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Exhibit 10.3 AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the
"Agreement"), made effective as of December 19, 2008 (the
"Effective Date"), is between Navigant Consulting, Inc., a Delaware
corporation (the "Company"), and Julie M. Howard (the "Executive").
RECITALS
A. The
Company and the Executive entered into an Employment Agreement
dated as of November 3, 2003 (the "Prior Agreement").
B. The
Company desires to continue to obtain the benefits of the
Executive’s knowledge, skills, and experience by employing
the Executive as its President and Chief Operating Officer upon the
terms and subject to the conditions of this Agreement.
C. The
Company desires to offer the Executive an amendment of the terms
and conditions of the Prior Agreement, which is embodied in the
terms and conditions of this Agreement as provided herein.
AGREEMENT
NOW,
THEREFORE, in consideration of the foregoing premises and mutual
covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1.
Employment. Subject to the terms and conditions of this
Agreement, the Company agrees to employ the Executive, and the
Executive agrees to be employed by the Company, for the period
stated in Paragraph 2 hereof.
2.
Employment Term. The term of the Executive’s
employment by the Company under this Agreement will begin on the
Effective Date, and will continue, subject to earlier termination
as provided in Paragraph 7 and 8 hereof, for a rolling
one-year period, such that the remainder of the term shall always
be one full year (the "Employment Term"), subject to either party
being able to reduce or limit the Employment Term, by written
notice provided as set forth in Paragraph 11(b) hereof.
3.
Position and Responsibilities. During the Employment Term,
the Company shall employ, and the Executive shall serve as the
Company’s President and Chief Operating Officer. During the
Employment Term, the Executive shall possess such powers and
perform such duties and functions as are generally consistent with
the role of President and Chief Operating Officer. Nothing in this
agreement shall prevent the Company from restructuring or
reorganizing its senior management team or their accountabilities,
provided that any such reorganization or restructuring that reduces
the Executive’s accountabilities in more than a de minimis
fashion shall be deemed a material diminution for purposes of
Paragraph 7(c)(ii) of this Agreement. For avoidance of doubt,
the parties agree that the Executive’s powers, duties and
functions as of the Effective Date are consistent with those of a
President and Chief Operating Officer.
During
the Employment Term, the Executive also agrees to serve, if
elected, as an officer and director of any direct or indirect
subsidiary of the Company without additional compensation. Upon the
Date of Termination (as defined below), the Executive shall be
deemed to resign from any position with the Company or any
subsidiary, including, but not limited to, as an officer or member
of the board of directors of any subsidiary.
4.
Performance of Duties; Commitment of Time. During the
Employment Term, the Executive shall discharge the following
obligations: (a) Except for illness,
reasonable vacation periods, and reasonable leaves of absence, the
Executive shall, subject to Paragraph 4(c) hereof, devote her best
efforts and full business time, attention and skills to the
business and affairs of the Company and its subsidiaries,
affiliates and divisions, as such business and affairs now exist
and as they may be hereafter changed or added to. The Executive
agrees to comply materially with all codes of conduct, personnel
policies and procedures applicable to senior executives of the
Company including, without limitation, policies regarding sexual
harassment, conflicts of interest and insider trading.
(b) The Executive shall report
directly to the Chief Executive Officer of the Company (the "CEO")
and she shall perform all of her duties in accordance with such
reasonable directions, requests, rules and regulations as are
specified by the CEO in connection with her employment.
(c) Nothing herein shall preclude the
Executive from devoting such reasonable time as required to serve,
or to continue to serve, on the boards of directors of, or to hold
any other offices or positions in or with respect to, other
companies, organizations or entities, provided that (i) the
Executive gives prior notice to the Company of such other
activities, (ii) such other activities do not violate
Paragraph 6 hereof, and (iii) such other activities have
no material effect on the time the Executive is required to spend
in connection with the services required of her hereunder.
5.
