June 25, 2015
Exhibit 10.2
Execution Version
June 25, 2015
Xxxxxxx Xxxx
000 X. Xxxx Xxxxx Xxxxxx
Xxxxxx Xxxxx, XX 00000
Dear Xxxxxxx:
We are pleased to offer you employment with Volt Information Sciences, Inc. (“Volt” or the “Company”) under the terms and conditions set forth below in this letter agreement (“Agreement”). Such terms and conditions will be deemed to have taken effect on June 25, 2015 (the “Effective Date”).
1. POSITION
You will be employed as Volt’s Interim President and Chief Executive Officer (“Interim CEO”), reporting to the Company’s Board of Directors (the “Board”).
2. DUTIES AND RESPONSIBILITIES
You will devote your full business time and attention to the responsibilities of the position of Interim CEO, and will perform such additional duties for Volt and its affiliates as the Board may direct and as are required in such position. You agree that you will be subject to and comply with all Volt policies, procedures and rules, as now existing or as subsequently adopted, modified or supplemented by the Company. You further agree that you will comply with all applicable laws, rules and regulations governing your business and conduct.
3. DEFINITIONS
“Change of Control” means: (a) a “person,” or “group” within the meaning of 13(d) of the Securities Exchange Act of 1934 (other than a “person” or “group” consisting solely of descendants of Xxxxxx Xxxx, their spouses and trusts or other persons formed primarily for their benefit) becomes a “beneficial owner,” as such term is used in Rule 13d-3 promulgated under that Act, of 50% or more of the outstanding common stock of Company; (b) the majority of the Board of Directors of the Company consists of individuals other than “incumbent” directors, which term means the members of the Board of Directors on the date you execute this Agreement; provided that any person becoming a director subsequent to such date whose election or nomination for election was supported by two-thirds of the directors who then comprised the incumbent directors will be considered to be an incumbent director; (c) the Company adopts any plan of liquidation providing for the distribution of all or substantially all of its assets; (d) all or substantially all of the assets or business of Company are disposed of pursuant to a merger, consolidation or other transaction (unless the stockholders of Company immediately prior to such merger, consolidation or other transaction beneficially own, directly or indirectly, in substantially the same proportion as they owned the voting stock of Company immediately prior to such merger, consolidation or other transaction, all of the voting stock or other ownership interests of the entity or entities, if any, that succeed to the business of Company); or (e) the Company combines with another company and is the surviving corporation but, immediately after the combination, the stockholders of Company immediately prior to the combination hold, directly or indirectly, less than 50% of the voting stock of the combined company (there being excluded from the number of shares held by such stockholders, but not from the voting stock of the combined company, any shares received by affiliates of such other company in exchange for stock of such other company).
4. COMPENSATION
Your compensation will be composed of the elements set forth below in Paragraphs 4(a)-(d). All elements of your compensation and any other payments set forth in this Agreement shall be paid according to the Company’s normal payroll practices, less all required withholdings and deductions. You acknowledge and agree that the Company shall have authority to recover any compensation you have received that is required to be recovered by the Xxxxxxxx-Xxxxx Act of 2002, the Xxxx-Xxxxx Act of 2010, or any rules or regulations promulgated in connection therewith. Your compensation pursuant to this Agreement will be in addition to the compensation to which you are currently entitled to receive in your capacity as a non-executive member of the Board, except that any incremental fees to which you are entitled to receive in your capacity as Chairman of the Board shall be suspended during your term as Interim CEO or as Chief Executive Officer of the Company.
(a) Salary
You will receive a salary at the rate of $66,666 per month. Your salary may be reviewed and adjusted upward by the Company from time to time, but will not be reduced other than as part of a general reduction applicable to all or substantially all senior executives of Volt.
(b) Stock Options
On the Effective Date, you will receive an award comprised of non-qualified stock options to acquire 100,000 shares of Volt common stock (the “Options”). The Options will vest in equal monthly installments on the first day of the month for the next six months beginning on August 1, 2015, provided that you remain employed by Volt on each of those dates, although all of the Options shall vest immediately (i) upon a Change of Control of the Company, as defined herein, or (ii) upon the termination of your position as Interim CEO as a result of a successor Chief Executive Officer being approved by the Company’s Board of Directors. The Options will be subject to the terms and conditions of the Company’s 2006 Incentive Stock Plan and the award agreement applicable to the Options, and will be priced based on the closing price of a share of Volt common stock on June 29, 2015.
