooperate with Company to protect its right to such ideas, discoveries,
inventions, improvements, and knowledge, including applying for, obtaining, and
enforcing patents and copyrights thereon in any and all countries.
6.3 NONSOLICITATION AND NONCOMPETITION.
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(a) During the term of Employee's employment and continuing for one
(1) year from such termination date (the "Restricted Period"), Employee shall
not directly or indirectly: (i) solicit, or contact with a view to the
engagement or employment by, any person or entity of any person who is an
employee of Company; (ii) seek to contract with or engage (in such a way as to
adversely affect or interfere with the business of Company) any person or entity
who has been contracted with or engaged to manufacture, assemble, supply or
deliver products, goods, materials or services to Company; or (iii) engage in or
participate in any effort or act to induce any of the customers, associates,
consultants, or employees of Company to limit doing business with Company.
(b) During the Restricted Period, Employee shall not (i) engage,
anywhere within fifty (50) miles of any Company office in the Business other
than for Company, or (ii) be or become a stockholder, partner, owner, officer,
director or employee or agent of, or a consultant to or give financial or other
assistance to, any other person or entity considering engaging in the Business
or so engaged.
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(c) Nothing herein shall prohibit Employee and his affiliates from
owning, as passive investors, in the aggregate not more than two percent (2%) of
the outstanding publicly traded stock of any corporation so engaged.
(d) The duration of the Employee's covenants set forth in this Section
shall be extended by a period of time equal to the number of days, if any,
during which the Employee is in violation of the provisions hereof.
6.4 INJUNCTIVE AND OTHER RELIEF.
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(a) Employee acknowledges and agrees that the covenants contained
herein are fair and reasonable in light of the consideration paid hereunder, and
that damages alone shall not be an adequate remedy for any breach by Employee of
his covenants contained herein and accordingly expressly agrees that, in
addition to any other remedies which Company may have, Company shall be entitled
to injunctive relief in any court of competent jurisdiction for any breach or
threatened breach of any such covenants by Employee. Nothing contained herein
shall prevent or delay Company from seeking, in any court of competent
jurisdiction, specific performance or other equitable remedies in the event of
any breach or intended breach by Employee of any of its obligations hereunder.
(b) Notwithstanding the equitable relief available to Company, the
Employee, in the event of a breach of his covenants contained in Section 6
hereof, understands and agrees that the uncertainties and delay inherent in the
legal process would result in a continuing breach for some period of time, and
therefore, continuing injury to Company until and unless Company can obtain such
equitable relief. Therefore, in addition to such equitable relief, Company shall
be entitled to monetary damages for any such period of breach until the
termination of such breach, in an amount deemed reasonable to cover all actual
and consequential losses, plus all monies received by Employee as a result of
said breach and all costs and attorneys' fees incurred by Company in enforcing
this Agreement. If Employee should use or reveal to any other person or entity
any confidential information, this will be considered a continuing violation on
a daily basis for so long a period of time as such confidential information is
made use of by Employee or any such other person or entity.
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SECTION 7. MISCELLANEOUS
7.1 Arbitration.
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(a) All disputes arising out of or relating to this Agreement which
cannot be settled by the parties shall promptly be submitted to and determined
by a single arbitrator in Princeton, New Jersey, pursuant to the rules and
regulations then obtaining of the American Arbitration Association; provided
that nothing herein shall preclude Company from seeking, in any court of
competent jurisdiction, damages, specific performance or other equitable
remedies in the case of any breach or threatened breach by Employee of Section 6
hereof. The decision of the arbitrator shall be final and binding upon the
parties, and judgment upon such decision may be entered in any court of
competent jurisdiction.
(b) Discovery shall be allowed pursuant to the United States Federal
Rules of Civil Procedure and as the arbitrators determine appropriate under the
circumstances.
