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EX-10.1 AMENDED AND RESTATED EMPLOYMENT AGREEMENT

Employment Agreement

EX-10.1 AMENDED AND RESTATED EMPLOYMENT AGREEMENT | Document Parties: HARRIS INTERACTIVE INC You are currently viewing:
This Employment Agreement involves

HARRIS INTERACTIVE INC

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Title: EX-10.1 AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Governing Law: Delaware     Date: 10/3/2005
Industry: Business Services     Sector: Services

EX-10.1 AMENDED AND RESTATED EMPLOYMENT AGREEMENT, Parties: harris interactive inc
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Exhibit 10.1

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (“Agreement”) is dated as of September 28, 2005, effective as of September 7, 2005 (the “Effective Date”) between HARRIS INTERACTIVE INC., a Delaware corporation (“Company”), and GREGORY T. NOVAK (“Executive”).

     This Agreement amends, restates, and replaces in its entirety the Employment Agreement between Company and Executive dated as of April 1, 2004 as amended (collectively, the “Prior Agreement”); provided, however, that all rights of Executive to payments and benefits under Sections 3.1 – 3.5, inclusive, of the Prior Agreement accrued but unpaid as of the Effective Date shall survive execution of this Agreement. This Agreement does not modify the terms of any stock option agreements between the Company and the Executive in effect on the Effective Date, which stock option agreements shall remain unchanged and in full force according and subject to the terms contained therein.

1. CAPACITY AND DUTIES

     1.1 Employment; Acceptance of Employment . Company hereby employs Executive and Executive hereby accepts employment by Company for the period and upon the terms and conditions hereinafter set forth.

     1.2 Capacity and Duties .

          (a) Executive shall serve as the President and Chief Executive Officer of the Company. Executive shall perform duties and shall have authority as may from time to time be specified by the Board of Directors of Company (the “Board”), and shall report to the Board (or a duly authorized committee thereof). Executive’s position and duties may be changed from time to time by the Board; provided, however, that Executive’s position, authority, duties, and responsibilities shall be no less senior and executive in nature than those customarily performed by a chief executive officer. Executive shall perform his duties for Company principally at Company’s executive offices, presently in Rochester, New York, provided, however, that Executive acknowledges and agrees that travel to Company’s and its affiliates’ various offices, and to other locations in furtherance of Company’s business, will be required in connection with the performance of Executive’s duties hereunder.

          (b) Executive shall devote full time efforts to the performance of Executive’s duties hereunder, in a manner that will faithfully and diligently further the business and interests of Company.

          (c) Executive shall be appointed as a member of the Board of Directors of Harris as of the Effective Date. Prior to the Termination Date and prior to any Change of Control, the Board of Directors shall nominate Executive for re-election as a director at each annual meeting of stockholders coinciding with the expiration of his term as a director, and shall recommend him for re-election, but the failure of the stockholders to elect Executive as a member of the Board of Directors shall not constitute a breach of this Agreement. Unless

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otherwise requested by the Board of Directors, Executive will resign as a director on the Termination Date and upon his failure to do so hereby authorizes and grants full authority to the Chairman of the Board of Directors to deliver Executive’s resignation on his behalf.

          (d) Executive acknowledges that Company’s reputation is important in the continued success of its business, and agrees that he will not discuss or comment in such a manner as may adversely impact the reputation or public perception, or otherwise disparage, Company or its officers, employees, or directors in any manner; provided, however, that Executive may make such disclosures as may be required by law. Company acknowledges that Executive’s reputation is important to his continued success. Company agrees that it will not, and that it will use all reasonable efforts to cause its officers, employees, and directors not to, defame, disparage, or otherwise discuss or comment about Executive in such a manner as may adversely impact his reputation or public perception; provided, however, that Company may make such disclosures as may be required by law.

2. TERM OF EMPLOYMENT

     2.1 Term . The term of Executive’s employment hereunder, for all purposes of this Agreement, shall commence on the Effective Date (the “Commencement Date”) and continue through and including the earliest to occur of (i) June 30, 2006, if and as further extended to subsequent June 30ths as provided in this Section 2.1, (ii) the date on which Executive dies, and (iii) the date on which either the Company or Executive terminates Executive’s employment for any reason (the “Termination Date”). Except as hereinafter provided, on June 30, 2006 this Agreement shall be automatically extended for an additional one-year term, and if so extended shall be automatically extended for successive additional one-year terms, unless either the Executive or Company shall have given the other written notice of nonrenewal of this Agreement at least three (3) months prior to June 30, 2006, or if applicable any one-year extension term then in effect. If written notice of nonrenewal is given as provided above, Executive’s employment under this Agreement shall terminate on June 30, 2006, or if the term of this Agreement has automatically renewed, on the June 30 immediately following the date of the non-renewal notice.

