THIS
SEPARATION AGREEMENT (this “Agreement”) is made and
entered into this 29 th day of May, 2009, by and between BRADLEY T.
ROOS , (“Executive”) and PRG-SCHULTZ
INTERNATIONAL, INC. , a Georgia corporation
(“Company”). Executive and Company are sometimes
hereinafter referred to together as the “Parties” and
individually as a “Party.”
A.
Executive was employed as the Senior Vice President and President
— Europe and Asia Pacific of Company pursuant to an
employment agreement, dated November 28, 2008
(“Employment Agreement”), between Executive and
Company.
B.
Executive and Company now mutually desire to end Executive’s
employment and terminate the Employment Agreement effective as of
the date hereof.
C.
Company and Executive wish to avoid any disputes which could arise
under the Employment Agreement and have therefore compromised any
claims or rights they have or may have under the Employment
Agreement by agreeing to the terms of this Agreement and the
Compromise Agreement set out at Exhibit C hereto (the
“Compromise Agreement”).
NOW,
THEREFORE, FOR AND IN CONSIDERATION of the premises, the mutual
promises, covenants and agreements contained herein, and other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as
follows:
1.
Termination of Employment . The Parties agree that
(a) the Employment Agreement is hereby terminated as of the
date hereof, (b) the initial presentation of this Agreement to
Executive on April 7, 2009 constituted written notice of
termination of Executive’s employment, and
(c) Executive’s employment relationship with Company
terminated effective May 8, 2009 (“Termination
Date”), and all benefits, privileges and authorities related
to Executive’s employment with Company ceased, except as
otherwise specifically set forth in this Agreement.
2. No
Admission . The Parties agree that their entry into this
Agreement is not and shall not be construed to be an admission of
liability or wrongdoing on the part of either Party.
3.
Future Cooperation . Executive agrees that,
notwithstanding the termination of Executive’s employment on
the Termination Date, Executive upon reasonable notice will make
himself available to Company or its designated representatives for
the purposes of: (a) providing information regarding the
projects and files on which Executive worked for the purpose of
transitioning such projects; and (b) providing information
regarding any other matter, file, project and/or client with whom
Executive was involved while employed by Company.
(a) In
consideration for Executive’s agreement to terminate the
Employment Agreement, to fully release Company from any and all
Claims as described below, and to perform the other duties and
obligations of Executive contained herein, and to fully release all
claims set out in the Compromise Agreement at Exhibit C
by signing the Compromise Agreement and procuring a certificate in
the form set out at Schedule 1 to the Compromise Agreement
from his Legal Adviser (as defined in the Compromise Agreement),
Company will, subject to ordinary and lawful deductions (including
normal withholdings consistent with Company’s practice for
equalization of Executive’s tax liability) and Sections 4(b)
and (c) below:
(i)
Pay severance to Executive in the form of salary continuation for
the twelve (12) months immediately following the Termination Date
(“Severance Period”). Such payments shall be made in
accordance with Company’s standard pay practices in an amount
equal to Twelve Thousand Four Hundred and Twenty Three Dollars
($12,423) per bi-weekly pay period for twenty-six (26) pay
periods following Executive’s Termination Date, except that
no payments shall be made during the period that begins immediately
after the Termination Date and ends on the earlier of
(i) Executive’s death or (ii) the date that is six
months after the Termination Date. The payments that would
otherwise have been made in such period shall be accumulated and
paid in a lump sum on the first bi-weekly pay period after the end
of such period.
(ii)
Continue after the Termination Date any health care (medical,
dental and vision) plan coverage, other than under a flexible
spending account, provided to Executive and Executive’s
spouse and dependents at the Termination Date for the Severance
Period, on a monthly or more frequent basis, on the same basis and
at the same cost to Executive as available to similarly-situated
active employees during such Severance Period, provided that such
continued coverage shall terminate in the event Executive becomes
eligible for any such coverage under another employer’s
plans.
(iii)
Pay an amount equal to Executive’s actual earned full-year
bonus for calendar year 2009, pro rated based on the number of days
Executive was employed for such year on and before the Termination
Date, payable at the time Executive’s annual bonus for such
year otherwise would have been paid had Executive continued
employment. Fifty percent (50%) of Executive’s target bonus
hereunder is dependent upon the Company’s achievement of a
certain level of 2009 consolidated Company adjusted EBITDA
established by the Compensation Committee and the remaining fifty
percent (50%) of Executive’s target bonus is dependent upon
the Europe-Asia Pacific business’ achievement of a certain
level of 2009 adjusted EBITDA established by the Compensation
Committee. Fifty percent (50%) of Executive’s maximum bonus
hereunder is dependent upon the Company’s achievement of a
certain higher (than target) level of 2009 consolidated Company
adjusted EBITDA established by the Compensation Committee and the
remaining fifty percent (50%) of Executive’s maximum bonus is
dependent upon the Europe-Asia Pacific business’ achievement
of a certain higher (than target) level of 2009 adjusted EBITDA
established by the Compensation Committee.
