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EXHIBIT 10.17
January 7, 2000
Mr. Mark Perlberg
310 Green Park Court
Atlanta, Georgia 30327
Re: Employment Offer
Dear Mark:
I am pleased to extend this offer of full time employment with The Profit
Recovery Group International I, Inc. ("PRG") as President-World Wide Accounts
Payable Operations conditioned upon your signing the attached Employee
Agreement. We are very excited about your joining our organization and the
opportunities for our mutual success.
Enclosed is our new hire package, which includes the forms to be completed and
returned to my attention at the Atlanta office.
The following confirms our offer:
1. Base Salary. Base salary paid at the rate of $300,000.00 per annum,
paid $11,538.46 every two weeks and pro-rated for partial years. The
term "Adjusted Base Salary" means and refers to the sum of your Base
Salary and Twenty-Five Thousand and No/100 ($25,000.00) Dollars (such
Twenty-Five Thousand and No/100 ($25,000.00) Dollars, together with
accrued interest as hereinafter provided, is referred to as the "Salary
Deferred Compensation Credit"). Your Salary Deferred Compensation
Credit will not be paid to you but such amount will instead be deferred
and credited to your Account (as defined in the attached Deferred
Compensation Schedule). You will commence employment with PRG on
February 9, 2000.
2. Performance Bonus. While you remain employed by PRG you will be
eligible for annual bonuses, which will include annual payout
potentials of 15% of your base salary for achievement of your threshold
performance goals, 33% of your base salary for achievement of target
performance goals, or 50% of your base salary for achievement of your
stretch performance goals. These goals will be role-specific
performance objectives to be mutually agreed upon by you and your
Manager. The first period for measurement of bonus attainment will be
for the period beginning
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Mr. Mark Perlberg
January 7, 2000
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January 1, 2000 through December 31, 2000. The measurement periods will
be calendar quarter or calendar year or a combination of both. For
2000, your bonus will be no less than 33% of your actual base salary
paid to you in 2000. Your bonus will be pro-rated for partial years
based on the number of days you were employed by PRG during such year.
3. Car Allowance. You will be eligible for a car allowance paid at the
rate of $12,000.00 per annum, paid $1,000 monthly during your
employment and pro-rated for partial periods.
4. Options. You will be granted options to purchase 100,000 shares of
Common Stock in The Profit Recovery Group International, Inc. ("PRGX").
This grant will be made pursuant to the terms of your option agreement,
the form of which has been delivered to you.
5. Employee Benefits. You will be eligible for participation in PRG's
Employee Benefits Plan, which currently offers medical, dental, life,
short term and long term disability insurance, flexible spending
accounts, 401(k) Savings Plan and Employee Stock Purchase Program. The
effective dates for your coverage and participation in these plans will
be communicated to you under separate cover.
6. Reimbursement of Expenses. PRG will pay your reasonable travel and
business expenses (including air travel at business class rate),
subject to you submitting receipts in accordance with PRG's normal
practices and procedures.
7. Deferred Compensation. You will participate in PRG's Deferred
Compensation Program pursuant to the terms set forth in the attached
Deferred Compensation Schedule.
8. Termination.
(a) This Agreement may be terminated by PRG for "cause" upon
delivery to you of notice of termination. As used herein,
"cause" shall mean (i) fraud, dishonesty, gross negligence,
willful misconduct, commission of a felony or an act of moral
turpitude, or (ii) engaging in activities prohibited by
Sections 3, 4, 5, 6 or 7 of the attached Employee Agreement,
or any other material breach of this Agreement.
(b) You may, without cause, terminate this Agreement by giving PRG
thirty (30) days' written notice in the manner specified in
Section 11 hereof and such termination will be effective on
the thirtieth (30th) day following the date of such notice or
such earlier date as PRG specifies. PRG may, without cause,
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January 7, 2000
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terminate this Agreement by giving to you thirty (30) days'
written notice in the manner specified in Section 11 hereof
and such termination will be effective on the thirtieth (30th)
day following the date of such notice. At PRG's option, you
will cease performing your duties as an employee on such
earlier date as PRG may specify in notice of termination.
