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EXHIBIT 10.14
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "AGREEMENT") is entered into effective
as of December 14, 1998 (the "EFFECTIVE DATE") by and between Pritchett
Publishing Company, a Texas corporation (the "COMPANY") and an indirect wholly
owned subsidiary of ProfitSource Corporation, a Delaware corporation (the
"PROFITSOURCE"), and Early Price Pritchett, III ("EMPLOYEE").
The Company desires to retain the services of Employee, and Employee
desires to render such services, on the terms set forth herein.
NOW THEREFORE, in consideration of the mutual covenants set forth
herein, the parties hereto agree as follows:
1. EMPLOYMENT. Employee's employment with the Company will be at-will,
which means that either Employee or the Company may terminate Employee's
employment at any time for any reason or no reason without payment, penalty or
further obligation except as set forth in Section 8, provided, however, that
Employee's employment with the Company shall not be terminated without Cause
without majority approval of an executive management committee of Enterprise
Profit Solutions Corporation, a Delaware corporation and parent of the Company
("EPS"), which committee shall consist of four (4) members of the senior
management of EPS and one (1) representative of the President's Council of EPS.
2. DUTIES. Employee shall initially serve as Chairman of the Company. In
that capacity, Employee shall have authority and responsibility to manage the
operations of the Company consistent with the Company's annual business plan.
This business plan will set forth guidelines related to budgeting, capital
expenditures, hiring, and strategic initiatives, and will be formulated by the
Employee and approved by the Service Line Leader of ProfitSource with respect to
the Company. Employee will formulate the business plan and manage the Company
with the primary goal of enhancing ProfitSource stockholder value by maximizing
revenues and profitability of the Company. Employee will have authority to bind
the Company to contracts that are consistent with Employee's duties and
responsibilities hereunder, subject to limitations consistent with ProfitSource
and Company policies. The Employee shall perform such related duties and
services as the Company's board of directors (the "BOARD") and/or ProfitSource's
Chief Executive Officer (each with authority delegated by EPS) may from time to
time assign, provided however, that if Employee remains employed by the Company,
Employee's responsibility and authority within the Company will not be
materially diminished without Employee's consent as long as shares of restricted
stock purchased by Employee pursuant to that certain Restricted Stock Purchase
Agreement of even date herewith between Employee and ProfitSource (the
"RESTRICTED STOCK PURCHASE AGREEMENT") are subject to Restrictions (as defined
in the Restricted Stock Purchase Agreement) (the "RESTRICTED PERIOD"). Except as
set forth herein, Employee's position and duties may be changed at any time and
from time to time by the Board or ProfitSource's Chief Executive Officer (each
through authority delegated by EPS). Such duties shall be rendered at such place
or places as the Company shall require based upon the interest, need, business
and/or opportunities of the Company, provided however, that for the Restricted
Period, the principal place at which Employee renders such duties (the
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"Principal Place") shall not be relocated more than twenty-five (25) miles from
the location of Principal Place on the date hereof without Employee's consent.
3. TIME AND EFFORTS. While employed by the Company (the "EMPLOYMENT
PERIOD"), Employee shall use his or her best efforts and devote his or her time
and attention to the business of the Company on a full-time basis and shall at
all times faithfully and industriously and to the best of his or her ability,
experience and talent, perform all of the duties that may be required of him or
her pursuant to the terms hereof. During the Employment Period, Employee shall
not engage in any other employment or consulting activities without the express
written consent of the Company. The foregoing shall not preclude Employee from
engaging in civic, charitable and/or religious activities, directing his or her
own passive investments and/or serving on boards of directors of other entities
so long as such activities do not interfere or conflict with Employee's duties
hereunder as reasonably determined by the Company.
4. COMPENSATION. During the Employment Period, the Company shall pay
Employee at the annual rate of One Hundred and Fifty Thousand and Seven Hundred
and Forty Two Dollars ($150,742) (as such pay may be increased by the Company
from time to time in its discretion, the "ANNUAL SALARY") for all services
rendered to the Company by Employee, payable in accordance with the Company's
regular payroll policies, subject, however, to withholding deductions, including
without limitation social security taxes and applicable federal, state and local
income and other employment taxes. In addition, in connection with Employee's
employment by the Company and services performed by Employee for the Company,
Employee is acquiring concurrently herewith restricted stock of the Company
pursuant to the Restricted Stock Purchase Agreement. The Company may, but shall
not be obligated to, pay bonuses from time to time to Employee in accordance
with such plans or standards as the Company may develop. Employee has no right
to any specific compensation or benefits other than as set forth herein or
required pursuant to applicable law.
