Attached files
| file | filename |
|---|---|
| 10-K - FORM 10-K 2009 - HOOPER HOLMES INC | form10k2009.htm |
| EX-24 - POWER OF ATTORNEY - HOOPER HOLMES INC | exhibit24.htm |
| EX-23 - EXHIBIT 23 CONSENT OF AUDITOR KPMG - HOOPER HOLMES INC | exhibit23.htm |
| EX-31.2 - EXHIBIT 31.2 CFO CERTIFICATION - HOOPER HOLMES INC | exhibit31-2.htm |
| EX-31.1 - EXHIBIT 31.1 CEO CERTIFICATION - HOOPER HOLMES INC | exhibit31-1.htm |
| EX-32.1 - EXHIBIT 32.1 CEO CERTIFICATION - SECTION 1350 - HOOPER HOLMES INC | exhibit32-1.htm |
| EX-32.2 - EXHIBIT 32.2 CFO CERTIFICATION - SECTION 1350 - HOOPER HOLMES INC | exhibit32-2.htm |
| EX-21 - EXHIBIT 21 SUBSIDIARIES OF HOOPER HOLMES, INC. - HOOPER HOLMES INC | exhibit21.htm |
Employment
Agreement
This Employment Agreement
("Agreement") is made as of the 15th day of December, 2009 (the “Effective
Date”), by and between Hooper
Holmes, Inc., a New York corporation, with its principal office at 170
Mt. Airy Road, Basking Ridge, New Jersey 07920 (the "Company") and Michael Shea
("Executive").
RECITALS
WHEREAS, the Company desires to embody
in this Agreement the terms and conditions of Executive’s employment with the
Company.
NOW, THEREFORE, in consideration of the
mutual promises and agreements contained in this Agreement, including the
compensation to be paid to Executive, the parties hereby agree as
follows:
1. Employment; Term; Duties and
Responsibilities.
1.1. Employed as Senior Vice President
and Chief Financial Officer. The Company wishes to continue to
employ Executive as its Senior Vice President and Chief Financial Officer, and
Executive hereby accepts such continued employment, subject to the terms and
conditions of this Agreement. Executive represents and warrants to
the Company that he is not a party to any agreement that would restrict or
prohibit him from being employed by the Company. The Company and
Executive acknowledge that Executive has been serving as the Company’s Senior
Vice President and Chief Financial Officer since May 8, 2006.
1.2. Term. The
provisions of his Agreement shall be effective as of the Effective Date and
shall continue in force until the second anniversary of the Effective Date or
the termination of Executive’s employment as provided in Section 3 of this
Agreement, whichever shall occur first (the “Term”). This Agreement
will automatically renew for successive one-year terms (each a “Renewal Term”)
upon its expiration unless, at least 30 days prior to the expiration of the
then-current Term or Renewal Term, the employment of Executive has been
terminated or the Company shall have given Executive notice of its intent not to
renew the Agreement.
1.3. Location of
Employment. Executive shall be based at the Company’s
headquarters in Basking Ridge, New Jersey.
1.4. Duties and
Responsibilities. In his capacity as Senior Vice President and
Chief Financial Officer of the Company, Executive shall report directly to the
President and Chief Executive Officer (“CEO”). Executive shall have such duties
and responsibilities, and the power and authority, normally associated with the
position of Senior Vice President and Chief Financial Officer, as well as any
additional duties and responsibilities of an executive character as shall, from
time to time, be delegated or assigned to him by the CEO or the Hooper Holmes,
Inc. Board of Directors (the “Board”). As Senior Vice President and Chief
Financial Officer, Executive shall keep the CEO and Board fully informed of any
and all matters of a material nature, from an operational or financial
perspective, and seek CEO and Board approval of appropriate matters, in
accordance with his fiduciary duties to the Company and its
shareholders.
1.5. Devotion of
Time. During the Term, Executive shall expend all of his
working time, care and attention to his duties, responsibilities and obligations
to the Company. Executive may serve on the boards of (i) civic and
charitable entities, and (ii) with the prior written consent of the
Board, other corporate entities; provided, however, that such activities do not,
either individually or in the aggregate, interfere with Executive’s duties and
responsibilities as Senior Vice President and Chief Financial Officer of the
Company.
1.6. Elected Officer of the
Company. The Company and Executive acknowledge that Executive
currently serves as an elected Officer of the Company.
2. Compensation;
Benefits.
As compensation and consideration for
the services to be rendered by Executive as Senior Vice President and Chief
Financial Officer of the Company in accordance with the terms and conditions of
this Agreement, and while Executive is employed with the Company as Senior Vice
President and Chief Financial Officer, Executive shall be entitled to the
compensation and benefits set forth in this Section 2 (subject, in each case, to
the provisions of Section 3 of this Agreement).
2.1. Base
Salary. Executive shall receive an annual base salary (“Base
Salary”) of Two Hundred and Fifty Thousand Dollars ($250,000) per year, payable
in accordance with the Company’s standard payroll dates and practices, provided
such payments shall not be made less frequently than twice in each calendar
month. The Base Salary shall be reviewed at least annually by the CEO
and Compensation Committee (the “Committee”) of the Board and may be adjusted by
the Committee, in its sole discretion, based on the Committee’s consideration of
the Company’s performance, financial and otherwise. If the Base
Salary is adjusted, the adjusted amount will thereafter be the Base Salary for
all purposes of this Agreement. However, the Base Salary shall never
be lower than $250,000 per year.
