Exhibit 10.21
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as of
October 1, 1996 by and between PSW TECHNOLOGIES, INC., a Delaware corporation
(the "Company"), and XX. XXXXXXX X. XXXX (the "Executive").
W I T N E S S E T H
WHEREAS, the Company desires to employ Executive on the terms and
conditions herein contained; and
WHEREAS, Executive is willing to enter into this Agreement for
employment with the duties outlined herein on a full-time basis.
NOW, THEREFORE, in consideration of the employment of Executive by
the Company, the Company and Executive agree as follows:
1. Term of the Agreement. The Company shall employ Executive and
Executive shall accept employment with the Company for the two (2) year period
commencing on October 1, 1996 (the "Commencement Date") and ending September 30,
1998 (the "Employment Period"), subject, however, to prior termination as
hereinafter provided in Section 5. Thereafter, unless either party provides the
other party, no later than thirty (30) days prior to the end of the Employment
Period, with notice of its or his intention not to extend the Agreement and the
Employment Period as hereinafter set forth, this Agreement and the Employment
Period shall automatically be extended for subsequent one (1) year periods and
the provisions hereof shall remain applicable for each such subsequent period.
2. Executive's Title, Duties and Obligations.
a. Title and Duties. Executive shall serve as President and
Chief Executive Officer of the Company. Executive shall at all times report to
the Board of Directors of the Company (the "Board"), and shall be subject to the
policies established by the Board and shall discharge his responsibilities in a
competent and faithful manner, consistent with sound business practices.
b. Non-Disclosure Agreement. Prior to his commencement of
employment with the Company, Executive shall execute the Company's form of
Employee Non-Disclosure and Developments Agreement (the "Non-Disclosure
Agreement") attached hereto as Exhibit A.
3. Devotion of Time to Company's Business
a. Full-Time Efforts. During his employment with the Company,
Executive shall devote all of his business time, attention and efforts to the
business of the Company.
b. No Other Employment. During his employment with the
Company, Executive shall not, whether directly or indirectly, render any
services of a commercial or professional nature to any other person or
organization, whether for compensation or otherwise, without the prior written
consent of the Company's Board of Directors.
c. Non-Competition. During his employment with the Company and
for a period of two (2) years thereafter, Executive shall not, directly or
indirectly, either as an employee, employer, consultant, agent, principal,
partner, joint venturer, stockholder, corporate officer, director, or in any
other individual or representative capacity, provide any software development,
porting support or contract programming services (the "Business") to any other
individual, corporation or entity for whom the Company has performed any
services within the twelve (12) month period prior thereto, or made a proposal
to provide any services within the six (6) month period prior thereto; or (ii)
solicit, divert or take away, or attempt to divert or to take away, the business
or patronage of any of the clients, customers or accounts which were contacted,
solicited or served by Executive while employed by the Company.
d. Non-Solicitation of Employees. Executive agrees that during
his employment with the Company and for two (2) years thereafter, he will not
encourage or solicit any employee of the Company to leave the Company for any
reason; provided, however, that this obligation shall not affect any
responsibility he may have as an employee of the Company with respect to the
bona fide hiring and firing of Company personnel.
e. Exceptions. Notwithstanding the provisions of this Section
3, nothing herein shall prohibit Executive from (i) holding less than one
percent (1%) of the outstanding capital stock of a publicly-held corporation
engaged in a business that competes with the Business or Proposed Business of
the Company; or (ii) serving on up to five (5) Boards of Directors of other
companies provided such role requires no more than twenty-five (25) days of
effort per annum total and involves no business conflict of interests within
Executive's services hereunder.
f. Interpretation. If any restriction set forth in Sections
3.c., 3.e. or 3.f. is found by any court of competent jurisdiction to be
unenforceable because it extends for too long a period of time or over too great
a range of activities or in too broad a geographic area, it shall be interpreted
to extend only over the maximum period of time, range of activities or
geographic area as to which it may be enforceable.
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g. Equitable Remedies. The restrictions contained in Sections
3.c., 3.e. and 3.f. are necessary for the protection of the business and
goodwill of the Company and are considered by Executive to be reasonable for
such purpose. Executive agrees that any breach of Sections 3.c., 3.e. or 3.f. of
this Agreement is likely to cause the Company substantial and irrevocable damage
and therefore, in the event of any such breach, Executive agrees that the
Company, in addition to any other remedies which may be available, shall be
entitled to specific performance and other injunctive relief.
