Exhibit 10.13
EMPLOYMENT AGREEMENT
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This Agreement is made and entered into as of April 10, 2000 (the
"Effective Date"), by and between XPEDIOR INCORPORATED hereinafter referred to
as "Xpedior," and Xxxxxx XxXxxx, hereinafter referred to as "Employee."
In consideration of the mutual covenants and agreements hereinafter set
forth, the parties agree as follows:
1. OFFER AND ACCEPTANCE OF EMPLOYMENT. Employee's officer title shall be
Senior Vice President - International of Xpedior as of the Effective Date.
Employee agrees to accept such employment and to perform the services specified
herein, all upon the terms and conditions hereinafter stated.
2. DUTIES. Employee agrees to discharge faithfully, diligently and to the
best of his ability during the term hereof the duties normally incidental to the
position of Senior Vice President - International of Xpedior. Employee agrees
to serve in such capacity and perform such duties as the Chief Operating Officer
may reasonably direct from time to time and which are consistent with Employee's
position and status. Employee's duties will include, but not be limited to,
overall profit and loss responsibility for Xpedior's international operations;
development of regional business plans with the Chief Operating Officer and
integration of such plans into Xpedior's worldwide budget and operating plan;
support of regional general managers in executing regional plans; development of
additional lines of business with the Chief Operating Officer consistent with
Xpedior's business strategy; participate fully as a member of Xpedior's
executive strategy committee; and participate fully as a member of Xpedior's
executive team evaluating acquisition and partnership opportunities for Xpedior.
Employee agrees that during the term of this Agreement, Employee will devote
Employee's entire business time, skill, energy, knowledge and best efforts to
the business and affairs of Xpedior, and that Employee will not engage, directly
or indirectly, in any other business interest or activities, whether or not
similar to that of Xpedior, except with the prior written consent of the Xpedior
Board of Directors, in its sole discretion. Employee shall be expected to
commit whatever time is necessary for the normal responsibilities of Xpedior
management.
3. COMPENSATION. During the term of this Agreement, Xpedior agrees to pay
the following compensation to Employee, and the Employee agrees to accept such
compensation:
3.1 Base Compensation. Employee shall receive a base cash salary at
the rate of approximately Sixteen Thousand, Six Hundred Sixty-Six Dollars and
Sixty-Six Cents ($16,666.66) per month, which would be equivalent to Two Hundred
Thousand Dollars and No Cents ($200,000.00) over the course of a twelve (12)
month period, through the term of this Agreement; provided however, that the
parties are free to increase this salary by mutual agreement in a writing
executed by each of them. Such Base Compensation will be reviewed from time to
time by the Board's Compensation Committee (the "Compensation Committee"), and
the Compensation Committee, in its sole discretion, may make appropriate
adjustments. The
compensation received by Employee from time to time pursuant to this Section 3.1
shall be hereinafter referred to as "Base Compensation." The Base Compensation
constitutes a gross amount and shall be paid in substantially equal semi-monthly
installments subject to such withholding and deductions as may from time to time
be legally required.
3.2 Bonus. Immediately upon the commencement of his employment with
Xpedior, Employee shall be eligible to receive an annual bonus (the "Incentive
Bonus") of up to fifty percent (50%) of the Base Compensation paid to Employee
under this Agreement based on Employee's meeting or exceeding certain
performance objectives. The performance objectives for the Incentive Bonus for
the year 2000 shall be mutually agreed upon by no later than May 30, 2000, and
for each subsequent calendar year shall be mutually agreed upon no later than
March 31 of the applicable calendar year. In each of these years, unless
otherwise mutually agreed in writing, two thirds of the Incentive Bonus will be
based on meeting budgeted revenue expectations for the budget year, and the
remainder for meeting an additional target goal. Except for the Incentive Bonus
for the year 2000, which the parties agree shall be paid in full to Employee,
the Chief Operating Officer, together with the Chief Executive Officer and the
Board, shall determine whether Employee has met or exceeded the performance
objectives for each year. Incentive Bonuses will be paid on or before March 31
of the year following the calendar year during which the bonus criteria was
achieved (the "Payout Date"), provided, however, that up to 75% of the total
Incentive Compensation will be advanced over one or more quarterly payments if
the Chief Operating Officer determines that year-to-date performance is on track
for meeting the established performance objectives for that year. If Employee's
employment terminates prior to the Payout Date for any reason, Xpedior will pro-
rate and pay Employee the amount of unpaid portions of the Incentive Bonus which
Employee has earned. If Employee is advanced any part of an Incentive Bonus in
any year during the which the Chief Operating Officer ultimately determines that
performance objectives were not met or exceeded, then the amounts thus paid will
be credited against the first dollars otherwise to be paid in Incentive Bonus in
subsequent years or credited against any first dollars that may be owed to
Employee by Xpedior, including payments owed in consequence of a termination of
this Agreement.
