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AMENDED AND RESTATED EMPLOYMENT AGREEMENT
AMENDED AND RESTATED EMPLOYMENT AGREEMENT made as of the 6th day of May
1999 (the "Effective Date"), between XXXXX Online, Inc. with its principal
office at 00 Xxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxx ("Company"), and Xxxxx
Xxxxxxxxxx having an address at 000 Xxxxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000
("Employee").
W I T N E S S E T H:
WHEREAS, the Company operates an Internet financial information business;
and
WHEREAS, the Company and the Employee entered into an employment agreement
dated as of January 1, 1996 (the "Original Agreement"); and
WHEREAS, the Company and the Employee desire to amend certain provisions
of the employment agreement by entering into an amended and restated employment
agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements hereinafter set forth, the parties agree as follows:
1. Employment. The Company shall employ the Employee and the Employee
shall serve the Company, upon the terms and conditions hereinafter set forth.
2. Term. The term of the Employee's employment shall commence on the
Effective Date and unless terminated earlier or extended as provided below,
shall continue for a period of five years from the Effective Date (the
"Employment Term"). Upon the expiration of the initial employment term and on
each anniversary date thereafter, the employment of Employee shall be renewed
and extended for an additional year unless either party provides written notice
to the other party, of her or its, as the case may be, desire to terminate this
Agreement at least thirty (30) days prior to the renewal date.
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3. Duties. During the Employment Term, the Employee shall have such
duties, functions, authority and responsibilities normally associated with the
positions and offices of Chief Executive Officer and Secretary. During the
Employment Term, the Employee shall devote her full attention and business time
to the business and affairs of the Company and the Employee will use her best
efforts to perform faithfully and efficiently, and to discharge, the Employee's
responsibilities and duties under this Agreement. Notwithstanding the foregoing,
the Employee may devote such time to manage her personal affairs and to serve on
community, corporate, civic, professional or charitable boards or committees, so
long as such activities do not unreasonably interfere with the performance of
the Employee's duties and responsibilities under this Agreement.
4. Compensation and Employee Benefits.
(a) The Employee's base salary during the initial term of
employment shall be no less than $150,000 commencing on the Effective Date
payable in accordance with the Company's payroll practices as in effect from
time to time. The Employee's base salary will be reviewed annually by the
Company's Board of Directors (the "Board") to determine whether an increase is
warranted or appropriate. The Employee also will be entitled to be considered
for awards each year under the Company's then existing incentive compensation
program, which may take into account individual and Company-wide performance, or
such other performance criteria as the Board may from time to time apply.
(b) The Employee hereby waives any and all rights that she may
have had to annual salary increases for years 1997, 1998 and 1999 under the
terms and conditions of the Original Agreement. The Company agrees to pay the
Employee all salary previously deferred at the earlier of (i) the demand by the
Employee which can be made at any time following the first
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anniversary of the Effective Date and (ii) the closing date of the initial
public offering of the Company's common stock.
5. Benefits. During the Employment Term, the Employee shall have the right
to participate in such health and disability insurance plans which the Company
may provide to its senior executive officers and for which the Employee is
eligible, the premiums of which shall be paid by the Company (e.g., long term
disability, life insurance and medical insurance for the Employee and her
dependents). During the Employment term, the Employee will be entitled four
weeks of paid vacation in accordance with the Company's policy. Such vacation
may be taken in the Employee's discretion with the prior approval of the
Company, and at such time or times as are not inconsistent with the reasonable
business needs of the Company.
6. Business Expenses. All reasonable travel, entertainment and other
expenses incident to the performance of the Employee's duties or the rendering
of services incurred on behalf of the Company by the Employee during the
Employment Term shall be paid by the Company.
7. Termination. Notwithstanding the provisions of Section 2 hereof, the
Employee's employment with the Company may be earlier terminated as follows:
(a) By action taken by the Board, the Employee may be
discharged for cause (as defined below), effective as of such time as the Board
shall determine. Upon discharge of the Employee pursuant to this Section 7(a),
the Company shall have no further obligation or duties to the Employee, except
for payment of (i) the deferred salary amount discussed in Section 4(b) hereof
and (ii) accrued salary, bonus and benefits payable to the Employee through the
date of termination of employment, and the Employee shall have no further
obligations or duties to the Company, except as provided in Section 8.
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(b) In the event of (i) the death of the Employee or (ii) by
action of the Board in the event of the inability of the Employee, by reason of
physical or mental disability, to continue substantially to perform her duties
hereunder for an aggregate period of 180 days during the Employment Term, during
which 180 day period salary and any other benefits hereunder shall not be
suspended or diminished. Upon any termination of the Employee's employment under
this Section 7(b), the Company shall have no further obligations or duties to
the Employee, except for payment of (i) the deferred salary amount discussed in
Section 4(b) hereof and (ii) accrued salary, bonus and benefits payable to the
Employee through the date of termination of employment, and the Employee shall
have no further obligations or duties to the Company, except as provided in
Section 8.