(c) In the event of your Disability, physical or mental, PRG will
have the right, subject to all applicable laws, including
without limitation, the Americans with Disabilities Act
("ADA"), to terminate your employment immediately. For
purposes of this Agreement, the term "Disability" shall mean
your inability or expected inability (or a combination of
both) to perform the services required of you hereunder due to
illness, accident or any other physical or mental incapacity
for an aggregate of ninety (90) days within any period of one
hundred eighty (180) consecutive days during which this
Agreement is in effect, as agreed by the parties or as
determined pursuant to the next sentence. If there is a
dispute between you and PRG as to whether a Disability exists,
then such issue shall be decided by a medical doctor selected
by PRG and a medical doctor selected by you and your legal
representative (or, in the event that such doctors fail to
agree, then in the majority opinion of such doctors and a
third medical doctor chosen by such doctors). Each party shall
pay all costs associated with engaging the medical doctor
selected by such party and the parties shall each pay one-half
(1/2) of the costs associated with engaging any third medical
doctor.
(d) This Agreement may be terminated by you for "Good Reason" upon
thirty (30) days prior written notice of termination served
personally in accordance with Section 11 hereof, such "Good
Reason" being specified in the notice; provided that at the
time of such notice to PRG, there is no basis for termination
by PRG of your employment for cause. For purposes of this
Agreement, "Good Reason" means any one of the following: (i)
the assignment to you of duties or a position or title
inconsistent with or lower than the duties, position or title
provided in this Agreement; (ii) the principal place where you
are required to perform a substantial portion of your
employment duties hereunder is outside of the metropolitan
Atlanta, Georgia area; or (iii) the reduction of your Base
Salary, potential Bonus or annual automobile allowance below
amounts set forth herein; provided however you shall have no
right to terminate pursuant to this Section if PRG's Board of
Directors or the Compensation Committee of the Board (the
"Committee") has duly authorized and directed a general
compensation decrease for all executive employees of PRG and
the reduction of the sum of your Base Salary, potential Bonus
and automobile allowance hereunder is similarly reduced in
respect of other executives. Notwithstanding the foregoing, a
termination shall not be treated as a termination for "Good
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Mr. Mark Perlberg
January 7, 2000
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Reason" (A) if you have consented in writing to the occurrence
of the event giving rise to the claim of termination for Good
Reason or (B) unless you have delivered a written notice to
PRG stating that you intend to terminate your employment for
Good Reason and specifying the factual basis for such
termination, and such event shall not have been cured by PRG
within thirty (30) days of receipt of such notice.
(e) In the event this Agreement is terminated, all provisions in
this Agreement or the Employee Agreement relating to any
actions, including those of payment or compliance with
covenants, subsequent to termination shall survive such
termination.
9. Severance Payments.
(a) If your employment with PRG is terminated for cause or if you
voluntarily resign other than (i) for Good Reason (as defined
below) or (ii) due to Retirement (as defined below), you will
receive your base salary prorated through the date of
termination, payable in accordance with PRG's normal payroll
procedure, and you will not receive any bonus or any other
amount in respect of the year in which termination occurs or
in respect of any subsequent years.
(b) If your employment with PRG is terminated by PRG without cause
or by you for Good Reason, you will receive your base salary
and bonus for the year in which such termination occurs
prorated through the date of such termination, plus a
severance payment equal to twelve (12) months of base salary,
bonus at target level and car allowance. Except as provided in
the immediately preceding sentence, you will not receive any
other amount in respect of the year in which termination
occurs or in respect of any subsequent years. The prorated
base salary will be paid in accordance with PRG's normal
payroll procedure and the prorated bonus will be paid in a
lump sum within ninety (90) days after the end of the year to
which it relates, and the severance payment will be paid in
twelve (12) equal monthly installments commencing on the last
day of the first month following termination.
(c) If your employment with PRG is terminated by your death or
Retirement, you (or your legal representative in the case of
death) will receive base salary and bonus for the year in
which such termination occurs prorated through the date of
such termination and will not receive any other amount in
respect of the year in which termination occurs or in respect
of any subsequent years. The prorated base salary will be in
accordance with PRG's normal payroll
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Mr. Mark Perlberg
January 7, 2000
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procedure and the prorated bonus will be paid in a lump sum
within ninety (90) days after the end of the year to which it
relates.