(c) Restricted Stock Units
On the Effective Date, you will receive an award comprised of 42,000 restricted stock units (the “Restricted Stock Units”). The Restricted Stock Units will vest on the six month anniversary of the Effective Date, provided that you remain employed by Volt on such date, although all of the Restricted Stock Units shall vest immediately (i) upon a Change of Control of the Company, as defined herein, or (ii) upon the termination of your position as Interim CEO as a result of a successor Chief Executive Officer being approved by the Company’s Board of Directors. The Restricted Stock Units will be subject to the terms and conditions of the Company’s 2006 Incentive Stock Plan and the form of award agreement applicable to restricted stock unit grants made to senior executives.
(d) Legal Fees
The Company will reimburse you for any attorney’s fees incurred in connection with the review and negotiation of this Agreement, in an amount not to exceed $10,000, to be paid no later than 30 days after a written invoice is submitted to the Company.
(e) Additional Stock Options and Restricted Stock Units
You may be eligible for an additional grant of Options and Restricted Stock Units in the event that you remain employed by Volt after January 1, 2016.
5. BENEFITS
You will be eligible to participate in the Company’s employee benefits plans and programs generally available to similarly situated employees at the Company, subject to the eligibility requirements, terms and conditions of such plans and programs. Such plans and programs are subject to change or termination by the Company at any
time in the Company’s sole discretion, provided that the Company will not change or terminate any of such employee benefits plans or programs that are deemed deferred compensation subject to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), in a manner that would result in liability under Section 409A of the Code.
(a) Paid Vacation and Sick Leave
You shall accrue paid time off for vacation time and sick leave in accordance with Volt’s policies and applicable law. Vacation shall be scheduled at mutually agreeable times.
(b) Business Expenses
Volt will reimburse you for reasonable and necessary business expenses incurred in connection with the Company’s business, including travel expenses, food and lodging while away from home, subject to such policies as Volt may from time to time establish for its employees, provided that all such reimbursements shall comply with Section 409A of the Code.
6. TERMINATION; COMPENSATION ON TERMINATION
Your employment is “at-will,” which means that you are free to resign your employment at any time, and Volt is free to terminate your employment any time, in each case for any reason or no reason and upon thirty (30) days’ advance written notice. The term “Termination Date” shall mean the effective date of termination of employment with Volt.
During the notice period, Volt, in its sole discretion, may or may not require you to continue to report to work and may assign you all, some or none of your regular duties. During the notice period, Volt will continue to pay you your salary, less all applicable withholdings and deductions, provided that you continue to perform your job duties and responsibilities, if so required, and otherwise comply with all obligations and loyalties owed to Volt as your employer.
On the next payroll date following the Termination Date (or sooner if required by law), you (or your estate or other legal designee) will be paid (a) all accrued salary through the Termination Date; and (b) payment for any unused accrued vacation, consistent with applicable law. Any business expenses submitted for reimbursement under Paragraph 5(b) will be paid no later than 60 days after the Termination Date. Upon termination of employment, you will also be entitled to receive any vested benefits, consistent with the applicable plan; however, upon termination of your employment, you will have no rights to any unvested benefits, unearned salary under Paragraph 4(a), or any other compensation or payments after the Termination Date except as set forth in this Agreement.
7. REPRESENTATION AND WARRANTIES
As a condition of your employment with the Company, you represent and warrant that you are legally authorized to perform the services contemplated by this Agreement; that you are not a party to any agreement or instrument with any third party which would prohibit you from entering into or performing the services contemplated by this Agreement; and that you will not bring with you to the Company, or use, any confidential information or trade secrets belonging to any prior employer.
