EXHIBIT 10.1
EMPLOYMENT
AGREEMENT
This Employment Agreement
(“Agreement”) is made by and between Analysts
International Corporation (the “Company”) with
headquarters at 3601 W. 76th Street, Minneapolis, Minnesota 55435
and Randy W. Strobel, 2543 Bridle Creek Trail, Chanhassen,
Minnesota 55317 (“Executive”).
RECITALS
WHEREAS, the Company desires to retain Executive
as an employee of the Company, and Executive desires to be so
employed.
NOW, THEREFORE, in consideration of the mutual
promises and agreements set forth herein, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and Executive hereby agree as
follows:
In consideration of the mutual promises
contained herein, the parties, intending to be legally bound, agree
as follows:
AGREEMENT
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Commencement
Date. This
Agreement shall become effective on August 25, 2008 (the
“Commencement Date”).
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Position . The Company will employ Executive
in the capacity of Senior Vice President, Chief Financial Officer,
reporting to the Company’s CEO.
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Best
Efforts . During Executive’s employment
by the Company, Executive agrees to devote his full time and best
efforts to the interests of the Company and to refrain from
engaging in other employment or in any activities that may be in
conflict with the best interests of the
Company. Executive agrees to perform his duties to a
level consistent with the highest standards of one holding such
position in similar businesses or enterprises. Executive
agrees not to render services to anyone other than the Company (or
its parent or subsidiaries) for compensation as an employee,
consultant or otherwise during the term of this
Agreement.
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Personal
Activities . The provisions of Sections 1.2 and
1.3 of this Agreement will not be deemed to prohibit Executive from
devoting reasonable time to personal matters.
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Duration . Subject to the provisions for
termination set forth in Sections 6, 7 and 8 below, the Original
Term of this Agreement (“Original Term”) will continue
from the Commencement Date through the 31st day of December,
2010.
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Extension of
Provisions. At the end of the Original Term, the
provisions of the Agreement will automatically renew for an
additional one (1) year term (“Additional Term”)
commencing January 1, 2011, unless either party gives notice of
nonrenewal at least ninety (90) days before the scheduled
expiration of the term. At the end of any Additional
Term, the provisions of the Agreement will automatically renew for
an Additional Term, unless either party gives notice of
nonrenewable at least ninety (90) days before the scheduled
expiration of the term.
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Compensation and Benefits.
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Salary . For all services rendered by
Executive pursuant to this Agreement, the Company will pay
Executive an annual base salary (“Base Compensation”)
equal to Two Hundred-Fifty Thousand Dollars
($250,000). Payment will occur at regular payroll
intervals in accordance with the Company’s standard payroll
practices. The Company’s CEO and compensation
committee of the Board or the Board itself will review the
Executive’s compensation annually and, in its sole
discretion, may determine to increase such base salary for the
following year but cannot decrease the annual salary below
$250,000.
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Incentive
Compensation . In addition to Executive’s
Base Compensation, Executive will be eligible to earn additional
cash incentive compensation in a target range of between 0% and 70%
of Base Compensation in each year of employment during the Original
Term or any Additional Term (“Incentive
Compensation”). Executive’s potential
Incentive Compensation for fiscal year 2008 will be determined in
accordance with the 2008 Annual Management Incentive Plan attached
as Exhibit B (“AMIP”), and will be prorated on a 5/12
basis to reflect his partial service during 2008. For
purposes of the AMIP, Executive is a leader of an SSU and is
eligible to participate in the AMIP. Executive
understands that the AMIP set forth in Exhibit B applies only to
fiscal year 2008, and in the sole discretion of the Company will be
replaced, amended or eliminated for fiscal years after
2008.
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Long-Term
Incentive Compensation . In addition, Executive shall be
eligible to be awarded stock options or restricted shares from the
Company’s stock option and equity incentive plans at the sole
discretion of the compensation committee.
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Stock
Options . On
or about August 25, 2008, Executive will be granted options to
purchase 250,000 shares of the Company’s common stock with
one-quarter being vested immediately and the remainder vesting on
the anniversary date hereof in even increments over three years
from the date of the grant.
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Such options
shall be incentive stock options to the extent that such options
qualify as incentive stock options as defined in Internal Revenue
Code Section 422. The Company may issue such options
from the plans as it deems appropriate but to the extent possible
shall issue the options as incentive stock options. The
stock option agreement shall provide that in the event of a Change
of Control on or after the effective date of this Agreement, any
options remaining unvested at the time of the Change of Control
shall vest immediately. For purposes of this Section
3.4, “Change of Control” shall have the same meaning as
set forth in Exhibit A. Executive shall sign an option
agreement or agreements containing the terms for the options
outlined herein and such other terms and conditions required of
similarly situated executives by the Company as determined by the
Board or the compensation committee of the Board.
