Exhibit 10.1

 

February 3, 2016

 

Mr. Shirish Lal

3344 Deborah Dr

Monroe, Louisiana  71201

 

Dear Shirish,

 

We are very pleased to offer you the position of Chief Operating Officer & Chief
Technology Officer, with an effective date on or about February 22.  You will
report to the Chief Executive Officer of Harte Hanks.   We are confident that
your contributions will enhance Harte Hanks’ standing as an industry leader and
an employer of choice.

 

Compensation

 

Salary and Bonus

 

Upon your commencement of employment, you will be paid a salary at the rate of
$15,384.61 per biweekly pay period (which equates to $400,000 annually).   You
will be considered for pay increases consistent with the consideration given
other executive officers.   You will participate in the Harte Hanks 2016 Annual
Incentive Plan, the cash annual incentive plan approved by the Board of
Directors and/or Compensation Committee for executive officers with corporate
revenue and operating income objectives.  Your target incentive under the 2016
Annual Incentive Plan will be 75% of your base salary.

 

Equity

 

You will be granted $600,000 in Harte Hanks equity awards, as follows:

 

(i) $210,000 worth of shares of restricted stock (with the share amount
calculated by dividing such amount by the Company’s share price on the grant
date), which shares shall vest in three equal annual installments;

 

(ii) $150,000 worth of non-qualified options to purchase common stock (with the
share amount calculated by dividing such amount by the value of such an option
for the Company’s shares on the grant date using the Black-Scholes method), such
options to have an exercise price equal to the grant date fair market value and
to vest in four equal annual installments; and

 

(iii) $240,000 worth of performance units (with the share amount calculated by
dividing such amount by the Company’s share price on the grant date), which
units will vest in 2019 based on the performance measures established by the
Compensation Committee for other executive officers in 2016.

 

The foregoing awards will each be subject to the standard terms and conditions
of such awards under the Harte Hanks 2013 Omnibus Incentive Plan (or, at the
Company’s election, similar terms but granted as “inducement awards” pursuant to
New York Stock Exchange rules).  The options and restricted stock awards will be
granted on the third business day of your employment; the performance unit
awards will be granted on April 15, 2016, or such other date as the Board of
Directors makes annual grants to executive officers for 2016.  The foregoing
awards are in lieu of any annual equity awards for 2016, however, as with other
senior executives, you will be considered for equity awards in future years
consistent with the company’s regular annual equity award/review process.

 

Sign-on Bonus

 

Provided that you remain employed on such date, on or before March 31, 2016 the
Company will pay you a one-time sign-on bonus of $200,000, provided, however,
that if you should resign from the Company or be terminated for cause prior to
the first anniversary of your employment with the Company, you will immediately
repay to the Company $100,000 of such bonus.

 

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Executive Officer Benefits / Perquisites

 

You will receive the standard perquisites for an officer at the Executive Vice
President level, as approved by the Board of Directors and/or Compensation
Committee from time to time:

 

·

Executive Severance Policy: you will be a designated participant in Harte Hanks’
current Executive Severance Policy;

 

 

·

Change-in-Control Severance Agreement: you will be offered Harte Hanks’ current
standard change-in-control severance agreement for corporate officers;

 

 

·

Automobile Allowance: a $975/month non-accountable automobile allowance (in lieu
of mileage reimbursements), provided that the Company may, at its election
convert this to salary at any time;

 

 

·

Salary Continuation: subject to submitting to customary health disclosures/exams
for the sole purpose of obtaining insurance, payments of $700,000 (in ten equal
annual installments) to your beneficiary upon your death while employed;

 

 

·

Bonus Restricted Stock Election: option to elect to receive up to 30% of a
year’s annual incentive payment in the form of restricted stock vesting in one
year at a rate of 125%;

 

 

·

Deferred Compensation: eligible to defer some or all salary and Bonus in the
Company’s non-qualified Deferred Compensation Plan; and

 

 

·

Indemnification: you will be offered Harte Hanks’ standard indemnification
agreement for corporate officers.

