Exhibit 10.4
EMPLOYMENT AGREEMENT
AGREEMENT made as of the 1st day of January, 1999, by and between WILTEK,
INC., a Connecticut corporation, with its principal offices located at 000
Xxxxxxxx Xxxxxx, Xxxxxxx XX 00000 (the "Company") and Xxxxx X. Xxxxxxxxxxxx, an
individual, residing at 0000 Xxxxxxxx Xxxx, Xxxxx, Xxxxxxx 00000 (the
"Employee").
W I T N E S S E T H:
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WHEREAS, the Company desires that the Employee shall be employed by the
Company, and the Employee is desirous of such employment, upon the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements contained herein, the parties hereto agree as follows:
1. Defining Terms. As used in this Agreement, the following terms shall
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have the following meanings:
(a) "Company" shall mean and include Wiltek, Inc., and its
parents, subsidiaries and affiliates and the respective
successors and assigns of any of them, whether now existing
or hereafter arising: provided, however, that references to
the Company in Paragraphs 6, 7 and 9 of this Agreement shall
be limited solely to Wiltek, Inc.
(b) "Customer" shall mean any individual, firm, partnership,
corporation, company, joint venture or governmental or
military unit or any other entity or any parent, subsidiary
or affiliate of any of them which is negotiating or has a
contract with the Company for the purchase or lease of the
Company's equipment, products or services or which has been
solicited by the Company with respect to such purchase or
lease during the Employee's employment with the Company.
(c) "Confidential Information" shall mean information concerning
the Company, its products, processes and services and its
customers, suppliers, contractors, agents, consultants and
employees (herein-after referred to as "Company
Affiliates"), including, but not limited to, information
relating to research, development. inventions, manufacture,
purchasing, accounting, finances, costs, profit margins,
patents, methods, programs, apparatus, engineering,
marketing, merchandising, selling, Customer lists, Customer
requirements and personnel, pricing, pricing methods and
data processing and any other materials
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or information, heretofore or hereafter during the term of
this Agreement, conceived, designed, created, used or
developed by or relating to the Company or any of the
Company Affiliates; provided, however, that Confidential
Information shall not include any information which may be
in the public domain or come into the public domain not as a
result of a breach by the Employee of any of the terms and
provisions of this Agreement.
(d) "Proprietary Property" shall mean discoveries, concepts and
ideas and expressions thereof, whether or not subject to
patent, copyright, trademark, trade name or service xxxx
protection, including, but not limited to, software,
services, processes, methods, formulae, techniques,
apparatus, designs and writings as well as improvements
thereon, revisions thereof and know-how related thereto,
concerning any present or future activities of the Company;
provided, however, that Proprietary Property shall not
include anything which may be in the public domain or come
into the public domain not as a result of a breach by the
Employee of any of the terms and provisions of this
Agreement.
(e) "Competing Product" shall mean any product, process or
service of any person or legal entity other than the
Company, in existence or under development, which, during
the term of this Agreement, competes with or is an
alternative to any present or future product, process, or
service of the Company whether or not actively marketed by
the Company.
(f) "Competing Organization" shall mean any person or legal
entity engaged in, about to engage in or intending to engage
in research on or development, use, production, marketing,
or selling of a Competing Product.
2. Employment. The Company hereby employs the Employee, and the Employee
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hereby accepts such employment, upon the terms and conditions set forth in
this Agreement.
3. Duties. The Employee shall be employed by the Company as Vice President
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and he shall perform such duties and render such services consistent
therewith as may from time to time be required of him by the President of
the Company.
4. Extent of Service. During the term of his employment, the Employee
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agrees that (a) he will serve the Company faithfully, diligently and to the
best of his ability under the direction of the Chairman or the Board of
Directors of the Company; (b) he will devote his best efforts and
substantially his entire working time, attention and energy to the
performance of his duties hereunder and to promoting and furthering the
interests of the Company, taking, however, from time to time, reasonable
vacations consistent with the performance of his obligations hereunder, and
(c) he will not, without the prior written approval of the President of the
Company, which approval shall not be unreasonably withheld, become an
officer, director, employee or consultant of, or otherwise become
associated with or engaged in, any business other than that of the Company,
and he will do nothing inconsistent with his duties to the Company.
