Exhibit 10.39
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT is made and entered into as of November
20,1998, between PolyVision Corporation, a New York corporation (the
"Company"), and Xxxxxxx X. Still (the "Executive").
W I T N E S S E T H :
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WHEREAS, pursuant to a Stock Purchase Agreement, dated as of September
1, 1998, as amended (the "Purchase Agreement"), by and among the Company,
Alliance International Group, Inc. (formerly known as AIG Holdings, Inc.)
("AIG") and the stockholders of AIG (including the Executive) (the "Sellers"),
the Company has agreed to purchase, and the Sellers have agreed to sell, all of
the outstanding capital stock of AIG (the "Acquisition");
WHEREAS, the Executive has been employed by AIG and is presently
serving as the Senior Vice President and Chief Financial Officer of AIG;
WHEREAS, the Company recognizes that the Executive possesses an
intimate knowledge of the business and affairs of AIG and, in connection with
the Acquisition, the Company wishes to be assured that it will have the
continued benefit of the services and advice of the Executive and the
Executive's agreement to maintain the confidentiality of certain information and
not to compete with the Company as set forth herein; and
WHEREAS, the Executive is willing to be employed by the Company and,
coincident with and/or following that employment, is also willing to maintain
information as confidential and to agree not to compete on the terms and
conditions set forth herein.
NOW THEREFORE, in consideration of the premises and the respective
covenants and agreements of the parties herein contained, and intending to be
legally bound hereby, but subject to the closing of the Acquisition under the
Purchase Agreement, the parties hereto agree as follows:
1. EMPLOYMENT. The Company hereby agrees to employ the Executive, and
the Executive hereby agrees to serve the Company, on the terms and conditions
set forth herein.
2. TERM. The Company shall employ the Executive, and the Executive
shall serve the Company during an initial two-year period (including any
extension thereof, the "Term") commencing on the day immediately following the
Closing Date (as such term is defined in the Purchase Agreement) (the
"Commencement Date").
3. POSITION AND DUTIES. The Executive shall serve as the Chief
Financial Officer of the Company with such responsibilities, duties and
authority as are customary for such a position and office and as may from time
to time be assigned to the Executive by the Company's Board of Directors (the
"Board") and/or its President and/or Chief Executive Officer. In the ordinary
course of his duties, the Executive shall report to the Company's Chief
Executive Officer with
respect to long-range financial and budgetary matters and to the Company's Chief
Operating Officer with respect to day-to-day financial and budgetary matters.
The Executive shall devote all of his working time and efforts to the business
and affairs of the Company, provided that the Executive may be involved in
charitable and trade association activities and make passive investments that do
not materially detract from the discharge of his responsibilities hereunder,
PROVIDED, HOWEVER, that any such passive investments shall not be in companies
that are competitors of the Company.
4. COMPENSATION AND RELATED MATTERS.
(a) SALARY. During the term of the Executive's employment hereunder,
the Company shall pay to the Executive an annual base salary of $175,000 (the
"Base Salary"), such salary to be paid in substantially equal periodic
installments in accordance with the normal payroll practice of the Company. The
Base Salary for any partial year will be prorated based upon the number of days
elapsed in such year.
(b) DISCRETIONARY BONUS. The Executive will be eligible to receive
an annual bonus within 90 days after the end of each fiscal year of the Company
equal to up to 35% of the Base Salary, with the actual amount of such annual
bonus to be determined by the Board, and with such determination to be based
upon the Company's and the Executive's achievement of budgetary and other
objectives, as set by the Board and the Chief Executive Officer, and upon their
discretionary evaluation of the Executive's performance.
(c) EXPENSES. During the term of the Executive's employment
hereunder, the Executive shall be entitled to receive prompt reimbursement for
all reasonable and customary expenses incurred by the Executive in performing
services hereunder, including, but not limited to, all expenses of travel and
associated living expenses while away from home when such travel is at the
request and in the service of the Company.
(d) CAR ALLOWANCE. During the term of the Executive's employment
hereunder, the Executive will be eligible to receive a monthly car allowance
equal to a net after-tax amount of $800 per month.
(e) STOCK OPTIONS.
(i) The Executive shall be entitled to receive stock options
(the "Stock Options") to purchase 150,000 shares of Common Stock, par value
$.001 per share, of the Company at an exercise price equal to $1.50 per share,
vesting in four equal installments of 37,500 shares on the first, second, third
and fourth annual anniversaries of the Commencement Date, and pursuant to a
customary stock option agreement, which the Executive and the Company shall
enter into by no later than the first annual anniversary of the Commencement
Date.