(c) In the event that there is a change of control of the
Company (as defined below), and the Agreement is terminated by either the
Employee or the Company for whatever reason within one year of such a change of
control, the Company shall pay to the Employee, in addition to the payment of
(i) the deferred salary amount discussed in Section 4(b) hereof and (ii) accrued
salary, bonus and benefits payable to the Employee through the date of
termination of employment, a severance payment from the Company equal to the
product of 2.99 times the sum of (x) the Employee's then applicable annual base
salary and (y) the average of the last two year's cash bonuses paid by the
Company to the Employee. In addition, all stock options and other awards under
the Company's stock option plans shall immediately vest and remain exercisable
for the a period of the lesser of (i) the original term of the stock option and
(ii) five years.
(d) For purposes of this Agreement, the Company shall have
"cause" to terminate the Employee's employment under this Agreement upon (i) the
failure by the Employee to substantially perform her duties under this
Agreement, (ii) the engaging by the
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Employee in criminal misconduct (including embezzlement and criminal fraud)
which is materially injurious to the Company, monetarily or otherwise, (iii) the
conviction of the Employee of a felony, or (iv) gross negligence on the part of
the Employee. The Company shall give written notice to the Employee, which
notice shall specify the grounds for the proposed termination and the Employee
shall be given thirty (30) days to cure if the grounds arise under clauses (i)
or (iv) above.
(e) For purposes of this Agreement, a "change of control of
the Company" shall mean the occurrence of (i) the acquisition by an individual,
entity, or group of the beneficial ownership of 50% or more (other than by Marc
and Xxxxx Xxxxxxxxxx and their affiliates) of (1) the outstanding common stock,
or (2) the combined voting power of the Company's voting securities; provided,
however, that the following acquisitions will not constitute a "change of
control": (x) any acquisition by any employee benefit plan of the Company or any
affiliate or (y) any acquisition by any corporation if, immediately following
such acquisition, more than 50% of the outstanding common stock and the
outstanding voting securities of such corporation is beneficially owned by all
or substantially all of those who, immediately prior to such acquisition, were
the beneficial owners of the common stock and the Company's voting securities
(in substantially similar proportions as their ownership of such Company
securities immediately prior thereto); or (ii) the approval by the Company's
stockholders of a reorganization, merger or consolidation, other than one with
respect to which all or substantially all of those who were the beneficial
owners, immediately prior to such reorganization, merger or consolidation, of
the Common Stock and the Company's voting securities beneficially own,
immediately after such transaction, more than 50% of the outstanding common
stock and voting securities of the corporation resulting from such transaction
(in substantially the same proportions as their
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ownership, immediately prior thereto, of the Common Stock and the Company's
voting securities); or (iii) the approval by the Company's stockholders of the
sale or other disposition of all or substantially all of the assets of the
Company, other than to a subsidiary of the Company
8. Confidentiality; Noncompetition.
(a) The Company and the Employee acknowledge that the services
to be performed by the Employee under this Agreement are unique and
extraordinary and, as a result of such employment, the Employee will be in
possession of confidential information relating to the business practices of the
Company. The term "confidential information" shall mean any and all information
(oral or written) relating to the Company or any of its affiliates, or any of
their respective activities, other than such information which can be shown by
the Employee to be in the public domain (such information not being deemed to be
in the public domain merely because it is embraced by more general information
which is in the public domain) other than as the result of breach of the
provisions of this Section 8(a), including, but not limited to, information
relating to: trade secrets, proprietary information, personnel lists, financial
information, research projects, services used, pricing, customers, customer
lists and prospects, product sourcing, marketing and selling and servicing. The
Employee agrees that she will not, during her employment or subsequent to the
termination of employment, directly or indirectly, use, communicate, disclose or
disseminate to any person, firm or corporation any confidential information
regarding the clients, customers or business practices of the Company acquired
by the Employee during her employment by Company, without the prior written
consent of Company; provided, however, that the Employee understands that
Employee will be prohibited from misappropriating any trade secret at any time
during or after the termination of employment. At no time during the Employment
Term, or thereafter shall the Employee directly
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or indirectly, disparage the commercial, business or financial reputation of the
Company.
(b) In consideration of Company's hiring Employee, the payment
by the Company to the Employee as described below and for other good and
valuable consideration, the Employee hereby agrees that she shall not, during
the Employment Term and for a period of one (1) year following such employment
(the "Restrictive Period"), directly or indirectly, take any action which
constitutes an interference with or a disruption of any of the Company's
business activities.
(c) For purposes of clarification, but not of limitation, the
Employee hereby acknowledges and agrees that the provisions of subparagraph 8(b)
above shall serve as a prohibition against her, during the Restrictive Period :
(1) directly or indirectly, contacting, soliciting or
directing any person, firm, or corporation to contact or solicit,
any of the Company's customers, prospective customers, or business
partners for the purpose of selling or attempting to sell, any
products and/or services that are the same as or similar to the
products and services provided by the Company to its customers
during the Restrictive Period. In addition, the Employee will not
disclose the identity of any such business partners, customers, or
prospective customers, or any part thereof, to any person, firm,
corporation, association, or other entity for any reason or purpose
whatsoever; and
(2) directly or indirectly, engaging or carrying on in any
manner (including, without limitation, as principal, shareholder,
partner, lender, agent, employee, consultant, or investor (other
than a passive investor with less than a five percent (5%) interest)
trustee or through the agency of any corporation,
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partnership, limited liability company, or association) in any
business that is in competition with the engaged in any business in
competition with the business of the Company; and
(3) soliciting on her own behalf or on behalf of any other
person, the services of any person who is an employee of the
Employer, and soliciting any of the Employer's employees to
terminate employment with the Employer.