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5. Terms of Employment. The term of employment of the Employee under this
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Agreement shall be for a period commencing on the date of this Agreement
and terminating twelve (12) months thereafter, unless sooner terminated
pursuant to Paragraph 9 of this Agreement (the "Term"), and for successive
one-year Terms thereafter; provided, however, that with respect to each
such successive Term, the Company and the Employee shall have mutually
agreed, in writing, to basic compensation for such successive Term. If the
Company decides not to renew the Employee's Employment Agreement, then the
Employee shall be entitled to the termination provisions provided for in
Clause 9(b) of this Employment Agreement.
6. Basic Compensation. As basic compensation for the services to be
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rendered hereunder by the Employee for the initial Term, the Company agrees
to pay to the Employee, and the Employee agrees to accept, a minimum salary
at the rate of $110,000 per annum. The salary payable to the Employee
hereunder shall be paid in equal semi-monthly installments during the Term,
or in such other manner as shall be mutually agreed upon by the parties
hereto.
7. Other Benefits. The Employee shall be entitled to participate in any
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retirement, disability, profit-sharing, medical or life insurance or other
similar plan or arrangement provided by the Company to its employees, or
its other executive employees. The Employee shall also receive benefits as
stated within the attached "Schedule of Benefits."
8. Disability. If Employee shall be disabled, he shall receive full
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compensation (less any payments received from Worker's Compensation,
Wiltek's disability plans or other governmental payment for such
disability) for all periods of disability even if a period of disability
extends beyond the Term; provided, however, that the maximum number of
consecutive days during which disability occurs and for which Wiltek shall
be obligated to pay such compensation shall be ninety (90) days. Disability
means the inability of Employee to perform his duties hereunder on account
of mental or physical illness or physical incapacity.
9. Termination.
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(a) The employment of the Employee hereunder shall terminate in the event
of the death of the Employee and, at the option of the Company, upon
written notice to the Employee, (i) in the event that Base Salary
payments are terminated due to disability pursuant to Paragraph 8 of
this Agreement, or (ii) in the event that the Employee shall breach
any of the terms and provisions of this Agreement.
(b) In addition to the provisions of Paragraph 9(a) above, the Company may
also, in its sole discretion, elect to terminate, without cause, the
employment of the Employee hereunder by thirty (30) days prior written
notice to the Employee; provided, however, that if the Company shall
so terminate this Agreement pursuant to this Paragraph 9(b), the
Company shall pay the Employee guaranteed severance pay in accordance
with the next sentence, continue the benefits set forth in Item 2 of
the attached "Schedule of Benefits" for so long as the severance
payments are being made, will continue the benefit set forth in Item 1
thereof for the terms thereof and will pay the bonuses set forth in
Item 6 thereof per the terms thereof. During the six-month period
following the receipt of written notice by the Employee, the Company
shall pay the Employee guaranteed severance pay at a rate equal to the
Employee's base compensation immediately prior to such termination and
such guaranteed severance pay shall be paid to the Employee in the
manner and at the time or times that such base compensation would
otherwise have been paid to the Employee. Following the six-month
guaranteed severance pay period, if the Employee does not become
employed, the Company shall pay the Employee additional supplemental
severance pay in accordance with the next sentence. During the six-
month period following the conclusion of Company payment to the
Employee of six months of guaranteed severance pay, the Company shall
pay the Employee additional supplemental severance pay at a rate equal
to the Employee's base compensation immediately prior to such
termination and such additional supplemental
severance pay shall be paid to the Employee in the manner and at the
time or times that such base compensation would otherwise have been
paid to the Employee.
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10. Representations and Warranties of the Employee as to Conflicts.
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The Employee hereby represents and warrants to the Company that his
employment by the Company does not and will not violate any provision of
law or fiduciary duty by which he is bound and will not conflict with or
result in a breach of any agreement or instrument to which he is a party or
by which he is bound, and the Employee agrees that he will indemnify and
hold harmless the Company, its directors, officers and employees against
any claims, damages, liabilities and expenses (including attorneys' fees)
which may be incurred, including amounts paid in settlement, by any of them
in connection with any claim based upon or related to a breach of the
Employee's representation and warranty set forth in this Paragraph. In the
event of any claim based upon or related to a breach of the Employee's
representation and warranty set forth in this Paragraph 10, the Company
will give prompt notice thereof, in writing, to the Employee and the
Employee shall have the right to defend such claim with counsel reasonably
satisfactory to the Company.
