EXHIBIT 10.8
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into as of
January 1, 2000, between eGlobe, Inc., a Delaware corporation with principal
offices located in Washington, D.C. (the "Company"), and XXXXX XXXXXXXX (the
"Executive").
WHEREAS, the parties desire to enter into this Agreement setting
forth the terms and conditions for the employment relationship of the Executive
with the Company.
NOW, THEREFORE, it is AGREED as follows:
1. EMPLOYMENT. The Executive is hereby employed as the Chief
Financial Officer of the Company for a period commencing on January 1, 2000 (the
"Effective Date") and ending on the fourth anniversary of the Effective Date.
Prior to the expiration of the initial term of employment, the parties may
extend the term by mutual agreement. As the Chief Financial Officer of the
Company, the Executive's duties will be those of chief finance and
administration officer of the Company and all of its divisions and subsidiaries.
The Executive shall report directly to the Company's Chief Executive Officer and
shall also perform such other duties commensurate with the Executive's title and
position as the Chief Executive Officer of the Company may from time to time
reasonably direct.
2. LOCATION OF SERVICES. During the term of this Agreement,
the Executive shall perform his duties primarily in New York, New York and in
Washington, DC, with his primary office located in New York and his time divided
evenly between New York and Washington or as otherwise agreed with the chief
Executive Officer.
3. SALARY. The Company shall pay the Executive an annual
salary equal to $160,000, with such increases as may be determined by the
Company in its discretion ("Base Salary"). The Base Salary of the Executive
shall not be decreased at any time during the term of this Agreement from the
amount then in effect, unless the Executive otherwise agrees in writing. The
Base Salary shall be payable to the Executive not less frequently than monthly.
4. BONUSES. The Executive shall be eligible to earn an annual
bonus (the "Annual Bonus") during each fiscal year (such year being
referred to herein as a "Bonus Period") that he remains an executive employee of
the Company. For each Bonus Period, the Executive and the Chairman and Chief
Executive Officer of the Company shall adopt written performance goals within
the Bonus Period. These performance goals shall be consistent among the senior
executive officers (which shall include the CEO, CFO and COO). If annual goals
are met or exceeded for an annual Bonus Period, the Executive shall earn an
Annual Bonus of 40% of the Base Salary (for the avoidance of doubt, a delay by
any person in the adoption of written performance goals shall not deny the
Executive any bonus or, upon the adoption and achievement of such goals, delay
in any way the payment thereof). If only certain of such goals are met, or goals
are met only in part, for such Bonus Period, the Executive shall earn a bonus
equal to an amount to be determined by the Company, in its sole discretion.
Annual Bonuses shall be payable to the Executive by February 15th of each year
or within 45 days after the end of the applicable period (or, in each case,
within 30 days of when it is determined whether the applicable goals are met,
whichever is later). The Board of Directors may, in its sole discretion, award
additional or greater bonuses to the Executive based upon achievement of other
Company objectives during the Bonus Period.
5. PARTICIPATION IN EMPLOYEE BENEFIT PLANS. In addition to the
benefits noted below, the Executive shall be entitled to participate, on the
same basis as other executive employees of the Company, in any stock option,
stock purchase, pension, thrift, profit-sharing, group life insurance, medical
coverage, education, or other retirement or employee pension or welfare plan or
benefits that the Company has adopted or may adopt for the benefit of its
employees. The Executive shall be entitled to participate in any fringe benefits
which are now or may be or become applicable to the Company's executive
employees generally.
Such employee benefits presently include the following:
Medical coverage, including health, dental and vision insurance, commences at
the beginning of the month following 30 days from the date on which the
Executive commences service with the Company, and the Executive is responsible
for 25% of the expense of the Executive's medical coverage, with the Company
responsible for the remaining 75%. The Executive is eligible to participate in
the Company's 125 Flexible Spending Plan beginning on the Effective Date. The
Executive's life insurance is equal to two (2) times the Base Salary (up to a
maximum of $300,000). The Executive is eligible to contribute to the Company's
401k Plan 90 days following the Effective Date. Upon commencing service with the
Company, the Executive is eligible to immediately roll over any of Executive's
pre-existing 401k Plan holdings.
The Executive shall be reimbursed for any expenses which he
may incur in connection with his services hereunder in accordance with the
Company's normal reimbursement policies as established from time to time.
