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Exhibit 10.77
FIRST AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT
Agreement made as of October 1, 1998, by and between Financial Performance
Corporation, a New York corporation with offices at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ 10017("FPC"), FPC Information Corp., a New York
corporation with offices at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
("FPC Information Corp.") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, residing at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("▇▇▇▇▇▇"). FPC and FPC Information Corp. are
hereinafter jointly and severally referred to as the "Corporation".
W I T N E S S E T H:
Whereas, the parties hereto entered into a executive employment agreement dated
as of September 11, 1997 (the "Executive Employment Agreement"); and
Whereas, the parties hereto desire to amend and/or supplement the Executive
Employment Agreement as herein set forth.
Now, therefore, in consideration of the premises, the mutual covenants
hereinafter set forth, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1. Section 2 of the Executive Employment Agreement is hereby amended and
restated in its entirety to read as follows:
"Term.
(a) The term of this agreement is three (3) years, commencing on
October 1, 1997 and ending on September 30, 2000 (the "Initial Term"), unless
earlier terminated by the Corporation or by ▇▇▇▇▇▇ in accordance with the
provisions hereof. This agreement shall be automatically renewed for periods of
one (1) year each (the "Renewal Term") unless either party shall give the other
notice of his or its desire to terminate this agreement no later than on the
June 1st immediately preceding the expiration of the then current term, in which
event ▇▇▇▇▇▇'▇ employment shall terminate at the end of the Initial Term or the
applicable Renewal Term, as the case may be. The Initial Term and the Renewal
Term are hereinafter collectively referred to as the Term.
(b) If ▇▇▇▇▇▇ has not given notice to the Corporation on or before
June 1, 2000 that he elects not to renew this agreement at the expiration of the
Term and the Corporation gives notice to ▇▇▇▇▇▇ that it elects not to renew this
agreement at the expiration of the Term, then and only in such event, provided
that ▇▇▇▇▇▇'▇ employment is not properly terminated by the Corporation for cause
pursuant to and in accordance with the provisions of Section 7 below, in
addition to and without limitation of any other compensation, severance payments
or employment benefits which may be or become due from the Corporation to ▇▇▇▇▇▇
pursuant to this agreement, (but not in addition to any severance payment which
may be due pursuant to the provisions of subparagraph (c) of this Section 2, it
being understood that such severance payment and the severance payment payable
pursuant to this subparagraph (b) are mutually exclusive), (i) the Corporation
shall pay to
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▇▇▇▇▇▇ within ten (10) days following the expiration of the Term, a severance
payment in the amount of Three Hundred Fifty Thousand ($350,000.00) Dollars and
(ii) the Corporation shall issue to ▇▇▇▇▇▇ within ten (10) days following the
expiration of the Term, the Termination Stock (hereinafter defined) as set forth
in Section 8(d) below.
(c) If ▇▇▇▇▇▇ elects not to renew this Agreement at the expiration
of the Term and ▇▇▇▇▇▇'▇ employment is not properly terminated by the
Corporation for cause pursuant to and in accordance with the provisions of
Section 7 below, then and only in such event, in addition to and without
limitation of any other compensation, severance payments or employment benefits
which may be or become due from the Corporation to ▇▇▇▇▇▇ pursuant to this
agreement (but not in addition to any severance payment which may be due
pursuant to the provisions of subparagraph (b) of this Section 2, it being
understood that such severance payment and the severance payment payable
pursuant to this subparagraph (c) are mutually exclusive), the Corporation shall
pay to ▇▇▇▇▇▇, within ten (10) days following the expiration of the Term, a
severance payment in the amount of Two Hundred Fifty Thousand ($250,000.00)
Dollars.
(d) For purposes of this agreement, the term "employment benefits"
shall be deemed to include ▇▇▇▇▇▇'▇ Annual Bonus (as such term is hereinafter
defined).
