Exhibit 10.3
 
EMPLOYMENT AGREEMENT
 
THIS EMPLOYMENT AGREEMENT dated effective as of July 1, 2006, between
Perficient, Inc. a Delaware corporation (the “Company”), and Jeffrey S. Davis
(“Employee”).
 
WITNESSETH:
 
WHEREAS, the Company desires that Employee continue to be employed by it and
render services to it, and Employee is willing to be so employed and to render
such services to the Company, all upon the terms and subject to the conditions
contained herein.
 
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
 
1.  EMPLOYMENT. Subject to and upon the terms and conditions contained in this
Agreement, the Company hereby agrees to continue to employ Employee and Employee
agrees to continue in the employ of the Company, for the period set forth in
paragraph 2 hereof, to render to the Company, its affiliates and/or subsidiaries
the services described in paragraph 3 hereof.
 
2.  TERM. Employee’s term of employment under this Agreement shall be three
years, commencing as of the date hereof and continuing through and including
June 30, 2009, unless extended in writing by mutual agreement of the parties or
earlier terminated pursuant to the terms and conditions set forth herein (the
“Employment Term”).
 
3.  DUTIES.
 
(a)  Employee shall serve as the President and Chief Operating Officer of the
Company, reporting directly to the Chief Executive Officer of the Company (the
“CEO”). Employee shall perform all duties and services incident to the positions
held by him.
 
(b)  Employee agrees to abide by all By-laws and policies of the Company
promulgated from time to time by the Company.
 
4.  BEST EFFORTS. Employee agrees to devote his full business time and
attention, as well as his best efforts, energies and skill to the discharge of
the duties and responsibilities attributable to his position.
 
5.  COMPENSATION.
 
(a)  As compensation for his services and covenants hereunder, Employee shall
receive a base salary (“Base Salary”), payable pursuant to the Company’s normal
payroll procedures in place from time to time, at the rate of $250,000 per
annum, less all necessary and required federal, state and local payroll
deductions. The CEO may decide, in his sole discretion, to increase Employee’s
Base Salary from time to time during the term of this Agreement.
 

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(b)  Each year, Employee shall be eligible to receive a bonus of up to
two-hundred percent (200%) of his Base Salary (“Target Bonus”), less all
necessary and required federal, state and local payroll deductions. The criteria
for determining the amount of the bonus, and the conditions that must be
satisfied to entitle Employee to receive the bonus for any year during the term
of this Agreement shall be determined by the CEO, in his sole discretion but in
a manner consistent with that used to determine Employee’s bonus in prior years.
Payment of any bonus to Employee shall be in accordance with bonus policies
established from time to time by the Company.
 
6.  EXPENSES. Employee shall be reimbursed for business expenses incurred by him
which are reasonable and necessary for Employee to perform his duties under this
Agreement in accordance with policies established from time to time by the
Company. Employee shall receive reimbursement for other expenses consistent with
past practice and as approved by the CEO.
 
7.  EMPLOYEE BENEFITS.
 
(a)  During the Employment Term and any severance period hereunder, Employee
shall be entitled to participate in such insurance, disability, health and
medical benefits and retirement plans or programs as are from time to time
generally made available to executive employees of the Company pursuant to the
policies of the Company; provided that Employee shall be required to comply with
the conditions attendant to coverage by such plans and shall comply with and be
entitled to benefits only to the extent former employees are eligible to
participate in such arrangements pursuant to the terms of the arrangement, any
insurance policy associated therewith and applicable law, and, further, shall be
entitled to benefits only in accordance with the terms and conditions of such
plans. The Company may withhold from any benefits payable to Employee all
federal, state, local and other taxes and amounts as shall be permitted or
required to be withheld pursuant to any applicable law, rule or regulation.
 
(b)  Employee shall be entitled to vacation in accordance with the Company’s
policies as may be established from time to time by the Company for its
executive staff, which shall be taken at such time or times as shall be mutually
agreed upon with the Company.
 
8.  DEATH AND DISABILITY.
 
(a)  The Employment Term shall terminate on the date of Employee’s death, in
which event the Company shall, within 30 days of such termination, pay to his
estate, Employee’s Base Salary, any unpaid cash bonus awards, reimbursable
expenses and benefits owing to Employee through the date of Employee’s death
together with a lump-sum equal to one year’s Base Salary and Target Bonus.
Except as otherwise contemplated by this Agreement, Employee’s estate will not
be entitled to any other compensation upon termination of this Agreement
pursuant to this subparagraph 8(a).
 
