Executive Employment Agreement - Private Business Inc. and Thomas Black
EXECUTIVE EMPLOYMENT AGREEMENT OF
THOMAS BLACK
This Executive Employment Agreement ("AGREEMENT") is entered into between
PRIVATE BUSINESS, INC., a Tennessee corporation ("COMPANY"), and THOMAS BLACK, a
resident of Nashville, Tennessee ("EXECUTIVE"). The Company and Executive are
sometimes referred to herein as the "PARTIES."
1. Introduction. The Company has employed Executive as its President and Chief
Executive Officer since February 1, 2001. Accordingly, the Company and Executive
intend by this Agreement to specify the terms and conditions of Executive's
current employment relationship with the Company.
2. Employment. The Company confirms the employment of Executive and Executive
hereby confirms its acceptance of employment with the Company upon terms and
conditions set forth herein, in each instance effective February 1, 2001.
3. Duties and Responsibilities.
3.1 Extent of Service. Executive shall, during the term of this Agreement,
devote such of his entire time, attention, energies and business efforts to his
duties as an executive of the Company as are reasonably necessary to carry out
his duties specified in Paragraph 3.2 below. Executive shall not, during the
term of this Agreement, engage in any other business activity (whether or not
such business activity is pursued for gain, profit or other pecuniary advantage)
if such business activity would impair Executive's ability to carry out his
duties hereunder. This Paragraph 3.1, however, shall not be construed to prevent
Executive from investing his personal assets as a passive investor or from
serving on the boards of directors of companies whose Business Activities (as
defined in Section 10.1) are not competitive with either (i) any of the Business
Activities conducted or offered by the Company or its subsidiaries or
affiliates, which Business Activities shall include in any event and without
limitation, providing software products and marketing, training, management,
billing, collection and insurance brokerage services to entities in the business
of purchasing or financing accounts receivable or in the factoring business, or
(ii) any other Business Activities which the Company or its subsidiaries or
affiliates conducts or offers, or is actively planning to conduct or offer.
3.2 Position and Duties. Subject to the power of the Board of Directors of
the Company to elect and remove officers and the power of the stockholders to
remove directors, Executive shall serve the Company as President and Chief
Executive Officer and Director and shall be nominated for re-election as a
Director at the Company's Annual Meeting of Shareholders; and shall perform,
faithfully and diligently, the services and functions relating to such office
(or otherwise reasonably incident to such office) as may be designated from time
to time by the Board of Directors of the Company or its designee(s); provided
that all such services and functions shall be reasonable and within
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Executive's area of expertise, and provided further that Executive shall be
physically capable of performing the same.
3.3 Place of Employment. During the term of this Agreement, the Company shall
maintain its principal executive offices in the Nashville, Tennessee area, and
Executive's primary place of employment shall be at such principal executive
offices. During the term of this Agreement, the Company will provide Executive
with a private office and other customary staff support services commensurate
with the services and functions to be performed by him hereunder.
4. Salary and Other Benefits. Subject to the terms and conditions of this
Agreement:
4.1 Salary. As compensation for his services during the term of his
employment under this Agreement, Executive shall be paid at an annual rate of
not less than Two Hundred Ten Thousand Dollars ($210,000), payable in accordance
with the then current payroll policies of the Company. Such salary shall be
subject to increase by the Board of Directors of the Company (or the appropriate
committee thereof) from time to time. The annual salary payable from time to
time by the Company to Executive pursuant to this Paragraph 4.1 is herein
sometimes referred to as his "BASE SALARY."
4.2 Incentive Bonus Eligibility. Beginning with calendar year 2001, Executive
shall be eligible to be paid an annual incentive cash bonus ("BONUS") of up to
one hundred percent (100%) of his Base Salary subject to performance criteria
for the Company and Executive established from time to time by the Board of
Directors, or its designee(s), and Executive. The initial performance criteria
are set forth in Annex A to this Agreement.