5. VACATION. Until the Company adopts a vacation policy, Employee shall
be entitled to such number of days of paid vacation each year as Employee was
entitled pursuant to the vacation policy in place with Employee's employer
immediately prior to the date hereof. Upon adoption by the Company of a vacation
policy, Employee shall be entitled to such number of days as is consistent with
such policy and the Company's vacation policy as so adopted shall thereafter
govern accrual of vacation days. Vacation may be used, subject to approval by
the Company consistent with business needs, as it is earned. Employee may not
accrue more than 30 days of unused vacation. If Employee at any time has 30 days
of accrued unused vacation, no further vacation days shall accrue until Employee
again has fewer than 30 days of unused vacation. The Company shall pay Employee
for accrued unused vacation days only in connection with termination of
employment. Such payment shall be made on the basis of Employee's Annual Salary
at the time of payment, pro-rated for the number of accrued unused vacation days
at the time of termination.
6. BENEFITS. In addition to the compensation described in Section 4, the
Company shall provide Employee with benefits consistent with the Company's
employment policies as in effect from time to time.
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7. CERTAIN DEFINITIONS.
(a) Cause. For purposes hereof, the term "CAUSE" has the meaning
set forth in Schedule 1 hereto. Any termination by the Company of Employee's
employment within 90 days after the Company's becoming aware of the occurrence
of an event or circumstance constituting "Cause" will constitute termination for
Cause.
(b) Good Reason. If the Company breaches this Agreement in any
material respect and does not cure such breach within 15 days of receipt from
Employee of notice of such breach and demand for cure, and Employee terminates
Employee's employment with the Company within 90 days of such breach, such
termination by Employee will be termination with "GOOD REASON" for purposes
hereof.
8. CERTAIN PAYMENTS.
(a) Termination by Employee with Good Reason or the Company
Without Cause. Subject to Section 8(c), if Employee's employment under this
Agreement is terminated by Employee with Good Reason, by the Company without
Cause as by the Employee if he is forced to relocate more than twenty-five (25)
miles from the Principal Place subsequent to the Restricted Period, then
contingent upon execution and delivery by Employee to the Company of an
unconditional release in form satisfactory to the Company of all claims against
ProfitSource, EPS, the Company or any of their officers, directors or affiliates
arising from or in connection with this Agreement or Employee's employment with
the Company or the termination of that employment, Employee shall be entitled to
continue to receive regular monthly installments of his or her Annual Salary
over the Severance Period (as defined below) in accordance with the Company's
normal payroll schedule (the "SEVERANCE PAYMENT") for the duration of the
Severance Period. For purposes hereof, the "SEVERANCE PERIOD" means 90 days
following termination of employment.
(b) No Other Benefits. Except as set forth in Section 8(a) or
Section 5 or as may be required by applicable law or separate written agreement
between ProfitSource, the Company and Employee, the Company shall have no
obligations to pay any salary, bonus, accrued vacation or other amounts in
connection with any termination of Employee's employment or attributable to the
period after termination of Employee's employment. Without limiting the
foregoing, and subject to any separate written agreement to the contrary,
Employee will not be entitled to any severance payment or benefit if Employee's
employment under this Agreement is terminated by death, or by Employee without
Good Reason, or by the Company for Cause or disability.
(c) Post-Termination Cause. If any of the events or circumstances
constituting Cause listed in items A, B or C of Schedule 1 occurs during the
Severance Period, then (i) the Company will have no further obligation to
provide to Employee the Severance Payment, and (ii) the Company will be entitled
to recover from Employee any Severance Payment amounts paid to Employee or
Employee's successors and assigns, together with the costs of effecting such
recovery.
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9. CONFIDENTIALITY. Employee shall execute the Confidential Information
and Employee Invention Agreement attached hereto as Exhibit A (the
"CONFIDENTIALITY AGREEMENT"), which will survive termination or expiration of
this Agreement.
10. REPRESENTATIONS AND WARRANTIES. Employee represents and warrants to
the Company that (a) he or she is under no contractual restriction or other
restrictions or obligations that are inconsistent with the execution of this
Agreement, the performance of his or her duties and the covenants hereunder, and
(b) he or she is under no physical or mental disability that would interfere
with his or her keeping and performing all of the agreements, covenants and
conditions to be kept or performed hereunder.
11. MISCELLANEOUS.
(a) Governing Law. This Agreement shall be interpreted under and
governed by the laws of the State of California, excluding its rules on
conflicts of law.
(b) Arbitration. Any dispute regarding the application,
interpretation or breach of this Agreement shall be resolved by final and
binding arbitration before the American Arbitration Association ("AAA") in
accordance with AAA's National Rules for the Resolution of Employment Disputes.
Attorney's fees, costs and damages (where appropriate) shall be awarded to the
prevailing party in any dispute, and any resolution, opinion or order of AAA may
be entered as a judgment of the Superior Court.
(c) Modification and Waiver. No waiver or modification of this
Agreement or any term hereof shall be binding unless it is in writing signed by
the parties hereto. No failure to insist upon compliance with any term,
provision or condition to this Agreement, whether by conduct or otherwise, in
any one or more instances, shall be deemed to be or construed as a waiver of any
such term, provision or condition or as a waiver of any other term, provision or
condition of this Agreement.