Compensation and Benefits. (a)
Base Salary . During the Employment Term, the Executive will
receive an annual salary, payable in monthly or more frequent
installments, of $600,000.00, subject to authorized withholding and
other deductions. The annual salary will be reviewed annually by
the CEO in consultation with the Executive and, if appropriate,
increased by the Compensation Committee of the Company’s
Board of Directors (the "Board"), in its sole discretion. Such
annual salary, as increased, is hereinafter referred to as the
"Base Salary." In no event shall the Executive’s Base Salary
be reduced without Executive’s written consent unless such
reduction is part of a comparable reduction for all members of
senior management. (b) Annual Cash
Incentive Bonus . During the Employment Term, the Executive
will be eligible to receive an annual cash incentive bonus based
upon the Executive’s and/or the Company’s achievement
of annual performance goals or objectives. The bonus goals and
objectives shall be proposed by the CEO in consultation with the
Executive and shall be reviewed with and approved or modified by
the
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Compensation Committee of the Board, in its sole discretion. The
Executive shall have an annual target bonus equal to one hundred
percent (100%) of Base Salary. Payment is made on or before
March 15th of each calendar year immediately following the
year in which such compensation is earned.
(c) Employee Benefits and
Perquisites . During the Employment Term, the Executive will be
entitled to receive all benefits and perquisites of employment
generally available to other members of the Company’s senior
executive management, upon her satisfaction of the eligibility or
participation criteria therefor. The Company reserves the right to
modify employee benefits and perquisites at its discretion.
(d) Reimbursement of Business
Expenses . The Company shall pay or reimburse the Executive, in
accordance with its normal policies and practices, for all
reasonable business expenses incurred by the Executive in
connection with the performance of her obligations hereunder. The
Executive shall produce accounts and vouchers or other reasonable
evidence of expenses incurred or payments made by the Executive,
all in accordance with the Company’s regular procedures in
effect from time to time and in form suitable to establish the
validity and deductibility of such expenses for tax purposes.
(e) Legal Fees . The Company
shall pay, or reimburse the Executive for the legal fees and
expenses of counsel incurred by the Executive in connection with
the preparation, negotiation, execution and delivery of this
Agreement, up to a maximum of $10,000.00.
(f) Withholding Taxes . There
shall be deducted and withheld from the Base Salary and all other
compensation payable to the Executive during or for the Employment
Term any and all amounts required to be deducted or withheld under
the provisions of any statute, regulation, ordinance or order.
6.
Obligations of the Executive During and After Employment.
(a) The Executive acknowledges and
agrees that solely by virtue of her employment by, and relationship
with, the Company, she will acquire "Confidential Information," as
defined in subparagraph (viii) below, as well as special
knowledge of the Company’s business and its relationships
with its clients and employees, and that, but for her association
with the Company, the Executive will not have had access to said
Confidential Information or knowledge of said relationships. The
Executive further acknowledges and agrees (1) that the Company
has long term relationships with its clients and employees, and
that those relationships were developed at great expense and
difficulty to the Company over several years of close and
continuing involvement; (2) that the Company’s
relationships with its clients and employees are and will continue
to be valuable, special and unique assets of the Company and
(3) that the Company has the following protectable interests
that are critical to its competitive advantage in the industry and
would be of demonstrable value in the hands of a competitor:
Company-specific information concerning revenues, costs, margins,
marketing strategies, employees, compensation systems, employee
benefits, corporate development plans and opportunities, financial,
accounting and corporate governance systems, and concepts,
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ideas, and other matters not generally known to the public. The
Company acknowledges and agrees that such protectable interests do
not include information properly in the public domain, or the
generalized knowledge, skills and know-how possessed by the
Executive, whether as a result of her employment or otherwise. In
return for the consideration described in this Agreement, the
