Exhibit 10.19
EMPLOYMENT AGREEMENT
AMENDED AND RESTATED AGREEMENT, dated as of August 16, 2005, between
GENERAL PHYSICS CORPORATION, a Delaware corporation with principal executive
offices at 0000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxx 00000 (the
"Company"), and Xxxxxx Xxxxxxxx-Xxxxx, residing at 0000 Xxxxx Xxx, Xxxxxxxx, XX
00000 ("Employee").
WITNESSETH
WHEREAS, the Company and Employee have entered into an agreement, dated as
of April 11, 2005 (the "Existing Agreement"), pursuant to which the Company has
employed Employee to perform services for the Company, and any successor or
assign of the Company; and
WHEREAS, the Company and Employee wish to amend and restate the Existing
Agreement as set forth in this Agreement, and the Company desires to employ
Employee to perform services for the Company, and any successor or assign of the
Company, and Employee desires to perform such services, subject to the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises, the mutual promises,
covenants, and conditions herein contained and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto intending to be legally bound hereby agree as follows:
1. Term. The Company agrees to employ Employee, and Employee agrees to serve, on
the terms and conditions of this Agreement, for a period commencing on April 11,
2005 and ending on July 31, 2007, or such shorter period as may be provided for
herein (the "Employment Period"). If the Employment Period ends on July 31,
2007, then commencing on August 1, 2007, the Employee shall be an
employee-at-will of the Company.
2. Duties and Services. During the Employment Period, Employee shall be employed
in the business of the Company as Executive Vice President or in such other
capacity or capacities as shall be assigned to Employee by the President, Chief
Executive Officer or Board of Directors of the Company (the "Board") that are
consistent with being an executive of the Company. In performance of his/her
duties, Employee shall be subject to the direction of the President, Chief
Executive Officer or another senior executive of the Company as designated by
the President, Chief Executive Officer or Board. Employee agrees to his/her
employment as described in this Section 2 and, subject to any qualifications and
limitations set forth herein, the Employee agrees to devote all of his/her
business time and efforts to the performance of his/her duties under this
Agreement and to promote and advance the business interests of the Company.
Employee shall comply with the policies and procedures of the Company adopted
from time to time. Employee shall be available to travel as the needs of the
business reasonably require.
3. Compensation. As full compensation for his/her services hereunder, the
Company shall provide Employee during the Employment Period the following:
(a) Base Salary. During the Employment Period, the Company shall pay
to Employee a base annual salary at the rate paid by the Company to Employee
immediately prior to the Employment Period, payable at such intervals (at least
monthly) as salaries are paid
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generally to other employees of the Company. On April 1 of each year, beginning
in 2006, the base annual salary shall be increased, as determined by the Board,
by a minimum of the greater of (i) 3% and (ii) the percentage increase in the
Consumer Price Index (All Urban Consumers) published by the U.S. Department of
Labor during the prior calendar year. During any period in which Employee is
eligible to receive salary replacement payments under the provisions of any
benefits plan(s) sponsored or maintained by the Company, the Company's
obligation to pay salary shall be reduced by an amount equal to the amount of
benefits paid or payable under such plan(s).
(b) Employee Benefit Plans. Employee shall be entitled to participate
in all employee benefit plans maintained by the Company for its executives or
employees, including without limitation the Company's medical, dental,
disability, life, stock option and 401(k) Plans and Bonus Plan, if he/she meets
the eligibility requirements. The Company shall maintain the existing life and
disability insurance policies covering Employee or comparable policies. The cost
of such benefits to Employee shall not exceed the cost of such benefits to the
Company's vice presidents generally.
(c) Paid Time Off. Employee shall be entitled to reasonable vacations
and other paid time off in accordance with the then regular procedures of the
Company governing executives.
(d) Automobile. The Company shall provide Employee with an automobile
(comparable to the automobile provided by the Company to Employee immediately
prior to the Employment Period) of his/her choice on the same terms as currently
provided to officers of the Company. Alternatively, Employee may elect to
receive a monthly allowance equal to such amount as the Company shall then pay
its vice presidents who elect to use his/her own automobile, and assume personal
responsibility for the cost of operating and maintaining such vehicle, rather
than to use a Company-provided automobile.
