EXHIBIT 10.11
EMPLOYMENT AGREEMENT
This Agreement
among Charles Moran (the "Executive") and SmartForce PLC, a public
company limited by shares formed under the laws of the Republic of
Ireland ("SmartForce PLC") and its wholly-owned subsidiary,
SmartForce, a Delaware corporation ("SmartForce"), is entered into
as of June 10, 2002. The effectiveness of this Agreement is subject
to the occurrence of the Closing Date as that term is defined in
the Agreement and Plan of Merger by and among SmartForce, SkillSoft
Corporation and Slate Acquisition Corp. (the "Effective Date"). If
such Agreement and Plan of Merger is terminated prior to the
Closing Date, this Agreement shall be null and void. For purposes
of this Agreement, the term "Company" shall be used to refer to
both SmartForce PLC and SmartForce.
WHEREAS, the
Company desires to employ the Executive and the Executive desires
to accept employment with the Company on the terms and conditions
set forth below;
NOW, THEREFORE, in
consideration of the foregoing recital and the respective covenants
and agreements of the parties contained in this document, the
Company and the Executive agree as follows:
1. Employment
and Duties. The Executive shall be employed as President and Chief
Executive Officer of the Company effective as of the Effective Date
reporting to the Board of Directors of SmartForce PLC (the
"Board"), and assuming and discharging such responsibilities as are
mutually agreed upon by the Executive and the Board commensurate
with such office and position. The Executive shall perform
faithfully the executive duties assigned to him to the best of his
ability.
2. Base
Salary. In consideration of the Executive's services, the Executive
shall be paid a minimum base salary at the rate of $225,000 per
year during the period of employment (the "Base Salary"), to be
paid in installments in accordance with the Company's standard
payroll practices. This Base Salary shall be reviewed for increases
at least annually by the Board on the same basis as the Board shall
review the compensation of other executive officers of the
Company.
3. Bonus.
In addition to the Base Salary, the Executive shall be eligible to
receive an annual performance bonus in the amount determined by the
Board(the "Targeted Bonus") based on performance metrics
established by the Board. This Targeted Bonus shall be reviewed for
increases at least annually by the Board on the same basis as the
Board shall review the compensation of other executive officers of
the Company.
4. At-Will
Employment. The Company and the Executive acknowledge that the
Executive's employment is and shall continue to be at-will, as
defined under applicable law. If the Executive's employment
terminates for any reason, the Executive shall not be entitled to
any payments, benefits, damages, awards or compensation other than
as provided by this Agreement, or as may otherwise be available in
accordance with the Company's established employee plans and
policies or other written agreements with the Executive at the time
of termination.
5. Benefits;
Expenses. The Executive, together with his spouse and dependent
children, shall be permitted, to the extent eligible, to
participate at the Company's expense in any group medical, dental,
life insurance and disability insurance plans, or similar benefit
plans of the Company that are available to other executive officers
in each case pursuant to the terms and conditions of each such plan
or program. The Executive shall also be entitled to four (4) weeks'
annual vacation. Without limiting the generality of the foregoing,
the Company shall reimburse the Executive for all reasonable
business and travel expenses actually incurred or paid by the
Executive in the performance of services on behalf of the Company,
in accordance with the Company's expense reimbursement policy as in
effect from time to time.
6. Voluntary
Termination and Termination for Cause. In the event that the
Executive terminates his employment with the Company voluntarily
(other than for Good Reason, as defined below) or the Company
terminates the Executive's employment for Cause, Sections 6(a),
6(b) and 6(c) below shall apply. For purposes of this Agreement,
termination for "Cause" shall mean (i) any act of personal
dishonesty taken by the Executive in connection with his
responsibilities as an employee which is intended to cause a
material personal financial benefit for the Executive and is
intended to cause a material financial detriment to the Company,
(ii) the Executive's conviction of or plea of nolo contendere to a
felony, (iii) a willful act by the Executive which constitutes
misconduct and is injurious to the Company, and (iv) continued
willful violations by the Executive of the Executive's obligations
to the Company under this Agreement.
(a) Covenant
Not to Solicit. Beginning with the effective date of the
Executive's voluntary termination (other than for Good Reason) or
termination for Cause and until the later of (i) one (1) year
thereafter or (ii) the date that is two (2) years after the
Effective Date (the "Non-Compete Period"), the Executive agrees
that he will not:
(i) solicit,
encourage, or take any other action which is intended to induce any
other employee of the Company to terminate his employment with the
Company, or
(ii)
interfere in any manner with the contractual or employment
relationship between the Company and any such employee of the
Company.
