Sample Business Contracts

Employment Agreement - Heidrick & Struggles Inc. and Kevin J. Smith

Employment Forms

  • Employment Agreement. Employers can customize an employment agreement that states the salary, benefits, working hours and other important provisions for their new or existing employee.
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  • Sales Representative Contract. Independent sales representatives offer companies the potential to increase the sale of products or services without the burden of increasing headcount. Both parties should understand how commissions are calculated, when commissions will be paid, as well as how the representative will treat confidential information from the company and whether the representative may also sell a competing line of products or services.
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            [Letterhead of Heidrick & Struggles International, Inc.]

March 20, 2002


Mr. Kevin J. Smith
6 Clubside Court
Burr Ridge, Illinois 60521

Dear Kevin:

On behalf of Heidrick & Struggles, Inc., I am pleased to confirm the
terms of your employment to you.

Title. You will serve as Chief Financial Officer reporting
to the Chief Executive Officer of Heidrick & Struggles International,
Inc. (the "Company"). You will also have the internal title of
Senior Partner. You will be a member of the Global Operating
Committee ("GOC") or its equivalent. Initially you will be located
in the Company's corporate offices in Chicago.

Base Salary. Your base salary is $430,000 annually, subject
to review on a 24-month basis.

Target Bonus. Your target bonus for 2002 is 100% of base
salary to be paid when bonuses are paid to executive officers in
March of 2003. Your target bonus will be guaranteed to the extent of
50% for 2002. Bonuses (other than the guaranteed portion of your 2002
bonus) are discretionary and are not earned until approved by the
Compensation Committee and/or the Board of Directors of the Company
and subject to the provisions of the Change in Control Severance Plan
and the paragraphs below relating to termination without Cause
including resignation for Good Reason, will be payable only if you
are in the Company's employ on the regular bonus payment date.

Incentive Compensation and Other Plans. You will be eligible
to participate in the incentive and other executive compensation
plans applicable to members of GOC and executive officers, including,
without limitation, the performance share plan, the annual bonus plan
and the management stock option plan which have been provided to you.
You shall also be eligible to participate in the Change In Control
Severance Plan in Tier One. In addition, you will be covered by the
Company's Severance Plan in the tier for Top Management, provided (i)
the terms "Cause" and "Good Reason" shall have the meanings
defined below and any resignation by you for Good Reason shall be
deemed a termination by the Company without Cause under the


Mr. Kevin J. Smith
March 20, 2002
Page 2

Severance Plan and (ii) any reduction in your base salary or bonus
opportunity that constitutes Good Reason shall be disregarded in
determining the severance payment due to you.

Sign-On Arrangements.

        Options. You will receive a stock option grant to purchase
        10,000 shares of Heidrick & Struggles International, Inc.
        common stock within 60 days of the date you commenced
        employment. The options will be granted at the closing price
        of the common stock as reported on NASDAQ on the trading day
        preceding such date, will vest 100% on the first anniversary
        of the date of grant, and will have a ten-year term.

        Cash Payment. Within 30 days following the date of this
        Agreement the Company will lend to you $250,000 to be
        evidenced by a non-interest bearing promissory note (the
        "Note") payable on March 20, 2005, except that, if you
        cease to be in the Company's employ, then subject to the next
        succeeding paragraphs, the entire principal balance of the
        Note then outstanding shall, without demand or notice of any
        kind, be and become due and payable within 30 days of the
        termination of your employment.

        If you are in the Company's employ, the Note will be forgiven
        in the principal amount of $83,333 on each of March 20, 2003,
        2004 and 2005. The income arising from the loan forgiveness
        will be subject to personal income tax withholding. The
        Company is authorized to deduct the amounts required to be
        withheld from your cash bonus; if the bonus amount is less
        than the withholding, you will, within 10 days, reimburse the
        Company for withholding payments made to the extent not
        covered by your bonus. The Company will reimburse you on a
        grossed-up basis for any income tax arising out of the
        interest-free nature of the loan.

        In addition, the Note will be forgiven in full at any time if
        the Company has terminated your employment without Cause or
        if you have resigned for Good Reason).

           The term "Good Reason" shall mean (i) a diminution of
           the amount of your base salary or target bonus or benefits
           or level of eligibility for stock options or other
           incentive programs unless such diminution is consistent
           with other employees at your level; (ii) the elimination
           of your position or a diminution of responsibilities
           associated with your position or (iii) a change in the
           location of your principal place of employment more than
           50 miles in radius from its initial location without your

           The term "Cause" shall mean (a) fraud, or the
           embezzlement or misappropriation of funds or property of
           the Company or any of its affiliates by you, the
           conviction of, or the entrance of a plea of


Mr. Kevin J. Smith
March 20, 2002
Page 3

           guilty or nolo contendere by you, to a felony, or a crime
                     ---- ----------
           involving moral turpitude; (b) neglect, misconduct or
           willful malfeasance which is materially injurious to the
           Company or any of its affiliates; or (c) willful failure or
           refusal to perform your duties, or a willful, material
           breach of contract.

Benefits. You will be eligible to participate in the Company's
benefit programs and will receive a detailed guide shortly after your
starting date. The Company's benefit programs include group health
and life/AD&D insurance, long-term disability, short-term disability
salary continuation, time-off benefits (vacation, paid holidays, paid
sick time), the Flexible Spending Account and the Heidrick &
Struggles, Inc. 401(k) Profit-Sharing and Retirement Plan. The
Company's benefit programs, bonus programs and polices are reviewed
from time to time by Company management and may be modified, amended,
or terminated at any time.