(b)  The Employment term shall terminate upon Employee’s Disability. For
purposes of this Agreement, “Disability” shall mean the CEO’s reasoned and good
faith judgment that Employee is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment
which can be expected to result in death or can by expected to last for a
continuous period of not less than 12 months. The reasoned and good faith
judgment of the CEO as to Disability shall be based on such competent medical
evidence as shall be presented to it by Employee and/or by any physician or
group of physicians or other competent medical experts employed by Employee or
the Company to advise the CEO. In case of such termination, Employee shall be
entitled to receive his Base Salary, any unpaid bonus awards, reimbursable
expenses and benefits owing to Employee through the date of termination. In
addition, the Company shall pay to Employee an amount equal to one year’s Base
Salary and Target Bonus, payable in installments through regular payroll over
the one year period commencing on the termination date. Except as otherwise
contemplated by this Agreement, Employee will not be entitled to any other
compensation upon termination of his employment pursuant to this subparagraph
8(b).
 
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9.  TERMINATION.
 
(a)  The Company shall have the right, upon delivery of written notice to the
Employee, to terminate the Employee’s employment hereunder prior to the
expiration of the Employment Term (i) pursuant to a Termination for Cause or
(ii) pursuant to a Without Cause Termination. The Employee shall have the right,
upon delivery of written notice to the Company, to terminate his employment
hereunder prior to the expiration of the Employment Term by providing the
Company with not less than 30 days prior written notice.
 
(b)  In the event that the Company terminates the Employee’s employment pursuant
to a Without Cause Termination or, if at any time prior to a Change of Control,
Employee voluntarily terminates his employment pursuant to a Constructive
Termination, the Company shall be obligated to pay Employee, within 30 days of
the date of Employee’s termination or such later date as required by applicable
law, in a lump-sum, his Base Salary, any unpaid bonus awards, reimbursable
expenses and benefits owing to Employee through the day on which Employee is
terminated, together with a severance payment to the Employee in an amount equal
to one year’s Base Salary and Target Bonus. Employee shall also be entitled to
benefits pursuant to paragraph 7 hereof for the one year period commencing on
the termination date. No other cash payments shall be made, or benefits
provided, by the Company under this Agreement in the event of a Without Cause
Termination or a Constructive Termination; provided that all stock option grants
and/or restricted stock grants previously awarded to Employee shall immediately
vest in their entirety, regardless of the satisfaction of any conditions
contained therein, in the event of a Without Cause Termination (but not a
Constructive Termination). Except as otherwise contemplated by this Agreement,
Employee will not be entitled to any other compensation upon termination of this
Agreement pursuant to this subparagraph 9(b).
 
(c)  In the event that the Company terminates the Employee’s employment
hereunder due to a Termination for Cause or the Employee voluntarily terminates
employment with the Company for any reason other than a Constructive
Termination, the Employee shall not be entitled to any severance, except that
the Company shall be obligated to pay Employee his Base Salary, any unpaid bonus
awards, reimbursable expenses and benefits owing to Employee through the day on
which Employee is terminated. Except as otherwise contemplated by this
Agreement, Employee will not be entitled to any other compensation upon
termination of this Agreement pursuant to this subparagraph 9(c).
 
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(d)  For purposes of this Agreement, the following terms have the following
meanings:
 
(i)  The term “Termination for Cause” means, to the maximum extent permitted by
applicable law, a termination of the Employee’s employment by the Company
attributed to (a) the repeated or willful failure of Employee to substantially
perform his duties hereunder (other than any such failure due to physical or
mental illness) that has not been cured reasonably promptly after a written
demand for substantial performance is delivered to Employee by the CEO, which
demand identifies the manner in which the CEO believes that Employee has not
substantially performed his duties hereunder; (b) conviction of, or entering a
plea of guilty or nolo contendere to a crime involving moral turpitude or
dishonesty or to any other crime that constitutes a felony; (c) Employee’s
intentional misconduct, gross negligence or material misrepresentation in the
performance of his duties to the Company; or (d) the material breach by Employee
of any written covenant or agreement with the Company under this Agreement or
otherwise, including, but not limited to, an agreement not to disclose any
information pertaining to the Company or not to compete with the Company,
including (without limitation) the covenants and agreements contained in
paragraph 11 hereof.
 
