EMPLOYMENT AGREEMENT
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1 EMPLOYMENT AGREEMENT This Employment Agreement ("Agreement") is made between the ACME Association, a nonprofit corporation (the "Association"), and Jane Doe (the "Executive"), hereinafter collectively referred to as "the Parties" and each individually as a "Party," for mutual consideration, the receipt and adequacy of which are acknowledged by the Parties, who agree: 1. Term. The Executive is engaged to serve as Executive Director of the Association for a three (3) year period from [ October 15, until October 14, ]. Following the initial three-year term, this Agreement will automatically renew each year on October 15 for an additional one-year period unless the Agreement is cancelled by the Association or the Executive according to the provisions of Paragraph 6 of this Agreement. The Agreement may not be terminated by nonrenewal but only by cancellation of the Agreement according to the provisions of Paragraph 6 of this Agreement. 2. Nature of Position; Review. (a) The Executive is the chief employed officer of the Association with full authority for the management of its affairs, subject only to the duties specified by the Association's bylaws or other governing documents or to the direction of the Association's Board of Directors (the "Board"), the Association's Executive Committee (the "Executive Committee"), or the Association's President (the "President"). The Executive has sole and exclusive authority for the engagement and discharge of all other employees of the Association. The Executive will be employed at the headquarters office of the Association in Anywhere, Virginia. (b) The Executive will devote the Executive's full working time and energy to the Executive's duties as Executive Director of the Association; provided, however, that the Executive may: (i) continue her individual artistic endeavors, with the understanding that such endeavors shall not impede the Executive's work, and the Executive shall not use the Association's name in connection with such endeavors, unless approved by the President or his/her designee, (ii) serve on one or more Boards of Directors related to education and/or the arts, as disclosed on Exhibit B to this Agreement or otherwise approved by the President, or his/her designee, prior to the acceptance of such appointment, and (iii) serve as an adjunct professor/instructor/teacher not to exceed one course per term. The Parties agree that all such outside activities shall be subject to the prior approval of the President, or his/her designee, prior to the acceptance of such position, and shall in no case require absence from the Association, or inability to work on Association matters, during normal working hours.
2 (c) The Executive's job duties are specified by the Association's bylaws and other governing documents. These duties may be supplemented from time to time by the Board or by the Executive Committee. The Executive reports to the Board or to the Executive Committee when either is in session. If neither is in session, the Executive reports to the President, or his/her designee. The performance of the Executive will be reviewed annually by the Executive Committee based upon performance criteria and goals provided in writing to the Executive at the beginning of the period under review. 3. Compensation. (a) Base Salary. From October 15, 2009 through June 30, 2010, the Executive's "Base Salary" will be $100, per year, payable according to the Association's regular salary payment schedule. The Base Salary of the Executive for subsequent years of this Agreement will be negotiated and agreed to by the Executive and the Executive Committee following the Executive's annual performance review. In no event, however, will the Executive's Base Salary for any subsequent year of this Agreement be reduced below the level of the previous year unless there is a general reduction in the compensation rates for all of the Association's employees. (b) Sick and Vacation Leave Allowance. At the time of the Executive's annual performance review, the Executive's sick and vacation leave allowance may also be reviewed and potentially increased. (c) Performance Bonus. In lieu of performance bonus eligibility, the Association has secured for the Executive a long term care insurance policy that will be paid by the Association through [ relevant date ]. 4. Employee Benefits. During the term of the Executive's employment, the Executive is entitled to all employee benefits provided to Association employees subject to changes in the Board-approved employee benefit schedule. However, in no event will the Executive's individual benefits not include the following: (a) Twenty-five (25) business days of paid vacation each year subject to the limitation that the Executive may carry forward no more than ten (10) vacation days that have not been utilized in one [calendar/fiscal] year to the subsequent [calendar/fiscal] year such that up to a total of thirty-five (35) vacation days may be available to the Executive in any one [calendar/fiscal] year. (b) Individual health, prescription, vision and dental insurance including major medical covered under the Association health plan. plan. (c) Long term disability insurance provided under the Association's current (d) Paid medical reimbursement to a maximum of $5, annually to include an annual physical examination and other services that promote health and well-being -2-