11. Proprietary Property. With respect to Proprietary Property made
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or conceived by the Employee in the field of data communications, whether
or not during the hours of his employment or with the use of the Company's
facilities, materials or personnel, either individually or jointly with
others during the period of his employment by the Company, the Employee
shall, without the payment of royalty or any other considerations to him
therefor:
(a) Inform the Company promptly and fully of such Proprietary
Property by a written report satisfactory to the Company;
(b) Apply, at the Company's requests and expense, for United
States and foreign letters patent, copyright, trademark or
service xxxx, as the case may be, either in the Employee's
name or otherwise as the Company shall direct;
(c) Assign to the Company all of his right, title and interest
in such Proprietary Property, and to applications for United
States and/or foreign letters patent, copyright, trademark
and service xxxx and to any letters patent, copyright,
trademark and service xxxx which may be issued upon such
Proprietary Property;
(d) Deliver promptly to the Company, without charge to the
Company but at its expense, such written instruments, and do
such other acts, as may be necessary, in the opinion of the
Company, to obtain and maintain United States and/or foreign
letters patent, copyright, trademark or service xxxx on the
Proprietary Property and to vest the entire right, title and
interest thereto in the Company; and
(e) Grant to the Company, prior to assignment of the Employee's
right title and interest to the Company in any Proprietary
Property as required above, the royalty-free right to use in
its business, and to make, have made, use and sell products,
processes, services, writings and/or marks based upon or
related to Proprietary Property made or conceived by the
Employee.
12. Confidentiality.
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(a) During the Term and at all times thereafter, the Employee
will not use Confidential Information for his own benefit or for the benefit of
any person or legal entity other than the Company nor will he disclose the same
to any other person or legal entity, except as required to conduct the business
of the Company in the ordinary course.
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(b) Except with the prior written approval of the Company or
except as required to conduct the business of the Company in the ordinary
course, the Employee will not, at any time, directly or indirectly, use,
disseminate, disclose, lecture upon or publish articles concerning any
Confidential Information.
(c) Upon the termination of his employment with the Company, all
documents, records, notebooks and similar repositories of or containing
Confidential Information, including any copies thereof, then in the Employee's
possession, or under his control, whether prepared by him or others, will be
left with or immediately returned to the Company by the Employee.
13. Non-Compete. The Employee agrees that, during the term of his
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employment with the Company and also for one year following the
Employee's termination or departure from the Company, he will not,
without the written approval of the Company, directly or
indirectly, under any circumstances whatsoever, own, manage,
operate, engage in, control or participate in the ownership,
management, operation or control of, or be connected in any manner
with, whether as an individual, partner, stockholder, director,
officer, principal, agent, employee or consultant, or in any other
relation or capacity whatsoever, any Competing Organization, and
will not in any such manner compete with the Company or solicit or
call on any Customer of the Company, wherever located, which was a
Customer of the Company at any time during the period one (1 year
prior to the termination of the Employee's employment with the
Company for the purpose of inducing such Customer to purchase or
lease a Competing Product. Notwithstanding the foregoing, nothing
contained in this Paragraph 13 shall restrict the Employee from
making any investment in any company whose stock is listed on a
national securities exchange or actively traded in the over-the-
counter market, so long as such investment does not give him the
right to control or influence the policy decisions of any such
business or enterprise which is or might be in competition with
any business of the Company.
14. Non-Interference. The Employee will not, for a period of one (1)
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year following the termination of the Employee's employment by the
Company, directly or indirectly, employ, hire, solicit or, in any
manner, encourage any employee of the Company to leave the employ
of the Company.
15. Injunctive Relief. In addition to any other rights or remedies
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available to the Company as a result of the breach of the
Employee's obligations hereunder, the Company shall be entitled to
enforcement of such obligations by an injunction or a decree of
specific performance from a court with appropriate jurisdiction
and in the event that the Company is successful in any suit or
proceeding brought or instituted by the Company to enforce any of
the provisions of this Agreement or on account of any damages
sustained by the Company by reason of the violation by the
Employee of any of the terms and/or provisions of this Agreement
to be performed by the Employee, the Employee agrees to pay to the
Company all attorneys' fees reasonably incurred by the Company.
16. Withholding. The Employee hereby agrees that he will make such
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arrangements as the Company may deem necessary to discharge any
obligations of the Company to withhold Federal, state or local
taxes imposed upon the Company in respect of this Agreement.
17. Severability. The provisions of this Agreement shall be
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severable and if any part of any provision shall be held invalid
or unenforceable or any separate covenant contained in any
provision is held to be unduly restrictive and void by a final
decision of any court or other tribunal of competent jurisdiction,
such part, covenant or provision shall be construed to give it
maximum lawful validity and the remaining provisions of this
Agreement shall nonetheless remain in full force and effect.