(ii) In the event of termination of employment (A) by the
Executive without Good Reason (as defined in Section 6(d)) on or prior to the
third annual anniversary of the Commencement Date or (B) pursuant to Section
6(c), all Stock Options not theretofore exercisable
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will lapse and be forfeited. In the event the Executive's employment is
terminated for any other reason on or prior to the third annual anniversary of
the Commencement Date, all Stock Options not theretofore exercisable will
thereupon become exercisable. Except as otherwise provided in the following
paragraph, each Stock Option will expire ten years after it is granted.
(iii) In the event of the termination of the employment of the
Executive, all unexercised and exercisable stock options granted to him
hereunder must be exercised by him, or his estate (or heir(s)), as the case may
be, (A) within 12 months of the Date of Termination, as defined in Section 6(g),
if the termination is due to Disability, as defined in Section 6(b), (B) in the
event of death of the Executive, within 12 months of the Date of Termination, as
defined in Section 6(g), if the termination is due to death OR within three
months of the date of death if the termination was pursuant to Disability, or
(C) within three months of the Date of Termination if the termination is for any
other reason, PROVIDED, HOWEVER, that in the event the Executive's employment is
terminated with Cause, all unexercised and exercisable stock options granted to
him hereunder become null and void immediately upon termination.
(f) OTHER BENEFITS. The Executive shall be entitled to participate
in all of the fringe benefit plans and arrangements of the Company (including,
without limitation, the Company's group life insurance and accident plan,
medical and dental insurance plan, and disability plan) as are provided from
time to time to other senior executives of the Company.
(g) ANNUAL PHYSICAL EXAMINATION. During the term of this Agreement,
the Company shall reimburse the Executive for the reasonable expenses incurred
by the Executive in undergoing an annual physical examination by a licensed
physician.
5. ADDITIONAL OFFICES. Subject to Section 3, the Executive agrees to
serve without additional compensation, if elected or appointed thereto, as a
director of any of of the Company's subsidiaries and in one or more executive
offices of any of the Company's subsidiaries, provided that the Executive shall
receive indemnification from any such subsidiaries (to the same extent as
indemnified by the Company) for serving in any and all such capacities.
6. TERMINATION. The Executive's employment hereunder may be terminated
without any breach of this Agreement only under the following circumstances:
(a) DEATH. The Executive's employment hereunder shall terminate upon
his death.
(b) DISABILITY. The Company may terminate the Executive's employment
hereunder if, as a result of the Executive's incapacity due to physical or
mental illness ("Disability"), the Executive shall have been absent from his
duties hereunder on a full-time basis for 180 days during any eight-month
period.
(c) CAUSE. The Company may terminate the Executive's employment
hereunder for "Cause." For purposes of this Agreement, the Company shall have
"Cause" to terminate the Executive's employment hereunder upon (i) the willful
and continued failure by the
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Executive to substantially perform his duties hereunder (other than any such
failure resulting from the Executive's Disability) after written notice is
delivered by the Company that specifically identifies the manner in which the
Company believes the Executive has not substantially performed his duties, which
failure is not cured within 30 days after such written notice, or (ii) the
willful engagement by the Executive in misconduct which is materially injurious
to the Company, monetarily or otherwise (including, but not limited to, conduct
that constitutes competitive activity pursuant to Section 8 hereof). For
purposes of this paragraph, an act, or failure to act, on the Executive's part
shall not be considered "willful" if done, or omitted to be done, by him in good
faith and with reasonable belief that his action or omission was in the best
interests of the Company.
(d) TERMINATION BY THE EXECUTIVE FOR GOOD REASON. The Executive may
terminate his employment hereunder for "Good Reason." For purposes of this
Agreement, "Good Reason" shall mean a failure by the Company to comply with any
material provision of this Agreement which has not been cured within 30 days
after notice of such noncompliance has been given by the Executive to the
Company.
(e) TERMINATION ELECTION.
(i) A notice to Executive by the Company will constitute an
election by the Company to terminate the Executive's employment (A) 30 days
following the date of delivery of the notice if the termination is without Cause
and (B) upon the date of delivery of the notice if the termination is with
Cause.
(ii) A notice to the Company by the Executive will constitute an
election by the Executive to terminate the Executive's employment 60 days
following the date of delivery of the notice.
(f) NOTICE OF TERMINATION. Any termination of the Executive's
employment by the Company or by the Executive (other than termination pursuant
to Section 6(a) hereof) shall be communicated by written notice to the other
party hereto, in accordance with Section 10 hereof, which shall indicate, the
specific termination provision in this Agreement relied upon and, in the case of
termination pursuant to Sections 6(b), (c) or (d), shall set forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provision so indicated (the "Notice of
Termination").