2.2. Annual
Bonus. Executive shall be eligible to participate in such
annual bonus or incentive compensation plans and programs as may be in effect
from time to time in accordance with the Company’s compensation practices and
the terms and provisions of any such plans or programs. Executive’s
annual target bonus opportunity under the Company’s 2009 Executive Pay for
Performance Plan will be equal to 45% of his Base Salary, with the opportunity
to earn a maximum bonus equal to 86% of his Base Salary. The actual
bonus amount, and the performance measures and other factors bearing on such
amount, under that plan were approved by the Committee at its meeting held on
January 20, 2009. Except as otherwise provided by the terms of this
Agreement, any annual bonus earned shall be paid at the same time and in the
same manner as corresponding awards to other senior executives of the Company
generally.
2.3. Long-Term and Equity
Compensation. Executive shall be eligible to participate in
any long-term incentive compensation plan (including any equity-compensation
plan) that may be adopted by the Company from time to time during the
Term. The specific awards under any such plan will be reviewed by the
CEO and made by the Committee in its sole discretion, commensurate with
Executive’s position as Senior Vice President and Chief Financial
Officer.
2.4. Participation in Other Benefit
Plans. While Executive is employed with the Company:
(a) Executive
shall be eligible to participate in all retirement and other benefit plans and
programs of the Company generally available from time to time to employees of
the Company and for which Executive qualifies under the terms
thereof. Nothing in this Agreement shall limit the Company’s ability
to change, modify, cancel, amend or discontinue any of such plans.
2.5. Reimbursement of
Expenses. The Company shall pay directly or reimburse
Executive for reasonable business-related expenses and disbursements incurred by
him for and on behalf of the Company in connection with the performance of his
duties as the Senior Vice President and Chief Financial Officer of the Company,
subject, however, to the Company’s written policies relating to business-related
expenses as in effect from time to time. Executive shall submit to
the Company, no later than the month after the month during which he incurred
any such business-related expenses and disbursements, a report of such expenses
and disbursements in the form normally used by the Company and receipts with
respect thereto, and the Company’s obligations under this Section 2.5 shall be
subject to compliance therewith. Reimbursement of any
business-related expenses and disbursements shall be made in accordance with the
Company’s written policies relating to business-related expenses as in effect
from time to time. In no event will reimbursement of any
business-related expenses and disbursements be made later than the last day of
the calendar year following the calendar year in which any such expense or
disbursement was incurred.
2.6. Vacation. Executive
shall be entitled to paid vacation in accordance with the Company’s Paid Time
Off (PTO) policy in effect from time to time.
2.7. Executive Officer Company Car
Benefit. Executive shall be eligible to participate in the
Executive Officer Company Car benefit in accordance with the terms and
provisions of the Hooper Holmes, Inc. Executive Officer Company Car
Policy. Executive shall be responsible for taxes that are due, as a
result of receiving this benefit. Nothing in this Agreement shall limit the
Company’s ability to change, modify, cancel, amend or discontinue the Hooper
Holmes, Inc. Executive Officer Company Car Policy at any time, at the sole
discretion of the Compensation Committee.
2.8 Executive Change-in-Control
Agreement. Executive acknowledges that in connection with
Executive’s employment, Executive has entered into an Executive
Change-in-Control Agreement with the Company (the “CIC Agreement”). Executive
further acknowledges that the Company has notified Executive of its intent not
to renew the CIC agreement, and will offer Executive a successor form of
Retention Agreement upon expiration of the CIC Agreement. For
purposes of this Employment Agreement, it is specifically understood that any
reference to the CIC Agreement shall be construed to include any successor
Retention Agreement in effect between the Company and Executive, if
applicable.
2.9. Indemnification;
Insurance.
(a) Executive
acknowledges that, upon commencement of his employment with the Company, he was
offered and accepted indemnification in accordance with the Company’s bylaws and
the terms of the Company’s form indemnity agreement for officers and directors,
in each case subject to applicable law.
(b) Executive
shall be covered by directors’ and officers’ liability insurance during the Term
and for any applicable statute of limitations period thereafter, to the same
extent as other officers of the Company.
2.10. Deductions;
Withholdings. All compensation payable to Executive under the
terms of this Agreement shall be subject to any applicable income, payroll or
other tax withholding requirements and such other deductions or amounts, if any,
as may be authorized by Executive.
3. Termination.
3.1. Termination by the
Company. The Company shall have the right, subject to the
terms of this Agreement, to terminate Executive’s employment at any time, with
or without “Cause.” The Company shall give Executive written notice
of a termination for Cause (the “Cause Notice”) in accordance with Section 7.2
of this Agreement. The Cause Notice shall state the particular
action(s) or inaction(s) giving rise to the termination for Cause. No
action(s) or inaction(s) will constitute Cause unless:
(a) a
resolution finding that Cause exists has been approved by a majority of all of
the members of the Board (excluding Executive), at a meeting at which Executive
is allowed to appear with his legal counsel; and
(b) where
remedial action is feasible, Executive fails to remedy the action(s) or
inaction(s) within ten (10) days after receiving the Cause Notice.
If
Executive effects a cure to the satisfaction of the Board within the 10-day
period following his receipt of the Cause Notice, the Cause Notice shall be
deemed rescinded and of no force or effect.
For
purposes of this Agreement, “Cause” shall mean:
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participation
by Executive in fraudulent conduct against the Company, or a material
misrepresentation or omission by Executive that, in the Board’s reasonable
judgment, has resulted or will likely result in injury to the business,
operations or financial condition of the
Company;
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conviction
of or a plea of guilty or nolo contendere with
respect to a felony involving theft or moral
turpitude;
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Executive’s
violation of any statutory or common law duty of loyalty or good faith to
the Company or any of its
subsidiaries.