8. CONFIDENTIAL INFORMATION
You agree that for the period of your employment with the Company and thereafter, you will not, except as required for the performance of your duties with the Company, disclose or use, or enable any third party to disclose or use, any Confidential Information (as defined below) of the Company or its affiliates. You may not take or replicate Confidential Information for your personal benefit or for the benefit of a third party unrelated to the Company, including, but not limited to, saving a copy of Confidential Information on a non-Company computer, USB flash drive, zip drive, or otherwise, without the Company’s prior written approval. You further agree that all information, including, without limitation, all Confidential Information, you develop or discover in connection with the performance of your duties is the sole and exclusive property of the Company, and you
hereby assign to the Company all of your right, title and interest in and to same. “Confidential Information” means all trade secrets, data and other information relating to the operations of the Company and its affiliates, whether in hard copy, electronic format or communicated orally, that you acquire through your employment with the Company, or that the Company or its affiliates treats as confidential through its policies, procedures and/or practices. Confidential Information is limited to information which is not generally known to the public, and includes information which you know the Company does not intend to be made public. Examples of Confidential Information include, but are not limited to: information concerning the Company’s operations, methods, technology, software, developments, inventions, accounting and legal and regulatory affairs; information concerning the Company’s sales, marketing, servicing, bidding, product development and investment activities and strategies; information concerning the identity, addresses, telephone numbers, email addresses, needs, business plans and creditworthiness of the Company’s past, present and prospective customers and clients; information concerning the terms on which the Company provides products and services to such past, present and prospective customers and clients; information concerning the Company’s pricing strategies for its products and services; information concerning the Company’s finances, financing methods, credit and acquisition or disposition plans and strategies; to the extent permitted by law, information concerning the employment and compensation of the Company’s employees; and disclosure of Confidential Information to another Company employee other than as required for you and such other Company employee to perform your duties for the Company. This provision does not restrict you from providing information as required by a court or governmental agency with appropriate jurisdiction; however, in the event you are so required, you agree that you will give the Company immediate written notice of such disclosure requirement in order to allow the Company the opportunity to respond to such request.
9. RESTRICTIVE COVENANTS
You acknowledge that the Company’s relationships with its customers, clients, and employees are extremely valuable and are the result of the investment of substantial time, resources and effort in developing, servicing and maintaining such relationships, and that, during your employment, you will be provided with and/or have access to Confidential Information, including without limitation, confidential and proprietary information concerning such relationships and the Company’s operations. In consideration for your employment and for the Company providing to you such confidential and proprietary information, you agree to comply with all provisions of this Section 9 while you are employed with the Company (including any notice period). In addition, you agree to comply with the provisions of this Section 9 for a period of time following the Termination Date as set forth in the schedule below:
(i) If you remain employed as Interim CEO for a period of less than three months from the date of this agreement, you shall be under no obligation to comply with the provisions of Section 9 following the Termination Date;
(ii) If you remain employed as Interim CEO for at least three months, but less than six months, from the date of this agreement, you agree to comply with the provisions of Section 9 for four months following the Termination Date;
(iii) If you remain employed as Interim CEO for at least six months, but less than nine months, from the date of this agreement, you agree to comply with the provisions of Section 9 for eight months following the Termination Date;
(iv) If you remain employed as Interim CEO for at least nine months from the date of this agreement, or if you accept a permanent position as the Chief Executive Officer of the Company, you agree to comply with the provisions of Section 9 for 12 months following the Termination Date.
(a) Non Competition
You will not, directly or indirectly, engage in, own or control any interest in, or act as an officer, director, partner, employee of, or consultant or advisor to, any firm, institution or other entity directly or indirectly engaged in a business that is substantially similar to that in which you were engaged during your employment with the Company or which competes with the Company or any of its affiliates, within the geographical area
that is co-extensive with the scope of your responsibilities for the Company or any of its affiliates during the last twelve months of your employment with the Company. Notwithstanding the foregoing, it will not be a violation of this Paragraph 9(a) for you to directly or indirectly own less than two percent (2%) of the outstanding public equity or debt of a publicly owned corporation engaged in the same or similar business to that of the Company or its affiliates, provided that you are not in a control position with respect to such corporation.