2. Section 5 of the Executive Employment Agreement is hereby amended
and restated in its entirety to read as follows:
"5. Compensation. For all services rendered by ▇▇▇▇▇▇ pursuant to
this agreement, the Corporation shall pay ▇▇▇▇▇▇ an annual salary twice monthly
on the 15th and 30th of each month, in arrears, as follows: (i) One Hundred
Fifty Thousand ($150,000.00) Dollars per annum during the period commencing on
October 1, 1997 through September 30, 1998; and (ii) Two Hundred Fifty Thousand
($250,000.00) Dollars during the period commencing on October 1, 1998 through
the balance of the Term. Such salary shall be subject to periodic increases as
shall be determined by the Board of Directors of the Corporation."
3. Section 6 of the Executive Employment Agreement is hereby re-titled
"Employment Benefits".
4. Section 7 of the Executive Employment Agreement is hereby restated
and amended in its entirety to read as follows:
"7. Termination.
(a) The Corporation may, at its election in accordance with the
procedures more particularly set forth below, terminate this agreement for
cause. For purposes of this agreement, "cause" shall be defined as and limited
to the following: (i) a material breach by ▇▇▇▇▇▇ of any material term of this
agreement that has not been cured within thirty (30) days of receipt by ▇▇▇▇▇▇
of written notice of such breach and which causes substantial damage to the
reputation, business or property of the Corporation, any of the Corporation's
affiliates or any of the Corporation's (or any affiliate's) customers; (ii) a
continued failure of ▇▇▇▇▇▇ after thirty (30) days notice of a prior failure to
devote ▇▇▇▇▇▇'▇ full active business time (as more particularly described in
Section 4 above) to the performance of ▇▇▇▇▇▇'▇ duties hereunder; (iii) an act
of willful misconduct in the performance of ▇▇▇▇▇▇'▇ duties hereunder which
causes substantial damage to the reputation, business or property of the
Corporation, any of the Corporation's affiliates or any of the Corporation's
customers including, without limitation, any oral or written
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material misrepresentation relating to the Corporation (or any affiliate) or any
of its (or any affiliate's) customers which causes substantial damage to the
reputation of the Corporation (or any affiliate); (iv) conviction of a felony;
and (v) substantial, continuing and willful improper performance or
non-performance of any of ▇▇▇▇▇▇'▇ material duties hereunder after thirty (30)
days written notice to cure as aforesaid. For purposes of this subsection (a),
no act, or failure to act, on ▇▇▇▇▇▇'▇ part shall be considered "willful" unless
done, or omitted to be done, by him not in good faith or without reasonable
belief that his action or omission was in the best interests of the Corporation.
Notwithstanding the foregoing, ▇▇▇▇▇▇ shall not be deemed to have been
terminated for cause without (i) thirty (30) days' notice to ▇▇▇▇▇▇ setting
forth the reasons for the Corporation's intention to terminate for cause as set
forth above in this subsection (a), (ii) an opportunity for ▇▇▇▇▇▇, together
with his counsel, to be heard before the Corporation's board of directors, and
(iii) delivery to ▇▇▇▇▇▇ of a Notice of Termination as defined in subsection (d)
below from an executive officer of the Corporation finding that, in the good
faith opinion of the Board of Directors of FPC, ▇▇▇▇▇▇ was guilty of conduct set
forth or described above in justifying the Corporation's termination of ▇▇▇▇▇▇'▇
employment for cause and specifying the particulars thereof in detail.
(b) ▇▇▇▇▇▇ may terminate his employment under this agreement for
Good Reason (as hereinafter defined). For purposes of this agreement, "Good
Reason" shall mean (i) a Change in Control (as defined below) of FPC or of FPC's
subsidiary, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Partners Inc. ("MKP") which shall have been in
effect for a period of at least ninety (90) consecutive days; provided, however,
that ▇▇▇▇▇▇ shall be unable to work harmoniously and effectively with the
personnel constituting the new management of FPC resulting from such Change of
Control (if any), (ii) a failure by the Corporation to comply with any material
provision of this agreement, which noncompliance shall have a material adverse
effect upon ▇▇▇▇▇▇ and which shall not have been cured within thirty (30) days
after notice of such noncompliance has been given by ▇▇▇▇▇▇ to the Corporation
pursuant to this agreement, (iii) if ▇▇▇▇▇▇'▇ management functions, duties or
responsibilities or any other material aspect of ▇▇▇▇▇▇'▇ employment shall have
been materially and adversely changed by the Corporation for a period in excess
of thirty (30) consecutive days notwithstanding ▇▇▇▇▇▇'▇ written objection
thereto, (iv) if ▇▇▇▇▇▇ shall cease to be chairman of the board of directors and
the chief executive officer of FPC (other than by reason of death, incapacity or
resignation) or (v) any purported termination of ▇▇▇▇▇▇'▇ employment which is
not properly effected pursuant to a Notice of Termination satisfying the
requirements of subsection (d) below (and for purposes of this agreement no such
purported termination shall be effective).