(ii)  The term “Without Cause Termination” means a termination of the Employee’s
employment by the Company other than due to (a) a Termination for Cause, (b)
Disability, (c) the Employee’s death, or (d) the expiration of this Agreement.
 
(iii)  The term “Change of Control” means a Change of Control as defined in the
Company’s Amended and Restated 1999 Stock Option/Stock Issuance Plan.
 
(iv)  The term “Constructive Termination” means Employee’s voluntary termination
of his employment with the Company within 30 days of the appointment by the
Board of Directors of the Company of a person other than John T. McDonald or the
Employee as the Chief Executive Officer of the Company, provided that such
appointment occurs prior to a Change of Control.
 
10.  CHANGE IN CONTROL - TERMINATION OF EMPLOYMENT AND COMPENSATION IN EVENT OF
TERMINATION.
 
(a)  Upon the occurrence of a Change in Control, 50% of all unvested stock
option grants and/or restricted stock grants previously awarded to Employee
shall immediately vest, regardless of the satisfaction of any conditions
contained therein. In addition, if the Company (or any successor thereto)
terminates Employee’s employment with the Company pursuant to a Without Cause
Termination in connection with or following a Change in Control, Employee shall
be entitled to all the benefits set forth in subparagraph 9(b).
 
(b)  In the event that any part of any payment or benefit received (including,
without limitation, granting of and/or acceleration of vesting of stock options
and restricted stock) pursuant to the terms of subparagraph 10(a) (the “Change
of Control Payments) would be subject to the Excise Tax determined as provided
below, then the Employee may elect, in the sole discretion of the Employee, to
receive in-lieu of the amounts payable pursuant to paragraph 10(a) a lesser
amount equal to $100 less than 3.00 times the Employee’s “Annualized Includable
Compensation” (within the meaning of Section 280G(d)(1) of the Code) (such
amount the “Cut-Back Amount”) by eliminating the accelerated vesting to the
extent necessary to reduce the payments and benefits under subparagraph 10(a) to
the Cut-Back Amount. Any amounts paid as a result of an election by the Employee
pursuant to this subparagraph 10(b) will be in full satisfaction of the amounts
otherwise payable to the Employee pursuant to subparagraph 10(a) hereof. For
purposes of determining whether any of the Change of Control Payments will be
subject to the Excise Tax and the amounts of such Excise Tax; (1) the total
amount of the Change of Control Payments shall be treated as “parachute
payments” within the meaning of Section 280G(b)(2) of the Code, and all “excess
parachute payments” within the meaning of Section 280G(b)(1) of the Code shall
be treated as subject to Excise Tax, except to the extent that, in the opinion
of independent counsel selected by the Company and reasonably acceptable to the
Employee (“Independent Counsel”), a Change of Control Payment (in whole or in
part) does not constitute a “parachute payment” within the meaning of Section
280G(b)(2) of the Code, or such “excess parachute payments” (in whole or in
part) are not subject to the Excise Tax, (2) the amount of the Change of Control
Payments that shall be treated as subject to the Excise Tax shall be equal to
the lesser of (A) the total amount of the Change of Control Payments or (B) the
amount of “excess parachute payments” within the meaning of Section 280G(b)(1)
of the Code (after applying clause (1) hereof), and (3) the value of any noncash
benefits or any deferred payment or benefit shall be determined by Independent
Counsel in accordance with the principles of Sections 280G(d)(3) and (4) of the
Code.
 
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(c)  In the event of any change in, or further interpretation of, Sections 280G
or 4999 of the Code and the regulations promulgated thereunder, the Employee
shall be entitled, by written notice to the Company, to request an opinion of
Independent Counsel regarding the application of such change or interpretation
to any of the foregoing, and the Company shall use its best efforts to cause
such opinion to be rendered as promptly as practicable. Any fees and expenses of
Independent Counsel incurred in connection with this Agreement shall be borne by
the Employee.
 
11.  DISCLOSURE OF TRADE SECRETS AND OTHER PROPRIETARY INFORMATION; RESTRICTIVE
COVENANTS.
 
(a)  Employee acknowledges that he is bound by the terms of the Company’s
Confidentiality and Intellectual Property Agreement. The Company will provide
Employee with valuable confidential information belonging to the Company or its
subsidiaries or its affiliates above and beyond any confidential information
previously received by Employee and will associate Employee with the goodwill of
the Company or its subsidiaries or its affiliates above and beyond any prior
association of Employee with that goodwill. In return, Employee promises never
to disclose or misuse such confidential information and never to misuse such
goodwill. To enforce Employee’s promises in this regard, Employee agrees to
comply with the provisions of this paragraph 11.
 
