Exhibit 10.22
EMPLOYMENT AND NONCOMPETITION AGREEMENT
THIS AGREEMENT is entered into by and between National TechTeam, Inc.
(the "Company"), and Xxxxxxx X. Xxxxx, Xx. (the "Executive"), effective as of
August 9, 2001.
1. Employment Period. The Company hereby agrees to employ the
Executive, and the Executive hereby agrees to remain in the
employ of the Company subject to the terms and conditions of
this Agreement, for the period commencing on August 9, 2001 (the
"Commencement Date") and ending when terminated as provided
herein (the "Employment Period").
2. Terms of Employment.
a) Position and Duties.
(i) During the Employment Period, the Executive
shall serve as Company's President and Chief
Executive Officer. Executive shall report to the
Chairman of the Company's Board of Directors
(the "Board").
(ii) During the Employment Period, Executive agrees
to devote his full attention and time to the
business and affairs of the Company and to use
the Executive's best efforts to: (A) perform
such responsibilities in a professional manner,
(B) promote the interests of the Company and its
subsidiaries, (C) discharge the executive and
administrative duties, not inconsistent with his
position, as may be reasonably assigned to him
by the Board, and (D) serve, without additional
compensation, as a director of the Company.
(iii) At all time, Executive agrees that he has read
and will abide by, any employee handbook,
policy, or practice that the Company has or
adopts with respect to its employees generally,
except as modified by this Agreement.
b) Compensation.
(i) Base Salary. During the Employment Period, the
Executive shall receive an annual base salary
("Annual Base Salary") in the initial amount of
$275,000. The Annual Base Salary may be revised
from time to time. The Annual Base Salary shall
be paid in accordance with the Company's normal
payroll practices for senior executives subject
only to such payroll and withholding deductions
as are required by law.
(ii) Annual Incentive. As of each December 31 during
the Employment Period, the Executive shall be
eligible to receive an annual incentive bonus to
be determined by the Board.
(iii) Savings and Retirement Plans. During the
Employment Period, the Executive shall be
eligible to participate in all savings and
retirement plans, practices, policies and
programs to the extent applicable generally to
other executives of the Company in accordance
with the provisions of those plans.
(iv) Welfare and Other Benefits Plans. During the
Employment Period, the Executive and the
Executive's eligible family members shall be
entitled to participate in all benefit and
executive perquisites under welfare, fringe and
other similar benefit plans, practices, policies
and programs which may be provided by the
Company (including, without limitation, medical,
prescription, dental, disability, employee life,
group life, accidental death and travel accident
insurance plans and programs) to the extent
applicable generally to other executives of the
Company.
(v) Expenses. During the Employment Period, the
Executive shall be entitled to receive prompt
reimbursement for all reasonable business
expenses incurred and submitted by the Executive
in accordance with the policies of the Company,
including his reasonable legal costs associated
with obtaining this Agreement.
(vi) Special Bonus. If a majority of the Company's
stock is purchased or if the Company is acquired
through merger or otherwise prior to September
30, 2002, Company shall pay Executive a bonus,
to be paid at the time of the closing of a
transaction, the amount of which is determined
as follows:
*
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3. Termination of Employment.
The Executive's employment may be terminated upon the occurrence
of any event set forth below.
a) Death or Disability. The Executive's employment shall
terminate automatically upon the Executive's death
during the Employment Period.
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* Indicates that material has been omitted and confidential treatment has
been requested therefor. All such omitted material has been filed separately
with the SEC pursuant to Rule 24b-2.
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If the Company determines in good faith that the
Disability (as defined below) of the Executive has
occurred during the Employment Period, it may give to
the Executive written notice of its intention to
terminate the Executive's employment. In such event, the
Executive's employment with the Company shall terminate
effective on the thirtieth day after receipt of such
notice by the Executive. For purposes of this Agreement,
"Disability" shall mean the Executive's inability to
perform his normal duties for the Company for three
months or more during any twelve-month period.
b) Cause. Until September 30, 2002, the Company may
terminate the Executive's employment only for "Cause."