(g) DATE OF TERMINATION. "Date of Termination" shall mean (i) if the
Executive's employment is terminated by his death, the date of the Executive's
death, (ii) if the Executive's employment is terminated pursuant to Section 6(b)
above, 30 days after Notice of Termination is given (provided that the Executive
shall not have returned to the performance of his duties on a full-time basis
during such 30 day period and provided further that such Date of Termination
shall not be as of a date earlier than the last day of the consecutive
eight-month period described in Section 6(b) above), (iii) if the Executive's
employment is terminated by either of the elections pursuant to Section 6(e)
above, the applicable date of termination determined
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under Section 6(e) above, and (iv) if the Executive's employment is terminated
for any other reason, the date on which a Notice of Termination is given.
7. COMPENSATION UPON TERMINATION OR DURING DISABILITY.
(a) During any period that the Executive fails to perform his duties
hereunder and such failure is the result of Disability, the Executive shall
continue to receive, or receive the benefit of (as the case may be), all items
described in Section 4 hereof at the rate then in effect for such period until
his employment is terminated pursuant to Section 6(b) hereof, provided that
payments so made to the Executive during the first 180 days of the disability
period shall be reduced by the sum of the amounts, if any, payable to the
Executive at or prior to the time of any such payment, under disability benefit
plans of the Company or under the Social Security disability insurance program,
where such amounts were not previously applied to reduce any such payment.
(b) In the event of a termination due to Disability, the Company
shall maintain in full force and effect, for the remainder of the month
following the Date of Termination, all employee welfare benefit plans and
programs in which the Executive was entitled to participate in immediately prior
to the Date of Termination provided that the Executive's continued participation
is possible under the general terms and provisions of such plans and programs.
(c) If the Executive's employment is terminated as a result of his
death, for the remainder of the month after the date of his death, the Company
shall pay to the Executive's estate any amounts due to, or for the benefit of
the Executive, or which would otherwise have been paid to the Executive under
Section 4 hereof.
(d) If the Executive's employment is terminated by the Company for
Cause, or the Executive's employment is terminated by the Executive without Good
Reason, the Company shall pay all amounts under Section 4 hereof, due to, or for
the benefit of, the Executive through the Date of Termination at the rate in
effect at the time Notice of Termination was given, PROVIDED, HOWEVER, that such
amounts shall not include any dicretionary bonus pursuant to Section 4(b), and
the Company shall have no further obligations to the Executive under this
Agreement.
(e) If the Executive's employment is terminated without Cause by the
Company or if the Executive terminates his employment for Good Reason, the
Company will pay the Executive (i) an amount equal to 100% of the balance of the
Base Salary in such increments and such manner as the Executive's salary was
paid prior to termination (at the Executive's then current compensation level on
the Date of Termination pursuant to Section 4(a)) as would have been payable to
the Executive if he had remained employed with the Company for the complete Term
(or if the Date of Termination under this paragraph is within the last three
months of the initial Term, the Executive's salary shall continue for three
months after such Date of Termination) and (ii) if the Date of Termination is
more than six months into the fiscal year of the Company, any discretionary
bonus that the Executive may be elligible to receive pursuant to Section 4(b)
with respect to such fiscal year prorated in accordance with the Date of
Termination; and the
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Executive and the Company shall thereupon each be released from all further
obligations to each other.
(f) If this Agreement is not extended or renewed after the initial
two-year Term, the Company shall pay to the Executive as severance an amount
equal to three times the monthly base salary in effect immediately prior to the
end of such initial Term.
(g) The Company's obligation to make the payments and provide the
benefits described in this Section 7 shall cease if the Executive is in
violation of the provisions of Section 8 hereof.
8. NONDISCLOSURE; NONSOLICITATION; NONCOMPETITION.
(a) The Executive agrees that he will not, either directly or
indirectly, use or divulge to any person, firm, corporation, partnership or
other legal entity, either during the term of this Agreement or thereafter, or
make known to any person, firm, corporation, partnership or other legal entity,
any Confidential Information (as hereinafter defined) of the Company. The
Executive shall keep secret and confidential all matters entrusted to the
Executive and shall not use or attempt to use any such Confidential Information
in any manner which may injure or cause loss or may be calculated to injure or
cause loss, whether directly or indirectly, to the Company. For purposes of this
Agreement, "Confidential Information" shall mean and include, without
limitation, any patents, patent applications, copyrights, trademarks, trade
names, service marks, service names, "know-how," trade secrets, technology,
custom computer hardware or software, customer or client lists, details of
client contracts, pricing policies, operational methods, marketing plans or
strategies, product development techniques or plans, procurement and sales
activities, promotion and pricing techniques, credit and financial data
concerning customers or suppliers, business acquisition plans or any portion or
phase of any scientific or technical information, ideas, discoveries, designs,
computer programs, processes, procedures, formulas or improvements of the
Company, whether or not in written or tangible form, and whether or not
registered, and including all memoranda, notes, plans, reports, records,
documents and other evidence thereof. The term "Confidential Information," as
used herein, does not include information which is or becomes generally
available to the public other than as a result of disclosure by the Executive or
others acting on his behalf or which is generally known in the information
display technology business.