(b)  Employee will not, during the Employment Term, directly or indirectly, as
an employee, employer, consultant, agent, principal, partner, manager,
stockholder, officer, director, or in any other individual or representative
capacity, engage in or participate in any other business that is competitive
with the business of providing information technology software consulting
services. The ownership by Employee of 5% or less of the issued and outstanding
shares of a class of securities which is traded on a national securities
exchange or in the over-the-counter market, shall not cause Employee to be
deemed a stockholder under this subparagraph 11(b) or constitute a breach of
this subparagraph 11(b).
 
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(c)  Employee will not, during the Employment Term and for a period of 60 months
thereafter, directly or indirectly, work in the United States as an employee,
employer, consultant, agent, principal, partner, manager, stockholder, officer,
director, or in any other individual or representative capacity for any person
or entity who is competitive with the business of providing information
technology software consulting services. The ownership by Employee of 5% or less
of the issued and outstanding shares of a class of securities which is traded on
a national securities exchange or in the over-the-counter market, shall not
cause Employee to be deemed a stockholder under this subparagraph 11(c) or
constitute a breach of this subparagraph 11(c).
 
(d)  Employee will not, during the Employment Term and for a period of 60 months
thereafter, on his behalf or on behalf of any other business enterprise,
directly or indirectly, under any circumstance other than at the direction and
for the benefit of the Company, (i) solicit for employment or hire any person
employed by the Company or any of its subsidiaries, or (ii) call on, solicit, or
take away any person or entity who was a customer of the Company or any of its
subsidiaries or affiliates during Employee’s employment with the Company, in
either case for a business that is competitive with the business of providing
information technology software consulting services.
 
(e)  It is expressly agreed by Employee that the nature and scope of each of the
provisions set forth above in this paragraph 11 are reasonable and necessary.
If, for any reason, any aspect of the above provisions as it applies to Employee
is determined by a court of competent jurisdiction to be unreasonable or
unenforceable under applicable law, the provisions shall be modified to the
extent required to make the provisions enforceable. Employee acknowledges and
agrees that his services are of unique character and expressly grants to the
Company or any subsidiary or affiliate of the Company or any successor of any of
them, the right to enforce the above provisions through the use of all remedies
available at law or in equity, including, but not limited to, injunctive relief.
 
12.  COMPANY PROPERTY.
 
(a)  Any patents, inventions, discoveries, applications or processes designed,
devised, planned, applied, created, discovered or invented by Employee during
the Employment Term, regardless of when reduced to writing or practice, which
pertain to any aspect of the Company’s or its subsidiaries’ or affiliates’
business as described above shall be the sole and absolute property of the
Company, and Employee shall promptly report the same to the Company and promptly
execute any and all documents that may from time to time reasonably be requested
by the Company to assure the Company the full and complete ownership thereof.
 
(b)  All records, files, lists, including computer generated lists, drawings,
documents, equipment and similar items relating to the Company’s business which
Employee shall prepare or receive from the Company shall remain the Company’s
sole and exclusive property. Upon termination of this Agreement, Employee shall
promptly return to the Company all property of the Company in his possession.
Employee further represents that he will not copy or cause to be copied, print
out or cause to be printed out any software, documents or other materials
originating with or belonging to the Company. Employee additionally represents
that, upon termination of his employment with the Company, he will not retain in
his possession any such software, documents or other materials.
 
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13.  EQUITABLE RELIEF. It is mutually understood and agreed that Employee’s
services are special, unique, unusual, extraordinary and of an intellectual
character giving them a peculiar value, the loss of which cannot be reasonably
or adequately compensated in damages in an action at law. Accordingly, in the
event of any breach of this Agreement by Employee, including, but not limited
to, the breach of any of the provisions of paragraphs 11 or 12 hereof, the
Company shall be entitled to equitable relief by way of injunction or otherwise
in addition to any damages which the Company may be entitled to recover.
 
14.  CONSENT TO TEXAS JURISDICTION AND VENUE. The Employee hereby consents and
agrees that state courts located in Travis County, Texas and the United States
District Court for the Western District of Texas each shall have personal
jurisdiction and proper venue with respect to any dispute between the Employee
and the Company. In any dispute with the Company, the Employee will not raise,
and hereby expressly waives, any objection or defense to any such jurisdiction
as an inconvenient forum.
 