(e) Cellular Telephone. The Company shall, at its expense, provide the
Employee with a cellular telephone, and pay all charges associated therewith,
for his/her use in connection with the performance of his/her duties hereunder.
(f) Stock Unit Grant. Within thirty (30) days after the beginning of
the Employment Period, Employee shall be granted 23,000 Stock Units ("Units") of
GP Strategies Corporation ("GPSC") Common Stock ("Common Stock") pursuant to the
GPSC 2003 Incentive Stock Plan (the "Plan"). Such grant shall be subject to the
provisions of the Plan and shall be on the terms and conditions, and subject to
the restrictions, set forth herein and in the form of grant attached hereto as
Exhibit A.
(g) Change in Control or Sale of the Company. Upon the occurrence of a
"Change in Control" or a "Sale of the Company" during the Employment Period, all
stock options to purchase GPSC common stock granted to Employee shall
immediately become fully vested and exercisable and all Units granted to
Employee shall immediately be paid in unrestricted shares of Common Stock. For
purposes of this Agreement, a "Change in Control" is deemed to have occurred if
any person who was not on March 18, 2005 a "beneficial owner" (as defined in
Rule 13d-3 under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of securities of GPSC representing 15% of more of the combined
voting power of GPSC's outstanding securities becomes the beneficial owner,
directly or indirectly, of securities of GPSC representing 25% or more of the
combined voting power of GPSC's outstanding securities and a "Sale of the
Company" is deemed to have occurred if (i) GPSC engages in a
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transaction or series of transactions (including, without limitation, a merger
or consolidation) with another corporation, partnership, limited liability
company, joint venture, trust or other entity, and the stockholders of GPSC
immediately prior to such transaction(s) do not, after such transaction(s), hold
at least 50% of the voting power of GPSC or its successor, (ii) GPSC and its
affiliates cease to own more than 80% of the voting stock of the Company, (iii)
all or substantially all of the assets of GPSC, the Company, or the business
unit of the Company with regard to which Employee is assigned are sold, or (iv)
the Common Stock is neither listed on a national securities exchange nor
authorized to be quoted in an inter-dealer quotation system of a registered
national securities association.
4. Expenses. Employee shall be entitled to reimbursement for reasonable travel
and other out-of-pocket expenses necessarily incurred in the performance of
his/her duties hereunder, upon submission and approval of written statements,
receipts and bills in accordance with the then regular procedures of the
Company.
5. Representations and Warranties of Employee. Employee represents and warrants
to the Company that (a) Employee is under no contractual or other restriction or
obligation which is inconsistent with the execution of this Agreement, the
performance of his/her duties hereunder, or the other rights of the Company
hereunder and (b) Employee is under no physical or mental disability that would
preclude his/her performance, with or without reasonable accommodation, of the
essential duties of his/her position.
