Exhibit 10.14
EMPLOYMENT AGREEMENT
(Xxxxxxx X. Xxxxx)
THIS EMPLOYMENT AGREEMENT (the "Agreement"), entered into as of the
first day of October, 1995, by and between HealthGate Data Corp., a Delaware
corporation (the "Company"), and Xxxxxxx X. Xxxxx ("Xxxxx").
W I T N E S S E T H
WHEREAS, the Company wishes to retain the services of Reece in
connection with the conduct of the business affairs of the Company, for a period
of three (3) years; and
WHEREAS, Reece is willing to provide such services to the Company, for
a three (3) year period;
NOW, THEREFORE, in consideration of the premises, mutual covenants and
agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. EMPLOYMENT. The Company shall employ Xxxxx, and Xxxxx shall
serve the Company as Chairman of the Board, President and Chief Executive
Officer upon the terms and conditions provided herein. Reece shall, in the
performance of his duties hereunder, report to and be directed only by the Board
of Directors of the Company (the "Board of Directors"). Reece shall devote such
of his business time as is reasonably necessary and appropriate in serving in
such positions.
2. TERM. The term of Xxxxx'x employment hereunder shall be for
the period beginning October 1, 1995, and ending September 30, 1998 (the
"Term"). Each twelve-month period of the Term commencing on October 1 and ending
on the following September 30 is referred to herein as a "Contract Year." On
October 1, 1996, and on each October 1 thereafter (each such date being
hereinafter referred to as a "Renewal Date"), the remaining term of Xxxxx'x
employment hereunder shall automatically be extended for an additional one (1)
year period unless either party hereto notifies the other in writing at least
thirty (30) days prior to the applicable Renewal Date that such party does not
wish to extend this Agreement beyond the expiration of the term or extended term
hereof, as the case may be, in which event this Agreement shall terminate on the
date three years following such applicable Renewal Date. Without limiting the
generality of the foregoing, the term of this Agreement shall be subject to
earlier termination as set forth in Section 4 hereof.
3. COMPENSATION. As compensation in full for the services to be
rendered by Reece hereunder, Reece shall be paid compensation and receive
benefits from the Company during the term of this Agreement as follows:
(a) Xxxxx shall be paid a minimum base salary of $110,000 per
annum. Such salary shall be reviewed from time to time, but at least
annually, by the Board of
Directors, and shall be adjusted for inflation in accordance with the
Consumers Price Index - Boston Metropolitan Region, and to reflect the
Company's revenues and profitability.
(b) The Company shall pay bonuses to Reece, based upon a bonus
program to be adopted by the Company as a result of good faith
negotiation among the parties, and shall also pay such other bonuses
to Reece as may be granted by the Board of Directors in its
discretion.
(c) The Company shall grant stock options to Reece, based upon
such option plans or policies as may be adopted by the Company from
time to time.
(d) Reece shall be entitled to such individual and family health
and disability insurance benefits and such other fringe benefits as
the Company shall from time to time make available to its employees of
an equivalent or lower status during the term of this Agreement.
(e) Reece shall be reimbursed by the Company for business and
travel expenses incurred by Reece and approved in accordance with the
Company's expense reimbursement policies as in effect from time to
time.
4. TERMINATION; SEVERANCE AND OTHER PAYMENTS.
(a) The Company shall have the right to terminate Xxxxx'x
employment hereunder at any time, upon written notice, for Cause. For
the purposes of this Agreement, "Cause" is defined as (i) conviction
for a felony involving the Company, or (ii) the determination of the
Board of Directors, adopted by the affirmative vote of not less than
seventy-five percent (75%) of the entire membership of the Board of
Directors at a meeting of the Board of Directors called and held for
such purpose, that Xxxxx'x employment should be terminated for
malfeasance, nonfeasance or breach hereof or hereunder. In the event
that Xxxxx'x employment is terminated pursuant to clause (i) of this
Section 4(a), Reece shall not be entitled to any further compensation
under this Agreement, except as may be required by applicable law. In
the event that Xxxxx'x employment is terminated pursuant to clause
(ii) of this Section 4(a), Reece shall be entitled to a lump sum
severance payment in an amount equal to (i) twelve (12) months'
compensation at his then-current base salary, (ii) the amount of the
bonus paid to Reece by the Company in the previous Contract Year plus
(iii) any accrued bonus through the date of such termination; in
addition, the Company shall continue to provide Reece with the
benefits described in Section 3(d) hereof for a period of twelve (12)
months following the date of termination.