(c) Such arbitrator shall be required to apply the contractual
provisions hereof in deciding any matter submitted to it and shall not have any
authority, by reason of this Agreement or otherwise, to render a decision that
is contrary to the mutual intent of the parties as set forth in this Agreement.
7.2 OTHER AGREEMENTS. Employee represents and warrants that he is not a
party to any other employment, non-competition or other agreement or restriction
which could interfere with his employment with Company or his or Company's
rights and obligations hereunder; and that the performance of his duties
hereunder will not breach the provisions of any contract, agreement, or
understanding to which he is party or any duty owed by him to any other person.
7.3 SEVERABILITY. The invalidity or unenforceability of any particular
provision or part of any provision of this Agreement shall not affect the other
provisions or parts hereof. If any provision hereof is determined to be invalid
or unenforceable by a court of competent jurisdiction by reason of the duration
or geographical scope of the covenants contained therein, such duration or
geographical scope, or both, shall be considered to be reduced to a duration or
geographical scope to the extent necessary to cure such invalidity.
7.4 ASSIGNMENT. This Agreement shall not be assignable by Employee, and
shall be assignable by Company only to any person or entity which may become a
successor in interest (by purchase of assets or stock, or by merger, or
otherwise) to Company in the business or a portion of the business presently
operated by it. Subject to the foregoing, this Agreement and the rights and
obligations set forth herein shall inure to the benefit of, and be binding upon,
the parties hereto and each of their respective permitted successors, assigns,
heirs, executors and administrators.
7.5 NOTICES. All notices hereunder shall be in writing and shall be
sufficiently given if hand-delivered, sent by documented overnight delivery
service or registered or certified mail, postage prepaid, return receipt
requested or by telegram, fax or telecopy (confirmed by U.S. mail), receipt
acknowledged, addressed as set forth below or to such other person and/or at
such
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other address as may be furnished in writing by any party hereto to the other.
Any such notice shall be deemed to have been given as of the date received, in
the case of personal delivery, or on the date shown on the receipt or
confirmation therefor, in all other cases. Any and all service of process and
any other notice in any such action, suit or proceeding shall be effective
against any party if given as provided in this Agreement; provided that nothing
herein shall be deemed to affect the right of any party to serve process in any
other manner permitted by law.
(a) If to Company:
Total Research Corporation
Princeton Corporate Center
0 Xxxxxxxxxxxx Xxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx, President
(b) If to Employee:
Xxxxx Xxxxxxx
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7.6 ENTIRE AGREEMENT AND MODIFICATION. This Agreement constitutes the
entire agreement between the parties hereto with respect to the matters
contemplated herein and supersedes all prior agreements and understandings with
respect thereto. Any amendment, modification, or waiver of this Agreement shall
not be effective unless in writing. Neither the failure nor any delay on the
part of any party to exercise any right, remedy, power or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, remedy, power or privilege preclude any other or further exercise of
the same or of any other right, remedy, power, or privilege with respect to any
occurrence be construed as a waiver of any right, remedy, power, or privilege
with respect to any other occurrence.
7.7 GOVERNING LAW. This Agreement is made pursuant to, and shall be
construed and enforced in accordance with, the internal laws of the State of New
Jersey (and United States federal law, to the extent applicable), without giving
effect to otherwise applicable principles of conflicts of law.
7.8 HEADINGS; COUNTERPARTS. The headings of paragraphs in this Agreement
are for convenience only and shall not affect its interpretation. This Agreement
may be executed in two or more counterparts, each of which shall be deemed to be
an original and all of which, when taken together, shall be deemed to constitute
but one and the same Agreement.
7.9 FURTHER ASSURANCES. Each of the parties hereto shall execute such
further instruments and take such other actions as any other party shall
reasonably request in order to effectuate the purposes of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
TOTAL RESEARCH CORPORATION
By:/s/Xxxxxx Xxxxxxxxx
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Xxxxxx Xxxxxxxxx
President
/s/Xxxxx Xxxxxxx
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XXXXX XXXXXXX
