CONFIDENTIAL
TREATMENT REQUESTED BY
EASYLINK SERVICES INTERNATIONAL CORPORATION
UNDER RULE 24b-2
CONFIDENTIAL
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO THE RULES
AND REGULATIONS OF THE SECURITIES AND EXCHANGE COMMISSION.
“X” HAS BEEN USED TO IDENTIFY INFORMATION WHICH IS
SUBJECT TO A CONFIDENTIAL TREATMENT REQUEST.
SECOND AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Second Amended and Restated Employment
Agreement (the “Agreement”) is entered into on
September 28, 2009 (the “Effective Date”) between,
EasyLink Services International Corporation (the
“Company”) and Terri Deuel (“Deuel”). This
Agreement amends, restates and supersedes the Amended and Restated
Employment Agreement (the “Prior Agreement”) between
the Company and Deuel entered into on April 1,
2008.
In consideration of the mutual covenants and
conditions set forth herein, the parties hereby agree as
follows:
1. Employment. The Company hereby employs Deuel in the capacity
of Executive Vice President of Product Development and Customer
Support. Deuel accepts such employment and agrees to perform such
services as are customary to such office and as shall from time to
time be assigned to her by the Company’s Chief Executive
Officer. Deuel will perform her duties so as to cause the Business
of the Company to be operated in accordance with an annual
operating plan and budget developed jointly by the Board and the
Company and approved by the Board. For purposes of this Agreement,
the “Business” of the Company is to provide
business-to-business supply chain data interchange in multiple
electronic formats.
2. Term. The employment hereunder shall be for a period
commencing on the Effective Date and ending on November 1,
2010 (the “Employment Period”). Unless either party
elects not to extend the term of this Agreement by so notifying the
other in writing at least 30 days prior to November 1,
2010 and November 1 of each year thereafter, the Employment Period
shall automatically extend for an additional one year period upon
November 1 of each such year. Deuel’s employment will be on a
full-time basis requiring the devotion of such amount of her
productive time as is necessary for the efficient operation of the
Business of the Company.
3.
Compensation and Benefits.
3.1 Salary. For the performance of Deuel’s duties
hereunder, the Company shall pay Deuel (i) an annual base salary in
the amount as provided on Exhibit A, a copy of which is
attached hereto and incorporated herein by reference, payable in
accordance with the Company’s standard payroll policies,
which may be changed from time to time (but in no case less
frequently than monthly).
3.2 Annual Cash Incentive.
Deuel will receive the opportunity
to earn an annual cash incentive pursuant to the terms of
Exhibit A attached hereto (the “Annual Cash
Incentive”). The Company agrees to negotiate in good faith a
new Annual Cash Incentive Plan for each year of Deuel’s
employment subsequent to Fiscal 2010. If the Company fails to
negotiate a new Cash Incentive Plan for any year after Fiscal 2010,
then the Annual Cash Incentive in effect for the preceding year
will govern. Notwithstanding any of the provisions of this
Agreement, the Annual Cash Incentive, to the extent payable for any
fiscal year of the Company, will be paid no later than the
15 th
day of the third month following the
end of the fiscal year of the Company to which the Annual Cash
Incentive relates.
3.3 Benefits. The Company shall provide to Deuel the benefits
as described on Exhibit B attached hereto.
3.4 Reimbursement of Expenses.
Deuel shall be entitled to be
reimbursed for all actual and reasonable expenses, including but
not limited to, expenses for travel, meals and entertainment,
incurred by Deuel in connection with and reasonably related to the
furtherance of the Company’s Business, per Company travel
guidelines in effect from time to time. Subject to the Company
travel guidelines in effect from time to time, the Company will
reimburse Deuel for such actual and reasonable expenses no later
than the last day of the calendar year following the calendar year
in which Deuel incurs the reimbursable expense.
3.5 Equity Grants. The parties incorporate the terms of
Exhibit A attached hereto regarding the equity grants
described therein, provided however, that upon any Change of
Control of the Company as defined in Section 4 of this
Agreement or if Deuel’s employment is terminated under
Sections 5.1(b), (d) or (e) of this Agreement, any
of Deuel’s equity-based incentive compensation (whether
granted pursuant to this Agreement or otherwise) that has not yet
vested will vest immediately.
