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MEDQUIST INC | R. Scott Bennett. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here. |
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Search Executive Employment Agreement by:
Exhibit 10.1
October 26, 2005
Via Overnight Mail and Facsimile
Mr. R. Scott Bennett
6 Kenwood Court
Malvern, PA 19355
Dear Scott:
On behalf of MedQuist Inc. (the “Company”), this Agreement describes the terms of your new employment as the Company’s Senior Vice President - Sales & Marketing, which must commence on a date mutually agreed to in writing by you and the Company (the “Employment Commencement Date”). For purposes of this Agreement, you are referred to as the “Employee.” Other capitalized terms used in this Agreement have the meanings defined in Section 7, below.
1.
Term. The Company shall employ
Employee hereunder for a three (3) year term commencing on the Employment
Commencement Date hereof (the “Term”), which Term will be
automatically extended for additional one (1) year periods beginning on
the third anniversary of the Employment Commencement Date and upon each
subsequent anniversary thereof unless either party provides the other party with
at least ninety (90) days prior written notice of its intention not to renew
this Agreement unless terminated earlier pursuant to Sections 3 or 5 of this
Agreement.
2.
Consideration.
a.
Compensation. As consideration for all
services rendered by Employee to the Company and for the Covenants contained
herein, Employee will be entitled to:
(1)
base salary at an annual rate of
$240,000, subject to review and adjustment annually during the Term;
(2)
signing bonus of $150,000 to be paid
within thirty (30) days of Employment Commencement Date. In the event
that you voluntarily resign from the Company within your first 12 months of
employment, this signing bonus must be repaid on a pro rata basis.
(3)
participate in MedQuist’s
Management Bonus Plan, commencing in 2006. Your target bonus in this plan
will be 45% of your base salary for 2006 and following years. The target
bonus is the payment amount that the Employee shall be eligible to receive if
the Company and Employee both attain the pre-established bonus plan target
objectives. The actual bonus award may be higher or lower than the target
bonus amount based upon achievement of the objectives by Employee and the
Company. Management Bonus Plan target objectives shall be developed on or
before February 28th of each year of the Management Bonus Plan.
Payment of $54,000, which is equal to half of your annual target bonus
for the year ending December 31, 2006, is guaranteed;
(4)
participate in the same employee
benefit plans available generally to other full-time employees of the Company,
subject to the terms of those plans (as the same may be modified, amended or
terminated from time to time); (benefits information package enclosed);
(5)
receive relocation support in
accordance with the Company Relocation Policy. This relocation offer will
be in effect for the first twenty-four (24) months of your employment;
(6)
if Employee’s employment is
terminated by the Company without Cause, the severance pay and benefits
described below in Section 5.
b.
Long Term
Incentives.
In addition, from time to time, the Board may review the performance of the
Company and Employee and, in its sole discretion, may grant stock options,
shares of restricted stock or other equity-based incentives to Employee to
reward extraordinary performance and/or to encourage Employee’s future
efforts on behalf of the Company. The grant of any such equity incentives
will be subject to the terms of the Company’s equity-based plans and will
be evidenced by a separate award agreement by and between the Company and
Employee.
(1)
Upon joining MedQuist, you will become
entitled to a special stock option grant of 60,000 shares of non-qualified
stock options (“Special Option Grant”) to purchase Company common
stock, no par value (“Common Stock”), pursuant to the
Company’s Stock Option Plan adopted May 29, 2002 (the “Option
Plan”). The grant date of the Special Option Grant will occur on
the later of (i) the date the Company becomes current in its reporting
obligations under the Securities Exchange Act of 1934; or (ii) the first
date thereafter when the Form S8 Registration Statement for the Option
Plan complies with the requirement of the Securities Exchange Commission
provided that you are still an employee on the grant date. The option
price for the Special Option Grant shall be equal at least to the fair market
value of the Company’s Common Stock as of the grant date. The
Special Option Grant will be subject to all of the terms and conditions of the
Option Plan and the Stock Option Agreement that will be issued if and when the
grant becomes effective. Your right to exercise the option will vest in
equal 20% installments on each of the first five (5) anniversaries of the
grant date. In the event of a “Change of Control” (as defined
below) of the Company while you are an employee, your Special Option Grant may,
from and after the date which is six months after the Change of Control (but not
beyond the expiration date of the option), be exercised for up to 100% of the
total number of shares then subject to the Special Option Grant minus the
number of shares previously purchased upon exercise of such option (as adjusted
for any change in the outstanding shares of the Common Stock of the Company in
accordance with the terms of the Option Plan) and your vesting date will
accelerate accordingly. A “Change of Control” shall be deemed
to have occurred upon the happening of any of the following events:
(i)
A change within a twelve-month period
in the holders of more than 50% of the outstanding voting stock of the Company;
or
(ii)
Any other event deemed to constitute a
“Change of Control” by the Company’s Board of Directors.
