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EXHIBIT 10.1
EMPLOYMENT AGREEMENT
AGREEMENT made as of the 1st day of January, 1999, by and between WILTEK,
INC., a Connecticut corporation, with its principal offices located at 000
Xxxxxxxx Xxxxxx, Xxxxxxx XX 00000 (the "Company") and Xxxxx X. Xxxxxxxxx, an
individual, residing at 00 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000 (the
"Employee").
W I T N E S S E T H:
WHEREAS, the Company desires that the Employee shall be employed by the
Company, and the Employee is desirous of such employment, upon the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements contained herein, the parties hereto agree as follows:
1. Defining Terms. As used in this Agreement, the following terms shall
have the following meanings:
(a) "Company" shall mean and include Wiltek, Inc., and its parents,
subsidiaries and affiliates and the respective successors and assigns of
any of them, whether now existing or hereafter arising: provided, however,
that references to the Company in Paragraphs 6, 7 and 9 of this Agreement
shall be limited solely to Wiltek, Inc.
(b) "Customer" shall mean any individual, firm, partnership,
corporation, company, joint venture or governmental or military unit or any
other entity or any parent, subsidiary or affiliate of any of them which is
negotiating or has a contract with the Company for the purchase or lease of
the Company's equipment, products or services or which has been solicited
by the Company with respect to such purchase or lease during the Employee's
employment with the Company.
(c) "Confidential Information" shall mean information concerning the
Company, its products, processes and services and its customers, suppliers,
contractors, agents, consultants and employees (herein-after referred to as
"Company Affiliates"), including, but not limited to, information relating
to research, development. inventions, manufacture, purchasing, accounting,
finances, costs, profit margins, patents, methods, programs, apparatus,
engineering, marketing, merchandising, selling, Customer lists, Customer
requirements and personnel, pricing, pricing methods and data processing
and any other materials or information, heretofore or hereafter during the
term of this Agreement, conceived, designed, created, used or developed by
or relating to the Company or any of the Company Affiliates; provided,
however, that Confidential Information shall not include any information
which may be in the public domain or come into the public domain not as a
result of a breach by the Employee of any of the terms and provisions of
this Agreement.
(d) "Proprietary Property" shall mean discoveries, concepts and ideas
and expressions thereof, whether or not subject to patent, copyright,
trademark, trade name or service xxxx protection, including, but not
limited to, software, services, processes, methods, formulae, techniques,
apparatus, designs and writings as well as improvements thereon, revisions
thereof and know-how related thereto, concerning any present or future
activities of the Company; provided, however, that Proprietary Property
shall not include anything which may be in the public domain or come into
the public domain not as a result of a breach by the Employee of any of the
terms and provisions of this Agreement.
(e) "Competing Product" shall mean any product, process or service of
any person or legal entity other than the Company, in existence or under
development, which, during the term of this Agreement, competes with or is
an alternative to any present or future product, process, or service of the
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Company whether or not actively marketed by the Company.
(f) "Competing Organization" shall mean any person or legal entity
engaged in, about to engage in or intending to engage in research on or
development, use, production, marketing, or selling of a Competing Product.
2. Employment. The Company hereby employs the Employee, and the Employee
hereby accepts such employment, upon the terms and conditions set forth in this
Agreement.
3. Duties. The Employee shall be employed by the Company as President and
he shall perform such duties and render such services consistent therewith as
may from time to time be required of him by the Board of Directors of the
Company or the Chairman of the Company.
4. Extent of Service. During the term of his employment, the Employee
agrees that
(a) he will serve the Company faithfully, diligently and to the best
of his ability under the direction of the Chairman or the Board of
Directors of the Company;
(b) he will devote his best efforts and substantially his entire
working time, attention and energy to the performance of his duties
hereunder and to promoting and furthering the interests of the Company,
taking, however, from time to time, reasonable vacations consistent with
the performance of his obligations hereunder, and
(c) he will not, without the prior written approval of the Board of
Directors of the Company, which approval shall not be unreasonably
withheld, become an officer, director, employee or consultant of, or
otherwise become associated with or engaged in, any business other than
that of the Company, and he will do nothing inconsistent with his duties to
the Company.
5. Terms of Employment. The term of employment of the Employee under this
Agreement shall be for a period commencing on the date of this Agreement and
terminating twelve (12) months thereafter, unless sooner terminated pursuant to
Paragraph 9 of this Agreement (the "Term"), and for successive one-year Terms
thereafter; provided, however, that with respect to each such successive Term,
the Company and the Employee shall have mutually agreed, in writing, to basic
compensation for such successive Term. If the Company decides not to renew the
Employee's Employment Agreement, then the Employee shall be entitled to the
termination provisions provided for in Clause 9(b) of this Employment Agreement.