4. Compensation and Benefits.
a. Base Compensation. During the term of this Agreement, the
Company shall pay to Executive a base annual compensation of Three Hundred Forty
Eight Thousand Dollars ($348,000), less all required withholdings (the "Base
Salary") payable in accordance with the Company's payroll policies.
b. Performance Bonuses. Executive shall be entitled to receive
bonuses based upon the achievement of certain performance objectives, as more
fully set forth on Exhibit B attached hereto (the "Performance Bonus"). The
Executive hereby expressly waives all bonus payments, if any, he would otherwise
be entitled to receive for the years ended December 31, 1997 and 1998 pursuant
to the employment agreement dated October 19, 1992 between the Executive and
Pencom Systems Incorporated.
c. Benefits. During his employment with the Company, Executive
will be entitled to receive all such health and medical benefits as are provided
to other executive officers of the Company. The Company reserves the right to
modify, amend or terminate any benefits listed above at any time for any reason
(provided such modification, amendment or termination is applicable to all
executives receiving such benefits) but shall, in any case, provide reasonable
health and disability benefits to Executive while Executive is a full-time
employee of the Company. Further, Executive will have the rights to participate
in any vacation and savings plans implemented by the Company which are provided
to other executive officers of the Company.
d. Expense Reimbursement. Executive shall be entitled to
reimbursement from the Company for all customary, ordinary and necessary
business expenses incurred by him in the performance of his duties hereunder,
provided that Executive shall furnish the Company with vouchers, receipts and
other details of such expenses within thirty (30) days after they are incurred.
5. Termination of Employment.
a. Termination for Good Cause. The Company may terminate
Executive's employment at any time for Good Cause. For the purposes of this
Agreement, "Good Cause" includes, but is not limited to, gross misconduct, gross
neglect of duties, acts involving moral turpitude, material breach by Executive
of the Non-Disclosure Agreement or
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any act or omission involving fraud, embezzlement, or misappropriation of any
property or proprietary information of the Company by Executive.
b. Termination without Good Cause. If Executive's employment
is terminated by the Company without Good Cause, Executive shall be entitled to
receive (i) any unpaid compensation accrued through the last day of Executive's
employment and (ii) severance payments equal to his base compensation, payable
on normal Company payroll dates, for a period ending three months after the date
of such termination (the "Severance Payments"), which Severance Payments shall
cease to be owing by the Company to Executive upon Executive's commencement of
employment with another company during such period.
c. Termination by Executive. Executive may terminate this
Agreement at any time, upon ninety (90) days' written notice to the Company. If
Executive terminates this Agreement under this Section 5.c., Executive shall
only be entitled to any unpaid compensation accrued through the last day of
Executive's employment, but in no event shall Executive be entitled to any
severance benefit.
d. Death or Disability. This Agreement shall terminate if
Executive dies or is mentally or physically Disabled. For the purposes of this
Agreement, "Disabled" shall mean a mental or physical condition that renders
Executive incapable of performing his duties and obligations under this
Agreement for three (3) or more consecutive months or for a total of six (6)
months during any twelve (12) consecutive months. If this Agreement is
terminated under this Section 5.d., Executive or his estate shall be entitled to
any unpaid compensation accrued through the last day of Executive's employment
but shall not be entitled to any severance benefits.
6. Miscellaneous.
a. Representations and Agreements of Executive. Executive
represents and warrants that he is free to enter into this Agreement and to
perform the duties required hereunder, and that there are no employment
contracts or understandings, restrictive covenants or other restrictions,
whether written or oral, preventing the performance of his duties hereunder.
Executive further represents and warrants that he does not possess any
proprietary information with respect to any former employer which is subject to
an agreement or understanding, whether written or oral, between Executive and
such former employer which restricts Executive's use or disclosure of such
proprietary information.
b. Governing Law. This Agreement shall be interpreted,
construed, governed and enforced according to the laws of the State of New York.
c. Amendments. No amendment or modification of the terms or
conditions of this Agreement shall be valid unless in writing and signed by the
parties hereto.
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d. Severability. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
construed, if possible, so as to be enforceable under applicable law, else, such
provision shall be excluded from this Agreement and the balance of the Agreement
shall be interpreted as if such provision were so excluded and shall be
enforceable in accordance with its terms.
e. Successors and Assigns. The rights and obligations of the
Company under this Agreement shall inure to the benefit of and shall be binding
upon the successors and assigns of the Company. Executive shall not be entitled
to assign any of his rights or obligations under this Agreement.
f. Non-Waiver. The waiver of any term or condition of this
Agreement shall not be deemed to constitute a waiver of any other term or
condition.
g. Notices. All notices required or permitted under this
Agreement shall be in writing and shall be deemed effective upon personal
delivery or two days after deposit in the United States Post Office, by
registered or certified mail, postage prepaid, addressed to the other party at
the address shown below such party's signature, or at such other address or
addresses as either party shall designate to the other in accordance with this
Section 5.h.
h. Entire Agreement. This Agreement, including the exhibits
attached hereto, constitutes the entire agreement between the parties with
respect to the employment of Executive.
i. Headings. The Section headings appearing in this Agreement
are for purposes of easy reference and shall not be considered a part of this
Agreement or in any way modify, amend, or affect its provisions.
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IN WITNESS WHEREOF, the parties have executed this Employment
Agreement as of the date set forth above.
PSW TECHNOLOGIES, INC.
_________________________________
By:
Title:
Address:
EXECUTIVE:
_________________________________
Xx. Xxxxxxx X. Xxxx
Address:
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