4.3 Method of Payment.
(a) No later than January 1 of each year, Executive may elect to take all
or any portion of his Base Salary for such year in cash and/or common stock
of the Company. Executive hereby elects to receive all of his Base Salary for
his employment from February 1, 2001 through December 31, 2001 in common
stock of the Company. If Executive elects to take any portion of his Base
Salary in common stock of the Company as to any calendar year, the Company
shall pay Executive as of January 1 of such year such number of restricted
shares (the "RESTRICTED SHARES") equal to the amount of Base Salary to be
paid in common stock, net of all applicable tax and other standard payroll
deductions (resulting in "NET Pay"), divided by the closing price of the
common stock on December 31 of the preceding calendar year (except that Net
Pay shall be divided by $3.00 for employment during 2001). With respect to
Executive's election in the second sentence of this Section 4.3(a) as to his
employment from February 1, 2001 through December 31, 2001, such formula
shall result in Executive receiving 43,608 shares, subject to the other terms
and conditions in this Agreement. The Restricted Shares shall vest one
twelfth (1/12th) per month (or one-eleventh (1/11th) per month as to 2001)
and shall be subject to a Restricted Stock Agreement dated as of January 1 of
such year (or on or about the date hereof with respect to 2001) in
substantially the form attached hereto as Exhibit A. (With respect to the
share and option calculations in Sections 4.3 and 4.4, all amounts have been
calculated after taking into effect the Company's one-for-three reverse stock
split effective August 9, 2001.)
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(b) Executive may also elect to take all or any portion of his Bonus
described in Section 4.2 in cash and/or common stock of the Company, within
ten (10) days of the date the Board of Directors sets the amount of such
Bonus. If Executive elects to take any portion of his Bonus in common stock
of the Company, the Company shall issue Executive such number of shares of
common stock equal to the amount of Bonus to be paid in common stock, net of
all applicable tax and other standard payroll deductions, divided by the
closing price of the common stock on the date the Board approves the amount
of the Bonus. Such stock shall not be subject to a Restricted Stock Agreement
substantially in the form attached as Exhibit A.
(c) In the event Executive elects to receive any shares of common stock
of the Company as provided in this Section 4.3, it shall be Executive's sole
responsibility to determine whether or not to make an election pursuant to
Section 83(b) of the Internal Revenue Code and if he determines to make such
election, it shall be his sole responsibility to file such election with the
IRS.
4.4 Stock Option Grants. Executive may be granted options to acquire shares
of the Company's common stock at anytime at the discretion of the Board. Such
grant shall be made pursuant to an Incentive Stock Option Agreement between the
Company and Executive to the extent Executive is eligible for incentive options
under applicable tax laws and, with respect to any excess, a Non-Qualified Stock
Option Agreement between the Company and Executive. Such agreement will provide
for vesting of such options over four (4) years at the rate of 1/48th per month,
unless otherwise determined by the Board. Executive shall be granted options to
acquire 333,333 shares of common stock pursuant to a separate Stock Option
Agreement dated on or about the date hereof. Such Agreement shall generally
provide for immediate vesting of 166,667 options as of the date of grant and
ratable vesting over four (4) years (1/48th per month) of the remaining 166,666
options, subject to other provisions of such Stock Option Agreement. The 166,667
options immediately vested upon grant shall have an exercise price of $3.00 per
share; 83,333 options shall have an exercise price of $12.00 per share; and
83,333 options shall have an exercise price of $18.00 per share. In all events
all options shall be subject to the terms and conditions of the Company's 1999
Amended and Restated Stock Option Plan, as the same may be amended from time to
time (the "STOCK OPTION PLAN").
4.5 Other Benefits. As long as Executive is employed by the Company,
Executive shall be entitled to receive the following benefits in addition to his
Base Salary:
(a) Executive shall have the right to participate in all group benefit
plans of the Company in accordance with the Company's regular practices with
respect to its senior officers.
(b) Executive shall be entitled to reimbursement from the Company for
reasonable out-of-pocket expenses incurred by him in the course of the
performance of his duties hereunder, subject to compliance with the Company's
standard expense policies and procedures.