6. Basic Compensation. As basic compensation for the services to be
rendered hereunder by the Employee for the initial Term, the Company agrees to
pay to the Employee, and the Employee agrees to accept, a minimum salary at the
rate of $168,000 per annum. The salary payable to the Employee hereunder shall
be paid in equal semi-monthly installments during the Term, or in such other
manner as shall be mutually agreed upon by the parties hereto.
7. Other Benefits. The Employee shall be entitled to participate in any
retirement, disability, profit-sharing, medical or life insurance or other
similar plan or arrangement provided by the Company to its employees, or its
other executive employees. The Employee shall also receive benefits as stated
within the attached "Schedule of Benefits."
8. Disability. If Employee shall be disabled, he shall receive full
compensation (less any payments received from Worker's Compensation, Wiltek's
disability plans or other governmental payment for such disability) for all
periods of disability even if a period of disability extends beyond the Term;
provided, however, that the maximum number of consecutive days during which
disability occurs and for which Wiltek shall be obligated to pay such
compensation shall be one-hundred-and-eighty (180) days. Disability means the
inability of Employee to perform his duties hereunder on account of mental or
physical illness or physical incapacity.
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9. Termination.
(a) The employment of the Employee hereunder shall terminate in the
event of the death of the Employee and, at the option of the Company, upon
written notice to the Employee, (i) in the event that Base Salary payments
are terminated due to disability pursuant to Paragraph 8 of this Agreement,
or (ii) in the event that the Employee shall breach any of the terms and
provisions of this Agreement.
(b) In addition to the provisions of Paragraph 9(a) above, the Company
may also, in its sole discretion, elect to terminate, without cause, the
employment of the Employee hereunder by thirty (30) days prior written
notice to the Employee; provided, however, that if the Company shall so
terminate this Agreement pursuant to this Paragraph 9(b), the Company shall
pay the Employee guaranteed severance pay in accordance with the next
sentence, continue the benefits set forth in Item 4 of the attached
"Schedule of Benefits" for so long as the severance payments are being
made, will continue the benefit set forth in Item 1 thereof for the terms
thereof and will pay the bonuses set forth in Items 8 and 9 thereof per
their respective terms. During the twelve-month period following the
receipt of written notice by the Employee, the Company shall pay the
Employee guaranteed severance pay at a rate equal to the Employee's base
compensation immediately prior to such termination and such guaranteed
severance pay shall be paid to the Employee in the manner and at the time
or times that such base compensation would otherwise have been paid to the
Employee. Following the twelve-month guaranteed severance pay period, if
the Employee does not become employed, the Company shall pay the Employee
additional supplemental severance pay in accordance with the next sentence.
During the six-month period following the conclusion of Company payment to
the Employee of twelve months of guaranteed severance pay, the Company
shall pay the Employee additional supplemental severance pay at a rate
equal to the Employee's base compensation immediately prior to such
termination and such additional supplemental severance pay shall be paid to
the Employee in the manner and at the time or times that such base
compensation would otherwise have been paid to the Employee.
10. Representations and Warranties of the Employee as to Conflicts. The
Employee hereby represents and warrants to the Company that his employment by
the Company does not and will not violate any provision of law or fiduciary duty
by which he is bound and will not conflict with or result in a breach of any
agreement or instrument to which he is a party or by which he is bound, and the
Employee agrees that he will indemnify and hold harmless the Company, its
directors, officers and employees against any claims, damages, liabilities and
expenses (including attorneys' fees) which may be incurred, including amounts
paid in settlement, by any of them in connection with any claim based upon or
related to a breach of the Employee's representation and warranty set forth in
this Paragraph. In the event of any claim based upon or related to a breach of
the Employee's representation and warranty set forth in this Paragraph 10, the
Company will give prompt notice thereof, in writing, to the Employee and the
Employee shall have the right to defend such claim with counsel reasonably
satisfactory to the Company.