6. STOCK PURCHASE. Effective as of the Effective Date, the
Executive shall purchase 36,000 shares of the common stock of the Company (the
"Stock Purchase") at a price equal to the closing price of the Company's common
stock as listed on the NASDAQ National Market on the Effective Date. In
connection with the Stock Purchase, the Company will extend a personal recourse
loan to the Executive in an amount equal to the full purchase price of the Stock
Purchase. Such loan shall have a term of 4 years and shall have an interest rate
equal to 8%, compounded annually, provided, however, that the loan may be called
by the Company of the Executive leaves the employ of the Company voluntarily.
7. TIME-VESTED STOCK OPTIONS. As previously approved by the
Compensation Committee of the Company's Board of Directors under the Company's
1995 Employee Stock Option and Appreciation Rights Plan, in consideration of the
Executive's acceptance of employment hereunder, the Executive is granted, on the
Effective Date, options to purchase an aggregate of 144,000 shares of the
Company's common stock, the vesting of which will be based solely upon the
Executive's continued employment with the Company over time (the "Time-Vested
Options"). The exercise price per share of the Time-Vested Options shall be
equal to the closing price of the Company's common stock as listed on The Nasdaq
National Market on the Effective Date. The Time-Vested Options granted to the
Executive shall be incentive stock options, as defined under Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code"), to the maximum extent
permitted thereunder, with the remaining Time-Vested Options to be nonqualified
stock options. The Time-Vested Options will have a term of five years from the
Effective Date. The Time-Vested Options shall become vested and exercisable in
installments of 36,000 shares each on December 31, 2000, 2001, 2002 and 2003,
respectively, provided that the Executive continues to be employed by the
Company on each such date. Notwithstanding the forgoing, all Time-Vested Options
will become fully vested and exercisable upon a "change in control" of the
Company (as defined below), a termination of the Executive's employment by the
Company (other than a "termination for cause" (as defined below)). In the event
of termination of the Executive's employment for any reason other than a
"termination for cause", all Time-Vested Options that are or become vested upon
termination of employment shall remain exercisable for a period of 90 days
following termination. The Time-Vested Options shall be on such terms and
conditions consistent with the
foregoing as set forth in the Company's standard form of stock option agreement
to be entered into between the Company and the Executive.
8. PERFORMANCE OPTIONS. As previously approved by the
Compensation Committee of the Company's Board of Directors under the Company's
1995 Employee Stock Option and Appreciation Rights Plan, in consideration of the
Executive's acceptance of employment hereunder, the Executive is granted options
to purchase an aggregate of 120,000 shares of the Company's common stock, the
vesting of which will be based upon the Executive's continued employment with
the Company and accelerated upon the achievement of certain performance goals
(the "Performance Options"). The Performance Options shall be nonqualified stock
options and shall have an exercise price equal to the closing price of the
Company's common stock as listed on The Nasdaq National Market on the Effective
Date. Each of the Performance Options will have a term of nine years from the
Effective Date. The Performance Options shall become vested on an accelerated
basis and exercisable in installments of 40,000 shares each on December 31,
2000, 2001, 2002, respectively provided that the Executive continues to be
employed by the Company on each such date and the performance goals determined
in the same manner as provided in Section 4 hereof for the applicable Bonus
Period have been achieved (Upon the achievement of 70% of the Executive's
performance goals, 50% of the number of shares eligible for vesting in that year
shall vest; if the percentage achievement of performance goals is higher than
70% then the number of shares that vest shall be increased proportionately from
50%); otherwise, the Performance Options shall vest in 9 years.
All Performance Options will become fully vested and
exercisable upon a "change in control" of the Company. In the event of
termination of the Executive's employment for any reason other than a
"termination for cause", all Performance Options that are or become vested upon
termination shall remain exercisable for a period of 90 days following
termination. Except as provided herein, the Performance Options shall be on such
terms and conditions as set forth in the Company's standard form of stock option
agreement to be entered into between the Company and the Executive.