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Executive’s
continued violation of a material policy of the Company for a period of
thirty (30) days after Executive’s receipt of a written notice specifying
the nature of such violation from the
Company;
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any
refusal by Executive to follow the lawful directives of the CEO and/or
Board that are consistent with the scope and nature of Executive’s duties
and responsibilities as set forth in this
Agreement;
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any
misconduct by Executive in connection with performance of his duties
hereunder for a period of thirty (30) days after having received a written
notice specifying the nature of such misconduct from the Company;
or
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any
breach by Executive of any one or more of the covenants contained in
Sections 4 and 5.
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3.2 Termination by
Executive. Executive shall have the right, subject to the
terms of this Agreement, to terminate his employment at any time with or without
“Good Reason.”
For purposes of this Agreement, “Good
Reason” shall mean the occurrence of any of the following during the Term
without Executive’s prior written consent:
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a
material diminution in Executive’s authority, duties and/or
responsibilities as contemplated by this
Agreement;
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a
material diminution in Executive’s Base Salary, or unless the diminution
is a result of a Company-wide diminution in the annual bonus opportunity,
target incentive awards and/or benefits of all similarly situated
employees as Executive, a material diminution in the amount of Executive’s
annual bonus opportunity, target incentive award and/or benefits,
including health, retirement and
fringe;
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a
material failure by the Company to comply with the provisions of Section 2
of this Agreement (provided that an isolated, insubstantial or inadvertent
action or omission that is not in bad faith and is remedied by the Company
promptly after receipt of notice thereof given by Executive shall not
constitute Good Reason);
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a
change in Executive’s principal place of employment, such that the
Executive’s commuting distance as of the date of this Agreement increases
by more than 50 miles, as measured from Executive’s principal residence as
of the date of this Agreement;
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in
the event of the occurrence of a Change in Control (as defined in
the CIC Agreement), the failure of a successor to the Company
to explicitly assume and agree to be bound by the terms of such agreement,
in accordance with the CIC Agreement then in effect;
or
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a
material breach by the Company of any of the terms and conditions of the
CIC Agreement.
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Executive
must give the Company written notice, in accordance with Section 7.2 of this
Agreement, of any Good Reason termination of employment. Such notice
must be given within 60 days following Executive’s knowledge of the first
occurrence (as determined without regard to any prior occurrence that was
subsequently remedied by the Company) of a Good Reason circumstance and must
specify which of the Good Reason circumstances Executive is relying on, the
particular action(s) or inaction(s) giving rise to such circumstance, and the
date that Executive intends to separate from service, as defined under Section
409A of the Internal Revenue Code of 1986, as amended (“Section 409A”), which
shall be no earlier than thirty (30) days following the date of the Company’s
receipt of the notice. Executive’s termination shall not be deemed a
Good Reason termination of employment if (i) within 30 days of the Company’s
receipt of such notice, the Company remedies the circumstance(s) giving rise to
the notice, or (ii) Executive’s termination of his employment does not occur
within 60 days after the end of the 30-day period provided to the Company to
remedy the circumstances giving rise to the notice.
3.3 Death. If
Executive dies during the Term, Executive’s employment shall automatically
terminate, such termination to be effective on the date of Executive’s
death.
3.4 Disability. If
Executive shall suffer a Disability, the Company shall have the right to
terminate Executive’s employment, such termination to be effective upon the
giving of notice to Executive in accordance with Section 7.2 of this
Agreement. For purposes of this Agreement, a Disability shall mean
any physical or mental incapacity as a result of which Executive is unable to
perform substantially all of his essential duties for an aggregate of four (4)
months, whether or not consecutive, during any calendar year, and which cannot
be reasonably accommodated by the Company without undue
hardship. Executive cannot be terminated for Disability unless the
Company has delivered a written demand for substantial performance to Executive,
specifically identifying the manner in which Executive has not substantially
performed his duties, and Executive does not cure such failure within thirty
(30) days of such demand.
3.5 Effect of
Termination.
(a) In
General. Subject to the terms of Section 3.5(c), in the event
of the termination of Executive’s employment for any reason during the Term or
any Renewal Term, the Company shall pay to Executive (or his
beneficiary, heirs or estate, in the event of his death), as provided in Section
3.6 of this Agreement: (i) any Base Salary, to the extent not previously paid,
to the date of termination; (ii) any reimbursable business expenses
that have not yet been reimbursed (collectively, the “Accrued Obligations”); and
(iii) any unused vacation time accrued to the date of termination in accordance
with the Company’s PTO policies then in effect. The Accrued
Obligations shall be paid within 30 days after the date of
termination.
(b) Termination Resulting from
Executive’s Death or Disability. In the event of termination
of Executive’s employment as a result of Executive’s death or Disability,
Executive (or, in the case of death, his beneficiary, heir or estate) shall be
entitled to the compensation payable in accordance with Section
3.5(a). In addition, any unvested stock rights, stock options and
other unvested incentives or awards previously granted to Executive by the
Company shall be subject to the terms of the applicable plan(s) under which such
rights, options, incentives or awards were granted pertaining to the
consequences of a plan participant’s death or disability.
(c) Termination by the Company
for Cause and by Executive other than for Good Reason. In the
event of termination of Executive’s employment by the Company for Cause, or by
Executive other than for Good Reason, neither Executive nor any beneficiary,
heir or estate of Executive shall be entitled to any compensation other than the
payments made or provided in accordance with Section
3.5(a). Executive shall immediately forfeit any right to or incentive
compensation not yet paid or payable as of the date of termination, and all
unvested stock rights, stock options and other such unvested incentives or
awards previously granted to him by the Company, unless otherwise specifically
provided in the applicable plan(s) under which such rights, options, incentives
or awards were granted. Nothing in this Agreement shall be construed
to limit the rights and remedies which may be available to the Company in the
event of a termination of Executive’s employment by the Company for
Cause.