3. COMPENSATION

     3.1 Base Compensation . As compensation for Executive’s services, Company shall pay to Executive base compensation in the form of salary (“Base Compensation”) in the amount of $475,000 per annum. The salary shall be payable in periodic installments in accordance with Company’s regular payroll practices for its executive personnel at the time of payment, but in no event less frequently than monthly. The Compensation Committee of the Board shall review Base Compensation periodically for the purpose of determining, in its sole discretion, whether Base Compensation should be adjusted; provided, however, that Executive’s Base Compensation shall not be less than $475,000.

     3.2 Performance Bonus . As additional compensation for the services rendered by Executive to Company, Executive shall be eligible for a performance bonus (“Performance Bonus”) payable in full at the same time as payment of other executive bonuses by the Company (generally targeted for payment within ninety (90) days after the end of the relevant fiscal year of the Company). The Performance Bonus award criteria and amounts shall be those established on

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an annual basis by the Compensation Committee of the Board of Directors of the Company based upon performance guidelines established for executive officers of the Company; provided, however, that the target bonus for Executive for the fiscal year ending June 30, 2006 shall be $250,000 provided that performance guidelines are met. No bonus will be due in the event that award criteria established by the Compensation Committee are not met.

     3.3 Employee Benefits . Executive shall be entitled to participate in such of Company’s employee benefit plans and benefit programs, including medical, hospitalization, dental, disability, accidental death and dismemberment and travel accident plans and programs, as may from time to time be provided by Company for its senior executives generally. In addition, Executive shall be eligible to participate in all pension, retirement, savings and other employee benefit plans and programs maintained from time to time by Company for the benefit of its senior executives generally. Company shall have no obligation, however, to maintain any particular program or level of benefits referred to in this Section 3.3.

     3.4 Vacation . 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. Any vacation days that are not taken in a given 12 month period shall accrue and carry over from year to year up to a maximum aggregate of 5 days. The Executive may be granted leaves of absence with or without pay for such valid and legitimate reasons as the Board in its sole and absolute discretion may determine, and is entitled to the same sick leave and holidays provided to other executive officers of Company.

     3.5 Expense Reimbursement . Company shall reimburse Executive for (a) all reasonable and documented expenses incurred by him in connection with the performance of Executive’s duties hereunder in accordance with its regular reimbursement policies as in effect from time to time, and (b) his reasonable attorney fees in connection with negotiation of this Agreement up to a maximum of $2,500.

     3.6 Term Life Insurance . In addition to the Company-paid life insurance made available to senior executives of the Company generally, the Company shall provide Executive with $600,000 face value of term life insurance as soon as reasonably practical after the date of this Agreement. Upon the request of the Executive made in connection with a Termination Date, the Company shall take all reasonable steps to provide Executive the right to continue such life insurance at his own expense after the Termination Date.

     3.7 Withholding . All payments under this Agreement shall be subject to any required withholding of Federal, state and local taxes pursuant to any applicable law or regulation.

4. TERMINATION OF EMPLOYMENT

     4.1 Accrued Obligations . For purposes of this Agreement, “Accrued Base Obligations” shall mean amounts for Base Compensation, expense reimbursement, employee benefits, and car allowance which have accrued, vested, and are unpaid as of the Termination Date, and (ii) “Accrued Bonus Obligations” shall mean (i) any unpaid Performance Bonus earned for any fiscal year ending before the Termination Date, and (ii) for the year in which the Termination Date occurs, a prorated Performance Bonus for the partial-year period ending before

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the Termination Date if the Termination Date occurs in the last six months of the applicable fiscal year calculated by annualizing the short period before termination, and no prorated Performance Bonus if the Termination Date occurs in the first six months of the applicable fiscal year. Accrued Base Obligations shall be paid within thirty (30) days after the Termination Date, and Accrued Bonus Obligations shall be paid on the date on which they would have been paid under this Agreement absent the occurrence of the Termination Date.

     4.2 Termination Procedures . Except as otherwise provided in this Agreement, any termination of Executive’s employment by the Company or by Executive (other than termination pursuant to death) shall be communicated by written Notice of Termination to the other party hereto. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and, if applicable, shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated.

     4.3 Death of Executive . If Executive dies prior to a Termination Date that otherwise occurs, Company shall not thereafter be obligated to make any further payments hereunder other than amounts for Accrued Base Obligations and Accrued Bonus Obligations.

     4.4 Disability of Executive . If Executive is permanently disabled (as defined in Company’s long-term disability insurance policy then in effect), then the Board shall have the right to terminate Executive’s employment upon 30 days’ prior written notice to Executive at any time during the continuation of such disability (“Disability”). In the event Executive’s employment is terminated for Disability in accordance with this Section 4.4, Company shall be obligated to make the payments required under Section 4.6(a)(i), (ii), (iii), and (iv) and provide the benefits required by Section 4.6(a)(v); provided, however, the Company’s obligation to make such payments shall be reduced by an amount equal to the amount which the Executive is entitled to receive during the same period under the Company’s disability insurance policies.