3.3 Benefits. Employee shall be entitled to participate in any plan
established by Xpedior to provide benefits to employees at the time Employee
meets the eligibility criteria established for each plan.
3.4 Equity Compensation. Subject to the approval of the Compensation
Committee and the terms of the Xpedior 1999 Stock Incentive Plan, Employee shall
be granted an option to purchase shares of Xpedior common stock at an exercise
price equal to the fair market value of such shares on the date of grant. Such
options will vest and become exercisable in equal monthly installments over the
thirty six month period following the commencement of Employee's employment with
Xpedior; provided, however, such option will immediately vest and become fully
exercisable if there is a change of control of Xpedior and, within one (1) year
of such change of control, Employee's employment is terminated by Xpedior
without Cause (as such term is hereinafter defined), or Employ resigns from his
position after there has been a Constructive Termination (as such term is
hereinafter defined) of Employee's employment with Xpedior. All of the terms
and conditions of the stock option will be set forth in a separate
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Nonstatutory Stock Option Agreement issued in conformity with the Xpedior 1999
Stock Incentive Plan to be executed and delivered by the parties as soon as
reasonably practicable following the commencement of Employee's employment with
Xpedior.
4. TERM AND TERMINATION OF EMPLOYMENT. Subject to earlier termination as
provided herein, Xpedior and Employee agree that the term of this Agreement
shall commence on the Effective Date and continue for two (2) years from the
Effective Date (the "Term"). Xpedior or Employee, as the case may be, shall
have the right to terminate employment under this Agreement at any time for any
of the following reasons:
(a) Termination For Cause. Prior to the end of the Term of this
Agreement, Xpedior, upon ten (10) days' prior written notice to Employee, may
discharge Employee for Cause and terminate this Agreement without any further
liability hereunder to Employee or his estate, other than the obligation to pay
to Employee his base salary accrued to the date of termination and accrued
vacation. For purposes of this Agreement, a discharge for "Cause" shall mean a
discharge resulting from a determination by the Board that Employee:
(i) has failed to diligently perform the material duties assigned
to Employee under this Agreement or to have abandoned Employee's assigned
job duties and not to have remedied the situation within a reasonable
period of time after receipt of written notice from Xpedior specifying the
failure;
(ii) has failed to abide by Xpedior's policies, rules, procedures
or directives and not to have remedied the situation within a reasonable
period of time after receipt of written notice specifying the failure;
(iii) has acted in a grossly negligent manner, or has engaged in
reckless or willful misconduct with respect to Xpedior which results or
could have resulted in material harm to Xpedior's standing among customers,
suppliers, employees and other business relationships;
(iv) has been found guilty by a court of law of fraud, dishonesty
and/or a felony crime, or any other crime involving moral turpitude;
(v) has engaged in employee misconduct, including but not limited
to, breach of fiduciary duty, theft, fraud, dishonesty, embezzlement,
violation of securities laws, violation of employment-related laws
(including but not limited to laws prohibiting discrimination in
employment), violation of non-competition, non-solicitation or
confidentiality obligations or this Agreement, falsification of employment
applications or other business records, insubordination, habitual
absenteeism or tardiness, or unethical activity or has failed to
immediately disclose a Conflict of Interest as defined in Section 7.