9. DEFINITION OF CHANGE IN CONTROL. For purposes of this
Agreement and notwithstanding any other definition set forth in any stock option
plan of the Company, a "change in control" shall be deemed to have taken place
if (i) the Company or its shareholders enter into an agreement to dispose of all
or substantially all of the assets or stock of the Company by means or a sale,
merger or other reorganization, liquidation, or otherwise (other than any
agreement of merger or reorganization where the
shareholders of the Company immediately before the consummation of the
transaction will own 50% or more of the fully diluted equity of the surviving
entity immediately after the consummation of the transaction), (ii) during any
period of two (2) consecutive years (not including any period prior to the date
hereof), individuals who at the beginning of such period constitute the Board of
Directors (and any new directors whose election by the Board of Directors or
nomination for election by the Company's shareholders was approved by a vote of
at least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was so approved) cease for any reason (except for death, disability or
voluntary retirement) to constitute a majority thereof, or (iii) during any
period of two (2) consecutive years (not including any period prior to the date
hereof), individuals who at the beginning of such period constitute the senior
management of the Company cease for any reason (except for death, disability or
voluntary retirement) to constitute a majority thereof. Notwithstanding the
foregoing, the Company's proposed merger with Trans Global Communications, Inc.
shall not be treated as a "change in control" for purposes hereof.
10. STANDARDS. The Executive shall perform the Executive's
duties and responsibilities under this Agreement in accordance with such
reasonable standards as may be established from time to time by the Company's
Chief Executive Officer. The reasonableness of such standards shall be measured
against standards for executive performance generally prevailing in the
Company's industry. Notwithstanding the foregoing, any allegation that the
Executive shall have failed to comply with such standard by itself shall not
constitute a basis for a "termination for cause" hereunder.
11. VOLUNTARY ABSENCES; VACATIONS. The Executive shall be
entitled to annual paid vacation of at least three weeks (fifteen days) per year
or such longer period as the Chief Executive Officer of the Company may approve.
The timing of paid vacations shall be scheduled in a reasonable manner by the
Executive.
12. DISABILITY. If the Executive shall become disabled or
incapacitated to the extent that the Executive is unable to perform the
Executive's duties and responsibilities hereunder, the Executive shall be
entitled to receive disability benefits of the type provided for other executive
employees of the Company.
13. TERMINATION OF EMPLOYMENT.
(a) The Chief Executive Officer or the Board of Directors may
terminate the Executive's employment at any time, subject to payment of the
compensation described below.
(b) In the event of any termination by the Company other than
"termination for cause" or in the event of any "resignation for good reason"
(each as defined below), the Executive shall receive his Accrued Rights and
shall continue to receive, for one year commencing on the date of such
termination (the "Severance Period"), full Base Salary and all other benefits
and compensation that the Executive would have been entitled to under this
Agreement in the absence of termination of employment, including, without
limitation, continued coverage for the Executive and his dependents in the
Company's health benefit plans (collectively, the "Severance Amount").
(c) The Severance Amount shall not be reduced by any
compensation which the Executive may receive for other employment with another
employer after termination of employment with the Company, nor shall the
Executive be required to mitigate damages with respect to the Severance Amount.
If during the term of this Agreement there is a "change in control" of the
Company, and in connection with or within two years after such change of control
the Company terminates the Executive's employment other than termination for
cause or the Executive terminates with good reason, the Company shall be
obligated, concurrently with such termination, to pay the Severance Amount in a
single lump sum cash payment to the Executive. If the Company fails to make
timely payment of any portion of the Severance Amount, the Executive shall be
entitled to reimbursement of all reasonable costs, including attorneys' fees,
incurred by the Executive in taking action to collect such amount or otherwise
enforce this Agreement. In addition, the Executive shall be entitled to interest
on the amounts owed to him under this Agreement at the rate of 5% above the
prime rate (defined as the base rate on corporate loans at large U.S. money
center commercial banks as published by the Wall Street Journal), compounded
monthly, for the period from the date of employment termination until payment is
made to the Executive.
(d) The Executive shall have no right to receive compensation
or other benefits from the Company for any period after a "termination for
cause" by the Company or termination by the Executive other than a "resignation
for good reason", except for his Accrued Rights.