(d) Termination by the Company
without Cause; by Executive for Good Reason or Non-Renewal. In
the event of a termination of Executive’s employment by the Company without
Cause during the Term, or by Executive for Good Reason during the Term, or in
the event the Company gives notice that it will not renew this Agreement
pursuant to Section 1.2 and the Executive elects to terminate his employment
within thirty (30) days following such notice, Executive shall receive the
payments provided for in Section 3.5(a). In addition:
(i)
Executive shall receive a lump-sum payment equal to the amount of Base Salary
(at the rate in effect immediately prior to his termination) that would have
been payable to him if he had continued in employment through the longer of (A)
the balance of the then-current Term or Renewal Term of Executive’s employment
under this Agreement, or (B) the one-year period following the date of
termination. Such lump-sum payment shall be made within fifteen (15) days after
Executive’s termination date; provided, however, that if at the time of
Executive’s termination for Good Reason, the Employee is a “specified employee”
as defined in Section 409A of the Code, then the Company will defer the payment
until the first day of the seventh (7th)
month following the date of termination or, if earlier, Executive’s death or
such earliest other date as is permitted under Section 409A. In the
event a lump sum payment would be subject to a delay under Section 409A,
Executive may elect to receive payments on the Company’s regularly scheduled pay
dates, and the Company shall make such payments to the extent permitted by
Section 409A and any other applicable law or regulation.
(ii) All
rights to exercise any outstanding award of stock options or stock appreciation
rights with respect to the Company’s common stock, or shares of restricted
stock, held by Executive at the date of termination shall be governed by the
terms of the applicable plan under which such award was granted.
(iii) For
the longer of (A) the balance of the then-current Term or Renewal Term or (B)
the one-year period following the date of termination, Executive shall have the
right, at the Company’s expense, to continue his participation in such
retirement and other benefit plans and programs of the Company generally
available from time to time to employees of the Company in which Executive was
enrolled and/or participating on the date of termination, to the extent
permitted by the applicable plan or program and subject to any subsequent
modifications or amendments to any such plan or program. The cost (if
any) to Executive of his continued participation in such retirement and other
benefit plans for this period shall be added to and paid with the lump sum
payment provided for in Section 3.5(d)(i), above.
(iv) For
the longer of (A) the balance of the then-current Term or Renewal Term or (B)
the one-year period following the date of termination, the Company will pay the
Executive a Car Allowance of $700 per month. The total amount of this
Car Allowance for this period shall be added to and paid with the lump sum
payment provide for in Section 3.5(d)(i), above. The Company’s
obligation in this regard is conditioned on Executive’s returning his Company
Car, if any, within 15 days following his termination of
employment.
To the
extent the payments under subsections (iii) or (iv) are not exempt from Section
409A, any payments that cannot be paid during the 6-month period after the date
of termination described in Section 7.10(a) will be postponed until the time for
payment permitted under Section 7.10.
3.6 Conditions of
Payment. Any payments or benefits made or provided in
connection with the termination of Executive’s employment with the Company in
accordance with Section 3.5 (other than payments made or provided in accordance
with Section 3.5(a) or due to a termination of Executive’s employment due to his
death) are subject to Executive’s:
(a) compliance
with the provisions of Sections 3.8, 4 and 5 of this Agreement; and
(b) delivery
to the Company of a resignation from all offices, directorships and fiduciary
positions with the Company, its affiliates and employee benefit plans prior to
the scheduled date for which the applicable payment or benefit is to be made or
provided.
Payment
of the amounts specified in Sections 3.5(d)(i), (iii) and (iv) will be
conditioned upon delivery by Executive of an executed, concurrently-effective
General Release, substantially in the form attached to this Agreement as Exhibit
A, with such changes or additions as needed under then applicable law to give
effect to its intent and purpose
3.7 Mitigation. Executive
shall be under no obligation to seek other employment following a termination of
his employment with the Company or any subsidiary for any reason. In
addition, there shall be no offset against amounts due Executive under this
Section 3 or otherwise on account of any compensation attributable to any
subsequent employment.
3.8 Cooperation;
Assistance. Executive agrees to cooperate fully, subject to
reimbursement by the Company of reasonable out-of-pocket costs and expenses,
with the Company or any subsidiary and its or their counsel with respect to any
matter (including any litigation, investigation or governmental proceeding)
which relates to matters with which Executive was involved or about which he had
knowledge during his employment with the Company or any
subsidiary. Such cooperation shall include appearing from time to
time at the offices of the Company or any subsidiary or its or their counsel for
conferences and interviews and, in general, providing the officers of the
Company or any subsidiary and its or their counsel with the full benefit of
Executive’s knowledge with respect to any such matter. Executive
further agrees, upon termination of his employment for any reason and if the CEO
and/or Board requests, to assist his successor in the transition of his duties
and responsibilities to such successor. Executive agrees to render
such cooperation in a timely fashion and at such times as may be mutually
agreeable to the parties. The Company shall compensate Executive for
time spent providing assistance to the Company, based on the number of hours
spent by Executive in providing such assistance. The hourly rate of
compensation shall be $120.