(2)
Contingent upon Employee’s
continued attainment of performance objectives, the Company agrees to deliver a
long term incentive value of $120,000 annually through one of the following, as
determined in the Company’s sole discretion: (i) a stock option
grant pursuant to the Option Plan, (ii) a restricted stock grant or
(iii) a cash-based long term incentive program to be developed. The
long term incentive value of Company stock will be calculated based on an
industry accepted stock valuation methodology.
3.
Employment-At-Will. Nothing contained in this
Agreement is intended to create an employment relationship whereby Employee
will be employed other than as an “at-will” employee.
Employee’s employment by the Company may be terminated by Employee or the
Company at any time; provided, however, that while employed by the
Company, the terms and conditions of Employee’s employment by the Company
will be as herein set forth; and provided further, that Section 4
of this Agreement will survive the termination of Employee’s employment.
4.
Covenants.
a.
Non-Solicitation. While employed by the
Company and for the twelve (12) month period following the cessation of that
employment for any reason (and without regard to whether such cessation was
initiated by Employee or the Company), Employee will not do any of the
following without the prior written consent of the Company:
(1)
solicit, entice or induce, either
directly or indirectly, any person, firm or corporation who or which is a
client or customer of the Company or any of its subsidiaries to become a client
or customer of any other person, firm or corporation;
(2)
influence or attempt to influence,
either directly or indirectly, any customer of the Company or its subsidiaries
to terminate or modify any written or oral agreement or course of dealing with
the Company or its subsidiaries (except in Employee’s capacity as an
employee of the Company); or
(3)
influence or attempt to influence,
either directly or indirectly, any person to terminate or modify any
employment, consulting, agency, distributorship, licensing or other similar
relationship or arrangement with the Company or its subsidiaries (except in
Employee’s capacity as an employee of the Company).
b.
Non-Disclosure. Employee shall not use for
Employee’s personal benefit, or disclose, communicate or divulge to, or
use for the direct or indirect benefit of any person, firm, association or
company other than Company, any “Confidential Information,” which
term shall mean any information regarding the business methods, business
policies, policies, procedures, techniques, research or development projects or
results, historical or projected financial information, budgets, trade secrets,
or other knowledge or processes of, or developed by, Company or any other
confidential information relating to or dealing with the business operations of
Company, made known to Employee or learned or acquired by Employee while in the
employ of Company, but Confidential Information shall not include information
otherwise lawfully known generally by or readily accessible to the general
public. The foregoing provisions of this subsection shall apply
during and after the period when the Employee is an employee of the Company and
shall be in addition to (and not a limitation of) any legally applicable
protections of Company interest in confidential information, trade secrets, and
the like. At the termination of Employee’s employment with Company,
Employee shall return to the
Company all copies of Confidential Information in any
medium, including computer tapes and other forms of data storage.
c. Non-Competition. While employed by the Company and for the twelve (12) month period following the cessation of that employment for any reason (and without regard to whether such cessation was initiated by Employee or the Company), Employee shall not directly or indirectly engage in (as a principal, shareholder, partner, director, officer, agent, employee, consultant or otherwise) or be financially interested in any business which is involved in business activities which are the same as or in direct competition with Business activities carried on by the Company, or being definitively planned by the Company at the time of termination of Employee’s employment. Nothing contained in this subsection shall prevent Employee from holding for investment up to three percent (3%) of any class o