(b) Upon the termination of this Agreement at the end of the
initial three-year term or of any extended term, except as otherwise
set forth in this Agreement, Reece (or
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his estate in the event of his death) shall be entitled to receive:
i. UNPAID SALARY. Unpaid salary to the date of
termination, accrued on a daily basis, payable forthwith.
ii. UNPAID BONUS. Unpaid bonus with respect to the
Contract Year immediately prior to the year of termination,
payable no later than the date provided in the bonus program to
be adopted pursuant to Section 3(b) of this Agreement, or
forthwith if termination is after such date.
iii. PRO RATA BONUS. Unless Reece is terminated for Cause
pursuant to Section 4(a)(i) of this Agreement, payment PRO RATA
for any bonus due with respect to the year of termination,
payable no later than the date the bonus with respect to such
year would otherwise have been payable.
(d) This Agreement shall be terminated by the death of Reece.
(e) Reece may elect to terminate this Agreement at any time for
Good Reason or following a Change in Control. In the event of such an
election, Reece shall be entitled to a lump sum severance payment in
an amount equal to (i) twelve (12) months' compensation at his
then-current base salary plus (ii) any accrued bonus through the date
of such election; in addition, the Company shall continue to provide
Reece with the benefits described in Section 3(d) hereof for a period
of twelve (12) months following the termination of Xxxxx'x employment.
For the purposes of this Agreement, "Good Reason" is defined as (i) a
material breach of this Agreement by the Company that the Company
fails to cure with thirty (30) days after receipt of written notice
thereof, (ii) the removal of Reece from any of the offices of Chairman
of the Board, President or Chief Executive Officer, or the assignment
of duties inconsistent with the offices or status of Chairman of the
Board, President or Chief Executive Officer, except in each case as
pursuant to Section 4(a)(ii) of this Agreement and (iii) the creation
of any office of the Company, the holder of which is assigned
supervisory duties over or with respect to Reece. For the purposes of
this Agreement, "Change in Control" is defined as (i) the merger or
consolidation of the Company in which the Company is not the
continuing or surviving corporation, (ii) the sale by the Company of
substantially all of its assets to a single purchaser or to a group of
associated purchasers, (iii) the sale, exchange or other disposition
of at least two-thirds of the outstanding common stock of the Company
in one transaction or in a series of related transactions, (iv) any
person or entity becoming directly or indirectly the owner or
beneficial owner of fifty percent (50%) or more of the Company's
outstanding common stock, (v) the individuals who at the date hereof
constitute the Board of Directors ceasing to constitute a majority
thereof, and (vi) the determination by the Board of Directors, in its
sole discretion, that there has been a Change in Control of the
Company.
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5. PLACE OF PERFORMANCE. The services to be rendered by Reece
hereunder shall be rendered at the Company's offices located within a twenty
(20) mile radius of Boston, Massachusetts, or at such other place as Reece and
the Company deem appropriate; provided however, that Reece may be required, on
behalf of the Company and in furtherance of his duties hereunder, to take such
reasonable number of business trips away from such place as the Company may
reasonably request and which are in accordance with his duties hereunder.
6. VACATION. Reece shall be entitled to a vacation period of four (4)
weeks in any calendar year without loss of compensation. Reece shall not be
entitled to carry previously allotted vacation time over to the following
calendar year beyond a maximum of six (6) weeks without the approval of the
Board of Directors.
7. CONFIDENTIAL INFORMATION. The parties acknowledge that they have
entered into that certain Confidentiality and Noncompetition Agreement, dated as
of February 9, 1994. The parties acknowledge that such Confidentiality and
Noncompetition Agreement remains binding on the parties hereto with the same
force and effect as if entered into as of the date hereof, notwithstanding any
change in the position or title held or duties performed by Reece.