3.9 Effect of the Occurrence of a Change
in Control under the CIC Agreement. Upon the occurrence of a
Change in Control (as defined in the CIC Agreement), the terms of this Section 3
(other than this Section 3.9) shall cease to have any further force or effect,
except under the following circumstances: (i) a Change in Control occurs, (ii)
no Triggering Event (as defined in the CIC Agreement) occurs within the 12-month
period following the Change in Control (defined in the CIC Agreement as the
“Employment Period”), and (iii) subsequent to the end of such Employment Period,
either the Company terminates Executive’s employment without Cause or Executive
terminates his employment for Good Reason. Under such circumstances
(and assuming this Agreement is in effect at the time of such termination),
Section 3 shall continue to apply to such termination.
4. Confidentiality.
4.1 Executive
acknowledges and agrees that:
(a) by
reason of his employment with the Company and his service as an Officer of the
Company, Executive will have knowledge of all aspects of the Company’s
operations and will be entrusted with and have access to confidential and secret
proprietary business information and trade secrets of the Company, including but
not limited to:
(i) information
regarding the Company’s business priorities and strategic plans;
(ii) information
regarding the Company’s personnel;
(iii) financial
and marketing information (including but not limited to information about costs,
prices, profitability and sales information not available outside the
Company);
(iv) secret
and confidential plans for and information about new or existing services, and
initiatives to address the Company’s competition;
(v) information
regarding customer relationships; and
(vi) proprietary
or confidential information of customers or clients for which the Company may
owe an obligation not to disclose such information.
(all such
information shall be collectively referred to as “confidential
information”);
(b) the
Company and its subsidiaries, affiliates and divisions will suffer substantial
and irreparable damage that will not be compensable through money damages if
Executive should divulge or make use of confidential information acquired by
Executive in the course of his employment with the Company and service to the
Board other than as may be required or appropriate in connection with
Executive’s work as an employee of the Company; and
(c) the
provisions of this Agreement are reasonable and necessary for the protection of
confidential information, the business of the Company and its subsidiaries,
affiliates and divisions, and the stability of their workforces.
4.2 Except
as may be required or appropriate in connection with Executive’s work as an
employee of the Company, Executive shall keep confidential all
confidential information he learns of during his employment with the Company
regarding the Company, its business, operations, systems, employees, customers,
clients and prospective clients. In addition, Executive agrees that
he will not disclose confidential information obtained from the Company or its
officers, directors or management during his employment, including, but not
limited to, information regarding, or statements by, the Company or its
officers, directors or management, to anyone other than as required by law or in
response to a lawful court order or subpoena.
4.3 Nothing
in this Section 4 shall prohibit Executive from participating as a witness at
the request of the Company or a third party in any investigation by the SEC or
any other governmental agency charged with the investigation of any matters
related to Executive’s employment with the Company, nor shall Executive be
prohibited from testifying in response to a subpoena, court order or notice of
deposition. Executive agrees to notify the Company’s General Counsel,
in writing, at least ten (10) days prior to the response deadline or appearance
date (whichever is earlier) for any such subpoena, court order or notice of
deposition issued by a court or investigating agency which seeks disclosure of
any confidential information. Executive further agrees to take any
actions reasonably requested by the Company to allow the Company to protect the
release of information regarding Executive’s employment from the Company in such
court or agency proceeding.
4.4 Executive
agrees that:
(a) he
will not, at any time, remove from the Company’s premises any notebooks,
software, data or other confidential information relating to the Company, except
to the extent necessary or appropriate to perform his duties and
responsibilities under the terms of this Agreement;
(b) upon
the expiration or termination of the Term for any reason whatsoever, he shall
promptly deliver to the Company any and all notebooks, software, data and
documents and material, including all copies thereof, in his possession or under
his control relating to any confidential information, or which is otherwise the
property of the Company; and
(c) he
will not use any confidential information for his own benefit or for the benefit
of any new employer or any third person.
4.5 For
purposes of this Section 4, the term “Company” shall mean and include the
Company and any and all subsidiaries and affiliated entities of the Company in
existence from time to time.
5. Non-Competition and
Non-Solicitation.
5.1 Executive
acknowledges that the Company is, as of the Effective Date, engaged principally
in the business of providing health information risk assessment services to
insurance companies and health and wellness providers, performing lab testing
services, providing underwriting services in connection with the processing of
life insurance applications, and providing health information gathering and
assessment services to healthcare and research entities, – throughout the United
States. By virtue of Executive’s position with the Company, Executive
will be exposed to and acquire significant confidential information about the
Company and its existing and future plans and strategies. As a
result, Executive acknowledges that the Company has a legitimate business
interest supporting the restrictive covenants set forth in this Section
5.
5.2 During
Executive’s employment with the Company and until the first anniversary of the
date of termination of Executive’s employment with the Company, Executive shall
not in any manner, directly or indirectly, within the United States (without the
prior written consent of a duly authorized officer of the Company):
(a) act
as a Competitive Enterprise or accept any engagement in any capacity that
involves Executive performing management, consultation, advisory or other
services of any kind with a Competitive Enterprise (as defined in Section 5.3
below);
(b) Solicit
(as defined in Section 5.3 below) any Customer (as defined in Section 5.3 below)
to transact business with a Competitive Enterprise or to reduce or refrain from
doing any business with the Company or any of its subsidiaries;
(c) transact
business with any Customer that would cause Executive to be a Competitive
Enterprise;
(d) interfere
with or damage any relationship between the Company or any its subsidiaries with
a Customer; or
(e) Solicit
anyone who is then an employee of the Company or any of its subsidiaries (or who
was an employee of the Company or any of its subsidiaries within the prior 12
months) to resign from the Company or any of its subsidiaries or to apply for or
accept employment with any other business or enterprise.