18. Entire Agreement. This Agreement and the attached "Schedule of
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Benefits" contains the entire agreement of the parties relative to
the subject matter hereof, superseding and terminating all prior
agreements or understandings, whether oral or written, between the
parties hereto relative to the subject matter hereof,
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and this Agreement may not be extended, amended, modified or
supplemented without the written consent of the parties hereto.
19. Waivers. Any waiver of the performance of the terms or
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provisions of this Agreement shall be effective only if in writing
and signed by the party against whom such waiver is to be
enforced. The failure of either party to exercise any of his or
its rights under this Agreement or to require the performance of
any term or provision of this Agreement, or the waiver by either
party of any breach of this Agreement, shall not prevent a
subsequent exercise or enforcement of such rights or be deemed a
waiver of any subsequent breach of the same or any other term or
provision of this Agreement.
20. Notices. Any notice required or permitted to be given under this
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Agreement shall be in writing and shall be deemed given when
personally delivered or sent by registered or certified mail,
postage prepaid, return receipt requested, to the respective
address of the parties hereto as set forth above or to such other
address as either party may designate to the other party in the
manner provided herein for giving notice.
21. Successors and Assigns. This Agreement shall be binding upon and
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inure to the benefit of the heirs, executors, administrators,
successors and legal representatives of the Employee, and shall
inure to the benefit of and be binding upon the Company and any
successor to the business of the Company pursuant to a merger or
acquisition of all or substantially all of its assets, but the
obligations of the Employee may not be delegated and the Employee
may not assign, transfer, pledge, encumber, hypothecate or
otherwise dispose of this Agreement, or any of his rights
hereunder (whether by operation of law or otherwise), except as
expressly permitted by this Agreement, and any such attempted
delegation or disposition shall be null and void and without
effect.
22. Governing Law. This Agreement shall be governed by and construed
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and enforced in accordance with the laws of the State of
Connecticut.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
WILTEK, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
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President & Board Member
By: /s/ Xxxxx X. Xxxxxxxxxxxx
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Xxxxx X. Xxxxxxxxxxxx
Vice President
WITNESS:
/s/ Xxxxx Xxxxxxx
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Schedule of Benefits
1. Company Car. Company obligation is direct payment of, or reimbursement to
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the Employee, for all lease payments, tax payments, insurance payments,
gasoline payments, service payments, repair payments, maintenance payments.
This benefit will continue for two (2) months after termination.
2. Company Standard Benefits. Health, major medical, dental, eye care,
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orthodontia, life insurance, short-term disability, long-term disability,
401K contribution, in addition to individual benefits provided within this
section ("Schedule of Benefits") to the Employee.
3. Annual Minimum Base Salary. $110,000.
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4. Guaranteed Severance Pay. Six (6) months of Annual Minimum Base Salary.
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5. Supplemental Severance Pay. If employment not found by Employee following
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Guaranteed Severance Pay Period, an additional six (6) months of Annual
Minimum Base Salary.
6. Revenue Bonus. If Wiltek reports fiscal year 1999 revenue (excluding any
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revenue for business's acquired after January 1, 1999) of at least
$6,800,000 then a cash bonus of .30% of total fiscal year 1999 revenue
$7,000,000 then a cash bonus of .32% of total fiscal year 1999 revenue
$7,200,000 then a cash bonus of .34% of total fiscal year 1999 revenue
$7,400,000 then a cash bonus of .36% of total fiscal year 1999 revenue
$7,600,000 then a cash bonus of .38% of total fiscal year 1999 revenue
$7,800,000 then a cash bonus of .40% of total fiscal year 1999 revenue
$8,000,000 then a cash bonus of .42% of total fiscal year 1999 revenue
$8,200,000 then a cash bonus of .44% of total fiscal year 1999 revenue
$8,400,000 then a cash bonus of .46% of total fiscal year 1999 revenue
$8,600,000 then a cash bonus of .48% of total fiscal year 1999 revenue
$8,800,000 then a cash bonus of .50% of total fiscal year 1999 revenue
The Company shall make full cash bonus payment to Employee within 60 days
(December 30, 1999) of close of fiscal year 1999. In the event of termination
any bonus accumulated as of the date of termination will be payable by the
Company to the Employee within 30 days of termination.
IN WITNESS WHEREOF, the parties have executed this Schedule of Benefits
as of the date first above written.
WILTEK, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
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President & Board Member
By: /s/ Xxxxx X. Xxxxxxxxxxxx
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Xxxxx X. Xxxxxxxxxxxx
Vice President
WITNESS:
/s/ Xxxxx Xxxxxxx
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