(c) For the purpose of this agreement, a "Change of Control" shall
be deemed to have taken place if: (i) a third person, including a "group" as
such term is defined in Section 13(d)(3) of the Securities Exchange Act of 1934,
becomes (other than as a result of a purchase from FPC) the beneficial owner of
shares of FPC having more than thirty (30%) percent of the total number of votes
that may be cast for the election of directors of FPC and such beneficial
ownership continues for thirty (30) consecutive days, or (ii) as a result of, or
in connection with, any cash tender or exchange offer, merger or other business
combination of the foregoing transactions relating to FPC (hereinafter referred
to as a "Transaction") the persons who were directors of FPC before the
Transaction shall cease for any reason to constitute at least a majority of the
Board of Directors of FPC, or any successor(s) of FPC.
(d) Any termination of ▇▇▇▇▇▇'▇ employment by the Corporation or by
▇▇▇▇▇▇ (other than termination by reason of ▇▇▇▇▇▇'▇ death or disability as set
forth in Section 14 below) shall be communicated by written Notice of
Termination to the other party hereto. For purposes of this agreement, a "Notice
of Termination" shall mean a notice which shall indicate the specific
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termination provision in this agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of ▇▇▇▇▇▇'▇ employment under the provision so indicated.
(e) "Date of Termination" shall mean (i) if ▇▇▇▇▇▇'▇ employment is
terminated by his death, the date of his death, (ii) if ▇▇▇▇▇▇'▇ employment is
terminated pursuant to subsection (c) above, the date specified in the Notice of
Termination, and (iii) if ▇▇▇▇▇▇'▇ employment is terminated for any other
reason, the date on which a Notice of Termination is given; provided that if
within thirty (30) days after any Notice of Termination is given the party
receiving such Notice of Termination notifies the other party that a dispute
exists concerning the termination, the Date of Termination shall be the date on
which the dispute is finally determined, either by mutual written agreement of
the parties, by a binding and final arbitration award or by a final judgment,
order or decree of a court of competent jurisdiction (the time for appeal
therefrom having expired and no appeal having been perfected)."
5. Section 8 of the Executive Employment Agreement is hereby restated
and amended in its entirety to read as follows:
"8. Compensation Upon Termination or During Disability.
(a) During any period that ▇▇▇▇▇▇ fails to perform his duties
hereunder as a result of incapacity due to physical or mental illness
("disability period"), ▇▇▇▇▇▇ shall continue to receive his full salary at the
rate then in effect for such period and all employment benefits due to ▇▇▇▇▇▇
until his employment is terminated pursuant to Section 7 above, provided that
payments so made to ▇▇▇▇▇▇ during the disability period shall be reduced by the
sum of the amounts, if any, payable to ▇▇▇▇▇▇ at or prior to the time of any
such payment under disability benefit plans of the Corporation and which were
not previously applied to reduce any such payment.
(b) If ▇▇▇▇▇▇'▇ employment is terminated by his death, the
Corporation shall pay to ▇▇▇▇▇▇'▇ spouse, or if he leaves no spouse, to his
estate, within thirty (30) days of ▇▇▇▇▇▇'▇ death, all salary and employment
benefits due to ▇▇▇▇▇▇ accrued through the date of his death.