4. Change of Control.
For the purposes of this Agreement,
the term “Change of Control” shall mean a change in the
beneficial ownership of the Company’s voting stock pursuant
to which:
(a) any “person,” including a
“syndicate” or “group” as those terms are
used in Section 13(d)(3) of the Securities Exchange Act of 1934, is
or becomes the beneficial owner, directly or indirectly, of
securities of the Company representing 50% or more of the combined
voting power of the Company’s then outstanding “Voting
Securities,” which is any security that ordinarily possesses
the power to vote in the election of the board of directors of a
corporation without the happening of any precondition or
contingency; or
(b) the Company is merged or consolidated
with another corporation and immediately after giving effect to the
merger or consolidation less than 50% of the outstanding Voting
Securities of the surviving or resulting entity are then
beneficially owned in the aggregate by either the shareholders of
the Company immediately prior to such merger or consolidation, or,
if a record date has been set to determine the shareholders of the
Company entitled to vote on such merger or consolidation, the
shareholders of the Company as of such record date; or
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(c) the Company transfers substantially all
of its assets to another corporation, other than a corporation of
which the Company owns, directly or indirectly, at least 50% of the
combined voting power of such corporation’s outstanding
voting securities.
5.1 Termination Events. Deuel’s employment hereunder will
terminate upon the occurrence of any of the following
events:
(b) Disability: If Deuel is unable perform
the duties assigned to her hereunder for a continuous period
exceeding 90 days by reason of injury, physical or mental
illness or other disability, which condition has been certified by
a physician; then, upon written notice to Deuel or her personal
representative setting forth specifically the nature of the
disability and the resulting performance failures and Deuel’s
failure to cure the cited performance failures within ten days of
receipt of such notice, the Company may discharge Deuel;
(c) Cause: As used in this Agreement,
“Cause” shall mean:
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(i)
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Deuel’s conviction of (or
pleading guilty or nolo contendere to) a felony or any misdemeanor
involving dishonesty or moral turpitude; provided, however, that
prior to discharging Deuel for Cause, the Board shall give a
written statement of findings to Deuel setting forth specifically
the grounds on which Cause is based, and Deuel shall have a period
of ten days thereafter to respond in writing to the Board’s
findings; or
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(ii)
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Deuel’s willful and continued
failure to substantially perform her duties with the Company (other
than any failure resulting from death, illness or disability) that
has, or can reasonably be expected to have, a direct and material
adverse monetary effect on the Company, provided that the Board has
tendered written notice to Deuel specifying the nature of the
misconduct or performance deficiency and giving Deuel 20 days to
cure such deficiency. For purposes of this subsection (ii), no act
or failure to act on Deuel’s part shall be considered
“willful” if done, or omitted to be done, by Deuel in
good faith and with reasonable belief that Deuel’s action or
omission was in the best interest of the Company. Any act, or
failure to act, based upon authority given pursuant to a resolution
duly adopted by the Board or based upon the advice of counsel for
the Company shall be conclusively presumed to be done, or omitted
to be done, by Deuel in good faith and in the best interests of the
Company;
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(d) Without Cause: The Board may terminate
Deuel by issuing at least 30 days’ advance written
notice, subject to the severance provisions set forth
below;
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(e) By Deuel With Cause: Deuel may
terminate her employment due to either (i) a material default
by the Company in the performance of any of its obligations
hereunder, or (ii) an Adverse Change in Duties (as defined
below), which default or Adverse Change in Duties remains
unremedied by the Company for a period of 30 days following
its receipt of written notice thereof from Deuel provided, however,
that Deuel must provide written notice to the Company of the
condition which would constitute cause for terminating her
employment hereunder within 90 days of the initial existence
of the condition, and, assuming such default or Adverse Change in
Duties remains unremedied by the Company after the 30-day period
set forth above, Deuel then must terminate her employment within
12 months of the initial existence of the condition;
or
(f) By Deuel Without Cause: Deuel may
terminate her employment for any reason upon the furnishing of at
least 30 days’ advance written notice to the
Board.
As used herein, “Adverse Change in
Duties” means an action or series of actions taken by the
Company, without Deuel’s prior written consent, that results
in:
(1) A material diminution in Deuel’s
authority, duties or responsibilities;
(2) A material diminution in Deuel’s
base compensation;
(3) A material diminution in the authority,
duties or responsibilities of the supervisor to whom Deuel is
required to report;
(4) A material diminution in the budget
over which Deuel retains authority; and
(5) A material change in the geographic
location of the Company, as located at the time of this Agreement,
at which Deuel performs her duties.
5.2 Effects
of Termination and Change of Control.
(a) Upon termination of Deuel’s
employment hereunder for any reason, the Company will promptly (but
in no event later than 30 days after termination of
engagement) pay Deuel all compensation owed to Deuel and unpaid
through the date of termination (including, without limitation,
salary and employee expense reimbursements).
(b) In addition, upon any Change of Control
of the Company as defined in Section 4 of this Agreement or if
Deuel’s employment is terminated under Sections 5.1 (b),
(d) or (e), the Company shall also pay Deuel an aggregate
severance amount equal to the sum of (A) Deuel’s
then-applicable annual base salary plus (B) the Target Annual
Cash Incentive for the fiscal year in which the ter
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