11. Proprietary Property. With respect to Proprietary Property made or
conceived by the Employee in the field of data communications, whether or not
during the hours of his employment or with the use of the Company's facilities,
materials or personnel, either individually or jointly with others during the
period of his employment by the Company, the Employee shall, without the payment
of royalty or any other considerations to him therefor:
(a) Inform the Company promptly and fully of such Proprietary Property
by a written report satisfactory to the Company;
(b) Apply, at the Company's requests and expense, for United States
and foreign letters patent, copyright, trademark or service xxxx, as the
case may be, either in the Employee's name or otherwise as the Company
shall direct;
(c) Assign to the Company all of his right, title and interest in such
Proprietary Property, and to applications for United States and/or foreign
letters patent, copyright, trademark and service xxxx and to any letters
patent, copyright, trademark and service xxxx which may be issued upon such
Proprietary Property;
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(d) Deliver promptly to the Company, without charge to the Company but
at its expense, such written instruments, and do such other acts, as may be
necessary, in the opinion of the Company, to obtain and maintain United
States and/or foreign letters patent, copyright, trademark or service xxxx
on the Proprietary Property and to vest the entire right, title and
interest thereto in the Company; and
(e) Grant to the Company, prior to assignment of the Employee's right,
title and interest to the Company in any Proprietary Property as required
above, the royalty-free right to use in its business, and to make, have
made, use and sell products, processes, services, writings and/or marks
based upon or related to Proprietary Property made or conceived by the
Employee.
12. Confidentiality.
(a) During the Term and at all times thereafter, the Employee will not
use Confidential Information for his own benefit or for the benefit of any
person or legal entity other than the Company nor will he disclose the same
to any other person or legal entity, except as required to conduct the
business of the Company in the ordinary course.
(b) Except with the prior written approval of the Company or except as
required to conduct the business of the Company in the ordinary course, the
Employee will not, at any time, directly or indirectly, use, disseminate,
disclose, lecture upon or publish articles concerning any Confidential
Information.
(c) Upon the termination of his employment with the Company, all
documents, records, notebooks and similar repositories of or containing
Confidential Information, including any copies thereof, then in the
Employee's possession, or under his control, whether prepared by him or
others, will be left with or immediately returned to the Company by the
Employee.
13. Non-Compete. The Employee agrees that, during the term of his
employment with the Company and also for one year following the Employee's
termination or departure from the Company he will not, without the written
approval of the Company, directly or indirectly, under any circumstances
whatsoever, own, manage, operate, engage in, control or participate in the
ownership, management, operation or control of, or be connected in any manner
with, whether as an individual, partner, stockholder, director, officer,
principal, agent, employee or consultant, or in any other relation or capacity
whatsoever, any Competing Organization, and will not in any such manner compete
with the Company or solicit or call on any Customer of the Company, wherever
located, which was a Customer of the Company at any time during the period one
(1 year prior to the termination of the Employee's employment with the Company
for the purpose of inducing such Customer to purchase or lease a Competing
Product. Notwithstanding the foregoing, nothing contained in this Paragraph 13
shall restrict the Employee from making any investment in any company whose
stock is listed on a national securities exchange or actively traded in the
over-the-counter market, so long as such investment does not give him the right
to control or influence the policy decisions of any such business or enterprise
which is or might be in competition with any business of the Company.
14. Non-Interference. The Employee will not, for a period of one (1) year
following the termination of the Employee's employment by the Company, directly
or indirectly, employ, hire, solicit or, in any manner, encourage any employee
of the Company to leave the employ of the Company.
15. Injunctive Relief. In addition to any other rights or remedies
available to the Company as a result of the breach of the Employee's obligations
hereunder, the Company shall be entitled to enforcement of such obligations by
an injunction or a decree of specific performance from a court with appropriate
jurisdiction and in the event that the Company is successful in any suit or
proceeding brought or instituted by the Company to enforce any of the provisions
of this Agreement or on account of any damages sustained by the Company by
reason of the violation by the Employee of any of the terms and/or provisions of
this Agreement to be performed by the Employee, the Employee agrees to pay to
the Company all attorneys' fees reasonably incurred by the Company.
16. Withholding. The Employee hereby agrees that he will make such
arrangements as the Company may deem necessary to discharge any obligations of
the Company to withhold Federal, state or local
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taxes imposed upon the Company in respect of this Agreement.
17. Severability. The provisions of this Agreement shall be severable and
if any part of any provision shall be held invalid or unenforceable or any
separate covenant contained in any provision is held to be unduly restrictive
and void by a final decision of any court or other tribunal of competent
jurisdiction, such part, covenant or provision shall be construed to give it
maximum lawful validity and the remaining provisions of this Agreement shall
nonetheless remain in full force and effect.
18. Entire Agreement. This Agreement and the attached "Schedule of
Benefits" contains the entire agreement of the parties relative to the subject
matter hereof, superseding and terminating all prior agreements or
understandings, whether oral or written, between the parties hereto relative to
the subject matter hereof, and this Agreement may not be extended, amended,
modified or supplemented without the written consent of the parties hereto.
19. Waivers. Any waiver of the performance of the terms or provisions of
this Agreement shall be effective only if in writing and signed by the party
against whom such waiver is to be enforced. The failure of either party to
exercise any of his or its rights under this Agreement or to require the
performance of any term or provision of this Agreement, or the waiver by either
party of any breach of this Agreement, shall not prevent a subsequent exercise
or enforcement of such rights or be deemed a waiver of any subsequent breach of
the same or any other term or provision of this Agreement.