(vi) fails to agree to and execute any written amendment to any
part or all of Sections 6-13 of this Agreement, within thirty (30) days of
receipt of the Xpedior
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Companies' (as defined herein) written request, provided said requested
amendment revises said Sections to conform with applicable law, and
provided further, that said requested amendment does not expand the time or
geographic limits set forth herein.
In making any determination described above, the Board must act in good faith.
Notwithstanding the foregoing, Employee shall in no event be deemed to have been
discharged for Cause unless and until there shall have been delivered to
Employee a termination notice in the form of a copy of a resolution duly adopted
by the affirmative vote of not less than a majority of the entire membership of
the Board.
(b) Termination Without Cause; Constructive Termination. Prior to the
end of the Term of this Agreement, Xpedior, upon written notice to Employee, may
discharge Employee without Cause and terminate this Agreement, such termination
to be effective upon the date as specified in said notice. In the event Xpedior
terminates Employee without Cause or Employee is Constructively Terminated,
Xpedior shall pay Employee an amount equal to twelve times (12) Employee's then
current monthly base and bonus compensation (less legally required
withholdings), to be paid in substantially equal semi-monthly installments
rather than as one lump sum, in return for Employee executing a termination of
employment agreement which contains a full release of all claims against Xpedior
and its affiliates, predecessors, parents, subsidiaries, and their directors,
officers, employees, agents and attorneys. For purposes of this Agreement,
"Constructively Terminated" or "Constructive Termination" shall mean the
occurrence of any of the following events without Employee's express written
consent:
(i) A substantial and adverse change in the Employee's duties,
control, authority, status or position with Xpedior, or the assignment to
the Employee of any duties or responsibilities which are materially
inconsistent with such status or position, or a material reduction in the
duties and responsibilities previously exercised by the Employee, or a loss
of title, loss of office, loss of significant authority, power or control,
or any removal of him from or any failure to reappoint or reelect him to
such positions, except in connection with the termination of his employment
for Cause; or
(ii) Any reduction by Xpedior in Employee's Base Compensation
unless such reduction shall also apply to similarly situated executives of
Xpedior and does not exceed ten percent (10%) per year (unless otherwise
agreed to in writing by Employee).
(d) Resignation. Should Employee, at any time during the term of this
Agreement, desire to resign his employment, Employee shall submit notice of his
proposed resignation to the Board at least thirty (30) days prior to the
intended effective date thereof. This notice period may be waived by the Board
in its sole discretion. Except as otherwise expressly provided herein, Xpedior
will have no further obligation if Employee resigns other than to pay, subject
to applicable withholding requirements, compensation already earned by Employee
including any obligation under any applicable benefit plan and to make COBRA
coverage available. Employee understands that Employee will still be subject to
the Sections 6, 8, 9 and
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10 of this Agreement.
5. NOTICES. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing, and if sent, postage prepaid, by
certified or registered mail, return-receipt requested (a) to Employee at 000
Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxx, X0X 0X0, Xxxxxx, and (b) to Xpedior
Incorporated at Xxx Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000,
Attention: Chief Operating Officer, with a copy to Xpedior Incorporated at 00
Xxxxxxxxx Xxxxx, 0xx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx 00000, Attention: General
Counsel, or (c) to other such address as either party shall designate by written
notice to the other party.
6. CONFIDENTIAL INFORMATION. Employee acknowledges that in the course of
his employment by Xpedior, Xpedior will provide him with certain confidential
information and knowledge concerning the operations of Xpedior and Metamor
Worldwide, Inc. and their affiliates, subsidiaries, successors, and assigns
(hereinafter individually and collectively referred to as the "Xpedior
Companies") which the Xpedior Companies desire to protect. This confidential
information shall include, but not be limited to:
(i) terms and conditions of and the identity of the parties to the
Xpedior Companies' agreements with their clients and suppliers,
including but not limited to price information;
(ii) management systems, policies or procedures, including the
contents of related forms and manuals;
(iii) professional advice rendered or taken by the Xpedior Companies;
(iv) the Xpedior Companies' own financial data, business and
management information, strategies and plans and internal
practices and procedures, including but not limited to internal
financial records, statements and information, cost reports or
other financial information;
(v) proprietary software, systems and technology-related
methodologies of the Xpedior Companies and their clients;
(vi) salary, bonus and other personnel information relating to the
Xpedior Companies' personnel;
(vii) the Xpedior Companies' business and management development
plans, including but not limited to proposed or actual plans
regarding acquisitions (including the identity of any
acquisition contacts), divestitures, asset sales, and mergers;
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(viii) decisions and deliberations of the Xpedior Companies'
committees or boards;
(ix) litigation, disputes, or investigations to which the Xpedior
Companies may be party and legal advice provided to Employee
on behalf of the Xpedior Companies in the course of Employee's
employment; and
(ix) the particular information technology needs and concerns of
the Xpedior Companies' customers, clients and active
prospects.