(d) If your employment with PRG is terminated for Disability (as
defined below), you or your legal representative will receive
(i) all unpaid base salary and bonus for the year in which
such termination occurs prorated through the date of
termination with such prorated base salary payable in
accordance with PRG's normal payroll procedure and the
prorated bonus payable in a lump sum within ninety (90) days
after the end of the year to which it relates, and (ii) base
salary for a period of ninety (90) days following termination
of employment due to Disability at the rates in effect upon
the date of such termination payable in accordance with PRG's
normal payroll procedure, reduced (but not below zero) by the
sum of (x) all amounts paid by PRG to you as base salary prior
to termination of employment for the times that you were
unable to perform the services required of you under this
Agreement due to illness, accident or any other physical or
mental incapacity which resulted in your Disability and (y)
all amounts that you are eligible to receive under any of
PRG's standard short-term group disability insurance coverage
provided to you as a result of such illness, accident or any
other physical or mental incapacity. To the extent that PRG
has not reduced its payments to you to reflect such amount
that you are eligible to receive under such short-term group
disability coverage, you will immediately remit to PRG such
amount upon your receipt thereof. You will not receive any
other amount in respect of the year in which termination
occurs or in respect of any subsequent years. In lieu of
terminating your employment, PRG may elect to put you on
unpaid leave of absence for a period determined in PRG's sole
discretion, but in no event to exceed one year. If put on
unpaid leave of absence, you will be entitled to the same
compensation to which you are entitled if you are terminated
as set forth above and shall not be entitled to any further
compensation except that you will continue to maintain your
eligibility in all PRG benefit plans (but only to the extent
such continued eligibility is not prohibited pursuant to the
terms of any such plan) provided that PRG will have no
responsibility to pay any premiums or other amounts on your
behalf with respect to any such plans. Notwithstanding
anything contained herein to the contrary, if PRG elects to
place you on unpaid leave of absence in lieu of terminating
you, (i) PRG will be entitled to subsequently terminate your
employment with PRG on the expiration of such leave of absence
without any further monetary obligations to you and (ii) PRG
will have no obligation to reinstate you to active status
unless PRG determines in its sole discretion that such
reinstatement is in the best interests of both PRG and you.
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Mr. Mark Perlberg
January 7, 2000
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(e) If your employment is terminated for any reason, you will be
paid within sixty (60) days of termination for the value of
all unused vacation time which accrued during the calendar
year in which such termination occurs up to the date of
termination in accordance with the Company's policies.
(f) If you fail to observe or perform any of your duties and
obligations under Sections 3, 4, 5, 6 or 7 of the attached
Employee Agreement, you will forfeit any right to severance or
other termination payments of any amounts other than base
salary prorated through the date of termination and upon PRG's
demand for same, you shall repay PRG any severance or other
termination payments paid to you after the date of termination
of your employment with PRG (other than such base salary).
10. Successors and Assigns. You may not assign this Agreement. This
Agreement may be assigned by PRG to any affiliate of PRG. The
provisions of this Agreement will be binding upon your heirs and legal
representatives.
11. Notices. Any notice to be given under this Agreement shall be given in
writing and may be effected by personal delivery or by placing such in
the United States certified mail, return receipt requested and
addressed as set forth below, or as otherwise addressed as specified by
the parties by notice given in like manner:
If to PRG: The Profit Recovery Group International I, Inc.
2300 Windy Ridge Parkway
Suite 100 North
Atlanta, Georgia 30339-8426
Attention: President
If to you: 310 Green Park Court
Atlanta, Georgia 30327
12. Withholdings. PRG will deduct or withhold from all amounts payable to
you pursuant to this Agreement such amount(s) as may be required
pursuant to applicable federal, state or local laws.
13. Entire Agreement. This Agreement, the Employee Agreement and such other
documents as may be referenced by such documents (the "Referenced
Documents"), constitute our entire agreement with respect to the
subject matter hereof and, except as specifically provided herein or in
the Employee Agreement and the Referenced Documents, supersedes all of
our prior discussions, understandings and agreements. Any such prior
agreements shall be null and void. This Agreement may not be changed
orally, but only by an agreement in writing signed by the party against
whom
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Mr. Mark Perlberg
January 7, 2000
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enforcement of any waiver, change, modification, extension or discharge
is sought. Time is of the essence of this Agreement and each and every
Section and subsection hereof.