(e) The term "termination for cause" shall mean termination by
the Company because of the Executive's (i) fraud or material misappropriation
with respect to the business or assets of the Company; (ii) persistent refusal
or failure materially to perform his duties and
responsibilities to the Company, which continues after the Executive receives
notice of such refusal or failure; (iii) conduct that constitutes breach of
fiduciary duty involving personal profit; (iv) conviction of the Executive, by a
court of competent jurisdiction, of, or Executive's plea of guilty or NOLO
CONTENDERE to, a felony under the laws of the United States or any state
thereof, or any equivalent crime in any foreign jurisdiction; (v) willful
violation of any law, rule, or regulation, involving dishonesty or moral
turpitude that is materially detrimental to the Company; or (vi) the use of
illegal drugs or alcohol which interferes materially with the Executive's
performance of his duties.
(f) The term "resignation for good reason" shall mean a
resignation of the Executive following (i) material reduction, without his
consent, of Executive's duties, titles, or reporting relationships as set forth
in Section 1 hereof; (ii) any reduction, without his consent, of the Executive's
Base Salary, Annual Bonus or any compensation or benefits rights under this
Agreement; (iii) any involuntary relocation of the Executive's principal place
of business as set forth in Section 2 hereof; or (iv) a material breach of any
part of this Agreement by the Company.
15. RESTRICTIVE COVENANTS.
(a) During the employment of the Executive under this
Agreement and for a period of one year after termination of such employment by
the Company, other than a termination by the Company without cause or a
"resignation for good reason" by the Executive, the Executive shall not at any
time (i) compete directly on his own behalf, or on behalf of any other person or
entity, with the business of the Company or any of its affiliates within
territories in which the Company does business, but only with respect to the
business, with respect to the business of the Company or any of its affiliates
as such business shall be conducted on the date hereof or during the employment
of the Executive under this Agreement; (ii) solicit or induce, on his own behalf
or on behalf of any other person or entity, any employee of the Company or any
of its affiliates to leave the employ of the Company or any of its affiliates;
or (iii) solicit or induce, on his own behalf or on behalf of any other person
or entity, any customer of the Company or any of its affiliates to reduce its
business with the Company or any of its affiliates.
(b) The Executive shall not at any time during or subsequent
to his employment by the Company, on his own behalf or on behalf of any other
person or entity, disclose any proprietary information of the Company or any of
its affiliates to any other person or entity other than on behalf of the Company
or in conducting its business, and the Executive shall not use any such
proprietary information for his own personal advantage or make such
proprietary information available to others for use, unless such information
shall have come into the public domain other than through unauthorized
disclosure, or as required by law or judicial process.
(c) The ownership by the Executive of not more than 5% of a
corporation, partnership or other enterprise in which the Executive does not
participate in the management or policy making shall not constitute a violation
hereof.
(d) If any portion of this Section 15 is found by a court of
competent jurisdiction to be invalid or unenforceable, but would be valid and
enforceable if modified, this Section 15 shall apply with such modifications
necessary to make this Section 15 valid and enforceable. Any portion of this
Section 15 not required to be so modified shall remain in full force and effect
and not be affected thereby. The Executive agrees that the Company shall have
the right of specific performance in the event of a breach by the Executive of
this Section 15.
16. NO ASSIGNMENTS.
This Agreement is personal to each of the parties hereto. No
party may assign or delegate any rights or obligations hereunder without first
obtaining the written consent of the other party hereto. However, in the event
of the death of the Executive, all rights to receive payments hereunder shall
become rights of the Executive's estate.
17. OTHER CONTRACTS.
The Executive shall not, during the term of this Agreement,
have any other paid employment other than with a subsidiary of the Company,
except with the prior approval of the Board of Directors.
18. AMENDMENTS OR ADDITIONS.
No amendments or additions to this Agreement shall be binding
unless in writing and signed by all parties hereto.
19. SECTION HEADINGS.
The section headings used in this Agreement are included
solely for convenience and shall not affect, or be used in connection with, the
interpretation of this Agreement.
20. SEVERABILITY.
The provisions of this Agreement shall be deemed severable and
the invalidity or unenforceability of any provision shall not affect the
validity or enforceability of the other provisions hereof.
21. GOVERNING LAW.
This Agreement shall be governed by the laws of the State of
Delaware (other than the choice of law rules thereof).
eGLOBE, INC.
By: /S/ XXXXXXXXXXX X. XXXXX
----------------------------
Title:Chairman of the Board of
Directors and Chief
Executive Officer
EXECUTIVE
/S/ XXXXX XXXXXXXX
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Xxxxx Xxxxxxxx