 

General Benefits

 

Harte Hanks offers a comprehensive benefits package.  You will be eligible to
participate in the following plans on the 1st of the month following 60 days of
employment.

 

·

Medical and dental plans which are paid for jointly by the Company and the
Employee;

 

 

·

Company paid life insurance and AD&D insurance plans; and

 

 

·

Flexible spending account plans (healthcare and dependent care) and vision plan.

 

Harte Hanks will reimburse payments you make toward COBRA until you are eligible
for coverage if applicable.

 

You will also be eligible to participate in additional valuable benefit plans
after applicable waiting periods including 401(k) (includes significant company
match effective the 1st of the month following 90 days of employment), salary
continuation, long-term disability, educational assistance, 20 days of annual
paid time off, paid holidays and several other benefit plans.  These benefits
will be explained to you in more detail after you join the Company.  Benefits
are subject to change at any time.  Should this occur, you will be notified. 
You may contact HR Support at 877-691-2147 for additional important enrollment
and eligibility information.

 

Executive Officer Responsibilities

 

As a corporate Executive Vice President, you will be an “executive officer” and
a “named executive officer” as defined by U.S. securities laws, and as such will
be required to promptly and publicly report to the U.S. Securities and Exchange
Commission all transactions in Harte Hanks stock.  Harte Hanks will be required
to promptly and publicly disclose all compensatory arrangements it makes with
you.  You will be subject to Harte Hanks’ Business Conduct Policy (including
restrictions on transacting in Harte Hanks’ stock) and Officer Stock Ownership
Guidelines.  You will be required to sign Harte Hanks’ standard employment
restrictions agreement for corporate officers, which contains both
non-competition and non-solicitation provisions, among other limitations.

 

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Other

 

Please note that this offer is contingent upon (i) approval of Harte Hanks’
Board of Directors and (ii) satisfactory completion of an education, credit,
employment, and criminal background check as well as a pre-employment drug
screen.  Additionally, you will need to provide the required documents
authorizing you to work for Harte Hanks in the United States.  This offer and
your response are not meant to constitute a contract of employment for a stated
term.  Your employment will be strictly “at will”.  This means that if you
accept this offer, you will retain the right to discontinue your employment at
any time and that the Company will retain the same right.  This offer is valid
for ten business days from receipt of this letter.

 

Please return the foregoing signed documents along with one copy of your signed
offer letter prior to your start date.  As a condition of your acceptance of
this offer of employment, you are assuring us that your employment with Harte
Hanks would not violate any non-competition, confidentiality or other
obligations you may have with any current or former employer.  You are also
confirming that you have advised your current employer that you will be working
for Harte Hanks, described the scope of your duties for Harte Hanks to them, and
they agree that your employment with Harte Hanks would not violate any
agreements or obligations you may have with them. You are also certifying that
you have provided us with copies of any non-competition, confidentiality or
other agreements that you signed with any current or former employer.

 

Harte Hanks reserves the right to contact your former employer if it has any
concerns regarding any non-competitive, confidentiality or other obligations
that you may have.  Harte Hanks also reserves the right to terminate your
employment if Harte Hanks determines, in its sole discretion, that your
employment with us may violate any continuing obligations to a former employer
and/or if Harte Hanks determines, in its sole discretion, that it does not wish
to become involved in legal proceedings concerning you and a former employer.

 

Shirish, on behalf of all of us at Harte Hanks, I would like to express my
pleasure in presenting you with this offer to join me on the Harte Hanks team as
we build a great company in the years ahead.

 

Yours sincerely,

 

 

/s/ Andrew P. Harrison

 

Andrew P. Harrison

 

SVP & Chief Human Resources Officer

 

 

 

Accepted By:

/s/ Shirish R. Lal

 

 

 

Shirish Lal

 

 

 

 

 

Enclosures:       Position Description

Form of Employment Restrictions Agreement

Form of Severance Agreement

Form of Indemnification Agreement

Harte Hanks, Inc. 2013 Omnibus Incentive Plan & Prospectus

Form of Non-Qualified Stock Option Agreement

Form of Restricted Stock Award Agreement

 

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