EMPLOYMENT AGREEMENT

 

                                                                   Exhibit 10.11

 

                              EMPLOYMENT AGREEMENT

 

      THIS EMPLOYMENT AGREEMENT (this "Agreement") is made as of the 5th day of

January 2004, by and among PDI, INC., a Delaware corporation (the "Company"),

having its principal place of business at 10 Mountainview Road, Suite C200,

Upper Saddle River, New Jersey 07458, on the one hand, and ALAN L. RUBINO,

residing at 210 Old Chester Road, Essex Fells, NJ 07021 (the "Executive"), on

the other.

 

                               W I T N E S S E T H

 

      WHEREAS, the Company believes that it would benefit from the application

of the Executive's particular and unique skills, experiences and background in

connection with the management and operation of the Company, and wishes to

employ the Executive as Executive Vice President and General Manager, Sales

Teams Business; and

 

      WHEREAS, the parties desire by this Agreement to set forth the terms and

conditions of the employment relationship between the Company and the Executive.

 

      NOW, THEREFORE, in consideration of the foregoing and the mutual covenants

in this Agreement, the Company and the Executive agree as follows:

 

      1. Employment and Duties. The Company hereby employs the Executive as

Executive Vice President and General Manager, Sales Teams Business on the terms

and conditions provided in this Agreement and Executive agrees to accept such

employment subject to the terms and conditions of this Agreement. The Executive

shall be responsible for management of the day-to-day affairs of the Company's

Sales Teams Business, shall perform the duties and responsibilities as are

customary for the officer of a corporation in such positions, and shall perform

such other duties and responsibilities as are reasonably determined from time to

time by the President of Global Sales and Marketing Services Group of the

Company. The Executive shall report to and be supervised by the Company's

President of Global Sales and Marketing Services Group. The Executive shall be

based at the Company's offices in Upper Saddle River, New Jersey, or such other

place that shall constitute the Company's headquarters. The Executive agrees to

devote substantially all his attention and time during normal business hours to

the business and affairs of the Company and to use his reasonable best efforts

to perform faithfully and efficiently the duties and responsibilities of his

positions and to accomplish the goals and

 

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objectives of the Company as may be established from time to time by the

Company's Board of Directors (the "Board"). Notwithstanding the foregoing, the

Executive may engage in the following activities (and shall be entitled to

retain all economic benefits thereof including fees paid in connection

therewith) as long as they do not interfere in any material respect with the

performance of the Executive's duties and responsibilities hereunder and, with

respect to subsections (i) and (ii) below, that such activity is pre-approved by

the Company's President of Global Sales and Marketing Services Group: (i) serve

on corporate, civic, religious, educational and/or charitable boards or

committees, provided that the Executive shall not serve on any board or

committee of any corporation or other business which competes with the Business

(as defined in Section 10(a) below); (ii) deliver lectures, fulfill speaking

engagements or teach on a part-time basis at educational institutions; and (iii)

make investments in businesses or enterprises and manage his personal

investments; provided that with respect to such activities, Executive shall

comply with all applicable laws and any business conduct and ethics policy

applicable to employees of the Company.

 

      2. Term. The term of this Agreement shall commence on January 5, 2004 (the

"Commencement Date"), and shall terminate on January 5, 2006, unless extended or

earlier terminated in accordance with the terms of this Agreement (the

"Termination Date"). Such term of employment is herein sometimes referred to

herein as the "Employment Term". The Employment Term shall be extended for

successive one year periods unless either party notifies the other in writing at

least 90 days before the Termination Date, or any anniversary of the Termination

Date, as the case may be, that he or it chooses not to extend the Employment

Term. If the Company chooses not to extend the Employment Term, the Executive

shall be paid an amount equal to the product of twelve (12) times the Monthly

Salary Amount (as defined below), the continuation of his car allowance and

medical benefits for the 12 months following the end of the term of the

Agreement, contingent upon receipt by the Company of a signed Agreement and

Release by the Executive.