5.3 For
purposes of this Agreement:
“Competitive Enterprise” means
any business enterprise that either (A) engages in a business that competes
anywhere in the United States with any business in which the Company or any of
its subsidiaries is then engaged in, or (B) holds a 5% or greater equity, voting
or profit participation interest in any enterprise that competes anywhere in the
United States with any activity that the Company or any of its subsidiaries is
then engaged in; provided, however, that if (i)
the Company, including any subsidiary, ceases to do, and exits, a particular
type of business activity, then following such exit the Company and its
subsidiaries will be deemed not to be “then engaged” in such business; or (ii)
the Company, including any of its subsidiaries, was not engaged in a particular
type of business activity (and was not contemplating such business activity),
while Executive was employed by the Company, then for the purposes of this
Agreement, the Company and its subsidiaries will be deemed not to be “then
engaged” in such business.
“Customer” means any customer
or prospective customer of the Company or any of its subsidiaries whose identity
became known to Executive in connection with Executive’s relationship with or
employment by the Company or any of its subsidiaries.
“Solicit” means any direct or
indirect communication of any kind, regardless of who initiates it, that in any
way invites, advises, encourages or requests any person to take or refrain from
taking any action.
6. Injunctive
Relief. If Executive
commits a breach, or threatens to commit a breach, of any of the provisions of
Section 4 or 5 of this Agreement, the Company shall have the right and remedy
(which shall be in addition to, and not in lieu of, any other rights and
remedies available to the Company at law or in equity) to have the provisions of
this Agreement specifically enforced by any court having equity jurisdiction, it
being acknowledged by Executive that any such breach or threatened breach will
or may cause irreparable injury to the Company and that money damages will or
may not provide an adequate remedy to the Company.
7. Miscellaneous.
7.1 Benefit of Agreement, Assignment;
Beneficiary. This Agreement shall inure to the benefit of and
be binding upon the Company and its successors and assigns. This
Agreement shall also inure to the benefit of, and be enforceable by, Executive
and his personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If Executive
should die while any amount would still be payable to Executive under this
Agreement if he had continued to live, all such amounts shall be paid in
accordance with the terms of this Agreement to Executive’s beneficiary, devisee,
legatee or other designee, or if there is no such designee, to Executive’s
estate.
7.2 Notices. Any
notice required or permitted under this Agreement shall be in writing and shall
be sufficiently given if personally delivered or if sent by certified mail,
postage prepaid, with return receipt requested or by reputable overnight
courier, addressed: (a) in the case of the Company, to the General Counsel of
the Company at the Company’s then-current corporate headquarters, and (b) in the
case of Executive, to Executive’s last known address as reflected in the
Company’s records, or to such other address as either party shall designate by
written notice to the other party. Any notice given hereunder shall
be deemed to have been given at the time of receipt thereof by the person to
whom such notice is given if personally delivered or at the time of mailing if
sent by certified mail or by courier.
7.3. Entire Agreement;
Amendment. Except as specifically provided in this Agreement,
this Agreement contains the entire agreement of the parties to this Agreement
with respect to the terms and conditions of Executive’s employment during the
Term, and supersedes all prior agreements and understandings, whether written or
oral, between the parties with respect to compensation due for services rendered
under this Agreement. For the avoidance of doubt, in the event of any
inconsistency between this Agreement and any plan, program or arrangement of the
Company or its affiliates, the terms of this Agreement shall
control. This Agreement may not be changed or modified except by an
instrument in writing signed by both of the parties.
7.4 Waiver. The waiver
of either party of a breach of any provision of this Agreement shall not operate
or be construed as a continuing waiver or as a consent to or waiver of any
subsequent breach.
7.5 Headings. The
section headings in this Agreement are for convenience of reference only, do not
constitute part of this Agreement and shall not be deemed to limit or affect any
of the provisions of this Agreement.
7.6 Governing
Law. This Agreement shall be governed by, and construed and
interpreted in accordance with, the internal laws of the State of New Jersey,
without reference to the principles of conflicts of laws.
7.7 Survivorship. The
respective rights and obligations of the parties under this Agreement shall
survive any termination of this Agreement to the extent necessary to effectuate
the intended preservation of such rights and obligations, including, without
limitation, Section 4 and 5 of this Agreement.
7.8 Validity. The
invalidity on unenforceability of any provision or provisions of this Agreement
shall not affect the validity or enforceability of any other provision or
provisions of this Agreement, which shall remain in full force and
effect. If any provision of this is held to be invalid, void or
unenforceable, any court so holding shall substitute a valid, enforceable
provision that preserves, to the maximum lawful extent, the terms and intent of
this Agreement.
7.9 Construction. The
parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement. Any reference to any federal, state or local statute
or law shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. The word
“including” shall mean including without limitation.
7.10 Section 409A.
(a) Notwithstanding
the due date of any post-employment payments, if at the time of the termination
of Executive’s employment Executive is a “specified employee” (as defined in
Section 409A, Executive will not be entitled to any payments upon termination of
employment that are subject to Section 409A until the later of (i) the date that
payments are scheduled to be made under this Agreement, or (ii)
the earlier of (A) the first day of the seventh month following the
date of termination of his employment with the Company for any reason other than
death, or (B) the date of Executive’s death. The provisions of this
paragraph will only apply if and to the extent required to avoid any “additional
tax” under Section 409A. The parties to this Agreement intend that
the determination of Executive’s termination of employment shall be made in
accordance with Treasury Reg. Section 1.409A-1(h).
