Exhibit 10.1
EMPLOYMENT
AGREEMENT
This Employment Agreement
(“Agreement”) is made by and between Analysts
International Corporation (the “Company” or
“AIC”) with headquarters at 3601 W. 76th Street,
Minneapolis, Minnesota 55435 and James D. Anderson, 15124 Lynn
Terrace, Minnetonka, Minnesota 55345
(“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
1.
Terms of
Employment
1.1
Commencement Date.
This Agreement shall become
effective on September 1, 2009 (the “Commencement
Date”).
1.2
Position . The Company will employ Executive in the
capacity of Senior Vice President, Client Services Operations,
reporting to the Company’s CEO.
1.3
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.
1.4
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.
Specifically, the Company acknowledges and agrees that Executive
may continue to provide advisory services to his former employer,
Element Consulting Group, through December 31, 2009.
Such services will be limited to high-level strategic discussions
which do not involve specific clients of Element Consulting or
clients that may be common to Element Consulting and AIC, and will
be provided by Executive to Element Consulting on a no-charge
basis.
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2.
Term of
Employment.
2.1
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 August,
2011.
2.2
Extension of
Provisions. At the
end of the Original Term, the provisions of this Agreement will
automatically renew for an additional one (1) year term
(“Additional Term”) commencing September 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.
3.
Compensation and
Benefits.
3.1
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 Seventy-five Thousand Dollars ($275,000). 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 $275,000.
3.2
Incentive Compensation
.
3.2.1
Balance of 2009
: In addition to
Executive’s Base Compensation, Executive will be eligible to
earn a cash incentive payment for his work during the balance of
2009, prorated on a 4/12 basis to reflect his actual employment
during calendar year 2009. The target amount of
Executive’s 2009 bonus is 50% of Base Compensation (subject
to proration). One-half of said 2009 bonus will be dependent
on whether or not Executive achieves certain individual performance
goals, and the other half of said 2009 bonus will be dependent on
whether or not the Company achieves certain performance
goals. Such goals will be formulated and determined in
accordance with an incentive performance plan to be completed and
agreed upon between the parties (with a target completion date of
within 30 days after the Commencement Date). Such Incentive
Performance Plan for the balance of 2009 shall become
Exhibit B to this Agreement when completed.
3.2.2
Other Years
: Commencing on
January 1, 2010 and continuing through the Original Term and
any Additional Term of this Agreement, in addition to
Executive’s Base Compensation, Executive will be eligible to
earn an annual cash incentive payment in a target amount equal to
50% of Base Compensation. Payment of any such annual cash
incentive will depend on
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whether and to what extent Executive
achieves certain performance goals consistent with the Annual
Management Incentive Plan (AMIP) as approved annually by the
Compensation Committee of the Board of Directors. Such
performance goals will be determined in accordance with an annual
incentive performance plan to be completed and agreed upon between
the parties. Each such incentive performance plan shall
become an exhibit to this Agreement when completed.
3.3
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 of the Board of Directors.
3.4
Stock Options
. Shortly after the
Commencement Date and subject to approval of the Company’s
Compensation Committee or its Board of Directors, 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.
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
or as set forth in the Company’s offer letter to
Executive.
3.5
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.
3.6
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:
3.6.1
Medical Insurance
Costs . The Company
will provide health insurance coverage for Executive,
Executive’s spouse, and Executive’s children (up to the
maximum age allowed by the Company’s plan, provided they meet
the terms of eligibility for participation in the plan).
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3.6.2
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.
3.6.3
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 76th Street, Minneapolis, Minnesota 55435.
3.6.4
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.
3.7
Signing Bonus
. The Company shall pay
Executive a “Signing Bonus” in the amount of $5,000,
payable within fifteen days of the Commencement Date and in
accordance with the Company’s standard payroll practices and
subject to applicable withholdings.
4.
Insurance
Policies.
The Company will keep all Directors
and Officers insurance policies current and will identify
Executive, if appropriate, on all such policies.
5.
Location.
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 substantial business time in locations other
than the Minneapolis, Minnesota area.
6.
Termination of Employment by
the Company.
6.1
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:
6.1.1
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;
6.1.2
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;
6.1.3
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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6.1.4
Executive’s conviction of, or
Executive’s guilty or nolo contendere plea with respect to,
any crime involving moral turpitude; or
6.1.5
Any bar against Executive from
serving as a director, officer or executive of any firm the
securities of which are publicly traded.
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.
6.2
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”):
6.2.1
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
6.2.2
Executive dies.
6.2.3
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 to be set forth in 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.
6.3
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.
6.4
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
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benefits as required by the
Consolidated Omnibus Budget Reconciliation Act
(“COBRA”) and the regulations promulgated
thereunder.
6.5
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. No severance shall be payable
if Executive’s employment is terminated within the first 90
days of Executive’s employment with the Company. If
Executive has been continuously employed by the Company for at
least 90 days after the Commencement Date and if the Company
thereafter 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.
7.
Termination of Employment by
Executive.
7.1
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.
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:
7.1.1
a reduction in Executive’s
Base Salary below $275,000;
7.1.2
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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7.1.3
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.
7.2
Notice . If Executive terminates his employment
for Good Reason, he must provide thirty (30) days’ prior
written notice to the Company.
7.3
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.
8.
Change of Control Obligations;
Deferred Compensation Payments.
8.1
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’