Please confirm your acceptance of this offer by signing and returning both this
letter and the Employee Agreement to me at your earliest convenience but in any
event on or before December 15, 1999.
Best wishes,
/s/ MARIE A. NEFF
Marie A. Neff,
Senior Vice President, Human Resources
Accepted and agreed:
/s/ MARK PERLBERG
- ------------------------------------
Mark Perlberg
Date: January 24, 2000
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DEFERRED COMPENSATION SCHEDULE
(a) Annual Deferred Compensation Credit. Beginning January 1, 2000, PRG
will maintain an account (the "Account") which, subject to the
exceptions set forth below, will be increased each calendar year
(beginning in 2000) by an amount equal to the sum of (i) the Salary
Deferred Compensation Credit (as defined in the body of your Employment
Offer letter) and (ii) Twenty-Five Thousand and No/100 ($25,000.00)
Dollars (the "Company Deferred Compensation Credit"); provided that for
the calendar year ending December 31, 2000 the Salary Deferred
Compensation Credit and the Company Deferred Compensation Credit will
each be reduced by Sixty-Eight and 49/100 ($68.49) Dollars multiplied
by each day during 2000 that passes prior to you commencing employment
with PRG. If your employment with PRG is terminated prior to the end of
any calendar year due to (a) termination by PRG without cause as a
result of your position with PRG being eliminated, or (b) your death,
Disability or Retirement (as defined below), (i) a prorated portion of
the Salary Deferred Compensation Credit will be credited to your
Account in respect of the month in which such termination occurs based
upon the ratio of the number of days in such month that you were an
employee of PRG to the total number of calendar days in such month and
no further credit will be made for any subsequent period, (ii) a
partial credit will be made to the Account with respect to a Company
Deferred Compensation Credit for such calendar year prorated based on
the ratio of the number of days in such year that you were an employee
of PRG to the total number of days in such year, and (iii) the Account
will also be credited with an amount computed like interest on the
credit balance of the Account at the rate publicly announced from time
to time by NationsBank, N.A., Atlanta, Georgia, as its "prime rate." If
your employment with PRG is terminated prior to the end of any calendar
year for any reason other than due to (a) termination by PRG without
cause as a result of your position with PRG being eliminated, or
(b) your death, Disability or Retirement, no portion of the Salary
Deferred Compensation Credit will be credited to your Account in
respect of the month in which such termination occurs or any subsequent
period and the amount that would have otherwise been credited in your
Account pursuant to the immediately preceding sentence in respect of
the month in which such termination occurs will instead be paid to you
as additional Base Salary and no credits will be made to the Account
with respect to a Company Deferred Compensation Credit for such
calendar year. For these purposes, the Salary Deferred Compensation
Credit and all interest accrued on the credit balance of the Account
shall be deemed to be credited to the Account as of the end of each
month and the Company Deferred Compensation Credit shall be deemed to
be credited to the Account as of December 31 of each year unless your
employment with PRG terminates due to (a) termination by PRG without
cause as a result of your position with PRG being eliminated, or
(b) your death, Disability or Retirement, in which
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case the Company Deferred Compensation Credit for your final year of
employment will be deemed to be credited to the Account as of the last
day of the month within which your employment with PRG is terminated.
PRG shall in all events determine (in its sole and absolute discretion)
whether your employment with PRG has been terminated as a result of
your position with PRG being eliminated.
(b) Vesting. The provisions of this Section (b) shall determine the portion
of the Account which is vested and eligible for payment in accordance
with Section (c) of this Schedule.
(i) General Vesting Rule. You will be immediately vested in the
portion of the account attributable to all Salary Deferred
Compensation Credits and subject to the other provisions of
this Schedule, interest credited with respect thereto. Subject
to the other provisions of this Schedule, your right to the
portion of the Account attributable to each Company Deferred
Compensation Credit and all interest credited with respect
thereto (as determined pursuant to Section (a) of this
Schedule) will vest annually at the rate of ten percent (10%)
per year as of December 31 of each year beginning with the
year that such Company Deferred Compensation Credit is
credited to the Account. Each Company Deferred Compensation
Credit made to the Account will vest independently of all
other Company Deferred Compensation Credits made to the
Account.