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(c) Executive shall be entitled to such vacation, holidays and other paid
or unpaid leaves of absence as are consistent with the Company's policy for
other senior officers.
5. Term. The term of this Agreement shall be for an initial period of four (4)
years and ending on January 31, 2005, and shall thereafter automatically be
extended for an additional period of one (1) year on a yearly basis, unless on
or before December 1 of any subsequent year, either Executive or the Company
gives the other party notice that the term of this Agreement will not be so
extended, in which case the term of this Agreement will end on the end of the
year designated in the notice.
6. Termination and Resignation. Notwithstanding Section 5, the Company shall
have the right to terminate Executive's employment hereunder at any time and for
any reason, and upon any such termination Executive shall be entitled to receive
from the Company prompt payment of the amount determined pursuant to the
applicable subparagraph of Paragraph 7 below. Executive shall have the right to
terminate his employment hereunder at any time by resignation, and he shall
thereupon be entitled to receive from the Company payment of the amount
determined pursuant to the applicable subparagraph of Paragraph 7 below.
7. Payments Upon Termination and Resignation.
7.1 Pro Rata Payments Upon Termination for Cause, Resignation Prior to Change
in Control, Death or Disability. If (a) the Company at any time terminates
Executive's employment for Cause (as defined below), or (b) prior to the
occurrence of a Change In Control (as defined below) of the Company, Executive
voluntarily resigns for any reason other than because of a Constructive
Discharge by the Company, then in each case Executive shall be entitled to
receive only his Base Salary on a pro rata basis to the date of termination plus
any amounts due Executive through the date of termination in accordance with
Paragraph 4.5. If Executive during the term of this Agreement dies or becomes
disabled (being the inability of Executive to perform his normal employment
duties for any six (6) months during any twelve (12) month period because of
either physical or mental incapacity), Executive or his estate shall be entitled
to receive any amounts due Executive pursuant to Section 4.5 and to receive his
Base Salary plus Bonus on a pro rata basis to the date of termination or
resignation. For purposes of this Paragraph 7.1, "pro rata" shall mean the
product of Executive's annual Base Salary and Bonus that would have been payable
had Executive's employment not terminated multiplied by a fraction the
denominator of which is 365 and the numerator of which is the number of days
during the calendar year that have passed through the date of the termination of
Executive's employment.
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7.2 Base Salary and Average Bonus Payment Upon Termination Prior to Initial
Change in Control Event or Upon Constructive Discharge Prior to Change in
Control. If (a) prior to the occurrence of an Initial Change in Control Event
(as defined below), the Company terminates Executive's employment because of a
Discharge Event (as defined below), or if (b) prior to the occurrence of a
Change in Control of the Company, Executive's employment ceases due to
Constructive Discharge, then in each case Executive shall be entitled to receive
a lump sum payment equal to his Base Salary and Average Bonus (as defined
below). If prior to the occurrence of an Initial Change in Control Event the
Company terminates Executive's employment without Cause (other than due to
Constructive Discharge) and without a Discharge Event, then Executive shall be
entitled to receive a lump sum payment equal to two times his Base Salary and
Average Bonus.
7.3 Payment Upon Termination After Initial Change of Control Event or Upon
Termination or Resignation After a Change in Control.
(a) If after the occurrence of an Initial Change of Control Event of the
Company, the Company terminates Executive's employment hereunder because of a
Discharge Event, or without Cause and without any Discharge Event, including
by Constructive Discharge, then in either case:
(i) in the event the closing trading price of the Company's common
stock on the date of the Initial Change of Control equals or exceeds three
(3) times the closing trading price of such stock on February 1, 2001, the
Company will pay Executive a lump sum payment equal to two (2) times the sum
of Executive's Base Salary and his Average Bonus (as defined below); or
(ii) in the event the closing trading price of the Company's common
stock on the date of the Initial Change of Control is less than three (3)
times the closing trading price of such stock on February 1, 2001 (such
closing price being $1.28), or $3.84 after adjustment for the Company's
one-for-three reverse stock split effective August 9, 2001 the Company will
pay Executive a lump sum payment equal to one (1) times the sum of
Executive's Base Salary and Average Bonus.