Executive hereby represents, warrants and covenants as follows:
(i) The Executive has executed and
delivered this Agreement as her free and voluntary act, after
having determined that the provisions contained herein are of a
material benefit to her, and that the duties and obligations
imposed on her hereunder are fair and reasonable and will not
prevent her from earning a comparable livelihood following the
termination of her employment with the Company;
(ii) The Executive has read and fully
understands the terms and conditions set forth herein, has had time
to reflect on and consider the benefits and consequences of
entering into this Agreement, and has had the opportunity to review
the terms hereof with an attorney or other representative if she so
chooses; (iii) The execution and
delivery of this Agreement by the Executive does not conflict with,
or result in a breach of or constitute a default under, any
agreement or contract, whether oral or written, to which the
Executive is a party or by which the Executive may be bound;
(iv) The Executive agrees that,
during the time of her employment with the Company and for a period
of one year after termination of the Executive’s employment,
the Executive will not, except on behalf of the Company, anywhere
in North America or in any other place or venue where the Company
or any affiliate, subsidiary or division thereof now conducts or
operates, or may conduct or operate, its business prior to the date
of the Executive’s termination of employment:
(A) directly or indirectly, contact
or solicit any of the Company’s clients or prospective
clients (as they are hereinafter defined) for the purpose of
selling or distributing or attempting to sell or distribute, any
products and/or services in competition with the Company to its
clients during the term hereof. In addition, the Executive will not
disclose the identity of any such clients or prospective clients,
or any part thereof, to any person, firm, corporation, association,
or other entity for any reason or purpose whatsoever, except to the
extent (1) required by any law, regulation or order of any
court or regulatory commission, department or agency, provided that
the Executive gives prompt notice of such requirement to the
Company to enable the Company to seek an appropriate protective
order, or (2) such disclosure is necessary to perform properly
the Executive’s duties under this Agreement; and
(B) directly or indirectly, solicit
on her own behalf or on behalf of any other person, the services of
any person who is an employee of the
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Company, nor solicit any of the Company’s employees to
terminate employment with the Company;
(v) The Executive agrees that, during
the time of her employment with the Company and for a period of one
year after termination of the Executive’s employment
hereunder, provided that such termination either is by Company for
Cause (as hereinafter defined) or results in Executive receiving
the payments described in Paragraph 8(a), 8(b) or 8(d) of this
Agreement, the Executive will not, except on behalf of the Company,
anywhere in North America or in any other place or venue where the
Company or any affiliate, subsidiary or division thereof now
conducts or operates, or may conduct or operate, its business prior
to the date of the Executive’s termination of employment,
become directly or indirectly, an investor, owner or stockholder
(excluding investments representing less than 2% of the common
stock of a public company), lender, director , consultant,
employee, agent or salesperson, whether part-time or full-time of
any business that substantially competes with the Company or its
subsidiaries, affiliates or divisions;
(vi) The scope described above is
necessary and reasonable in order to protect the Company in the
conduct of its business and that, if the Executive becomes employed
by another employer, she shall be required to disclose the
existence of this Paragraph 6 to such employer and the
Executive hereby consents to and the Company is hereby given
permission to disclose the existence of this Paragraph 6 to
such employer; (vii) For purposes of
this Paragraph 6, "client" shall be defined as any person,
firm, corporation, association, or entity that purchased any type
of product and/or service from the Company, or is or was doing
business with the Company within the 12-month period immediately
preceding termination of the Executive’s employment. For
purposes of this Paragraph 6, "prospective client" shall be
defined as any person, firm, corporation, association, or entity
contacted or solicited in writing by the Company or who contacted
the Company within the 12-month period immediately preceding the
termination of the Executive’s employment for the purpose of
having such persons, firms, corporations, associations, or entities
become a client of the Company.