 

      3. Compensation. As compensation for performing the services required by

this Agreement, and during the Employment Term, the Executive shall be

compensated as follows:

 

            (a) Base Compensation. The Company shall pay to the Executive an

annual salary ("Base Compensation") of $230,000, payable in equal installments

pursuant to the

 

 

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Company's customary payroll procedures in effect for its executive personnel at

the time of payment, but in no event less frequently than monthly, subject to

withholding for applicable federal, state and local income and employment

related taxes. The Executive may be entitled to such increases in Base

Compensation with respect to each calendar year during the Employment Term, as

shall be determined by the Compensation Committee of the Board (the

"Committee"), in its sole and absolute discretion, based on an annual review of

the Executive's performance.

 

            (b) Incentive Compensation. In addition to Base Compensation, the

Executive may be entitled to receive additional compensation ("Incentive

Compensation") in the discretion of the Committee. The Incentive Compensation

shall be pursuant to short-term and/or long-term incentive compensation programs

which currently exist or may be established by the Company. For purposes of this

Agreement, the Executive's "Pro Rata Share" of Incentive Compensation for any

calendar year shall be a fraction whose numerator shall be equal to the number

of months (or parts of months) during which the Executive was actually employed

by the Company during any such calendar year and whose denominator shall be the

total number of months in such calendar year. The current ICP program is set at

0-125% of base salary with a 100% target. These targets are subject to change at

the discretion of the Compensation Committee of the Board of Directors.

 

            (c) Sign-On Bonus. In addition to Base Compensation, the Company

shall pay to the Executive within the first thirty days following the

Commencement Date the sum of $20,000, subject to withholding for applicable

federal, state and local income and employment related taxes.

 

            (d) Sign-On Stock Option. The Executive will be granted an option to

purchase 10,000 shares of the Company's common stock upon approval by the

Committee within the first thirty days following the Commencement Date. The

price of option will be determined by the closing market price of the Company's

common stock on the day the Executive's employment begins with the Company. The

option will vest in one-third increments over three years.

 

            (e) Financial Planning Program. The executive is eligible for the

Company's Financial Planning Program (AYCO).

 

      4. Employee Benefits. During the Employment Term and subject to the

limitations set forth in this Section 4, the Executive and his eligible

dependents shall have the right to

 

 

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participate in any retirement plans (qualified and non-qualified), pension,

insurance, health, disability or other benefit plan or program that has been or

is hereafter adopted by the Company (or in which the Company participates),

according to the terms of such plan or program, on terms no less favorable than

the most favorable terms granted to senior executives of the Company.

 

      5. Vacation and Leaves of Absence. The Executive shall be entitled to the

normal and customary amount of paid vacation provided to senior executive

officers of the Company, but in no event less than 20 days during each 12 month

period, beginning on the Commencement Date of this Agreement. Any vacation days

that are not taken in a given 12 month period shall not accrue or carry-over

from year to year. Upon any termination of this Agreement for any reason

whatsoever, accrued and unused vacation for the year in which this Agreement

terminates will be paid to the Executive within 10 days of such termination

based on his annual rate of Base Compensation in effect on the date of such

termination. In addition, the Executive may be granted leaves of absence with or

without pay for such valid and legitimate reasons as the Company in its sole and

absolute discretion may determine, and the Executive shall be entitled to the

same sick leave and holidays provided to other senior executives of the Company.

 

      6. Expenses.

 

            (a) Business Expenses. The Executive shall be promptly reimbursed

against presentation of vouchers or receipts for all reasonable and necessary

expenses incurred by him in connection with the performance of his duties

hereunder.

 

            (b) Automobile Expense. During the Employment Term, in order to

facilitate the performance of the Executive's duties hereunder, and otherwise

for the convenience of the Company, the Company (a) (i) shall reimburse the

Executive for the cost of leasing an automobile consistent with the Executive

Vice President car benefit described in the Company's Car Benefit Program as of

December 2002 or (ii) shall pay the Executive $850.00 per month and (b) shall

pay or reimburse Executive (upon presentation of vouchers or receipts) for the

reasonable cost of all maintenance, insurance, repairs and other reasonable

expenses related to such automobile (the "Automobile Benefit"). The Executive

hereby agrees that a new lease for an automobile will not be executed until the

Executive's existing lease term has expired.