(b) Non Solicitation of Employees
You will not, directly or indirectly, recruit or hire any current employee of the Company or its affiliates, or otherwise attempt to induce such employee to leave the employment of the Company or its affiliates, to become an employee of or otherwise be associated with you or any company or business with which you are or may become associated.
(c) Non Solicitation of and Non-Interference with Clients or Customers
You will not, on your own behalf or on behalf of any other business entity, directly or indirectly, solicit or accept in competition with Volt the business of any existing or prospective client or customer of the Company or its affiliates with whom you had Material Contact during your employment with Volt. For purposes of this Agreement, “Material Contact” means, during your employment with Volt, personal contact or the supervision of the efforts of those who had personal contact with an existing or prospective client or customer in an effort to create, expand or further a business relationship between the Company and such existing or prospective client or customer.
(d) Acknowledgement
You agree that this Agreement provides special and sufficient consideration for your covenants in this Paragraph 9 and its subparagraphs, and that the restrictions on non-competition and non-solicitation are reasonable in terms of duration, scope and subject matter, and are no more than that which is reasonably required for the protection of the Company’s business and Confidential Information.
10. INVENTIONS
All discoveries, ideas, creations, inventions and properties (collectively, “Discoveries”), written or oral, which you (a) create, conceive, discover, develop, invent or use during your employment with the Company, whether or not created, conceived, discovered, developed or invented during regular working hours, or which are (b) created conceived, discovered, developed invented or used by the Company or its affiliates, whether or not in connection with your employment with the Company, will be the sole and absolute property of the Company and the Company’s applicable affiliate for any and all purposes whatsoever, in perpetuity. You will not have, and will not claim to have, any right, title or interest of any kind or nature whatsoever in or to any such Discoveries. For the avoidance of doubt, you hereby assign to the Company all of your right, title and interest in and to same. If any Discoveries, or any portion thereof, are copyrightable, it shall be a “work made for hire,” as such term has meaning in the copyright laws of the United States.
The previous paragraph shall not apply to any Discoveries (i) for which no equipment, supplies, facility or trade secret information of the Company, its affiliates or any customer of the Company was used and which was developed entirely on your own time, (ii) which does not relate to the business of the Company, its affiliates or to that of any customer of the Company and (iii) which does not result from any work performed for the Company, its affiliates or any customers of the Company.
You further agree that you will identify to the Company all Discoveries you develop during your employment with the Company. Upon request by the Company, you will disclose any such Discoveries to the Company (by a full and clear description) for the purpose of determining the Company’s rights therein and will promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary or desirable in order to vest title in such Discoveries in the Company.
11. ENFORCEMENT
You agree that a violation of any covenant in Paragraphs 8, 9, or 10, or their subparagraphs, will cause immediate and irreparable injury to the Company that cannot be adequately remedied by monetary damages, and will entitle the Company to immediate injunctive relief and/or specific performance, without the necessity of posting bond or proving actual damages, as well as to all other legal or equitable remedies to which the Company may be entitled.
12. RETURN OF COMPANY PROPERTY
You agree that on the Termination Date, unless you are a continuing member of the Board at such time, you will immediately return to the Company all of the Company’s property in your possession or under your control, including, but not limited to, all data and information relating to the business of the Company and its affiliates, and that you will not retain any copies thereof.
13. NOTICES
Any notice required in connection with this Agreement will be deemed adequately given only if in writing and personally delivered, or sent by first-class, registered or certified mail, or overnight courier. Notice shall be deemed to have been given on the third day after deposit into the mail. Notice shall be deemed to have been given on the second day after deposit with an overnight courier. Notices may also be hand-delivered, in which case, notice is effective upon delivery. Notices to Volt shall be addressed to 1065 Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, Attn: Board of Directors. Notices to you shall be addressed to your last known address on file with the Company.