(b) Notwithstanding the foregoing Subsection 7.3(a), the Company shall
pay Executive a termination payment equal to one (1) times his Base Salary
and Average Bonus if Section 7.3(a) is triggered but the Initial Change in
Control Event constitutes a "going private transaction," as defined in
Section 13(e)(3) of the Exchange Act of 1934 (other than an acquisition of
the Company by a third party not owned or controlled by "Affiliates" of the
Company, as "Affiliates" is also defined in Section 13(e)(3)).
(c) Notwithstanding Subsection 7.3(a), the Company shall pay Executive a
termination payment equal to one and one-half (1.5) of his Base Salary and
Average Bonus if, within one (1) year following a Change in Control Event,
Executive voluntarily resigns for any reason other than death, disability or
Constructive Discharge.
7.4 Certain Definitions. The following terms not defined elsewhere in this
Agreement shall have the following definitions:
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(a) "AVERAGE BONUS" shall mean that result obtained by dividing the sum
of the Bonuses, if any, actually paid to Executive pursuant to Paragraph 4.2
above in respect of the two (2) years immediately preceding the year in which
Executive is terminated by two; provided, however, that with respect to a
termination of employment that occurs prior to January 1, 2003, the Average
Bonus of Executive shall be equal to the Bonus Executive actually received
with respect to his employment during 2001, as annualized.
(b) Termination by the Company of Executive's employment for "CAUSE"
shall mean termination upon the willful misappropriation of funds or
properties of the Company or the willful contravention of the standards
referred to in the last sentence of Paragraph 9 below. For purposes of this
definition, no act, or failure to act, on Executive's part shall be
considered "willful" unless done, or omitted to be done, by Executive not in
good faith and without reasonable belief that Executive's action or omission
was in the best interest of the Company. Notwithstanding the foregoing,
Executive shall not be deemed to have been terminated for Cause unless and
until there shall have been delivered to Executive a copy of a resolution,
duly adopted by the affirmative vote of not less than one-half (1/2) of the
entire membership of the Board of Directors of the Company at a meeting of
the Board duly called and held (after reasonable notice to Executive and an
opportunity for Executive, together with his counsel, to be heard before the
Board) finding that in the good faith opinion of the Board Executive was
guilty of the conduct set forth above and specifying the particulars thereof
in detail.
(c) A "CHANGE IN CONTROL" shall be conclusively deemed to have occurred
if (and only if) any of the following shall have taken place: (i) a change in
control is reported by the Company in response to either Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act
of 1934, as amended ("EXCHANGE ACT"), or Item 1 of Form 8-K promulgated under
the Exchange Act; (ii) any person (as such term is used in Section 13(d) and
14(d)(2) of the Exchange Act) is or becomes the beneficial owner (as defined
in Rule 13d-3 under the Exchange Act) directly or indirectly, of securities
of the Company representing forty percent (40%) or more of the combined
voting power of the Company's then outstanding securities; or (iii) following
the election or removal of directors, a majority of the Board consists of
individuals who were not members of the Board two (2) years before such
election or removal, unless the election of each director who was not a
director at the beginning of such two-year period has been approved in
advance by directors representing at least a majority of the directors then
in office who were directors at the beginning of the two-year period.
(d) The "CODE" shall refer to the Internal Revenue of 1986, as amended.
(e) A "CONSTRUCTIVE DISCHARGE" by the Company shall mean either of the
following: (i) a material diminution in the authority, status or
responsibilities of Executive, (ii) failure to pay Executive's Base Salary
for more than thirty (30) days after the regularly scheduled due date for any
portion thereof (other than resulting from unintentional clerical error), or
(iii) relocation of Company's principal executive
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offices outside of Davidson or Williamson Counties, Tennessee; provided that
in no event will termination for Cause constitute Constructive Termination.