 

      7. Indemnification.

 

 

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            (a) General. The Company agrees that if the Executive is made a

party or is threatened to be made a party to any action, suit or proceeding,

whether civil, criminal, administrative or investigative (a "Proceeding"), by

reason of the fact that she is or was a director or officer of the Company, is

or was serving at the request of the Company as a director, officer, member,

employee or agent of another corporation or of a partnership, joint venture,

trust or other enterprise, including, without limitation, service with respect

to employee benefit plans, whether or not the basis of such Proceeding is

alleged action in an official capacity as a director, officer, member, employee

or agent while serving as a director, officer, member, employee or agent, the

Executive shall be indemnified and held harmless by the Company to the fullest

extent authorized by applicable law (in accordance with the certificate of

incorporation and/or bylaws of the Company), as the same exists or may hereafter

be amended, against all Expenses (as defined below) incurred or suffered by the

Executive in connection therewith, and such indemnification shall continue as to

the Executive even if the Executive has ceased to be an officer, director or

agent, or is no longer employed by the Company and shall inure to the benefit of

his heirs, executors and administrators.

 

            (b) Expenses. As used in this Agreement, the term "Expenses" shall

include, without limitation, damages, losses, judgments, liabilities, fines,

penalties, excise taxes, settlements and costs, attorneys' fees, accountants'

fees, and disbursements and costs of attachment or similar bonds,

investigations, and any expenses of establishing a right to indemnification

under this Agreement.

 

            (c) Enforcement. If a claim or request under this Agreement is not

paid by the Company, or on its behalf, within fifteen days after a written claim

or request has been received by the Company, the Executive may at any time

thereafter bring suit against the Company to recover the unpaid amount of the

claim or request and if successful in whole or in part, the Executive shall be

entitled to be paid also the expenses of prosecuting such suit. The burden of

proving that the Executive is not entitled to indemnification for any reason

shall be upon the Company.

 

            (d) Subrogation. In the event of payment under this Agreement, the

Company shall be subrogated to the extent of such payment to all of the rights

of recovery of the Executive.

 

 

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            (e) Partial Indemnification. If the Executive is entitled under any

provision of this Agreement to indemnification by the Company for some or a

portion of any Expenses, but not, however, for the total amount thereof, the

Company shall nevertheless indemnify the Executive for the portion of such

Expenses to which the Executive is entitled.

 

            (f) Advances of Expenses. Expenses incurred by the Executive in

connection with any Proceeding shall be paid by the Company in advance upon

request of the Executive that the Company pay such Expenses.

 

            (g) Notice of Claim. The Executive shall give to the Company notice

of any claim made against him for which indemnity will or could be sought under

this Agreement. In addition, the Executive shall give the Company such

information and cooperation as it may reasonably require and as shall be within

the Executive's power and at such times and places as are reasonable for the

Executive.

 

            (h) Defense of Claim. With respect to any Proceeding as to which the

Executive notifies the Company of the commencement thereof: (i) the Company will

be entitled to participate therein at its own expense; and (ii) except as

otherwise provided below, to the extent that it may wish, the Company jointly

with any other indemnifying party similarly notified will be entitled to assume

the defense thereof, with counsel reasonably satisfactory to the Executive. The

Company shall not be entitled to assume the defense of any action, suit or

proceeding brought by or on behalf of the Company or as to which the Executive

shall have reasonably concluded that there may be a conflict of interest between

the Company and the Executive in the conduct of the defense of such action.

 

                  The Company shall not be liable to indemnify the Executive

under this Agreement for any amounts paid in settlement of any action or claim

effected without its written consent. The Company shall not settle any action or

claim in any manner which would impose any penalty or limitation on the

Executive without Executive's written consent. Neither the Company nor the

Executive shall unreasonably withhold or delay their consent to any proposed

settlement.