(b) The
parties to this Agreement intend that this Agreement and Company’s and
Executive’s exercise of authority or discretion hereunder shall comply with the
provisions of Section 409A and the Treasury regulations relating thereto so as
not to subject Executive to the payment of interest and tax penalty which may be
imposed under Section 409A. In furtherance of this objective, to the
extent that any regulations or other guidance issued under Section 409A would
result in Executive being subject to payment of “additional tax” under Section
409A, the parties agree to use their best efforts to amend this Agreement in
order to avoid the imposition of any such “additional tax” under Section 409A,
which such amendment shall be designed to minimize the adverse economic effect
on Executive without increasing the cost to the Company (other than transactions
costs), all as reasonably determined in good faith by the Company and Executive
to maintain to the maximum extent practicable the original intent of the
applicable provisions. This Section 7.10 does not guarantee that
payments under this Agreement will not be subject to “additional tax” under
Section 409A.
7.11 Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original but all of which will constitute one and the same
instrument.
IN WITNESS WHEREOF, each of
the parties has duly executed this Agreement on the date indicated
below. The Company represents that its execution of this Agreement
has been authorized by the Compensation Committee of the Company’s Board of
Directors.
Hooper Holmes, Inc.
Date: 12/15/09 By: /s/ Roy H.
Bubbs_______________
Name: Roy
H. Bubbs
Title: President
and Chief Executive Officer
Date: 12/15/09
/s/ Michael J.
Shea____________________
Michael Shea
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Exhibit
A
General
Release
1. For
valuable consideration, the adequacy of which is hereby acknowledged, the
undersigned executive (“Executive”), on his own behalf and on behalf of his
family members, heirs, executors, administrators, personal representatives,
distributees, devisees, legatees, and successors and assigns (collectively, the
“Releasing Parties”),
does hereby knowingly, voluntarily and unconditionally release, waive, acquit
and fully discharge, and agree to hold harmless Hooper Holmes, Inc, a New York
corporation (the “Company”) and its present and past subsidiaries and
affiliates, and its and their officers, directors, shareholders, employee
benefit plans, plan fiduciaries and trustees, insurers, employees, agents,
representatives, successors and assigns (collectively referred to as the “Releasees”), from and against
any cause of action, legal claim, suit, right, liability or demand of any kind
or nature, known or unknown, liquidated or unliquidated, absolute or contingent,
at law or in equity (each such action, claim, suit, right, liability or demand
being hereinafter individually referred to as a “Claim” and collectively as
“Claims”) that Executive
may now or hereafter have against the Releasees, or any one or group of them,
including, but not limited to:
(a) any
and all Claims in connection with
(i) any
and all agreements between the Company and Executive, including but not limited
to the Employment Agreement, dated as of __________, 2009, by and between the
Company and Executive (the “Employment Agreement”), the
Retention Agreement dated as of May 23, 2006, by and between the Company and
Executive, and any successor retention or change-in-control agreement by and
between the Company and Executive;
(ii) Executive’s
employment relationship with the Company,
(iii) the
terms and conditions of such employment relationship (including compensation and
benefits),
(iv) Executive’s
service as an officer of the Company (except for indemnification in accordance
with the Company’s certificate of incorporation, bylaws or any director or
officer indemnity agreement between Executive and the Company), or
(v) the
termination of such employment relationship and the circumstances surrounding
such termination; and
(b) any
and all Claims relating to, or arising from, Executive’s right to purchase, or
actual purchase of, shares of stock of the Company, including, without
limitation, any claims for fraud, misrepresentation, breach of fiduciary duty,
breach of duty under applicable state corporate law, and securities fraud under
any federal or state law; and
(c) any
and all Claims for wrongful discharge of employment; constructive discharge;
termination in violation of public policy; discrimination; harassment;
retaliation; breach of contract, both express and implied; promissory estoppel;
negligent or intentional infliction of emotional distress; fraud; negligent or
intentional misrepresentation; negligent or intentional interference with
contract or prospective economic advantage; unfair business practices;
defamation; libel; slander; negligence; personal injury; assault; battery;
invasion of privacy; false imprisonment; conversion; and disability
benefits.
Without limiting the generality of the
foregoing, Executive specifically releases, acquits, discharges, waives and
agrees to hold Releasees harmless from and against any and all claims arising
under:
(A)
the Sarbanes-Oxley Act of 2002, 18 U.S.C. §1514A;
(B) Section
1981 of the Civil Rights Act of 1866, as amended, 42 U.S.C. §§1981;
(C)
Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. §§2000e, et seq. (the “Civil Rights
Act”);
(D) the
Americans with Disabilities Act of 1990, 43 U.S.C. §12101 et seq. (the “Americans with Disabilities
Act”);
(E) the
Equal Pay Act of 1993;
(F) the
Fair Labor Standards Act, except as prohibited by law;
(G) the
Older Workers Benefit Protection Act of 1990 (the “OWBPA”);
(H) the
Age Discrimination in Employment Act of 1967, 29 U.S.C. §626 et seq. (the “ADEA”);
(I) the
Family and Medical Leave Act of 1993, 29 U.S.C. §2601 et seq. (the “Family and Medical Leave
Act”), except as prohibited by law;
(J) the
Worker Adjustment and Retraining Notification Act, as amended;
(K) Executive
Order 11,141 (age discrimination);
(L) Executive
Order 11,246 (race, color, religion, sex and national origin
discrimination);
(M) the
National Labor Relation Act;
(N) the
Occupational Safety and Health Act, as amended;
(O) the
Immigration Reform and Control Act, as amended;
(P) the
Vietnam Era Veterans Readjustment Assistance Act;
(Q) Sections
503-504 of the Rehabilitation Act of 1973 (handicap
rehabilitation);
(R) the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”) (other than such
rights as are mandated or vested by law);
(S) the
New Jersey Law Against Discrimination, N.J.S.A. 10:5-1 et seq.;
(T) the
New Jersey Conscientious Employee Protection Act, N.J.S.A, 34:19-1 et seq.;
(U) the
New Jersey Wage and Hour laws, N.J.S.A. 34:11-56a et seq.;
(V) the
New Jersey Family Leave Act, N.J.S.A. 34:11B-1 et seq.;
(W) any
other federal, state or local fair employment, civil or human rights, wage and
hour laws and wage payment laws, and any and all other federal, state, local or
other governmental statutes, laws, ordinances, regulations and orders, under
common law, and under any Company policy, procedure, bylaw or rule.