(d) Entire Agreement. This Agreement and the Confidentiality
Agreement constitute the entire agreement between the parties with respect to
the subject matter hereof and supersede and replace all prior employment
agreements, if any, between the parties. No oral statements or prior written
agreements with respect to the subject matter hereof which are not specifically
incorporated herein or in the Confidentiality Agreement shall be of any force or
effect.
(e) Severability. If any provisions hereof shall be held or
construed to be illegal or invalid for any reason, such illegality or invalidity
shall not affect the remaining provisions of this Agreement, but the same shall
be construed and enforced just as though the illegal or invalid provisions had
not been included herein.
(f) Notices. Any notice, demand or other communication required,
permitted or desired to be given hereunder shall be in writing and shall be
deemed effectively given upon personal delivery, facsimile transmission (with
confirmation of receipt), delivery by reputable overnight delivery service or
five (5) days following deposit in the United States mail (if sent by certified
or registered mail, postage prepaid, return receipt requested), in each case
duly
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addressed to the Company at its headquarters or to Employee at his or her
address of record listed with the Company.
(g) Assignment. Employee's rights, duties and obligations under
this Agreement may not be assigned by Employee. The Company may assign its
rights, duties and obligations under this Agreement to any affiliate of the
Company.
(h) Headings. The section headings herein are intended for
reference and shall not affect in any way the construction or interpretation of
this Agreement.
(i) Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original but all of which shall constitute one and the
same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date set forth above.
EMPLOYEE THE COMPANY
Pritchett Publishing Company
Signature: /s/ PRICE PRITCHETT By: /s/ PRICE PRITCHETT
--------------------------- ----------------------------------
Printed Name: Early Price Pritchett, Name:
III --------------------------------
Title:
-------------------------------
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SCHEDULE 1 TO
EMPLOYMENT AGREEMENT
"CAUSE" means the occurrence of any one or more of the following events
or circumstances, provided however, that if any such event or circumstance is
susceptible to cure by Employee, such event or circumstance will not constitute
Cause unless Employee has failed to cure such event or circumstance within 15
days after receipt by Employee of written notice thereof: (i) Employee engages
in any wrongful conduct or knowingly violates any reasonable rule or regulation
of the Board, the Company's President or Chief Executive Officer or other senior
officer designated by the Chief Executive Officer that results in material
damage to the Company or any parent corporation of the Company, any subsidiary
corporation of the Company or any entity controlling, controlled by, or under
common control with the Company (an "AFFILIATED ENTITY"); (ii) any willful
misconduct or gross negligence by Employee in the responsibilities assigned to
Employee; (iii) any willful and material failure to perform Employee's job as
required to meet the lawful objectives of the Company or any Affiliated Entity;
(iv) Employee fails to comply with all material applicable laws and regulations
in performing Employee's duties and responsibilities to the Company; or (v)
Employee does any of the things described in (A)-(C) below.
(A) Employee renders services for any organization or engages directly
or indirectly in any business that, in the reasonable judgment of the Chief
Executive Officer of the Company or other senior officer designated by the Chief
Executive Officer, (x) during Employee's employment with the Company or any
Affiliated Entity, is or becomes competitive with the Company or any Affiliated
Entity, or which organization or business, or the rendering of services to such
organization or business, is or becomes otherwise materially prejudicial to or
in material conflict with the business or interests of the Company or any
Affiliated Entity, or (y) after termination of Employee's employment with the
Company or any Affiliated Entity, is or becomes competitive with the business
units of the Company or any Affiliated Entity to which Employee devoted
significant time and attention within the scope of Employee's employment
hereunder (the "BUSINESS UNITS"), or which organization or business, or the
rendering of services to such organization or business, is or becomes otherwise
prejudicial to or in conflict with the business or interests of the Business
Units. For an Employee whose employment has terminated, the judgment of the
Chief Executive Officer or such other senior officer shall be based upon the
Employee's position and responsibilities while employed by the Company or any
Affiliated Entity, the Employee's post-employment responsibilities and position
with the other organization or business, the extent of past, current and
potential competition or conflict between the Business Units and the other
organization or business, the effect on the customers, suppliers and competitors
of the Business Units of Employee's assuming the post-employment position, the
guidelines established in any employee handbook, any employment agreement with
the Employee, and such other considerations as are deemed by the Company to be
relevant given applicable facts and circumstances.
(B) Employee fails to comply with the Confidentiality Agreement or with
the lawful policies of the Company or any Affiliated Entity regarding
nondisclosure of confidential information, or without prior written
authorization from the Company or any Affiliated Entity discloses to anyone
outside the Company or any Affiliated Entity or uses for any purpose or in any
context other than in performance of Employee's duties to the Company or any
Affiliated Entity any confidential or trade secret information of the Company or
any Affiliated Entity.
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(C) Employee breaches in any material respect any agreement with or
legal duty to the Company or any Affiliated Entity.
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