(f) A "DISCHARGE EVENT" shall have occurred if Executive shall have
received a copy of a resolution duly adopted by the affirmative vote of a
majority of the members of the Compensation Committee of the Board of
Directors of the Company finding that, upon the recommendation of and for the
reasons cited by the Chairman of the Company, Executive is no longer
discharging his duties in a manner consistent with the effective
administration of the affairs of the Company and hence the continued
employment of Executive is no longer in the best interest of the Company.
(g) An "INITIAL CHANGE IN CONTROL EVENT" shall be conclusively deemed to
have occurred when any individual, group, partnership, corporation, trust or
other entity ("PERSON") initiates a course of action or conduct that, in the
good faith judgment of the Board of Directors of the Company, might
reasonably be expected to lead to a Change in Control of the Company. For
example and without limiting the scope of the foregoing, an Initial Change in
Control Event would include the public announcement or other disclosure by a
Person of its intention (i) to acquire by private or open market purchase,
tender offer, exchange offer, or otherwise forty percent (40%) or more of the
combined voting power of the Company's outstanding securities, or (ii) to
solicit proxies or consents for the removal of a majority of incumbent
directors or the election of persons to serve as a majority of directors of
the Company in opposition to nominees proposed by the Board of Directors of
the Company.
8. Exercise of Options.
8.1 In the event, prior to a Change in Control:
(a) Executive's employment is terminated by the Company for any reason
other than for Cause, including termination by Constructive Discharge,
Executive's stock options which are vested as of such time shall remain
exercisable for a period of no less than two (2) years, as determined by the
Company's Board of Directors or committee established by the Board of
Directors to administer the Stock Option Plan, subject to the terms and
conditions of the Stock Option Plan including, without limitation, provisions
regarding the maximum period during which incentive stock options may be
exercised;
(b) Executive's employment is terminated by the Company for Cause,
Executive's stock options shall terminate in accordance with the Stock Option
Plan;
(c) Executive's employment is terminated pursuant to Executive's death or
permanent disability, Executive's vested stock options shall remain
exercisable until the earlier of the expiration of the option term specified
in the applicable options agreement(s), or a period of no less than two (2)
years from the Date of Termination, as determined by the Company's Board of
Directors or committee established by the Board of Directors to administer
the Stock Option Plan, subject
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to the terms and conditions of the Stock Option Plan regarding the maximum
period during which incentive stock options may be exercised; or
(d) Executive's employment is terminated pursuant to Executive's
resignation, Executive's vested stock options shall remain exercisable for
ninety (90) days after the Date of Termination, unless a longer period is
established by the Company's Board of Directors or committee established by
the Board of Directors to administer the Stock Option Plan, subject in all
events to the terms and conditions of the Stock Option Plan including,
without limitation, provisions regarding the maximum period during which
incentive stock options may be exercised.
8.2 Contemporaneously with the occurrence of a Change in Control of the
Company, all outstanding options previously granted to Executive under any then
existing Company stock option, stock appreciation or other employee incentive
plan that are not otherwise exercisable by Executive at the time the Change in
Control of the Company occurs will immediately vest and become exercisable. In
the event, after a Change in Control:
(a) Executive's employment is terminated by the Company for any reason
other than for Cause, including termination by Constructive Discharge, then:
(i) Executive's stock options shall remain exercisable until the
earlier of the expiration of the option term specified in the applicable
option agreement(s), or five (5) years from the Date of Termination,
subject to the terms and conditions of the Stock Option Plan regarding
the maximum period during which incentive stock options may be exercised;
and
(ii) In addition to payments due Executive pursuant to Section 7.2,
the expiration of any restrictions on common stock awarded Executive
pursuant to his election under Section 4.3 in lieu of Base Salary for the
year in which the Change in Control occurs shall automatically be
accelerated, and such restrictions shall terminate as of the date
Executive's employment is so terminated.