(b) The Executive further agrees that he will not solicit, interfere
with or endeavor to entice away from the Company any customer or employee of the
Company for the Term of this Agreement and for a period of one year following
the expiration of this Agreement or the Date of Termination.
(c) The Executive agrees he will not within the United States of
America or the European Union, directly or indirectly, engage in any business or
own or control any interest in, or act as a shareholder, director, officer,
partner, trustee, employee, independent contractor, consultant or other agent of
any person, firm, corporation, partnership or other legal entity, directly or
indirectly engaged in the business conducted by the Company for the Term of this
Agreement and for a period of one year following the expiration of this
Agreement or the date of
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Termination. The Executive acknowledges that the business of the Company extends
beyond the geographic area of the State of New York (and is intended to extend
nationally and internationally) and that, accordingly, it is reasonable that the
restrictive covenants set forth above are not limited by specific geographic
areas but throughout the United States of America and the European Union.
(d) The Executive acknowledges that the foregoing provisions are an
essential part of the transactions contemplated by the Purchase Agreement, and
the Executive agrees to be bound by the provisions hereof to the maximum extent
permitted by law, it being the intent and spirit of the parties that the
foregoing shall be enforceable. If any court of competent jurisdiction should
determine that the duration, reach and/or scope (geographic or otherwise) of the
agreements contained herein are unreasonable, then to the fullest extent
permitted by law, the court may prescribe a reasonable duration, reach and/or
scope (geographic or otherwise).
9. SUCCESSORS; BINDING AGREEMENT.
(a) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company, by agreement in
form and substance satisfactory to the Executive, to expressly assume and agree
to perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken place.
Failure of the Company to obtain such assumption and agreement prior to the
effectiveness of any such succession shall be a breach of the Agreement and
shall entitle the Executive to compensation from the Company in the same amount
and on the same terms as he would be entitled to hereunder if he terminated his
employment for Good Reason, except that for purposes of implementing the
foregoing, the date on which any such succession becomes effective shall be
deemed the Date of Termination. As used in the Agreement, "Company" shall mean
the Company as previously defined and any successor to its business and/or
assets or which otherwise becomes bound by this Agreement by operation of law.
(b) This Agreement and all rights of the Executive hereunder shall
inure to the benefit of, and be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Executive should die at a time when amounts would
be payable to him hereunder if he were then alive, all such amounts, unless
otherwise provided for herein, shall be paid in accordance with the terms of
this Agreement, to the Executive's estate.
10. NOTICES. For the purposes of this Agreement, notices, demands and
all other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given when delivered or (unless otherwise
specified) mailed by United States certified or registered mail, return receipt
requested, postage prepaid, addressed as follows:
If to the Executive: Xx. Xxxxxxx X. Still
0000 Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
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If to the Company: PolyVision Corporation
00-00 00xx Xxxxxx
Xxxx Xxxxxx Xxxx, Xxx Xxxx 00000
Attn: Chief Executive Officer
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
11. MISCELLANEOUS. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive and such officer of the Company as may be
specifically designated by the Board. No waiver by either party hereto at any
time of any breach by the other party of any condition or provision of this
Agreement shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not set forth
expressly in this Agreement. The validity, interpretation, construction and
performance of this Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without regard to its conflicts of law
principles.
12. RELOCATION. The Company does not currently expect that the
Executive will be required to relocate his residence from the Atlanta, Georgia
vicinity while serving as an executive officer of the Company. In the event the
Board does require the Executive to relocate his residence from the Atlanta,
Georgia vicinity, and the Executive is unwilling to do so at such time, the
Executive shall be entitled to terminate his employment hereunder and such
termination shall be considered to be for Good Reason.
13. VALIDITY. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which other provisions shall remain in
full force and effect.
14. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
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15. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement of
the parties hereto in respect of the subject matter hereof and supersedes all
prior agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written. The Executive confirms
that the Senior Managment Agreement, dated December 29, 1997, between the
Executive and AIG is terminated as of the date hereof, with no further liability
or obligation on the part of the Company, AIG or any of their respective
affiliates.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
POLYVISION CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Chief Executive Officer
/s/ Xxxxxxx X. Still
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Xxxxxxx X. Still
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