14. ENTIRE AGREEMENT, CHOICE OF LAW, AND EXCLUSIVE JURISDICTION AND VENUE
This Agreement constitutes the entire understanding between the Company and you and supersedes all prior agreements concerning the terms and conditions of your employment. Unless otherwise expressly stated herein, the terms of this Agreement may not be modified, altered, changed or amended except by an instrument in writing signed by a duly authorized representative of the Company and you. No waiver by the Company or you of any breach by the other party of any condition or provision of this Agreement shall be deemed a waiver with respect to any similar or dissimilar condition or provision at any prior or subsequent time. If any provision of this Agreement is held to be invalid or unenforceable, then the remaining provisions of this Agreement shall be deemed severable and remain in full force and effect. If any of the covenants contained in Paragraphs 8 or 9 are held to be unreasonable in duration, geography or scope, then such terms shall be deemed modified to conform to such court or tribunal’s determination of reasonableness. The terms of this Agreement shall be governed and construed in accordance with the laws of the State of New York, except for such New York laws as would require application of the substantive laws of another jurisdiction. You and the Company agree that any dispute, claim, or controversy arising out of, involving, affecting, or related to this Agreement, any breach of this Agreement, your employment with the Company, or the termination of your employment with the Company shall be brought only in the Supreme Court of the State of New York, New York County or the United States District Court for the Southern District of New York. You irrevocably consent and submit to personal jurisdiction and venue in the Supreme Court of the State of New York, New York County or the United States District Court for the Southern District of New York; waive any and all objections to jurisdiction and venue in such courts; and waive any objection that such courts are an inconvenient forum.
15. SUCCESSORS AND ASSIGNS
You may not assign this Agreement. The Company may assign this Agreement to an affiliate or a person or entity which is a successor in interest to substantially all of the business operations of the Company.
16. CODE SECTION 409A OMNIBUS PROVISION
Notwithstanding any other provision of this Agreement, it is intended that payments and benefits under this Agreement comply with Section 409A of the Code or with an exemption from the applicable Code
Section 409A requirements and, accordingly, all provisions of this Agreement shall be construed in a manner consistent with the requirements for avoiding taxes and penalties under Section 409A of the Code. For purposes of this Agreement, all rights to payments and benefits hereunder of deferred compensation subject to Section 409A of the Code shall be treated as rights to receive a series of separate payments and benefits to the fullest extent allowed by Section 409A of the Code. For purposes of this Agreement, you will not be deemed to have had a termination of employment unless there has been a “separation from service” within the meaning of Section 409A of the Code. Furthermore, neither the Company nor any of its parents, subsidiaries, divisions, affiliates, directors, officers, predecessors, successors, employees, agents and attorneys shall be liable to you if any amount payable or provided hereunder is subject to any taxes, penalties or interest as a result of the application of Code Section 409A.
Notwithstanding any provision of this Agreement, if you are a “specified employee” (as defined in Section 409A of the Code and Treasury Regulations thereunder), then payment of any amount under this Agreement that is deferred compensation subject to Section 409A of the Code and the timing of which depends upon termination of employment shall be deferred for six (6) months after termination of your employment, as required by Section 409A(a)(2)(B)(i) of the Code (the “409A Deferral Period”). In the event such payments are otherwise due to be made during the 409A Deferral Period, the payments that otherwise would have been made in the 409A Deferral Period shall be accumulated and paid in a lump sum on the first day of the seventh month following the Termination Date, and the balance of the payments shall be made as otherwise scheduled.
17. COUNTERPARTS AND FACSIMILE EXECUTION
This Agreement may be executed and delivered (a) in one or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument, and/or (b) by facsimile or PDF in which case (i) the instruments so executed and delivered shall be binding and effective for all purposes, and (ii) the parties shall nevertheless exchange substitute hard copies of such facsimile or PDF instruments as soon thereafter as practicable (but the failure to do so shall not affect the validity of the instruments executed and delivered by facsimile or PDF).
Kindly indicate your acceptance of the terms of this Agreement by signing and returning it to the undersigned.
Sincerely,
Volt Information Sciences, Inc.
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By: |
/s/ Xxxxxx Xxxxxx, Chair of the Compensation Committee |
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As authorized by the Compensation Committee |
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I have read, understand, accept and agree to the above terms and conditions governing my employment with the Company.
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/s/ Xxxxxxx Xxxx |
June 25, 2015 |
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Xxxxxxx Xxxx |
Date |
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