-2-
(iv)
Vest in full Executive’s outstanding unvested options,
restricted stock and other equity-based awards that would have
vested based solely on the continued employment of Executive.
Additionally, all of Executive’s outstanding stock options
shall remain outstanding until the earlier of (i) one year
after the Termination Date or (ii) the original expiration
date of the options (disregarding any earlier expiration date
provided for in any other agreement, including without limitation
any related grant agreement, based solely on the termination of the
Executive’s employment).
(v)
Payment of one year of outplacement services from Executrak or an
outplacement service provider of Executive’s choice, limited
to $20,000 in total. This outplacement services benefit will be
forfeited if Executive does not begin using such services within 60
days after the Termination Date.
(vi)
Pay to Executive in cash in a single lump sum an amount equal to
Forty-Five Thousand Dollars ($45,000) on the thirty-first
(31 st
) day after the Termination Date as
set forth in the Compromise Agreement.
(b) Notwithstanding
anything else contained herein to the contrary, no payments shall
be made or benefits delivered under this Agreement (other than
payments required to be made by Company pursuant to Section 5
below) unless, within thirty (30) days after the Termination
Date: (i) Executive has signed and delivered to Company a Release
in the form attached hereto as Exhibit A (the
“Release”); (ii) the applicable revocation period
under the Release has expired without Executive having elected to
revoke the Release; (iii) Executive has signed and delivered
to Company the Compromise Agreement; and (iv) Executive has
procured and delivered to Company a certificate signed by his Legal
Adviser in the form of Schedule 1 to the Compromise Agreement.
Executive agrees and acknowledges that Executive would not be
entitled to the consideration described herein absent execution of
the Release and the Compromise Agreement. Any payments to be made,
or benefits to be delivered, under this Agreement (other than the
payments required to be made by Company pursuant to Section 5
below) within the thirty (30) days after the Termination Date
shall be accumulated and paid in a lump sum on the first bi-weekly
pay period occurring more than thirty (30) days after the
Termination Date, provided Executive delivers the signed Release
and Compromise Agreement to Company and the revocation period
thereunder expires without Executive having elected to revoke the
Release.
(c) As
a further condition to receipt of the payments and benefits in
Section 4(a) above, Executive also waives any and all rights to any
other amounts payable to him upon the termination of his employment
relationship with Company, other than those specifically set forth
in this Agreement, including without limitation any severance,
notice rights, payments, benefits and other amounts to which
Executive may be entitled under the laws of England and Wales, and
Executive agrees not to pursue or claim any such payments, benefits
or rights.
(d) Executive
agrees to vacate the Company-provided apartment in the United
Kingdom no later than June 30, 2009 and to indemnify Company
for any damages to the apartment, except for any ordinary wear and
tear.
-3-
Nothing
in this Agreement or the Release shall:
(a)
alter or reduce any vested, accrued benefits (if any) Executive may
be entitled to receive under any 401(k) plan established by
Company;
(b)
affect Executive’s right (if any) to elect and (subject to
Section 4(a)(ii) above) pay for continuation of
Executive’s health insurance coverage under Company’s
health plans pursuant to the Consolidated Omnibus Budget
Reconciliation Act of 1985 (C.O.B.R.A.), as amended, and to receive
any C.O.B.R.A. subsidy for such coverage that may be available
pursuant to applicable law;
(c)
affect Executive’s right (if any) to receive (i) any
base salary that has accrued through the Termination Date and is
unpaid, (ii) any reimbursable expenses that Executive has
incurred before the Termination Date but are unpaid and
(iii) any unused paid time off days to which Executive will be
entitled to payment, all of which shall be paid as soon as
administratively practicable (and in any event within thirty
(30) days) after the Termination Date;
(d)
alter or reduce the vested benefits to which Executive is entitled
under Company’s management incentive plan
(“MIP”), which shall be paid in accordance with the MIP
and Executive’s applicable performance unit
agreement;
(e)
affect Executive’s right (if any) to receive (i) any
additional amounts set forth on Exhibit A of the Employment
Agreement to which Executive may be entitled which have accrued
through the Termination Date and remain unpaid, which amounts will
be paid at the time originally set forth in the Employment
Agreement, (ii) continued housing (including rent and
utilities) and education allowance through June 30, 2009, as
set forth on Exhibit A of the Employment Agreement,
(iii) reimbursement for the cost of returning Executive, his
family and his belongings, back to the point of origin, in an
amount equal to the amount initially provided for Executive’s
relocation to the United Kingdom (including reimbursement for
temporary living expenses up to 60 days), all of which costs
must be incurred and paid and reimbursed no later than
December&nbs
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