Employee understands that such information is confidential, and he agrees not to
reveal such information to anyone outside the Xpedior Companies so long as the
confidential or secret nature of such information shall continue. Employee
further agrees that he will at no time use such information in competing with
the Xpedior Companies. At such time as Employee shall cease to be employed by
Xpedior, he will surrender to Xpedior all papers, documents, writings and other
property produced by him or coming into his possession by or through his
employment and relating to the information referred to in this paragraph, and
Employee agrees that all such materials will at all times remain the property of
the Xpedior Companies.
7. CONFLICTS OF INTEREST. Subject to the provisions of Section 2 above,
in keeping with Employee's fiduciary duties to the Xpedior Companies, Employee
agrees that he shall not, acting alone or in conjunction with others, directly
or indirectly, become involved in a conflict of interest, or upon discovery
thereof, allow such a conflict to continue. Moreover, Employee agrees that he
shall disclose to the Board any facts which might involve any reasonable
possibility of a conflict of interest.
It is agreed that a direct or indirect interest in, connection with, or
benefit from any outside activities, particularly commercial activities, which
interest might in any way adversely affect the Xpedior Companies involves a
possible conflict of interest. Circumstances in which a conflict of interest on
the part of Employee would or might arise, and which should be reported
immediately by Employee to the Board, include, but are not limited to the
following:
(i) Ownership of a material interest in any supplier, contractor,
subcontractor, or other entity with which the Xpedior Companies
do business;
(ii) Acting in any capacity including director, officer, partner,
consultant, employee, distributor, agent or the like, for
suppliers, contractors, subcontractors, or other entities with
which the Xpedior Companies do business;
(iii) Acceptance, directly or indirectly, of payments, services or
loans from a supplier, contractor, subcontractor, or other
entity with which the entity does business, including but not
limited to, gifts, trips, entertainment, or other favors, of
more than a nominal interest;
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(iv) Misuse of information or facilities of the Xpedior Companies to
which Employee has access in a manner which will be detrimental
to the Xpedior Companies' interest, such as, utilization for
Employee's own benefit of know-how or information developed
through the Xpedior Companies' business or research activities;
(v) Disclosure or other misuse of information of any kind obtained
through Employee's connection with the Xpedior Companies;
(vi) Acquiring or trading in, directly or indirectly, other
properties or interests connected with the services provided by
the Xpedior Companies;
(vii) The appropriation by Employee or diversion to others, directly
or indirectly, of any business opportunity in which it is known
or could reasonably be anticipated that the Xpedior Companies
would be interested; and
(viii) The ownership, directly or indirectly, of a material interest
in an enterprise in competition with the Xpedior Companies or
acting as a director, officer, partner, consultant, employee or
agent of any enterprise which is in competition with the
Xpedior Companies.
Nothing contained in this Agreement shall prohibit Employee from owing no
more than one percent (1%) of the publicly traded capital stock or possessing
greater than a one percent (1%) ownership interest in any company.