(b) Executive's employment is terminated by the Company for Cause,
Executive's stock options shall terminate in accordance with the Stock Option
Plan;
(c) Executive's employment is terminated pursuant to Executive's death or
permanent disability, Executive's vested stock options shall remain
exercisable until the earlier of the expiration of the option term specified
in the applicable option agreement(s), or a period of no less than two (2)
years from the Date of Termination, as determined by the Company's Board of
Directors or committee established by the Board of Directors to administer
the Stock Option Plan, subject to the terms and conditions of the Stock
Option Plan regarding the maximum period during which incentive stock options
may be exercised; or
(d) Executive's employment is terminated pursuant to Executive's
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resignation, Executive's vested stock options shall remain exercisable until
the earlier of the expiration of the option term specified in the applicable
option agreement(s), or five (5) years from the Date of Termination, subject
in all events to the terms and conditions of the Stock Option Plan regarding
the maximum period during which incentive stock options may be exercised.
8.3 For purposes of Sections 8.1 and 8.2, the "maximum period during which
incentive stock options may be exercised" shall be determined without regard to
any requirement in the Plan that incentive stock options be exercised within a
certain time after termination of Executive's employment. Accordingly, in the
event Executive ceases to be employed by the Company, any incentive stock option
issued to Executive that is not exercised within the time period specified in
Section 7.8, 7.9 or 7.10 of the Stock Option Plan, as applicable, may continue
to be exercisable as a non-qualified stock option for the term specified in
Section 8.1(a) or (c) or Section 8.2(a), (c) or (d) hereof, as applicable.
9. Preservation of Business; Fiduciary Responsibility. Executive shall use his
best efforts to preserve the business and organization of the Company, to keep
available to the Company the services of present employees and to preserve the
business relations of the Company with suppliers, distributors, customers and
others. Executive shall not knowingly commit any act, or in any way assist
others to commit any act, which would directly injure the Company. So long as
Executive is employed by the Company, Executive shall observe and fulfill proper
standards of fiduciary responsibility attendant upon his service and office.
10. Restrictive Covenants.
10.1 Non-Compete. During the term of this Agreement (including any renewal
periods as provided in Paragraph 5) and for a period of twenty-four (24) months
following the termination of Executive's employment with the Company under this
Agreement, whether Executive's employment terminates pursuant to the provisions
of Paragraph 6 of this Agreement or otherwise (collectively, the "RESTRICTED
PERIOD"), Executive covenants and agrees that he will not, without the express
approval of the Board of Directors, directly or indirectly anywhere in the
continental United States engage in any activity which is, or participate or
invest in, or provide or facilitate the provision of financing to, or assist
(whether as owner, shareholder, member, partner, director, officer, trustee,
employee, agent or consultant, or in any other capacity), any business,
organization or person other than the Company (or any subsidiary or affiliate of
the Company) whose business, activities, products or services (collectively,
"BUSINESS ACTIVITIES") are competitive with either (i) any of the Business
Activities conducted or offered by the Company or its subsidiaries or affiliates
during any period in which Executive is employed by the Company or any of its
subsidiaries or affiliates, or has served as a director of the Company, which
Business Activities shall include in any event and without limitation providing
software products and marketing, training, management, billing, collection and
insurance brokerage services to entities in the business of purchasing or
financing accounts receivable or in the factoring business, or (ii) any other
Business Activities which the Company or its subsidiaries or affiliates conducts
or offers on, or is actively planning and actually conducts or offers within
twelve (12) months after the date Executive's employment with the Company
terminates. Notwithstanding the foregoing, Executive may (i) own, directly or
indirectly, solely as an investment, securities of any entity if Executive (A)
is not a
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controlling person with respect to such entity and (B) does not, directly or
indirectly, own five percent (5%) or more of any class of the securities of such
entity; and (ii) serve on the boards of directors of companies whose Business
Activities are not competitive with either (A) any of the Business Activities
conducted or offered by the Company or its subsidiaries or affiliates, which
Business Activities shall include in any event and without limitation, providing
software products and marketing, training, management, billing, collection and
insurance brokerage services to entities in the business of purchasing or
financing accounts receivable or in the factoring business, or (B) any other
Business Activities which the Company or its subsidiaries or affiliates conducts
or offers, or is actively planning to conduct or offer.