6. Non-Competition, Non-Solicitation. In view of the unique and valuable
services that it is expected Employee will render to the Company, the knowledge
of the customers, trade secrets, and other proprietary information relating to
the business of the Company and its customers and suppliers that Employee has
obtained and that it is expected Employee will obtain, and in consideration of
the compensation to be received hereunder, Employee agrees
(a) that he/she will not during the period he/she is employed by the
Company under this Agreement or otherwise (i) Participate In (hereinafter
defined in this Section 6) any other business or organization (other than (A)
not-for profit professional, civic, or similar organizations that do not compete
with the Company or (B) as agreed to in writing by the Company), whether or not
such business or organization now is or shall then be competing with or of a
nature similar to the business of the Company; (ii) directly or indirectly
reveal the name of, solicit or interfere with, encourage to leave the Company,
or endeavor to entice away from the Company any of its suppliers, customers, or
employees; or (iii) directly or indirectly employ any person who, at any time
within the prior ninety (90) days, was an employee of the Company; and
(b) for a period of six months after he/she ceases to be employed by
the Company under this Agreement or otherwise, he/she will not (i) compete with,
or Participate In any other business or organization which during such six-month
period competes with, the Company, with respect to any product or service sold
within the twelve (12) month period preceding such cessation; (ii) directly or
indirectly reveal the name of, solicit or interfere with, encourage to leave the
Company, or endeavor to entice away from the Company any of its suppliers,
customers, or employees; or (iii) directly or indirectly employ any person who,
at any time within ninety (90) days prior to such cessation, was an employee of
the Company; provided that
(A) such six-month period shall be reduced to a four-month period if the
Company terminates Employee's employment
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(I) prior to August 1, 2007 for reasons other than those specified in
Section 9(a) or
(II) on or after August 1, 2007 for reasons other than (1) as a result
of a serious health condition (as defined in the Family and Medical
Leave Act of 1993), and after giving effect to any reasonable
accommodation required by law, Employee shall be physically or
mentally incapacitated or disabled or otherwise unable fully to
discharge his/her duties hereunder for a period of ninety (90)
consecutive days, (2) Employee shall be convicted, plead guilty, or
enter a plea of nolo contendere to a felony or a crime involving moral
turpitude, (3) Employee shall commit any act or omit to take any
action in bad faith and to the detriment of the Company, or (4)
Employee shall fail to perform his/her duties or obligations to the
Company and shall not correct such failure or breach within ten (10)
days after receipt of written notice thereof and
(B) if
(I) on or after August 1, 2007 Employee resigns for any reason or no
reason or the Company terminates Employee's employment for reasons
other than (1) as a result of a serious health condition (as defined
in the Family and Medical Leave Act of 1993), and after giving effect
to any reasonable accommodation required by law, Employee shall be
physically or mentally incapacitated or disabled or otherwise unable
fully to discharge his/her duties hereunder for a period of ninety
(90) consecutive days, (2) Employee shall be convicted, plead guilty,
or enter a plea of nolo contendere to a felony or a crime involving
moral turpitude, (3) Employee shall commit any act or omit to take any
action in bad faith and to the detriment of the Company, or (4)
Employee shall fail to perform his/her duties or obligations to the
Company and shall not correct such failure or breach within ten (10)
days after receipt of written notice thereof and
(II) Employee is in full compliance with this Section 6 and Section 8,
then the Company shall compensate Employee at the rate of Employee's base
annual salary received from the Company immediately prior to such
cessation, payable at such intervals (at least monthly) as salaries are
paid generally to employees of the Company, during the six-month period
commencing on the date that Employee's employment by the Company
terminates, provided that (x) the obligation of the Company to compensate
Employee pursuant to this Section 6 shall terminate if Employee does not
remain in full compliance with this Section 6 and Section 8 (but the
obligations of Employee pursuant to this Section 6 and Section 8, and the
remedies of the Company for a violation of this Section 6 and Section 8,
shall not be affected by such termination of the obligation of the Company
to compensate Employee), (y) if Employee has resigned for any reason or no
reason, the Company shall have the right, in its sole discretion and at any
time, to release Employee from its obligations under this Section 6 and to
cease paying such compensation, and (z) the Company shall have no
obligation to compensate Employee pursuant to this Section 6 during any
period that the Employee is receiving compensation pursuant to Section 9.
The term "Participate In" shall mean: "directly or indirectly, for his/her own
benefit or for, with, or through any other person, firm, or corporation, own
(other than the ownership of not more
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than 1% of the outstanding common stock of a corporation, if, at the time of its
acquisition, such stock is listed on a national securities exchange, is reported
on NASDAQ, or is regularly traded in the over-the-counter market by a member of
a national securities exchange), manage, operate, control, loan money to, or
participate in the ownership, management, operation, or control of, or be
connected as a director, officer, employee, partner, consultant, agent,
independent contractor, or otherwise with, or acquiesce in the use of his/her
name in." Since a breach of the provisions of this Section 6 or Section 8 could
not adequately be compensated by money damages, the Company shall be entitled,
in addition to any other right and remedy available to it, to seek an injunction
restraining such breach or a threatened breach, and in either case no bond or
other security shall be required in connection therewith. Employee agrees that
the provisions of this Section 6 and Section 8 are necessary and reasonable to
protect the Company in the conduct of its business. If any restriction contained
in this Section 6 or Section 8 shall be deemed to be invalid, illegal, or
unenforceable by reason of its extent, duration, geographical scope, or
otherwise, then (a) it is hereby declared to be the intention of the parties
hereto that such provision be reformed to reflect the maximum extent, duration,
geographical scope, or other limitation that is permitted by law and (b) the
court making such determination shall have the authority to reduce such
restriction to the maximum extent, duration, geographical scope, or other
limitation that is permitted by law, and in its reduced form such restriction
shall then be enforceable in the manner contemplated hereby.