15.  NOTICE. Except as otherwise expressly provided, any notice, request, demand
or other communication permitted or required to be given under this Agreement
shall be in writing, shall be sent by one of the following means to the Employee
at his address set forth on the signature page of this Agreement and to the
Company at 1120 South Capital of Texas Highway, Building 3, Suite 220, Austin,
Texas 78746, Attention: Chief Executive Officer (or to such other address as
shall be designated hereunder by notice to the other parties and persons
receiving copies, effective upon actual receipt), and shall be deemed
conclusively to have been given: (a) on the first business day following the day
timely deposited with Federal Express (or other equivalent national overnight
courier) or United States Express Mail, with the cost of delivery prepaid or for
the account of the sender; (b) on the fifth business day following the day duly
sent by certified or registered United States mail, postage prepaid and return
receipt requested; or (c) when otherwise actually received by the addressee on a
business day (or on the next business day if received after the close of normal
business hours or on any non-business day).
 
16.  INTERPRETATION; HEADINGS. The parties acknowledge and agree that the terms
and provisions of this Agreement have been negotiated, shall be construed fairly
as to all parties hereto, and shall not be construed in favor of or against any
party. The paragraph headings contained in this Agreement are for reference
purposes only and shall not affect the meaning or interpretation of this
Agreement.
 
17.  SUCCESSORS AND ASSIGNS; ASSIGNMENT; INTENDED BENEFICIARIES. Neither this
Agreement, nor any of Employee’s rights, powers, duties or obligations
hereunder, may be assigned by Employee. This Agreement shall be binding upon and
inure to the benefit of Employee and his heirs and legal representatives and the
Company and its successors. Successors of the Company shall include, without
limitation, any corporation or corporations acquiring, directly or indirectly,
all or substantially all of the assets of the Company, whether by merger,
consolidation, purchase, lease or otherwise, and such successor shall thereafter
be deemed “the Company” for the purpose hereof.
 
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18.  NO WAIVER BY ACTION. Any waiver or consent from the Company respecting any
term or provision of this Agreement or any other aspect of the Employee’s
conduct or employment shall be effective only in the specific instance and for
the specific purpose for which given and shall not be deemed, regardless of
frequency given, to be a further or continuing waiver or consent. The failure or
delay of the Company at any time or times to require performance of, or to
exercise any of its powers, rights or remedies with respect to, any term or
provision of this Agreement or any other aspect of the Employee’s conduct or
employment in no manner (except as otherwise expressly provided herein) shall
affect the Company’s right at a later time to enforce any such term or
provision.
 
19.  COUNTERPARTS; TEXAS GOVERNING LAW; AMENDMENTS; ENTIRE AGREEMENT; SURVIVAL
OF TERMS. This Agreement may be executed in two counterpart copies, each of
which may be executed by one of the parties hereto, but all of which, when taken
together, shall constitute a single agreement binding upon all of the parties
hereto. This Agreement and all other aspects of the Employee’s employment shall
be governed by and construed in accordance with the applicable laws pertaining
in the State of Texas (other than those that would defer to the substantive laws
of another jurisdiction). Each and every modification and amendment of this
Agreement shall be in writing and signed by the parties hereto, and any waiver
of, or consent to any departure from, any term or provision of this Agreement
shall be in writing and signed by each affected party hereto. This Agreement
contains the entire agreement of the parties and supersedes all prior
representations, agreements and understandings, oral or otherwise, between the
parties with respect to the matters contained herein. In the event of any
conflict between this Agreement and any Award Agreement, this Agreement shall
control. Paragraphs 9 through 13 hereof (and paragraphs 14 through 19 hereof as
they may apply to such paragraphs) shall survive the expiration or termination
of this Agreement for any reason.
 
[Signature page follows.]
 
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IN WITNESS WHEREOF, the parties have executed this Employment Agreement as of
the date first above written.

       
PERFICIENT, INC.
 
   
   
    By:   /s/ John T. McDonald  

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Name: John T. McDonald   Title: Chief Executive Officer

  

  /s/ Jeffrey S. Davis             8/3/06  

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Jeffrey S. Davis, Individually
       
Address:  
One City Place Drive, Suite 190
St. Louis, MO 63141
  Telephone:  (314) 995-8810    Facsimile: (314) 995-8802

 
SIGNATURE PAGE TO DAVIS EMPLOYMENT AGREEMENT

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