     4.5 Termination for Cause .

          (a) Executive’s employment hereunder shall terminate immediately upon a Notice of Termination from the Company that Executive is being terminated for Cause (as defined herein), in which event Company shall not thereafter be obligated to make any further payments hereunder other than Accrued Base Obligations and Accrued Bonus Obligations.

          (b) “Cause” shall be limited to the following:

                    (i) willful failure to substantially perform Executive’s duties as described in Section 1.2 after demand for substantial performance is delivered by Company in writing that specifically identifies the manner in which Company believes Executive has not substantially performed Executive’s duties and Executive’s failure to cure such non-performance within ten (10) days after receipt of the Company’s written demand; provided, however, that a failure to perform such duties during the remedy period set forth in Section 4.6(c)(i) hereof following the issuance of a Notice of Termination (as herein defined) by Executive for Good Reason shall not be Cause unless an arbitrator acting pursuant to Section 6.1 hereof finds Executive to have acted in bad faith in issuing such Notice of Termination;

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                    (ii) willful conduct that is materially and demonstrably injurious to Company or any of its subsidiaries, but not including good faith conduct taken without intention to injure the Company or its subsidiaries that, at the time engaged in, could not reasonably be expected to be more likely than not to be materially injurious to the Company; or

                    (iii) conviction or plea of guilty or nolo contendere to a felony or to any other crime which involves moral turpitude or, if not including moral turpitude, provided the act giving rise to such conviction or plea is materially and demonstrably injurious to the Company or any of its subsidiaries;

                    (iv) material violation of Section 5 of this Agreement, or material violation of Company polices set forth in Company manuals or written statements of policy provided in the case of violation of policy that such violation is either materially and demonstrably injurious to Company or, if curable, continues for more then three (3) days after written notice thereof is given to Executive by the Company; and

                    (v) material breach of any material provision of this Agreement by Executive, which breach continues for more than ten days after written notice thereof is given by the Company to Executive.

     Cause shall not exist under this Section 4.5 unless and until Company has delivered to Executive a copy of a resolution duly adopted by a majority of the members of the Board then in office finding that Cause exists in the good faith opinion of the Board. This Section 4.5 shall not prevent Executive from challenging, pursuant to Section 6.1, the Board’s determination that Cause exists, or that Executive has failed to cure any act (or failure to act), to the extent permitted by this Agreement, that purportedly formed the basis for the Board’s determination.

     4.6 Termination without Cause or by Executive for Good Reason .

          (a) The Company reserves the right to terminate Executive’s employment at any time. If, however, a Termination Date occurs (not including termination in the ordinary course on any applicable June 30 if the term of this Agreement is not automatically renewed which circumstance is covered by Section 4.6(b)) for any reason other than Cause under Section 4.5, termination by Executive under Section 4.7, death, or Disability (which is covered by Section 4.4), then Company shall have no further obligations under this Agreement except that Company shall pay to Executive:

                    (i) the Accrued Base Obligations through the date of termination, payable promptly after the date of termination,

                    (ii) any unpaid Performance Bonus earned for any fiscal year ended before the Termination Date payable the later of (A) the date on which such Performance Bonus would be paid absent termination and (B) a date no later than 30 days after the Termination Date,

                    (iii) the Performance Bonus, if any is earned, for the fiscal year in which the Termination Date occurs, allocable to and prorated for the period prior to termination, calculated by annualizing any short period before termination, calculated and

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payable when Performance Bonuses for the applicable year are paid to all other Company senior executives,

                    (iv) Base Compensation through and including: (A) the 12-month anniversary of his termination if his termination occurs on or before June 30, 2006, (B) the 15-month anniversary of his termination if his termination occurs between July 1, 2006 and June 30, 2007, (C) the 18-month anniversary of his termination if his termination occurs between July 1, 2007 and June 30, 2008, and (D) the 24-month anniversary of his termination if his termination occurs on or after July 1, 2008, in each case payable at the same times as paid under Section 3.1; and

                    (v) benefits as required by Section 3.3 of this Agreement during the same period that Base Compensation is due under Section 4.6(a)(iv); provided, however, if Executive, Executive’s spouse or Executive’s dependents are ineligible to participate in the Company benefit programs under Section 3.3, the Company shall arrange to provide Executive, Executive’s spouse and Executive’s dependents with the economic equivalent of such benefits which they otherwise would have been entitled to receive, and further provided that such benefits shall terminate upon the date or dates Executive receives coverage and benefits which are substantially similar, taken as a whole, without waiting period or pre-existing condition limitations, under the plans and programs of a subsequent employer.

          (b) If this Agreement is terminated in the ordinary course on any applicable June 30 because of a non-renewal notice given by the Company under Section 2.1, then Company shall have no further obligations under this Agreement except that Company shall pay to Executive the payments to which the Executive would be entitled under Section 


 
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