For purposes of this Agreement, "Cause" shall mean:
(i) any material breach of this Agreement by the
Executive, which breach is not remedied within
thirty (30) days after written notice thereof,
specifying the nature of such breach in
reasonable detail, is given by the Board to the
Executive,
(ii) Executive's conviction of a felony or other
crime involving moral turpitude,
(iii) any act or omission by the Executive during the
Employment Period involving willful malfeasance
or gross negligence in the performance of his
duties hereunder, and/or
(iv) Executive's failure to follow the reasonable
instructions given in good faith by the Board,
which failure is not remedied within thirty (30)
days after written notice thereof specifying the
details of such conduct is given by the Board to
the Executive.
(v) A material breach of this Agreement by the
Executive or the Executive's failure to follow
the reasonable instructions given in good faith
by the Board, the nature of which cannot be
remedied or cured.
(vi) Purchase of a majority of Company's stock or
acquisition of the Company through merger or
otherwise.
c) By Executive. After September 30, 2002, this Agreement
may be terminated by the Executive, upon sixty (60) days
prior notice to the Company. In such event, the
effective date of termination shall be the date set
forth in such notice.
d) Without Cause. After September 30, 2002, this Agreement
may be
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terminated by the Company, without Cause, upon sixty
(60) days prior notice to the Executive. In such event,
the effective date of termination shall be the date set
forth in such notice. If the Executive is terminated by
the Company without cause prior to September 30, 2002,
the Executive will be entitled to his pay and benefits
as set forth herein through September 30, 2002.
e) Notice of Termination. Any termination by the Company or
by the Executive shall be communicated by Notice of
Termination to the other party. A "Notice of
Termination" means a written notice which (i) indicates
the specific termination provision in this Agreement
relied upon, (ii) to the extent applicable, sets 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 and (iii) if
the Date of Termination is other than the date of
receipt of such notice, specifies the termination date.
f) Date of Termination. "Date of Termination" or
"Termination Date" means the effective date of
termination determined in accordance with the provisions
of this Paragraph 3.
4. Stock Options.
a) The Company hereby grants to Executive a vested
nonqualified stock option (the "Initial Stock Option")
pursuant to the Company's 1990 Non-qualified Stock
Option Plan to acquire up to 100,000 shares of the
Company's common stock at an exercise price of $2.75
per. share (this price is the fair market value of the
Company's Stock on the date the Executive signs this
Agreement. The Initial Stock Option shall expire on
August 9, 2004 ("Expiration Date") and no portion of the
Initial Stock Option shall be exercisable after the
Expiration Date.
b) *
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Should the Company be sold prior to September 30, 2002,
the Additional Stock Options will not vest at any time.
The Additional Stock Option shall expire on Expiration
Date and no portion of the Additional Stock Option shall
be exercisable after Expiration Date.
The Additional Stock Option shall become fully vested if
Company terminates Executive's employment without Cause.
----------------------------
* * Indicates that material has been omitted and confidential treatment
has been requested therefor. All such omitted material has been filed separately
with the SEC pursuant to Rule 24b-2.
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5. Confidential Information; Noncompetition.
a) The Executive shall hold in a fiduciary capacity for the
benefit of the Company all secret or confidential
information, knowledge or data relating to the Company
or any of its affiliated companies, and their respective
businesses, which shall have been obtained by the
Executive during the Executive's employment by the
company or any of its affiliated companies and which
shall not be or become public knowledge (other than by
acts by the Executive or representatives of the
Executive in violation of this Agreement). After
termination of the Executive's employment with the
Company, the Executive shall not, without the prior
written consent of the Company or as many otherwise be
required by law or legal process (provided the Company
has been given notice of and opportunity to challenge or
limit the scope of disclosure purportedly so required),
communicate or divulge any such information, knowledge
or data to anyone other than the Company and those
designated by it.