(viii) Both during her employment and
thereafter she will not, for any reason whatsoever, use for herself
or disclose to any person not employed by the Company any
"Confidential Information" of the Company acquired by the Executive
during her relationship with the Company, except to the extent that
such Confidential Information (a) becomes a matter of public
record or is published in a newspaper, magazine or other
periodical, or in other media, available to the general public,
other than as a result of any act or omission of the Executive,
(b) is required to be disclosed by law, regulation or order of
any court or regulatory commission, department or agency, provided
that the Executive gives prompt notice of such requirement to the
Company to enable the Company to seek an appropriate protective
order, or (c) is in the Executive’s reasonable judgment
required to be disclosed in order to perform properly the
Executive’s
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duties under this Agreement, including without limitation in
connection with a sale or potential sale of the Company or of all
or any portion of the assets of the Company under consideration by
the Board. The Executive further agrees to use Confidential
Information solely for the purpose of performing duties with the
Company and further agrees not to use Confidential Information for
her own private use or commercial purposes. The Executive agrees
that "Confidential Information" includes but is not limited to:
(1) any financial, engineering, business, planning,
operations, services, potential services, products, potential
products, technical information and/or know-how, organization
charts, formulas, business plans, production, purchasing,
marketing, pricing, sales, profit, personnel, customer, broker,
supplier, or other lists or information of the Company;
(2) any papers, data, records, processes, methods, techniques,
systems, models, samples, devices, equipment, compilations,
invoices, client lists, or documents of the Company; (3) any
confidential information or trade secrets of any third party
provided to the Company in confidence or subject to other use or
disclosure restrictions or limitations; and (4) any other
information, written, oral, or electronic, whether existing now or
at some time in the future, and whether pertaining to current or
future developments, which pertains to the Company’s affairs
or interests or with whom or how the Company does business. The
Company acknowledges and agrees that Confidential Information does
not include information properly in the public domain, or the
generalized knowledge, skills and know-how possessed by the
Executive, whether as a result of her employment or otherwise;
(ix) During the Employment Term and
thereafter, the Executive will not remove from the Company’s
premises any documents, records, files, notebooks, correspondence,
reports, video or audio recordings, computer printouts, computer
programs, computer software, price lists, microfilm, drawings, or
other similar documents containing Confidential Information,
including copies thereof, whether prepared by her or others, except
as her duties under this Agreement shall require, and in such
cases, will promptly return such items to the Company. Upon
termination of her employment with the Company, all such items
including summaries or copies thereof, then in the
Executive’s possession, shall be returned to the Company
immediately; (x) All ideas,
inventions, designs, processes, discoveries, enhancements, plans,
writings, and other developments or improvements (the "Inventions")
conceived by the Executive, alone or with others, during the term
of her employment, whether or not during working hours, that are
within the scope of the Executive’s business operations or
that relate to any of the Company’s work or projects
(including any and all inventions based wholly or in part upon
ideas conceived during the Executive’s employment with the
Company), are the sole and exclusive property of the Company. The
Executive further agrees that (1) she will promptly disclose
all Inventions to the Company and hereby assigns to the Company all
present and future rights she has or may have in those Inventions,
including without limitation those relating to patent, copyright,
trademark or trade secrets; and (2) all of the Inventions
eligible under the copyright laws are "work
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made for hire." At the request of and without charge to the
Company and without cost to the Executive, the Executive will do
all things deemed by the Company to be reasonably necessary to
perfect title to the Inventions in the Company and to assist in
obtaining for the Company such patents, copyrights or other
protection as may be provided under law and desired by the Company,
including but not limited to executing and signing any and all
relevant applications, assignments or other instruments.
Notwithstanding the foregoing, pursuant to the Employee Patent Act,
Illinois Public Act 83-493, the Company hereby notifies the
Executive that the provisions of this subparagraph (x) shall
not apply to any Inventions for which no equipment, supplies,
facility or trade secret information of the Company was used and
which were developed entirely on the Executive’s own time,
unless (1) the Invention relates (i) to the business of
the Company, or (ii) to actual or demonstrably anticipated
research or development of the Company, or (2) the Invention
results from any work performed by the Executive for the Company;
(xi) All client lists, supplier
lists, and client and supplier information are and shall remain the
exclusive property of the Company, regardless of whether such
information was developed, purchased, acquired, or otherwise
obtained by the Company or the Executive. The Executive also agrees
to furnish to the Company on demand at any time during her
employment, and upon the termination of her employment, any
records, notes, computer printouts, computer programs, computer
software, price lists, microfilm, or any other documents related to
the Company’s business, including originals and copies
thereof; (xii) The Executive may
become aware of "material" nonpublic information relating to
clients whose stock is publicly traded. The Executive acknowledges
that she is prohibited by law as well as by Company policy from
trading in the shares of such clients while in possession of such
information or directly or indirectly disclosing such information
to any other persons so that they may trade in these shares. For
purposes of this subparagraph (xii), "material" information may
include any information, positive or negative, which might be of
significance to an investor in determining whether to purchase,
sell or hold the stock of publicly traded clients. Information may
be significant for this purpose even if it would not alone
determine the investor’s decision. Examples include a
potential business acquisition, internal financial information that
departs in any way from what the market would expect, the
acquisition or loss of a major contract, or an important financing
transaction. (b) Remedy for
Breach . The Executive agrees that in the event of a material
breach or threatened material breach of any of the covenants
contained in this Paragraph 6, the Company will have the right
and remedy to have such covenants specifically enforced by any
court having jurisdiction, it being acknowledged and agreed that
any material breach of any of the covenants will cause irreparable
injury to the Company and that money damages will not provide an
adequate remedy to the Company. (c)
Blue-Penciling . The Executive acknowledges and agrees that
the non-competition and non-solicitation provisions contained
herein are reasonable and valid in geographic, temporal and subject
matter scope and in all other respects, and do not
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impose limitations greater than are necessary to protect the
goodwill, Confidential Information and other business interests of
the Company. Nevertheless, if any court or arbitrator determines
that any of said restrictive covenants and agreements, or any part
thereof, is unenforceable because of the duration or geographic
scope of such provision, such court or arbitrator will have the
power to reduce the duration, geographic scope or other scope of
such provision, as the case may be, and, in its reduced form, such
provision will then be enforceable to the maximum extent permitted
by applicable law.