7. Patents, Etc. Any interest in patents, patent applications, inventions,
copyrights, developments, and processes ("Such Inventions") which Employee has
acquired or hereafter acquires during the period he/she is employed by the
Company relating to the fields in which the Employee has been, or shall be,
engaged on behalf of the Company shall belong to the Company; and forthwith upon
request of the Company Employee shall execute all such assignments and other
documents and take all such other action as the Company may reasonably request
in order to vest in the Company all his/her right, title, and interest in and to
Such Inventions free and clear of all liens, charges, and encumbrances caused by
acts of Employee.
8. Confidential Information. All confidential information which Employee may now
possess, may obtain during or after the Employment Period, or may create prior
to the end of the period he/she is employed by the Company under this Agreement
or otherwise relating to the business of the Company or any of its affiliates or
of any customer or supplier of the Company or any of its affiliates shall not be
published, disclosed, or made accessible by him/her to any other person, firm,
or corporation either during or after the termination of his/her employment or
used by him/her except during the Employment Period in the business and for the
benefit of the Company, in each case without prior written permission of the
Company. Employee shall return all tangible evidence of such confidential
information to the Company prior to or at the termination of his/her employment.
9. Termination. Notwithstanding anything herein contained, if on or after the
date hereof and prior to the end of the Employment Period,
(a) either (i) as a result of a serious health condition (as defined
in the Family and Medical Leave Act of 1993), and after giving effect to any
reasonable accommodation required by law, Employee shall be physically or
mentally incapacitated or disabled or otherwise unable fully to discharge
his/her duties hereunder for a period of ninety (90) consecutive days, (ii)
Employee shall be convicted, plead guilty, or enter a plea of nolo contendere to
a felony or a crime involving moral turpitude, (iii) Employee shall commit any
act or omit to take any action in bad faith and to the detriment of the Company,
or (iv) Employee
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shall (A) willfully and continually fail to perform his/her duties or
obligations under any provision of this Agreement other than Section 6 or 8 in
any material respect, and shall not correct such failure within ten (10) days
after receipt of written notice thereof, or (B) fail to perform his/her duties
or obligations under Section 6 or 8 in any material respect, then, and in each
such case, the Company shall have the right to give notice of termination of
Employee's services hereunder as of a then present or future date to be
specified in such notice, Employee's employment shall terminate on the date so
specified, the Company shall pay Employee his/her base annual salary through the
date of termination only, and, except as provided by law or the terms of the
applicable benefit plan, Employee shall continue to receive the other benefits
set forth in Section 3 through the date of termination only.