The foregoing
shall not prohibit the Executive or any entity with which the
Executive may be affiliated from hiring a former employee of the
Company, provided that such hiring results from such employee's
affirmative response to a general recruitment effort carried out
through a public solicitation or a general solicitation.
(b) Covenant
Not to Compete. During the Non-Compete Period, the Executive agrees
that he will not, directly or indirectly, own, manage, operate,
join, control, advise or participate in, as a shareholder (other
than as a shareholder with less than one percent (1%) of the
outstanding stock of a company), officer, manager, executive,
partner, consultant or technical or business advisor (or any
foreign equivalents of the foregoing) any company that derives more
than ten percent (10%) of its revenues from a Restricted Business,
or any company or entity controlling, controlled by or under common
control with any company that derives more than ten percent (10%)
of its revenues from a Restricted Business (any such company, a
"Restricted Company").
For the
purposes of this Agreement, the term "Restricted Business" shall
mean the business of developing or selling computer-based training
for information technology professionals, on-line business degrees,
or any other interactive education business in which the Company is
then involved.
The foregoing will
not in any way affect the Executive's right to take any of the
foregoing positions if he is involved only in parts of a company
that do not derive any revenues from the Restricted
Business.
(i) In
the event that the Executive intends to associate with any
Restricted Company during the Non-Compete Period, the Executive
must provide information in writing to the Board of Directors of
the Company relating to the business engaged in or proposed to be
engaged in by such Restricted Company. All such current
associations of the Executive are set out in Exhibit A
hereto.
In the event that
the Board of Directors authorizes the Executive to engage in such
activity in writing, any activity by the Executive described in the
written information furnished to the Chairman of the Board and so
authorized shall be conclusively deemed not to be a violation of
Section 6(a) and (b) hereof.
(ii)
The Executive acknowledges that, pursuant to an Agreement and Plan
of Merger among the Company, SkillSoft Corporation ("SkillSoft")
and Slate Acquisition Corp., he is transferring all shares of
SkillSoft owned by him and that the Company will be irreparably
injured if the provisions of this Section 6 are not specifically
enforced. If the Executive commits or, in the reasonable belief of
the Company, threatens to commit a breach of any of the provisions
of this Section 6, the Company and each of its subsidiaries and
affiliates shall have the right and remedy, in addition to any
other remedy that may be available at law or in equity, to have the
provisions of this Section 6 specifically enforced by any court
having equity jurisdiction together with an accounting for any
benefit or gain by the Executive in connection with any such
breach, it being acknowledged and agreed that any such breach or
threatened breach will cause irreparable injury to the Company and
its subsidiaries and that money damages will not provide an
adequate remedy therefor. Such injunction shall be available
without the posting of any bond or other security, and the
Executive hereby consents to the issuance of such
injunction.
(c) The
Executive shall not receive any compensation or benefits under this
Agreement on account of his voluntary termination or termination
for Cause. The Executive's rights under the Company's benefit plans
upon such a termination shall be determined under the provisions of
those plans.
7. Termination
without Cause and Involuntary Termination. If the Executive's
employment with the Company is involuntarily terminated by the
Company other than for Cause or by the Executive for Good Reason
(an "Involuntary Termination Event"), Sections 7(a) and 7(b) below
shall apply.
For purposes of
this Agreement, the term "Good Reason" shall mean (i) without the
Executive's express written consent, the assignment to the
Executive of any duties, or the removal from or reduction or
limitation of the Executive's duties or responsibilities, which in
either case is a significant change in the Executive's position,
title, organization level, duties, responsibilities, compensation
and status with the Company; (ii) without the Executive's express
written consent, a substantial reduction of the facilities and
perquisites (including office space and location) available to the
Executive immediately prior to such reduction; (iii) without the
Executive's express written consent, a reduction by the Company in
the base salary of the Executive as in effect immediately prior to
such reduction; (iv) without the Executive's express written
consent, a reduction by the Company in the kind or level of
employee benefits to which the Executive is entitled immediately
prior to such reduction with the result that the Executive's
overall benefits package is significantly reduced; (v) without the
Executive's express written consent, the relocation of the
Executive to a facility or a location more than twenty (20) miles
from the Executive's then-present work location; (vi) any purported
termination of the Executive by the Company other than for Cause or
by reason of the Executive's death or Disability; (vii) the failure
of the Company to obtain the assumption of this Agreement by any
successor as required by Section 12 below; (viii) without the
Executive's express written consent, the granting of options or
other equity, or