(c) If ▇▇▇▇▇▇'▇ employment shall be properly terminated for cause
pursuant to all of the applicable provisions of this agreement, the Corporation
shall pay ▇▇▇▇▇▇ his full salary only through the Date of Termination at the
rate in effect at the time Notice of Termination is given and the Corporation
shall have no further obligations to ▇▇▇▇▇▇ under or pursuant to this Agreement.
(d) If (i) in breach of this agreement, the Corporation shall
terminate ▇▇▇▇▇▇'▇ employment other than pursuant to subsection 7 (a) above
(termination for cause) or Section 14 below (termination by reason of death or
disability)(it being understood that a purported termination by the Corporation
pursuant to subsection 7 (a) above or Section 14 below which is disputed and
finally determined not to have been proper shall be deemed a termination by the
Corporation in breach of this agreement) or (ii) ▇▇▇▇▇▇ shall terminate his
employment for Good Reason, then
(I) the Corporation shall pay ▇▇▇▇▇▇ his full salary and all
employment benefits due to ▇▇▇▇▇▇ through the Date of Termination at the rate in
effect at the time the Notice of Termination is given;
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(II) in lieu of any further salary payments to ▇▇▇▇▇▇ for
periods subsequent to the Date of Termination, the Corporation shall pay to
▇▇▇▇▇▇, as severance pay (and not as a penalty to the Corporation), an amount
equal to the product of (A) ▇▇▇▇▇▇'▇ annual base salary rate in effect as of the
Date of Termination, multiplied by (B) the number two (2), such payment to be
made (X) if resulting from a termination based on a Change of Control of the
Corporation or of MKP, in a lump sum on or before the thirtieth (30th) day
following the Date of Termination, or (Y) if resulting from any other cause, in
substantially equal semimonthly installments on the fifteenth and last days of
each month commencing with the month in which the Date of Termination occurs and
continuing for forty-eight (48) consecutive semimonthly payment dates (including
the first such date as aforesaid), without interest;
(III) in addition to all other salary, employment benefits and
other payments due to ▇▇▇▇▇▇ pursuant to the provisions of this subsection 8(d),
the Corporation shall issue to ▇▇▇▇▇▇, within ten (10) days after the Date of
Termination, such number of shares of the Corporation's common stock (such
shares of common stock are hereinafter referred to as the "Termination Stock")
as shall have an aggregate fair market value as of the Date of Termination equal
to one million ($1,000,000.00) dollars less the aggregate fair market value of
all of the shares of the Corporation's common stock and all of the warrants,
options and other derivative securities to purchase shares of the Corporation's
common stock which are owned of record by ▇▇▇▇▇▇ on the Date of Termination. For
purposes of this clause (III), (x) the fair market value of each share of the
Corporation's common stock as of the Date of Termination shall be the average of
the bid and ask prices for the Corporation's common stock for the ten (10)
trading days immediately preceding the Date of Termination and (y) the fair
market value of each warrant, option or other derivative security to purchase
one (1) share of the Corporation's common stock as of the Date of Termination
shall be equal to the fair market value of one (1) share of the Company's common
stock as of the Date of Termination less the per share exercise price of such
warrant, option or other derivative security (but in no event shall such fair
market value of any warrant, option or other derivative security be less than
zero). If the Corporation's common stock shall not be publicly traded on the
Date of Termination, then the fair market value of the Corporation's common
stock shall be mutually determined by two investment banking firms with
experience related to the business of the Corporation and its subsidiaries. In
such event, one such firm shall be designated by ▇▇▇▇▇▇ and the other firm shall
be designated by the Corporation. The fair market value of the Corporation's
common stock and the fair market value of the warrants, options and other
derivative securities to purchase shares of the Corporation's common stock as
determined pursuant to this clause (III) of this subsection 8(d) shall be final,
conclusive and binding upon the parties hereto. The Corporation shall be
obligated to register the Termination Stock, at the Corporation's sole cost and
expense, pursuant to a registration statement filed within sixty (60) days after
the Date of Termination and declared effective as soon thereafter as is
reasonably practicable. Further, if from and after the Date of Termination, the