b) Executive agrees not to utilize his knowledge of the
business of the Company or his relationships with
investors, suppliers, customers, clients, or financial
institutions to compete with the Company in any business
the same as, or similar to, the business conducted by
the Company during the term of this Agreement. Executive
agrees that he will not:
1. Executive agrees not to work for,
consult with, provide any services to or
provide any information to any firm or
entity or person which competes with, or
is engages in, or carries on any aspect
of the Company's businesses services in
competition with the Company within a
two (2) year period following his
termination from the Company; and
2. Executive shall not directly or
indirectly, assist, promote or encourage
any employees or clients of the Company
to terminate or discontinue their
relationship with the Company for at
least a one (1) year period beginning on
the Date of Termination.
c) Executive acknowledges that his services hereunder are
of a special, unique, and intellectual character and his
position with the Company places him in a position of
confidence and trust with customers, suppliers, and
employees of the Company. The Executive further
acknowledges that to perform his position, he will
necessarily be given access to confidential information
of the Company. Executive will continue to develop
personal relationships with the Company's customers,
financiers, suppliers, and employees. The parties
expressly agree that these provisions are reasonable,
enforceable, and necessary to protect the Company's
interests. In the unlikely event, however, that a court
of competent jurisdiction were
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to determine that any portion of such provisions is
unenforceable, then the parties agree that the remainder
of the provisions shall remain valid and enforceable to
the maximum extent possible.
d) The Executive agrees that it would be difficult to
measure damages to the Company from any breach of the
covenants contained in this Paragraph 5, but that such
damages from any such breach would be great,
incalculable and irremediable, and that money damages
would be an inadequate remedy. Accordingly, the
Executive agrees that the Company may have specific
performance of these provisions in any court of
competent jurisdiction. The parties agree, however, that
the specific performance remedies described above shall
not be the exclusive remedies, and the Company may
enforce any other remedy or remedies available to it
either in law or in equity including, but not limited
to, temporary, preliminary, and/or permanent injunctive
relief.
6. Successors.
a) This Agreement is personal to the Executive and shall
not be assignable by the Executive.
b) This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and assigns.
7. Change of Control. Company agrees to fully include Executive in
its Change of Control program, wherein Executive will qualify
for one year of continued compensation and benefits upon the
occurrence of a Change in Control of the Company. In no event
will Executive's wage compensation as a result a transaction
involving the Company, exceed one year's annual salary.
8. Previous Agreement. The parties agree that the provisions of a
Consulting Agreement between them are terminated.
9. Miscellaneous.
a) This Agreement shall be governed by and construed in
accordance with the laws of Michigan, without reference
to principles of conflict of laws. The captions of this
Agreement are not part of the provisions hereof and
shall have no force or effect. This Agreement may not be
amended or modified except by a written agreement
executed by the parties hereto or their respective
successors and legal representatives.
b) All notices and other communications hereunder shall be
in writing and shall be deemed to be received when (i)
hand delivered (with written confirmation of receipt),
(ii) when received by the addressee, if sent by
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nationally recognized overnight delivery service
(receipt requested) in each case to such address as a
party may designate by notice to the other party.
c) The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement.
d) This Employment Agreement may be executed through the
use of separate signature pages or in any number of
counterpart copies, and each of such counterparts shall,
for all purposes, constitute one agreement binding on
all the parties.
e) The provisions of this Agreement contain all of the
terms and conditions agreed upon by the parties relating
to the subject matter of this Agreement and shall
supersede all prior agreement, negotiations,
correspondence, undertakings and communications of the
parties, either oral or written, with respect to such
subject matter.
IN WITNESS WHEREOF, the Executive has executed this Agreement and,
subject to the authorization of its Board of Directors, the Company has caused
this Agreement to be executed in its name on its behalf, as of the Commencement
Date.
Date:
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Xxxxxxx X. Xxxxx, Xx.
"Executive"
Date: NATIONAL TECHTEAM, INC.
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By:
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Xxxxxxx X. Xxxxx, Chairman of
Board of Directors
"Company"
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