Expenses. The Company's Physical Examinations Policy will apply to
you effective immediately upon your employment commencement date. The
Financial Planning Program for Senior Partners will also apply to
you. The Company will reimburse you for all of your business expenses
in accordance with its policies. You will also be entitled to
reimbursement of up to $5,000 per year for the cost of initiation
fees, monthly dues and expenses incurred in connection with club

Confidentiality. Your employment with the Company under this
Agreement necessarily involves your access to and understanding of
certain trade secrets and confidential information pertaining to the
business of the Company and its affiliates. During the term of your
employment with the Company and thereafter, you will not, directly or
indirectly, without the prior written consent of the Company,
disclose or use for the benefit of any person, corporation or other
entity, or for yourself any and all files, trade secrets or other
confidential information concerning the internal affairs of the
Company and its affiliates, including, but not limited to, information
pertaining to its clients, services, products, earnings, finances,
operations, methods or other activities, provided, however, that the
foregoing shall not apply to information which is of public record or
is generally known, disclosed or available to the general public or
the industry generally (other than as a result of your breach of this
covenant). Notwithstanding the foregoing, you may disclose such
information as is required by law during any legal proceeding or to
your personal representatives and professional advisers and, with
respect to such personal representatives and professional advisers,
you shall inform them of your obligations hereunder and take all
reasonable steps to ensure that such professional advisers do not
disclose the existence or substance thereof. Further, you shall not,
directly or indirectly, remove or retain, and upon termination of
employment for any reason you shall return to the Company, any
records, computer disks, computer printouts, business plans or any
copies or reproductions thereof, or any information or instruments
derived therefrom, arising out of or relating to the business of the
Company and its affiliates or obtained as a result of your employment
by the Company.

Non-Solicitation/Non-Competition. During the term of your employment
with the Company and for a period of six-months after the termination
of your employment with the Company, you shall not (i) become an
employee of or consultant to any principal competitor of the Company
in substantially the same function as your employment with the Company
or its affiliates in the twelve-months prior to termination of your
employment or (ii) directly or indirectly solicit or


Mr. Kevin J. Smith
March 20, 2002
Page 4

hire, or assist any other person in soliciting or hiring, any
employee of the Company or its affiliates (as of your termination of
employment with the Company) or any person who, as of such date, was
in the process of being recruited by the Company or its affiliates,
or induce any such employee to terminate his or her employment with
the Company or its affiliates.

Other Legal Matters.

        You will be an "employee at will" unless or until you and
        the Company otherwise agree in writing. The purpose of this
        arrangement is to permit either of us to terminate employment
        and compensation at any time with or without Cause or Good
        Reason, except for such period of notice as may be expressly
        provided in writing under written Company employment policies
        in effect at the time of such termination. Your initial and
        continuing employment will be subject to your having the
        ability to work legally in the United States.

        You have advised the Company that your execution and
        performance of the terms of this Agreement do not and will
        not violate any other agreement binding on you or the rights
        of any third parties and you understand that in the event
        this advice is not accurate the Company will not have any
        obligation to you under this Agreement.

        This letter agreement contains our entire understanding and
        can be amended only in writing and signed by you and the
        Chief Executive Officer. You specifically acknowledge that no
        promises or commitments have been made to you that are not
        set forth in this letter.

        Any controversy or claim arising out of or relating to this
        agreement or for the breach thereof, or your employment,
        including without limitation any statutory claims (for
        example, claims for discrimination including but not limited
        to discrimination based on race, sex, sexual orientation,
        religion, national origin, age, marital status, handicap or
        disability; and claims relating to leaves of absence mandated
        by state or federal law), breach of any contract or covenant
        (express or implied), tort claims, violation of public policy
        or any other alleged violation of statutory, contractual or
        common law rights (and including claims against the Company's
        officers, directors, employees or agents) if not otherwise
        settled between the parties, shall be conclusively settled by
        arbitration to be held in New York, New York, in accordance
        with the American Arbitration Association's Employment
        Dispute Resolution Rules (the "Rules"). Arbitration shall
        be the parties' exclusive remedy for any such controversies,
        claims or breaches. The parties agree they shall not seek any
        award for punitive damages for any claims they may have under
        this Agreement. The parties also consent to personal
        jurisdiction in New York, New York with respect to such
        arbitration. The award resulting from such arbitration shall
        be final and binding upon both parties. Judgment upon said
        award may be entered in any court having jurisdiction.


Mr. Kevin J. Smith
March 20, 2002
Page 5

        You and the Company hereby waive the right to pursue any
        claims, including but not limited to employment
        termination - related claims, through civil litigation outside
        the arbitration procedures of this provision, unless otherwise
        required by law. You and the Company each have the right to
        be represented by counsel with respect to arbitration of any
        dispute pursuant to this paragraph. The arbitrator shall be
        selected by agreement between the parties, but if they do not
        agree on the selection of an arbitrator within 30 days after
        the date of the request for arbitration, the arbitrator shall
        be selected pursuant to the Rules.

        In the event of any arbitration hereunder, the parties agree
        each shall bear its or his own attorneys' fees and costs
        associated with or arising from such arbitration or other

Yours sincerely,

/s/ Stephanie W. Abramson

Stephanie W. Abramson
Chief Legal Officer

I hereby accept the terms and conditions of employment as outlined

/s/ Kevin J. Smith                                             4-4-02
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Kevin J. Smith                                                 Date