shares of the Corporation's common stock underlying the warrants, options and
other derivative securities owned of record by ▇▇▇▇▇▇ on the Date of Termination
(such underlying shares of common stock hereinafter referred to as "Underlying
Shares") shall not be freely tradeable by ▇▇▇▇▇▇ pursuant to an effective
registration statement, then the Corporation shall also be obligated to register
all of the Underlying Shares together with the Termination Stock, at the
Corporation's sole cost and expense, pursuant to the aforementioned registration
statement. The Corporation shall be obligated to use its best efforts to cause
such registration statement to be declared effective as soon as possible after
filing and to maintain such effectiveness until all of the Termination Stock and
all of the Underlying Shares shall have been sold by ▇▇▇▇▇▇; and
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(IV) in addition to the payments referred to in clauses (I),
(II) and (III) above, if termination of ▇▇▇▇▇▇'▇ employment arises out of a
breach by the Corporation of this agreement, the Corporation shall pay all other
damages to which ▇▇▇▇▇▇ may be entitled as a result of such breach, including
damages for any and all loss of benefits to ▇▇▇▇▇▇ under the Corporation's
employee benefit plans which ▇▇▇▇▇▇ would have received if the Corporation had
not breached this agreement and had ▇▇▇▇▇▇'▇ employment continued for the full
term provided in Section 2 hereof.
In addition to the occurrences specified in clauses (i) and (ii) of the preamble
to this subsection 8(d), the Termination Stock shall also be issued to ▇▇▇▇▇▇ as
provided in subsection 2(b) above.
(e) Unless ▇▇▇▇▇▇'▇ employment is properly terminated by the
Corporation for cause, the Corporation shall maintain in full force and effect,
for the continued benefit of ▇▇▇▇▇▇ for the greater of the number of years
(including partial years) remaining in the term of employment hereunder or the
number two (2), all employee benefit plans and programs in which ▇▇▇▇▇▇ was
entitled to participate immediately prior to the Date of Termination, provided
that ▇▇▇▇▇▇ continued participation is possible under the general terms and
provisions of such plans and programs. In the event that ▇▇▇▇▇▇'▇ participation
in any such plan or program is barred, the Corporation shall arrange to provide
▇▇▇▇▇▇ with benefits substantially similar to those which ▇▇▇▇▇▇ would otherwise
have been entitled to receive under such plans and programs from which his
continued participation is barred.
(f) The Corporation may withhold from any payments or other benefits
payable to ▇▇▇▇▇▇ pursuant to this Section 8 or any other provision of this
agreement all federal, state, city or other taxes as shall be required pursuant
to any law, government regulation or ruling."
6. Section 14 of the Executive Employment Agreement is hereby amended
by the addition of the following words at the end thereof: "except as otherwise
specifically set forth in Section 8 above".
7. The following provisions are hereby added as Section 23 of the
Executive Employment Agreement:
"Restated Agreement. This agreement has been restated and amended
effective as of October 1, 1998 to incorporate the provisions of the First
Amendment to the Executive Employment Agreement dated as of October 1, 1998 by
and between the Corporation and ▇▇▇▇▇▇."
8. Any capitalized term not specifically defined herein shall have the
meaning ascribed to such term in the Executive Employment Agreement.
9. Except as otherwise set forth in this agreement, all of the terms
and provisions of the Executive Employment Agreement, shall remain unmodified
and in full force and effect.
10. The covenants, agreements, terms, provisions and conditions
contained in this agreement shall bind and inure to the benefit of the parties
hereto and their respective heirs, successors, legal representatives and
permitted assigns, if any.
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11. This agreement may not be modified orally, but only by an agreement
in writing signed by the party against whom enforcement or any waiver, change,
modification or discharge is sought.
12. In the event of any inconsistency between the terms and provisions
of this agreement and the terms and provisions of the Shareholders Agreement,
the terms and provisions of this agreement shall govern and be binding.
In witness whereof, the parties hereto have executed this agreement as of the
day and year first above written.
WITNESS:
Financial Performance Corporation
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇, Secretary
FPC Information Corp.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇, Secretary
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, individually