10.2 Trade Secrets; Confidential Information. Executive covenants and agrees
that, at all times during and after the Restricted Period, he shall keep secret
and not disclose to others or appropriate to his own use or the use of others
any trade secrets, or secret or confidential information or knowledge pertaining
to the Company Business or the affairs of the Company or any of its affiliates
including without limitation trade know-how, trade secrets, consultant
contracts, customer lists, pricing policies, operational methods, marketing
plans or strategies, product development techniques or plans, business
acquisition plans, new personnel acquisition plans, technical processes, designs
and design projects, inventions and research projects; provided, however, that
the following shall not constitute a breach or violation of this Paragraph: any
disclosure made by Executive in the course of his employment by the Company as
provided in this Agreement, or any disclosure reasonably believed by Executive
to be compelled by law or legal process. Information shall not be deemed
confidential or secret for purposes of this Agreement if it is generally known
in the industry.
10.3 Employees of the Company. During the Restricted Period, Executive shall
not directly or indirectly hire away or solicit to hire away from the Company or
any of its affiliates any employee of the Company or its affiliates, other than
employment resulting from general media advertisements of employment
opportunities.
10.4 Property of the Company. All memoranda, notes, lists, records and other
documents (and all copies thereof) made or compiled by Executive or made
available to Executive during his employment by the Company concerning the
business or affairs of the Company or any of its affiliates, other than any of
such which may pertain primarily personally to Executive, shall be the exclusive
property of the Company and shall be delivered to the Company promptly upon the
termination of Executive's employment with the Company or at any other time on
request by the Board of Directors of the Company or such affiliates; provided,
however, that the Company shall allow Executive to make copies of any such
documents that are not directly related to the Business Activities of the
Company and are not likely to result in injury to the Company.
10.5 Rights and Remedies Upon Breach. If Executive breaches, or threatens to
commit a breach of, any of the provisions of Paragraphs 10.1 through 10.4 of
this Agreement (collectively, the "RESTRICTIVE COVENANTS"), the Company shall
have the following rights and remedies, each of which shall be independent of
the other and severally enforceable, and all of which shall be in addition to,
and not in lieu of, any other rights and remedies available to the Company: (a)
the right and remedy to have any of the
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Restrictive Covenants specifically enforced by any court having jurisdiction and
in Tennessee by an arbitration panel as provided in Paragraph 13 of this
Agreement, it being hereby acknowledged and agreed by Executive that any such
breach or threatened breach will cause irreparable injury to the Company and
that money damages will not provide an adequate remedy to the Company; and (b)
the right and remedy to require Executive to account for and pay over to the
Company all compensation, profits, monies, accruals, increments or other
benefits derived or received by Executive as a result of any transactions
constituting a breach of any of the Restrictive Covenants, and Executive shall
account for and pay over such benefits to the Company.
10.6 Severability of Covenants. If it is determined that any of the
Restrictive Covenants, or any part thereof, is invalid or unenforceable, the
remainder of the Restrictive Covenants shall not thereby be affected and shall
be given full effect, without regard to the invalid portions. If it is
determined that any of the Restrictive Covenants, or any part thereof, is
unenforceable because of the duration of such provision, the geographical area
covered thereby, or any other determination of unreasonableness of the
provision, the arbitration panel making such determination shall have the power
to reduce the duration, area or scope of such provision and, in its reduced
form, such provision shall then be enforceable and shall be enforced.
11. Notice. All notices, requests, demands and other communications given under
or by reason of this Agreement shall be in writing and shall be deemed given
when delivered in person or when mailed, by certified mail (return receipt
requested), postage prepaid, addressed as follows (or to such other address as a
party may specify by notice pursuant to this provision):
(a) To the Company:
Private Business, Inc
9010 Overlook Boulevard
Brentwood, Tennessee 37027
Attention: Chairman
With a copy to:
Lee C. Dilworth
Harwell Howard Hyne Gabbert & Manner, P.C.