3 including, but not limited to, fitness training, massage and other therapies. (e) Retirement plan participation in accordance with Association policies including an annual contribution of an additional twelve percent (12%) of the Executive's annual compensation into a tax-deferred vehicle. (f) flier/guest miles. Entitlement of the Executive to retain individually all earned frequent 5. Business Expenses. The Association will pay, or reimburse the Executive, for reasonable business expenses incurred by the Executive which are directly related to the performance of the Executive's duties of employment, subject to timely submission by the Executive of payment or reimbursement requests and appropriate documentation of the nature and amount of such expenses, as well as review by the Executive Committee. In particular, the Association will pay for the Executive's expenses for all reasonable business-related travel, business entertainment, and business equipment (including cell phone, blackberry, laptop), as well as membership, receipt of publications, and participation in the activities of professional associations related to the art education field, as approved by the Association. The Association requires that the Executive lease or purchase and be responsible for the maintenance of an automobile for Association business purposes to be housed, for security reasons, at the residence of the Executive. The Association will pay up to $ per month during the period of this Agreement toward that lease or purchase plus all actual costs of fuel, insurance, and maintenance expenses, with the Executive reimbursing the Association for the cost of any reasonably estimated non-business use of the automobile, including commuting. 6. Cancellation. (a) Cancellation by the Association for Cause. The Association may cancel this Agreement immediately for Cause and shall have no further obligations or liabilities under this Agreement except to pay to the Executive, or to the Executive's estate or personal representative, as the case may be, that portion, if any, of the Base Salary and any accrued benefits that remains unpaid for the pay period prior to the date of termination, less all lawful deductions. For purposes of this Agreement, "Cause" shall mean: (i) the death of the Executive; (ii) the Executive's disability, which means the Executive's inability to perform the essential functions of the Executive's duties to the Association by reason of the Executive's illness or injury, which inability has continued for a period of one-hundred-twenty (120) consecutive days or one-hundred-fifty (150) non-consecutive days in any twelve (12) month period; (iii) the Executive's insubordination or unwillingness to perform all, of substantially all, of the Executive's duties and responsibilities to the Association, which failure persists for five (5) business days after written notice from the Association to the Executive of the Association's determination that the Executive's performance has been deficient; or -3-
4 (iv) a failure to perform responsibilities deemed necessary by the Board for successful leadership of the Association as reasonably determined by the Board that remains uncorrected to the Association's reasonable satisfaction for thirty (30) days after written notice to the Executive; (v) conduct by the Executive which is likely to damage the mission and/or reputation of the Association as reasonably determined by the Board that remains uncorrected to the Association's reasonable satisfaction for thirty (30) days after written notice to the Executive; (vi) documented acts of dishonesty, fraud, embezzlement or theft by the Executive in connection with the Executive's duties or in the course of the Executive's employment with the Association; (vii) engagement by the Executive in misconduct or gross negligence in connection with performance of the Executive's duties to the Association; (viii) the Executive being convicted of, or pleading guilty or nolo contendre to, or being indicted for, a felony, or a misdemeanor or other crime involving theft, fraud, or the equivalent thereof, or involving moral turpitude; or (ix) willful damage by the Executive to property of the Association. (b) Cancellation by the Association Without Cause. The Association may cancel this Agreement for any other reasons, which need not be disclosed to the Executive, by giving the Executive written notice of the cancellation and paying full compensation and benefits to the Executive during the notice period at its sole discretion. The Association will determine whether to require that the Executive perform the Executive's duties for the Association during that notice period; the length of that notice period is one (1) month for each completed year of the Executive's tenure with the Association, subject to a minimum of six (6) months and a maximum of twelve (12) months, which period may extend beyond the thencurrent annual term of this Agreement and the Agreement will automatically be extended through that notice period only. (c) Cancellation by the Executive. The Executive may cancel this Agreement by giving the Association three (3) months advance notice in writing, with any longer notice subject to the approval of the Executive Committee; the notice may extend beyond the then-current annual term of this Agreement and the Agreement will automatically be extended through that notice period only. The Executive will receive full compensation and benefits during that notice period; at its sole discretion, the Association will determine whether to require that the Executive perform the Executive's duties for the Association during that notice period. The Association reserves the right to terminate the Executive prior to her noticed resignation date, as provided under Paragraphs 6(a) and 6(b) above. 7. Intellectual Property, Confidentiality. The Executive recognizes and agrees that all copyrights, trademarks, or other intellectual property rights to created works arising in -4-