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Deferred
Compensation Plan . Executive will be entitled to
participate in the Company’s deferred compensation plan
(known as the “Restated Special Executive Retirement
Plan” or “Restated SERP”) at a participation rate
of fifteen percent (15%) of Base Compensation.
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Fringe
Benefits . Executive will be entitled to
participate in the Company’s standard benefit programs, on
the same terms as other senior executives of the
Company. Notwithstanding the foregoing, the Company will
also provide Executive the following:
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Paid Time
Off . Executive shall be entitled to paid
time off at his discretion and as business conditions
warrant. If necessary due to business conditions of the
Company, Executive agrees to obtain concurrence from the CEO prior
to taking the paid time off.
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Paid
Parking . The
Company will provide Executive with a paid indoor, underground
parking spot, if available, at the Company’s office building
presently located at 3601 West 76 Street, Minneapolis, Minnesota
55435.
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Business
Expenses . Executive will be entitled to
reimbursement of all reasonable, business-related travel and other
expenses incurred by Executive in the ordinary course of business
on behalf of the Company, so long as such expenses are incurred,
documented and authorized pursuant to the Company’s expense
reimbursement policies.
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Amount; When
Payable . The
Company shall pay Executive a “Signing Bonus” in the
amount of $75,000. The Signing Bonus will be payable
within fifteen days of the Commencement Date and shall be payable
in accordance with the Company’s standard payroll practices
and subject to applicable withholdings.
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Repayment
Required Under Certain Circumstances . Upon request, Executive agrees to
promptly repay to the Company the entire amount of the Signing
Bonus (less applicable withholdings) if for any reason his
employment with the Company terminates before December 31,
2008.
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The Company
will keep all Directors and Officers insurance policies current and
will identify Executive, if appropriate, on all such
policies.
Executive will
provide his services in the Minneapolis, Minnesota
area. Notwithstanding the foregoing, the parties
recognize and acknowledge that Executive may be required to spend
considerable business time in locations other than the Minneapolis,
Minnesota area.
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Termination of Employment by the
Company.
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For
Cause . For
purposes of this Agreement, the Company will have the right to
terminate Executive’s employment for Cause. For
purposes of this Agreement, “Cause” shall
mean:
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Executive’s substantial failure or
neglect, or refusal to perform, the duties and responsibilities of
Executive’s position and/or the reasonable direction of the
CEO;
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The commission
by Executive of any willful, intentional or wrongful act that has
the effect of materially injuring the reputation, business or
performance of the Company;
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Executive’s conviction of, or
Executive’s guilty or nolo contendere plea with respect to,
any crime punishable as a felony;
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Executive’s conviction of, or
Executive’s guilty or nolo contendere plea with respect to,
any crime involving moral turpitude; or
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Any bar against
Executive from serving as a director, officer or executive of any
firm the securities of which are publicly traded.
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For purposes of
this Section 6.1, an act or failure to act by Executive shall not
be “willful” unless it is done, or omitted to be done,
in bad faith and without any reasonable belief that
Executive’s action or omission was in the best interests of
the Company.
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Inability to
Perform. For
purposes of this Agreement, the Company will have the right to
terminate Executive’s employment upon the occurrence of any
of the following events (“Inability to
Perform”):
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Executive
becomes unable to perform the essential functions of
Executive’s position for a period of at least ninety (90)
days to the extent that, in the reasonable determination of the
CEO, he is no longer able to report to work and to carry on his
duties on behalf of the Company; or
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Notwithstanding
anything to the contrary in this Section 6.2, if and to the extent
the Company’s CEO and compensation committee of the Board
determine, in their sole discretion and in accordance with the
performance objectives set forth in the AMIP attached as Exhibit B,
that Executive should be paid Incentive Compensation for the
portion of the fiscal year prior to any such termination for
Inability to Perform, Executive shall be paid such amount within
thirty (30) days after the Company’s CEO and compensation
committee of the Board make such determination. For the
avoidance of doubt, in the event of an Inability to Perform,
Executive understands that he shall have no right to any such
Incentive Compensation, and whether or not he receives Incentive
Compensation in such event is solely a matter of discretion for the
Company’s CEO and compensation committee of the Board to
determine.