 

            (i) Non-exclusivity. The right to indemnification and the payment of

expenses incurred in defending a Proceeding in advance of its final disposition

conferred in this Section 7 shall not be exclusive of any other right which the

Executive may have or hereafter may acquire

 

 

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under any statute, provision of the certificate of incorporation or bylaws of

the Company, agreement, vote of stockholders or disinterested directors or

otherwise.

 

            (j) Directors and Officers Liability Policy. The Company agrees to

use reasonable efforts to maintain directors and officers liability insurance

covering the Executive in a reasonable and adequate amount determined by the

Company.

 

      8. Termination and Termination Benefits.

 

            (a) Termination by the Company.

 

                  (i) For Cause. Notwithstanding any provision contained herein,

the Company may terminate this Agreement at any time during the Employment Term

for "Cause". For purposes of this subsection 8(a)(i), "Cause" shall mean (1) the

continuing failure by the Executive to perform his duties hereunder for any

reason other than total or partial incapacity due to physical or mental illness,

or (2) gross negligence or gross malfeasance on the part of the Executive in the

performance of his duties hereunder that causes material harm to the Company.

Termination pursuant to this subsection 8(a)(i) shall be effective immediately

upon giving the Executive written notice thereof stating the reason or reasons

therefor with respect to clause (2) above, and 15 days after written notice

thereof from the Company to the Executive specifying the acts or omissions

constituting the failure and requesting that they be remedied with respect to

clause (1) above, but only if the Executive has not cured such failure within

such 15 day period. In the event of a termination pursuant to this subsection

8(a)(i), the Executive shall be entitled to payment of his Base Compensation and

the benefits pursuant to Section 4 hereof up to the effective date of such

termination and it is also the intention and agreement of the Company that

Executive shall not be deprived by reason of termination for Cause of any

payments, options or benefits which have been vested or have been earned or to

which Executive is entitled as of the effective date of such termination.

 

                  (ii) Disability. If due to illness, physical or mental

disability, or other incapacity, the Executive shall fail, for a total of any

six consecutive months ("Disability"), to substantially perform the principal

duties required by this Agreement, the Company may terminate this Agreement upon

30 days' written notice to the Executive. In such event, the Executive shall be

(1) paid his Base Compensation until the Termination Date and his Pro Rata Share

of any Incentive Compensation to which she would have been entitled for the year

in which such

 

 

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termination occurs, and (2) provided with employee benefits pursuant to Section

4, to the extent available, for the remainder of the Employment Term; provided,

however, that any compensation to be paid to the Executive pursuant to this

subsection 8(a)(ii) shall be offset against any payments received by the

Executive pursuant to any policy of disability insurance the premiums of which

are paid for by the Company.

 

            (b) Termination Without Cause or Termination For Good Reason. The

Company may terminate the Executive's employment hereunder without Cause and the

Executive may terminate his employment hereunder for "Good Reason" (as defined

below). If the Company terminates the Executive's employment hereunder without

Cause, other than due to death or Disability, or if the Executive terminates his

employment for Good Reason, the Executive shall be paid (contingent upon receipt

by the Company of a signed Agreement and General Release by the Executive): (i)

his Base Compensation at the rate in effect at the time of termination through

the Termination Date; (ii) his Pro Rata Share of any Incentive Compensation to

which she would have been entitled for the year in which such termination

occurs; (iii) a lump sum payment equal to the product of twelve (12) times the

"Monthly Salary Amount"; (iv) any vested deferred compensation (including,

without limitation, interest or other credits on the deferred amounts) and any

accrued vacation pay; (v) continuation, until the expiration of the Employment

Term and for twelve months thereafter, of the health and welfare benefits of the

Executive and any long-term disability insurance generally provided to senior

executives of the Company (as provided for by Section 4 of this Agreement) (or

the Company shall provide the economic equivalent thereof); provided, however,

if the Executive obtains new employment and such employment makes the Executive

eligible for health and welfare or long-term disability benefits which are equal

to or greater in scope then the benefits then being offered by the Company, then

the Company shall no longer be required to provide such benefits to the

Executive; (vi) continuation, until the expiration of the Employment Term and

for twelve months thereafter, of the Automobile Benefit; and (vii) any other

compensation and benefits as may be provided in accordance with the terms and