This
General Release shall not waive or release any Claims that Executive may have
which arise after the date of this General Release or that arise under or are
explicitly preserved by the Employment Agreement and shall not waive any Claims
for benefits required by applicable law (including post-termination
health-continuation insurance benefits required by state or federal law) or
Claims which cannot be waived or relesaed under the terms of any federal law or
the laws of the state(s) governing Executive’s employment with the
Company.
2. Executive
agrees not to sue concerning, or in any manner to institute, prosecute or pursue
any Claim in respect of any of the matters covered by Section 1 of this General
Release in any court of the United States or in any state, or with any
administrative agency of the United States or any state, county or municipality,
or before any other tribunal, public or private, against the Company or any of
the Releasees.
3. This
General Release is not intended to and does not interfere with the right of the
Equal Employment Opportunity Commission (“EEOC”) to enforce
anti-discrimination laws or to seek relief that will benefit the public and any
victim of unlawful employment practices who has not waived his or her
claims. The Company acknowledges and agrees that Executive is not
prevented from filing a charge with, or testifying, assisting, or participating
in any proceeding brought by the EEOC concerning an alleged discriminatory
practice of the Company. Executive, on behalf of himself and any and
all other Releasing Parties, hereby waives all rights to any benefits,
including, but not limited to, monetary recovery and reinstatement, derived from
any actions, suits or proceedings brought on behalf of Executive or any of the
other Releasing Parties, including any action, suit or proceeding brought by the
EEOC or anyone else. Executive, on behalf of himself and any and all
other Releasing Parties, also agrees not to initiate or become a party to or
otherwise participate or support any current or former employee(s) in any
action, suit or proceeding brought by such employee(s). If Executive
or any other Releasing Party files any action, suit or proceeding with respect
to any Claim released by Executive under the terms of this Agreement, Executive
agrees to indemnify the Company against any damages or judgments arising from
any such action, suit or proceeding.
4. Executive
agrees that Executive shall not be eligible and shall not seek or apply for
reinstatement or re-employment with the Company and agrees that any application
for re-employment may be rejected without explanation or liability.
5. In
further consideration of the promises made by the Company in Section 3 of the
Employment Agreement, Executive specifically waives and releases the Company, to
the extent set forth in Section 1 of this General Release, from all Claims
Executive may have as of the date of this General Release, whether known or
unknown, arising under the ADEA. Executive further agrees
that:
(a) Executive’s
waiver of rights under this General Release is knowing and voluntary and in
compliance with the OWBPA.
(b) Executive
understands the terms of this General Release.
(c) The
consideration offered by the Company under Section 3 of the Employment Agreement
in exchange for the General Release represents consideration over and above that
to which Executive would otherwise be entitled, and the consideration would not
have been provided had Executive not agreed to sign the General Release and did
not sign the General Release.
(d) The
Company is hereby advising Executive in writing to consult with an attorney
prior to executing this General Release.
(e) The
Company is giving Executive a period of twenty-one (21) days within which to
consider this General Release.
(f) Following
Executive’s execution of this General Release, Executive has seven (7) days in
which to revoke this General Release by written notice. An attempted
revocation not actually received by the Company prior to the revocation deadline
will not be effective.
(g) This
General Release and all payments and benefits otherwise payable under Section 3
of the Employment Agreement (other than payments and benefits made or provided
in accordance with Section 3.5(a)) shall be void and of no force and effect if
Executive chooses to so revoke, and if Executive chooses not to so revoke within
the 7-day period, this General Release shall then become effective and
enforceable.
6. This
General Release does not waive any rights or claims that may arise under the
ADEA after the date Executive signs this General Release. To the
extent barred by the OWBPA, the covenant not to sue contained in Section 2 above
does not apply to claims under the ADEA that challenge the validity of this
General Release.
7. To
revoke this General Release, Executive must send a written statement of
revocation to:
Hooper Holmes, Inc.
170 Mt. Airy Road
Basking Ridge, New Jersey
07920
Attn: General Counsel
The revocation must be received by no
later than 5:00 p.m. on the seventh day following Executive’s execution and
delivery of this General Release. If Executive does not revoke, the
eighth day following Executive’s execution and delivery of this General Release
will be the effective date of this General Release.
8. Executive
acknowledges and agrees that this General Release is not intended by Executive
or the Company to be construed, and will not be construed, as an admission by
the Company of any liability or violation of any law, statute, ordinance,
regulation or legal duty of any nature whatsoever.
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9. This
General Release shall be governed by the internal laws (and not the choice of
laws) of the State of New Jersey, except for the application of pre-emptive
federal law.
Please read this General Release
carefully. It contains a release of all known and unknown
claims.
Date: __________________________________
Michael J. Shea
Hooper Holmes, Inc.
By: _______________________
Name:
Title:
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