5 any way from, or related to, the Executive's employment by the Association are the sole and exclusive property of the Association, agrees to not assert any rights to those works against the Association or any third-parties, and agrees to assist the Association in any way requested to procure or protect the Association's rights to those works. Upon cancellation of this Agreement by either Party for any reason, or if requested by the Executive Committee at any time, the Executive will return to the Association all documents, books, manuals, lists, records, publications, or other materials, whether in written, electronic or other form, passwords, keys, credit cards, equipment, or other articles that came into the Executive's possession in connection with the Executive's employment by the Association and to maintain no copies or duplicates without the prior written approval of the Executive Committee. The Executive will maintain in confidence during and subsequent to the Executive's employment any information about the Association or its members which is confidential information or which might reasonably be expected by the Executive to be regarded by the Association or its members as confidential and will not use that information except for the benefit of the Association. 8. Non-Compete and Non-Solicitation. During the term of this Agreement and for one (1) year following the cancellation of this Agreement by either Party for any reason, the Executive will not, without the express written approval of the Executive Committee: (a) provide services akin to those provided by the Executive pursuant to this Agreement to or on behalf of any individual (including the Executive), association or other entity, that provides services or products in competition with the Association; (b) solicit any individual who is then or was at any time within the twelve (12) months preceding such solicitation an employee of the Association to leave the Association's employment; or (c) solicit any individual or entity who is then or was at any time within the twelve (12) months preceding such solicitation a member of the Association to terminate or non-renew such membership status. 9. Other. (a) Continuation of Certain Provisions. Following the cancellation of this Agreement by either Party for any reason, the provisions of Paragraphs 6, 7, 8 and 9 shall continue to the extent necessary to give full force and effect to the Parties' respective rights and obligations as set forth therein. (b) Indemnification. The Association indemnifies, holds harmless, and will defend the Executive against claims arising against the Executive in connection with the Executive's performance of the duties of the Executive's employment by the Association to the full extent permitted by law but not with respect to claims successfully resolved against the Executive that the Executive engaged in fraudulent, grossly negligent, criminal, or ultra vires acts. (c) Authority. The Association and the Executive each represents and warrants that each has legal authority to enter into this Agreement and is not prohibited or restricted from doing so by any governance documents or resolutions of the Association or by any agreement or obligation of the Executive to a third party, including a former employer. (d) Successors. This Agreement is binding upon the Association and the Executive, their heirs, executors, administrators, successors, and assigns. The Executive will not -5-
6 assign or delegate any part of the Executive's rights or responsibilities under this Agreement unless the Executive Committee agrees in writing to the assignment or delegation. In the event of dissolution of the Association, this Agreement will continue in force through the then-current period of employment. In the event of any merger, consolidation, or reorganization involving the Association, this Agreement becomes an obligation of any legal successor or successors to the Association. (e) Governing Law. All questions with respect to the construction of this Agreement or the rights and liabilities of the Parties hereunder shall be determined in accordance with the laws of the Commonwealth of Virginia. (f) Severability. All provisions of this Agreement are severable. If any provision or portion hereof is determined to be unenforceable in arbitration or by a court of competent jurisdiction, then the remaining portion of the Agreement shall remain in full force and effect. (g) Waiver. A waiver by the Association or the Executive of a breach of this Agreement does not constitute a waiver of any later breach. (h) Entire Agreement. This document contains the entire agreement of the Association and the Executive. It may not be changed orally but only by an agreement in writing signed by the Association and the Executive. This Agreement supersedes and cancels all previous agreements between the Association and the Executive. Date, President Date, Past President Date Jane Doe, Executive Director This document has been produced by the law firm of Venable LLP, 575 7th Street, N.W., Washington, D.C For more information, please contact Jeff Tenenbaum at jstenenbaum@venable.com or via telephone at
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