(ii) Termination Due to Death, Disability or Retirement. If your
employment with PRG terminates due to your death, Disability
or Retirement (as defined below), then notwithstanding
anything to the contrary in Section (b)(i) of this Schedule,
you, in the event of Disability or Retirement, or your
Beneficiary, in the event of your death, will be vested in the
entire balance of the Account [including any Company Deferred
Compensation Credit credited to the Account as of the last day
of the month within which your employment with PRG is
terminated, as provided in Section (a) of this Schedule].
Retirement means your resignation of employment with PRG on or
after your sixtieth (60th) birthday and following at least ten
(10) years of full time employment with PRG.
(iii) Termination for Cause. Upon the termination of your employment
for Cause (as defined in Section 8(a) of the Employment Offer
letter), notwithstanding anything to the contrary in Section
(b)(i) of this Schedule, you will be vested in the Salary
Deferred Compensation Credit in the Account as of the end of
the month preceding such termination or resignation but you
will not be vested in any portion of the Company Deferred
Compensation Credit, regardless of whether or
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not previously vested, or in any interest accrued on either
the Salary Deferred Compensation Credit or the Company
Deferred Compensation Credit.
(iv) Termination by PRG Without Cause. If your employment with PRG
is terminated by PRG without cause, then notwithstanding
anything to the contrary in Section (b)(i) of this Schedule,
your right to each Company Deferred Compensation Credit and
all interest credited with respect thereto (as determined
pursuant to Section (a) of this Schedule) will vest for the
year within which such termination occurs by an additional
percentage equal to ten percent (10%) multiplied by a
fraction, the numerator of which is the number of days in such
year that you were an employee of PRG and the denominator of
which is the total number of days in such calendar year. For
example, if your employment is terminated by PRG without cause
effective as of July 2, 2001 (the 182nd day of the year) you
will be entitled to (i) fifteen percent (15%) of the Company
Deferred Compensation Credit relating to 2000, and all
interest credited with respect thereto (calculated by adding
10% for 2000 and 182/365 of 10% for 2001), and (ii) five
percent (5%) of the Company Deferred Compensation Credit
relating to 2001 and all interest credited with respect
thereto (calculated as 182/365 of 10% for 2001).
(v) No Further Credits. Except as otherwise expressly provided for
above, upon your termination of employment with PRG, no
further increase in the vested balance shall be made to the
Account.
(c) Payments Following Termination of Employment. If your employment with
PRG is terminated for any reason, you (or, in the event of your death,
your Beneficiary) will receive a payment equal to the portion of the
Credit Balance of the Account which is vested in accordance with
Section (b) of this Schedule within sixty (60) days after the earlier
to occur of (A) your death, or (B) your termination of employment with
PRG. The portion of the Account which is not vested in accordance with
Schedule hereof following termination of your employment with PRG will
be forfeited and you will not be entitled to any payment with respect
thereto.
(d) Beneficiary. You have the right to designate a beneficiary
("Beneficiary") under this Agreement who shall succeed to your right to
receive payments with respect to this Schedule in the event of your
death. If you fail to designate a Beneficiary or a Beneficiary dies
without your designation of a successor Beneficiary, then for all
purposes hereunder the Beneficiary shall be your estate. No designation
of Beneficiary will be valid unless in writing signed by you, dated and
delivered to PRG. Beneficiaries may be changed by you without the
consent of any prior Beneficiary.
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(e) Rights Unsecured; Unfunded Plan; ERISA. PRG's obligations arising under
this Schedule to pay benefits to you or your Beneficiary constitute a
mere promise by PRG to make payments in the future in accordance with
the terms hereof and you and your Beneficiary have the status of a
general unsecured creditor of PRG. Neither you nor your Beneficiary
have any rights in or against any specific assets of PRG. It is our
mutual intention that PRG's obligations under this Schedule be unfunded
for income tax purposes and for purposes of Title I of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"). We each
will treat our obligations under this Schedule as maintained for a
select group of management or highly compensated employees exempt from
Parts 2, 3 and 4 of Title I of ERISA. PRG will comply with the
reporting and disclosure requirements of Part 1 of Title I of ERISA in
accordance with U.S. Department of Labor Regulation 2520.104-23.
(f) Nonassignability. Your rights and the rights of your Beneficiary to
payments pursuant to this Schedule hereof are not subject in any manner
to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance attachment, or garnishment by your creditors or those of
your Beneficiary.