20. Notices. Any notice required or permitted to be given under this
Agreement shall be in writing and shall be deemed given when personally
delivered or sent by registered or certified mail, postage prepaid, return
receipt requested, to the respective address of the parties hereto as set forth
above or to such other address as either party may designate to the other party
in the manner provided herein for giving notice.
21. Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the heirs, executors, administrators, successors and legal
representatives of the Employee, and shall inure to the benefit of and be
binding upon the Company and any successor to the business of the Company
pursuant to a merger or acquisition of all or substantially all of its assets,
but the obligations of the Employee may not be delegated and the Employee may
not assign, transfer, pledge, encumber, hypothecate or otherwise dispose of this
Agreement, or any of his rights hereunder (whether by operation of law or
otherwise), except as expressly permitted by this Agreement, and any such
attempted delegation or disposition shall be null and void and without effect.
22. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Connecticut.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
WILTEK, INC.
By:/s/ X.X. Xxxxxxxxxxx
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Chairman of the Board
By:/s/ Xxxxx X. Xxxxxxxxx
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Xxxxx X. Xxxxxxxxx
President & CEO
WITNESS:
/s/ Xxxxx X. Xxxxxxx
----------------------------
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SCHEDULE OF BENEFITS
1. Company Car. Company obligation is direct payment of, or reimbursement to
the Employee, for all lease payments, tax payments, insurance payments,
gasoline payments, service payments, repair payments, maintenance payments.
This benefit will continue for two (2) months after termination.
2. Complete Annual Physical Examination. Company obligation is reimbursement
to the Employee for the cost of any fees or charges not covered under the
Company's standard health insurance plan. This benefit is eliminated upon
termination.
3. Disability Policy. Company obligation is reimbursement to the Employee for
the cost of the Employee maintaining a long-term disability insurance
policy providing up to 70% of Annual Minimum Base Salary. This benefit is
eliminated upon termination.
4. Company Standard Benefits. Health, major medical, dental, eye care,
orthodontia, life insurance, short- term disability, long-term disability,
401K contribution, in addition to individual benefits provided within this
section ("Schedule of Benefits") to the Employee.
5. Annual Minimum Base Salary. $168,000.
6. Guaranteed Severance Pay. Twelve (12) months of Annual Minimum Base Salary.
7. Supplemental Severance Pay. If employment not found by Employee following
Guaranteed Severance Pay Period, an additional six (6) months of Annual
Minimum Base Salary.
8. Consulting Division Sale Bonus. Ten percent (10%) of the selling price of
the consulting division paid by the Company and allocated by the Employee
to himself, other officers and other employees. The Company's obligation
remains until the latter of December 31, 1999 or three (3) months after
termination. The Company shall make full payment within five (5) business
days of consulting division selling transaction.
9. Revenue Bonus. If Wiltek reports fiscal year 1999 revenue (excluding any
revenue for business's acquired after January 1, 1999) of at least
$6,800,000 then a cash bonus of .60% of total fiscal year 1999 revenue
$7,000,000 then a cash bonus of .64% of total fiscal year 1999 revenue
$7,200,000 then a cash bonus of .68% of total fiscal year 1999 revenue
$7,400,000 then a cash bonus of .72% of total fiscal year 1999 revenue
$7,600,000 then a cash bonus of .76% of total fiscal year 1999 revenue
$7,800,000 then a cash bonus of .80% of total fiscal year 1999 revenue
$8,000,000 then a cash bonus of .84% of total fiscal year 1999 revenue
$8,200,000 then a cash bonus of .88% of total fiscal year 1999 revenue
$8,400,000 then a cash bonus of .92% of total fiscal year 1999 revenue
$8,600,000 then a cash bonus of .96% of total fiscal year 1999 revenue
$8,800,000 then a cash bonus of 1.00% of total fiscal year 1999 revenue
The Company shall make full cash bonus payment to Employee within 60 days
(December 30, 1999) of close of fiscal year 1999. In the event of termination
any bonus accumulated as of the date of termination will be payable by the
Company to the Employee within 30 days of termination.
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IN WITNESS WHEREOF, the parties have executed this Schedule of Benefits as
of the date first above written.
WILTEK, INC.
By:/s/ X.X. Xxxxxxxxxxx
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Chairman of the Board
By:/s/ Xxxxx X. Xxxxxxxxx
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Xxxxx X. Xxxxxxxxx
President & CEO
WITNESS:
/s/ Xxxxx X. Xxxxxxx
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