(b) If (i) (A) Employee resigns for "Just Cause," as defined below, or
(B) the Company terminates Employee's employment for reasons other than those
specified in Section 9(a) and (ii) Employee is in full compliance with his/her
obligations under Sections 6 and 8, then, (x) for the period that would have
been remaining in the Employment Period if Employee had not so resigned or been
terminated or for a period of 6 months after termination (whichever is longer),
(1) the Company shall pay Employee his/her base annual salary at the rate in
effect on the date of such employment termination, payable at such intervals (at
least monthly) as salaries are paid generally to executive officers of the
Company and (2) Employee shall continue to be eligible to receive such benefits
as Employee would have been entitled to under Section 3 had his/her employment
not terminated and (y) for purposes of the Units only, Employee shall be deemed
to be employed by the Company through April 10, 2008; provided that the
obligations of the Company pursuant to Section 9(b)(x) shall terminate, and
Section (b)(y)shall be of no force or effect, if Employee does not remain in
full compliance with Sections 6 and 8. For the purposes hereof, the Employee
shall be deemed to have resigned for "Just Cause" in the event that the Employee
resigns within thirty (30) days following either (A) the Company, without the
express written consent of the Employee, (i) imposes any significant change in
the Employee's function, duties, or responsibilities that is not consistent with
the Employee being an executive of the Company and fails to rescind or modify
such change within ten (10) business days after receipt of written notice from
the Employee, or (ii) fails to make any material payment, or provide any
material benefit to the Employee, contemplated hereunder, and fails to correct
any such deficiency within ten (10) business days after receipt of written
notice from the Employee, or (B) the Company shall breach any other term of this
Agreement and shall not correct such failure or breach within thirty (30) days
after written notice from Employee. The payments to be made to the Employee
hereunder shall be made without regard to any compensation or remuneration
earned by the Employee from any source after the date of the termination of
his/her employment.
(c) If (i) (A) Employee resigns for "Just Cause," as defined above, or
(B) the Company terminates Employee's employment for reasons other than those
specified in Section 9(a) and (ii) Employee is not in full compliance with
his/her obligations under Sections 6 and 8, the Company shall pay Employee
his/her base annual salary only through the date of termination of employment
and, except as provided by law or the terms of the applicable benefit plan,
Employee shall continue to receive the other benefits set forth in Section 3
through the date of termination only. Employee shall repay to the Company any
amounts previously paid to which Employee was not entitled.
(d) If Employee shall die, then this Agreement shall terminate on the
date of Employee's death, whereupon Employee or his/her estate, as the case may
be, (i) shall be entitled to receive only his/her salary at the rate provided in
Section 3 to the end of the calendar
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month within which the date of termination shall take effect, plus his/her
salary at the rate provided in Section 3 for the next two calendar months, and
(ii) for purposes of the Units only, Employee shall be deemed to be employed by
the Company for the period that would have been remaining in the Employment
Period if Employee had not so died.
Nothing contained in this Section 9 shall be deemed to limit any other right the
Company may have to terminate Employee's employment hereunder upon any ground
permitted by law.
10. Merger, Etc. In the event of a future disposition of (or including) the
properties and business of the Company, substantially as an entirety, by merger,
consolidation, sale of assets, or otherwise, then the Company shall assign this
Agreement and all of its rights and obligations hereunder to the acquiring or
surviving corporation or other entity, and such corporation or other entity
shall assume in writing all of the obligations of the Company hereunder.
11. Survival. The covenants, agreements, representations, and warranties
contained in or made pursuant to this Agreement shall survive Employee's
termination of employment, irrespective of any investigation made by or on
behalf of any party.
12. Modification. This Agreement sets forth the entire understanding of the
parties with respect to the subject matter hereof, supersedes all existing
agreements between them concerning such subject matter, and may be modified only
by a written instrument duly executed by each party.
13. Notices. Any notice or other communication required or permitted to be given
hereunder shall be in writing and shall be mailed by certified mail, return
receipt requested, given by Federal Express, Express Mail, or similar overnight
delivery or courier service, or delivered against receipt to the party to whom
it is to be given at the address of such party set forth in the preamble to this
Agreement (or to such other address as the party shall have furnished in writing
in accordance with the provisions of this Section 13). Notice to the estate of
Employee shall be sufficient if addressed to Employee as provided in this
Section 13. Any notice or other communication given shall be deemed given at the
time of receipt thereof.
14. Waiver. Any waiver by either party of a breach of any provision of this
Agreement shall not operate as or be construed to be a waiver of any other
breach of such provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term of
this Agreement on one or more occasions shall not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing.
15. Binding Effect. Employee's rights and obligations under this Agreement shall
not be transferable by assignment or otherwise, such rights shall not be subject
to commutation, encumbrance, or the claims of Employee's creditors, and any
attempt to do any of the foregoing shall be void. The provisions of this
Agreement shall be binding upon and inure to the benefit of Employee and his/her
heirs and personal representatives, and shall be binding upon and inure to the
benefit of the Company and its successors and those who are its assigns under
Section 10.