(d) Upon the termination of the Employee's employment for any
reason whatsoever, all documents, records, notebooks, equipment, price lists,
specifications, programs, customer and prospective customer lists and other
materials which refer or relate to any aspect of the business of the Company
which are in the possession or under the control of the Employee including all
copies thereof, shall be promptly returned to the Company.
(e) The parties hereto hereby acknowledge and agree that (i)
the Company would be irreparably injured in the event of a breach by the
Employee of any of her obligations under this Section 8, (ii) monetary damages
would not be an adequate remedy for any such breach, and (iii) the Company shall
be entitled to injunctive relief, in addition to any other remedy which it may
have, in the event of any such breach.
(f) The rights and remedies enumerated in Section 8(e) shall
be independent of the other, and shall be enforceable, and all of such rights
and remedies shall be in addition to, and not in lieu of, any other rights and
remedies available to the Company under law or in equity.
(g) If any provision contained in this Section 8 is hereafter
construed to be invalid or unenforceable, the same shall not affect the
remainder of the covenant or covenants, which shall be given full effect,
without regard to the invalid portions.
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(h) If any provision contained in this Section 8 is found to
be unenforceable by reason of the extent, duration or scope thereof, or
otherwise, then the court making such determination shall have the right to
reduce such extent, duration, scope or other provision and in its reduced form
any such restriction shall thereafter be enforceable as contemplated hereby.
(i) It is the intent of the parties hereto that the covenants
contained in this Section 8 shall be enforced to the fullest extent permissible
under the laws and public policies of each jurisdiction in which enforcement is
sought (the Employee hereby acknowledging that said restrictions are reasonably
necessary for the protection of the Company). Accordingly, it is hereby agreed
that if any of the provisions of this Section 8 shall be adjudicated to be
invalid or unenforceable for any reason whatsoever, said provision shall be
(only with respect to the operation thereof in the particular jurisdiction in
which such adjudication is made) construed by limiting and reducing it so as to
be enforceable to the extent permissible, without invalidating the remaining
provisions of this Agreement or affecting the validity or enforceability of said
provision in any other jurisdiction.
9. Prior Agreements. This Agreement cancels and supersedes any and all
prior agreements and understandings between the parties hereto respecting the
employment of Employee by the Company, including, without limitation, the
Original Agreement.
10. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be delivered personally or sent by
registered or certified mail, return receipt requested, to the other party
hereto at her or its address as set forth in the beginning of this Agreement.
Either party may change the address to which notices, requests, demands and
other communications hereunder shall be sent by sending written notice of such
change of
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address to the other party in the manner above provided.
11. Assignability and Binding Effect. This Agreement shall inure to the
benefit of and shall be binding upon the executors, administrators, successors
and legal representatives of Employee and shall inure to the benefit of and be
binding upon the Company and its successors and assigns. The Employee may not
delegate or assign her duties or rights under this Agreement.
12. Waiver. Waiver by either party hereto of any breach or default by the
other party in respect of any of the terms and conditions of this Agreement
shall not operate as a waiver of any other breach or default, whether similar to
or different from the breach or default waived.
13. Complete Understanding: Amendment and Termination. This Agreement
constitutes the complete understanding between the parties with respect to the
employment of Employee hereunder and no statement, representation, warranty or
covenant has been made by either party with respect thereto except as expressly
set froth herein. This Agreement shall not be altered, modified, amended or
terminated except by written instrument signed by each of the parties hereto
provided, however, that the waiver by either party hereto of compliance with any
provision hereof or of any breach or default by the other party hereto need be
signed only by the party waiving such provision, breach or default.
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which taken together
shall constitute one and the same Agreement.
15. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Connecticut.
16. Paragraph Headings. The paragraph headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this
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Agreement.
17. Execution of Agreement. Employee shall execute this Agreement no later
than May 10, 1999. In the event Employee does not execute this Agreement by said
date, the non-signing of the Agreement constitutes Employee's choice to
terminate her employment with the Company.
18. Consideration. Employee hereby acknowledges and agrees that the
employment opportunity encompassed in this Agreement is contingent upon the
execution of this Agreement and that such employment, in addition to the mutual
promises herein, constitutes adequate consideration for this Agreement.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first above written.
XXXXX ONLINE, INC.
By: /s/ Xxx Xxx
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Its: President and Chief Operating Officer
Date: May 6, 1999
/s/ Xxxxx Xxxxxxxxxx
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Xxxxx Xxxxxxxxxx
Date: May 6, 1999
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