8. INJUNCTIVE RELIEF. In the event of any violation of the provisions
of Section 7 of this Agreement, the Company shall be entitled, in addition to
any other rights or remedies which it may have, to maintain an action for
damages, and to obtain temporary and permanent injunctive relief. The parties
agree that the Company shall be entitled to such temporary and permanent
injunctive relief because the Company would sustain substantial and irreparable
damage upon any such violation, which damage is impossible to ascertain in
advance.
9. INDEMNIFICATION. The Company shall indemnify Reece in the event
that Reece becomes a party to any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the Company) by reason of Xxxxx'x service
as an officer of the Company or his agreement to serve at the request of the
Company as a director, officer, employee or trustee of another corporation,
partnership, joint venture, trust or other enterprise, or by reason of any
action alleged to have been taken or omitted in such capacity, against costs,
charges, expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually incurred by Reece or on Xxxxx'x behalf in connection with
such action, suit or proceeding and any appeal therefrom, if Reece acted in good
faith and in a manner that Reece reasonably believed to be, or not opposed to,
the best interests of the Company, and, with respect to any criminal action or
proceeding, did not have reasonable cause to believe that his conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction or upon a plea of NOLO CONTENDERE or its equivalent shall
not, of itself, create a presumption that Reece did not act in good faith and in
a manner which he reasonably believed to be in, or not opposed to, the best
interests of the Company and, with respect to any criminal action or proceeding,
did not have reasonable cause to believe that his conduct was unlawful.
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10. CONSTRUCTION; HEADINGS. This Agreement shall be construed in
accordance with and be governed by the laws of the Commonwealth of
Massachusetts. The headings contained in this Agreement are for reference only
and shall not limit or otherwise affect the meaning of any provision of this
Agreement.
11. NOTICES. All notices and communications hereunder shall be given
in writing by registered or certified mail and shall be addressed as follows,
unless the addressee shall have previously notified the other party hereto by
registered or certified mail of a different address, in which event such
different address shall be substituted for said address hereunder. All such
notices or communications shall be deemed to have been given when deposited,
properly addressed, postage pre-paid, in the United States mail.
If to the Company: HealthGate Data Corp.
000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxxxxx 00000
With a copy to: Xxxxxxx X. Xxxx, Esq.
Rich, May, Xxxxxxxx & Xxxxxxxx, P.C.
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
If to Xxxxx: Xxxxxxx X. Xxxxx
HealthGate Data Corp.
000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxxxxx 00000
12. ASSIGNMENT. Any attempt to assign this Agreement shall be void;
provided, however, that, subject to the provisions of Section 4(e) hereof, if
the Company shall be merged or consolidated with any other corporation or
entity, or if substantially all of the assets of the Company shall be
transferred to another corporation or entity, the provisions of this Agreement
shall be binding upon and inure to the benefit of the corporation or entity
resulting from such merger or consolidation.
13. SEPARABILITY. In the event that any one or more provisions of this
Agreement shall be held to be invalid, the remainder of this Agreement shall
continue in full force and effect.
14. BINDING EFFECT. This Agreement shall inure to the benefit of and
be binding upon Reece and the Company and their permitted successors and
assigns.
15. ARBITRATION. Any controversy or claim arising under or relating to
this Agreement, or breach thereof, shall be settled by arbitration conducted in
Boston, Massachusetts in accordance with the commercial rules of the American
Arbitration Association as in effect from time to time. Judgment upon the award
rendered may be entered in any court having
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jurisdiction thereof.
16. ENTIRE AGREEMENT; AMENDMENT; WAIVER. This Agreement constitutes
the entire Agreement between the parties hereto pertaining to the subject matter
hereof and supersedes all prior agreements, understandings, negotiations and
discussions, whether oral or written of the parties, and there are no
warranties, representations or other agreements between the parties in
connection with the subject matter hereof, except as are specifically set forth
herein. Except as otherwise provided by this Agreement, no supplement,
modification, waiver or termination of this Agreement shall be binding unless
executed in writing by the party to be bound thereby. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of any
other provision hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
HEALTHGATE DATA CORP.
By:/s/ Xxxxx X. Xxxx By: /s/ Xxxxx X. Xxxxxx
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Witness Xxxx X. Xxxxxx
By:/s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxxx
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Witness Xxxxxxx X. Xxxxx
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