7.
Termination of Employment. (a)
Termination as a Result of Death or Disability . The
Executive’s employment with the Company shall terminate
automatically upon the Executive’s death during the
Employment Term. If the Disability of the Executive has occurred
during the Employment Term (pursuant to the definition of
"Disability" set forth below), the Company 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 30th
day after receipt of such notice by the Board (the "Disability
Effective Date"), provided that, within the 30 days after
receipt of notice, the Executive shall not have returned to
substantial performance of the Executive’s duties. For
purposes of this Agreement, "Disability" shall mean the absence of
the Executive from the Executive’s duties with the Company
for 120 consecutive days, or a total of 180 days in any
12-month period, as a result of incapacity due to mental or
physical illness that is determined to be total and permanent by a
physician jointly selected by the Company and the Executive or the
Executive’s legal representative, or, if the parties cannot
agree on the selection of such physician then each shall choose a
physician and the two physicians shall jointly select a physician
to make such binding determination.
(b) Termination by the Company for
Cause . The Company may terminate the Executive’s
employment during the Employment Term for Cause at any time upon
written notice from the CEO or the Board specifying such Cause and
the expiration of the cure period specified below, and thereafter,
the Company’s obligations hereunder (other than the
obligation to pay any accrued salary or benefit) shall cease and
terminate; provided, however, that such written notice shall not be
delivered until after the CEO or the Board shall have given the
Executive written notice specifying the conduct alleged to have
constituted such Cause. The Executive shall have 30 days to
cure the matters specified in the notice delivered by the Board (to
the extent that such matters are curable). For purposes of this
Agreement, "Cause" shall mean the Executive’s willful
misconduct, dishonesty or other willful actions (or willful
failures to act) which are materially and demonstrably injurious to
the Company, or a material breach by the Executive of one or more
terms of this Agreement, which shall include the Executive’s
habitual neglect of the material duties required of her under this
Agreement. For purposes of this Paragraph, no act or failure to
act, on the part of the Executive, shall be considered "willful"
unless it is done, or omitted to be done, by the Executive in bad
faith or without reasonable belief that the Executive’s
action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given pursuant to a
resolution duly adopted by the Board or based upon the advice of
counsel for the Company shall be presumed to be done, or omitted to
be done, by the Executive in good faith and in the best interests
of the
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Company. In addition, Executive’s employment shall be
deemed to have terminated for Cause if, within six months after
Executive’s Date of Termination, based on facts and
circumstances discovered after the Executive’s employment has
terminated, the Board determines in good faith after appropriate
investigation that the Executive committed an act during the
Employment Term that would have justified a termination for Cause.
(c) Termination by the Executive
for Good Reason . The Executive’s employment with the
Company may be terminated by the Executive for Good Reason. For
purposes of this Agreement, "Good Reason" shall mean any of the
following actions, events or conditions that occur without the
express written consent of the Executive:
(i) removal by the Company of the
Executive’s title of President and Chief Operating Officer,
or a change such that Executive no longer reports to the CEO;
(ii) any material changes by the
Company in the Executive’s title, functions, duties, or
respons
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