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Notice . In the event that the CEO
determines that Cause for termination exists, the CEO shall deliver
to Executive written notice that an event of Cause has occurred
after which Executive shall have fifteen (15) days to cure such
event of Cause to the reasonable satisfaction of the
CEO.
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Termination
for Cause/Inability to Perform . The Company may terminate
Executive’s employment at any time for Cause as defined
within this Agreement after giving Executive the notice and
Executive’s failure to cure pursuant to Section 6.3 above and
in any such case will have no further obligation or liability to
Executive. Likewise, if the Company terminates Executive
for Inability to Perform, the Company will have no further
obligation or liability to Executive except (and only) as stated in
Section 6.2.3 above and except for offering continuation of
benefits as required by the Consolidated Omnibus Budget
Reconciliation Act (“COBRA”) and the regulations
promulgated thereunder.
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Termination
Without Cause . Executive’s employment during
the Original Term or any Additional Term may be terminated by the
Company without Cause upon thirty (30) days’
notice. If the Company terminates Executive’s
employment without Cause during the Original Term or during any
Additional Term, Executive will continue to receive Base
Compensation for a period of twelve (12) months, provided that
Executive signs all appropriate paperwork, including a full release
of all claims to the Company, in a form acceptable to the
Company. The Company will also reimburse Executive for
medical insurance premium payments made under COBRA, for a period
of up to six (6) months following the date of termination, provided
that the Company receives sufficient evidence of proof of such
payments during the COBRA period. For purposes of this
Section 6.5, termination of Executive’s employment due to
nonrenewal of Executive’s employment agreement at the end of
the Original Term or any Additional Term, shall be deemed a
termination without Cause and entitle Executive to the payments and
benefits set forth in this Section 6.5.
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Termination of Employment by
Executive.
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Resignation
for Good Reason . If Executive believes Good Reason
to resign exists, before resigning, he must first give the Company
written notice of the alleged Good Reason and an opportunity to
cure within fifteen (15) days of notice if feasible. If
Executive resigns from his employment for Good Reason, he will
continue to receive Base Compensation for a period of twelve (12)
months, provided that Executive signs all appropriate paperwork,
including a full release of all claims to the Company, in a form
reasonably acceptable to the Company. The Company will
also reimburse Executive for all medical insurance premium
payments, made under COBRA, for a period of up to six (6) months
following the date of resignation for Good Reason, provided that
the Company receives sufficient evidence of proof of such payments
during the COBRA period.
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For purposes of
this Section 7.1 (and not for the purpose of determining
compensation and benefits payable under Exhibit A, the Change in
Control Agreement), “Good Reason” will mean a good
faith determination by Executive, communicated in writing to the
CEO, that any one or more of the following events has
occurred:
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a reduction in
Executive’s Base Salary below $250,000;
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a requirement
imposed on Executive that results in Executive being based at a
location that is outside of a fifty (50) mile radius of
Executive’s job location immediately prior to the change in
location;
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any material
breach or unilateral and material change in assignment or job
title, but not including a change in Executive’s reporting
structure in the event of a Change in Control.
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Notice . If Executive terminates his
employment for Good Reason, he must provide thirty (30) days’
prior written notice to the Company.
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Resignation
without Good Reason . If Executive resigns from his
employment (or elects not to renew the Agreement upon its
expiration) without Good Reason, the Company will have no further
obligation or liability to Executive.
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Change of
Control Obligations; Deferred Compensation
Payments.
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Change of
Control Obligations . In the event of a change in control
in the ownership of the Company, the Company’s and
Executive’s obligations, and Executive’s benefits,
shall be governed by the Change of Control Agreement attached
hereto as Exhibit A. Notwithstanding the foregoing, in
the event of a change in control (as the term “Change of
Control” is defined in Exhibit A), Executive shall have the
additional right at the six (6) month anniversary date after the
Change of Control to resign and receive the payments outlined in
Section 7.1 above, provided that Executive signs all appropriate
paperwork, including providing a full a release of all claims to
the Company in a form acceptable to the Company. To
exercise this right to resign and receive severance, Executive must
give written notice of intent to resign no sooner than four (4)
months after a Change of Control, and no later than five (5) months
after a Change of Control.
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Deferred
Compensation Payments . Deferred compensation covered by
the Company’s deferred compensation plan (Restated SERP) will
be treated and distributed in accordance with terms and conditions
of the Restated SERP.
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Limitation
on Change of Control Severance Payments . For the avoidanc
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