8. NON-COMPETITION AND NON-SOLICITATION COVENANTS. In return for the
consideration stated in this Agreement, including the promise of Xpedior to
provide Employee with confidential information, Employee agrees that, during
Employee's employment and for one (1) year after the termination of Employee's
employment for any reason (voluntarily or involuntarily), Employee shall not
directly or indirectly, on behalf of anyone other than the Xpedior Companies,
either alone or in conjunction with any other person or entity, (1) engage
anywhere in the world in an activity which could deemed to be a conflict of
interest under Section 7 of this Agreement, or (2) employ, solicit, induce, or
recruit for employment any person then employed by the Xpedior Companies or
employed by the Xpedior Companies at any time during the immediately preceding
one (1) year period.
Employee agrees that it is his intention that any restriction contained in
this section that is determined to be unenforceable be modified by any court
having jurisdiction to be reasonable and enforceable, and, as modified, to be
fully enforced.
9. SPECIFIC PERFORMANCE. Employee acknowledges that a remedy at law for
any breach or attempted breach of Sections 6, 7 and 8 of this Agreement will be
inadequate, agrees that the Xpedior Companies may be entitled to specific
performance and injunctive and other equitable relief in case of any such breach
or attempted breach, and further agrees to waive
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any requirement for the securing or purchasing of any bond in connection with
the obtaining of any such injunctive or any other equitable relief.
10. ARBITRATION. Any controversy or claim arising out of or relating to
this Agreement, the breach thereof, Employee's employment with Xpedior, or the
termination thereof, whether arising during or after the period of employment or
under statute, common law or otherwise, except for the injunctive relief
described in Section 9 of this Agreement, shall be settled by arbitration in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association (AAA), and judgment upon the award rendered by the arbitrator may be
entered in any court having jurisdiction thereof. The location of such
arbitration shall be Chicago, Illinois. To select an arbitrator, each party
shall strike a name from the list submitted by AAA with the grieving party
striking first. The arbitrator shall not have the power to add to or ignore any
of the terms and conditions of this Agreement. His decision shall not go beyond
what is necessary for the interpretation and application of this Agreement and
obligations of the parties under this Agreement. Cost of such arbitration, but
not attorney's fees, will be paid by the losing party.
11. BINDING EFFECT. This Agreement shall be binding upon all successors
and assigns of Xpedior. The obligations of Employee under this Agreement are
personal and may not be assigned.
12. GOVERNING LAW. This Agreement shall be construed in accordance with
and governed for all purposes by the laws of the State of Illinois.
13. SEVERABILITY. In case any term, phrase, clause, paragraph, section,
restriction, covenant or agreement contained in this Agreement shall be held to
be invalid or unenforceable, the same shall be deemed, and it is hereby agreed
that same is meant to be, severable, and such invalidity or unenforceability
shall not defeat or impair the remaining provisions hereof.
14. WAIVER OF BREACH. The waiver by either party hereto of a breach of
any provision of this Agreement by the other party shall not operate or be
construed as a waiver of any subsequent breach of such breaching party.
15. ENTIRE AGREEMENT; SURVIVAL. This Agreement supersedes, replaces and
merges all previous agreements and discussions relating to the same or similar
subject matters between Employee and Xpedior and constitutes the entire
Agreement between Employee and Xpedior with respect to the subject matter of
this Agreement. Employee acknowledges and agrees that he has not relied on any
representations not contained herein, which may have been made to Employee by
any representative of the Xpedior Companies, including but not limited to
representations about the Xpedior Companies or terms of employment.
Notwithstanding anything else contained in this Agreement, the provisions of
Sections 5-16 of this Agreement shall survive termination of this Agreement.
16. MODIFICATION. This Agreement may not be changed or terminated orally,
and
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no change, termination, or waiver of this Agreement or of any of the
provisions herein contained shall be binding unless made in writing and signed
by both parties, and in the case of Xpedior, by the Chief Operating Officer of
Xpedior.
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IN WITNESS WHEREOF, the parties hereto have affixed their signatures to
this Agreement on the dates stated below, this Agreement to be effective as of
the Effective Date.
XPEDIOR INCORPORATED
/s/ Xxxxxx XxXxxx /s/ J. Xxxxx Xxxxxx
____________________________ By: ________________________________
Xxxxxx XxXxxx J. Xxxxx Xxxxxx
Executive Vice President
and Chief Operating Officer
Date: April 10, 2000 Date: April 10, 2000
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