315 Deaderick Street
Suite 1800
Nashville, Tennessee 37238
(b) To Executive:
Tom Black
6204 Harding Road
Nashville, Tennessee 37205
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12. Controlling Law and Performability. The execution, validity, interpretation
and performance of this Agreement shall be governed by the laws of the State of
Tennessee.
13. Arbitration. Any dispute or controversy arising under or in connection with
this Agreement shall be settled by arbitration in Nashville, Tennessee. In the
proceeding Executive shall select one (1) arbitrator, the Company shall select
one (1) arbitrator and the two (2) arbitrators so selected shall select a third
(3rd) arbitrator. The decision of a majority of the arbitrators shall be binding
on Executive and the Company. Should one party fail to select an arbitrator
within five (5) days after notice of the appointment of the an arbitrator by the
other party or should the two (2) arbitrators selected by Executive and the
Company fail to select an arbitrator within ten (10) days after the date of the
appointment of the last of such two (2) arbitrators, any person sitting as a
Judge of the United States District Court for the Middle District of Tennessee,
Nashville Division, upon application of Executive or the Company, shall appoint
an arbitrator to fill such space with the same force and effect as though such
arbitrator had been appointed in accordance with the first sentence of this
Paragraph 13. Any arbitration proceeding pursuant to this Paragraph 13 shall be
conducted in accordance with the rules of the American Arbitration Association.
Judgment may be entered on the arbitrators' award in any court having
jurisdiction.
14. No Obligation to Mitigate. Executive shall not be required to mitigate the
amount of any payment provided for in Paragraph 7 by seeking other employment or
otherwise, nor shall the amount of any payment provided for in Paragraph 7 be
reduced by any compensation earned by Executive as a result of employment by
another employer or otherwise.
15. Additional Instruments. The Parties shall execute and deliver any and all
additional instruments and agreements that may be necessary or proper to carry
out the purposes of this Agreement.
16. Entire Agreement and Amendments. This Agreement, together with stock option
agreements and the Stock Option Plan contemplated by Section 4.4, contains the
entire agreement of the Parties relating to the matters contained herein and
supersedes all prior agreements and understandings, oral or written, between the
Parties with respect to the subject matter hereof. This Agreement may be changed
only by an agreement in writing signed by the Party against whom enforcement of
any waiver, change, modification, extension or discharge is sought.
17. Separability. If any provision of the Agreement is rendered or declared
illegal or unenforceable by reason of any existing or subsequently enacted
legislation or by the decision of any arbitrator or by decree of a court of last
resort, the Parties shall promptly meet and negotiate substitute provisions for
those rendered or declared illegal or unenforceable to preserve the original
intent of this Agreement to the extent legally possible, but all other
provisions of this Agreement shall remain in full force and effect.
18. Assignments. The Company may assign this Agreement and in the event of an
assignment of this Agreement, all covenants, conditions and provisions hereunder
shall inure to the benefit of and be enforceable against the Company's
successors and assigns.
<PAGE> 13
The rights and obligations of Executive under this Agreement are personal to
him, and no such rights, benefits or obligations shall be subject to voluntary
or involuntary alienation, assignment or transfer.
19. Effect of Agreement. Subject to the provisions of Paragraph 18 with respect
to assignments, this Agreement shall be binding upon Executive and his heirs,
executors, administrators, legal representatives and assigns and upon the
Company and respective successors and assigns.
20. Execution. This Agreement may be executed in multiple counterparts each of
which shall be deemed an original and all of which shall constitute one and the
same instrument.
21. Waiver of Breach. The waiver by either Party of a breach of any provision of
the Agreement by the other Party shall not operate or be construed as a waiver
by such Party of any subsequent breach by such other Party.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date(s) below, effective as set forth above.
PRIVATE BUSINESS, INC.
By:
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Title:
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August 13, 2001
EXECUTIVE
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THOMAS BLACK
August 13, 2001