16. Separability. If any provision of this Agreement is invalid, illegal, or
unenforceable, the balance of this Agreement shall remain in effect, and if any
provision is inapplicable to any person or circumstance, it shall nevertheless
remain applicable to all other persons and circumstances.
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17. No Third Party Beneficiaries. This Agreement does not create, and shall not
be construed as creating, any rights enforceable by any person not a party to
this Agreement (except as provided in Section 15).
18. Headings. The headings in this Agreement are solely for the convenience of
reference and shall be given no effect in the construction or interpretation of
this Agreement.
19. Counterparts; Governing Law. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. It shall be governed by
and construed in accordance with the laws of the State of Maryland, without
giving effect to conflict of laws principles.
20. Indemnification. The Company shall indemnify the Employee, to the maximum
extent permitted by applicable law and in accordance with the Company's By-Laws,
from any and all claims relating to or arising out of the performance by the
Employee of his/her duties hereunder, or his/her acts or omissions as an
officer, director or employee of the Company, and the Company shall hold
harmless the Employee from any and all costs or expenses actually and reasonably
suffered or incurred by him/her in connection with the defense against any such
claim. However, the Company shall not be required to indemnify the Employee with
respect to any proceeding initiated by the Employee against the Company, or any
counterclaim, cross-claim, affirmative defense or similar claim of the Company
in connection with any such proceeding, except as provided in Section 21 below.
21. Legal Expenses. In the event of any litigation arising out of, or relating
to, this Agreement or the Employee's employment with the Company, the prevailing
party shall be entitled to recover from the other party his/her/its legal fees,
expert witness fees, court costs, and other reasonable expenses incurred in
connection with any such litigation.
22. Units. If the Employment Period terminates on July 31, 2007 and during the
period commencing on August 1, 2007 and ending on April 10, 2008, (i) (A) the
Employee resigns within thirty (30) days following the Company's, without the
express written consent of the Employee, (I) imposing any significant change in
the Employee's function, duties, or responsibilities that is not consistent with
the Employee being an executive of the Company and failing to rescind or modify
such change within ten (10) business days after receipt of written notice from
the Employee, or (II) materially reducing Employee's compensation or benefits
from those provided under this Agreement, and failing to rescind such reduction
within ten (10) business days after receipt of written notice from the Employee,
or (B) the Company terminates Employee's employment for reasons other than (I)
as a result of a serious health condition (as defined in the Family and Medical
Leave Act of 1993), and after giving effect to any reasonable accommodation
required by law, Employee shall be physically or mentally incapacitated or
disabled or otherwise unable fully to discharge his/her duties hereunder for a
period of ninety (90) consecutive days, (II) Employee shall be convicted, plead
guilty, or enter a plea of nolo contendere to a felony or a crime involving
moral turpitude, (III) Employee shall commit any act or omit to take any action
in bad faith and to the detriment of the Company, or (IV) Employee shall fail to
perform his/her duties or obligations to the Company and shall not correct such
failure or breach within ten (10) days after receipt of written notice thereof
and (ii) Employee is in full compliance with his/her obligations under Sections
6 and 8, then, for purposes of the Units only, Employee shall be deemed to be
employed by the Company through April 10, 2008;
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provided that this Section 22 shall be of no force or effect if Employee does
not remain in full compliance with Sections 6 and 8.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first above written.
GENERAL PHYSICS CORPORATION EMPLOYEE
By:
----------------------------------- --------------------------------------
Xxxxxxx X. Xxxxx, President Xxxxxx Xxxxxxxx-Xxxxx
The undersigned hereby agrees to the provisions of Sections 3(f), 3(g), 9(b),
9(d), and 22 of this Agreement to the extent such provisions relate to options
to purchase GPSC common stock or to Units.
GP STRATEGIES CORPORATION
By:
----------------------------------
Xxxxx X. Xxxxxxxxx, President
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