Document:

exv10w12

 

EXHIBIT 10.12

RETIREMENT AGREEMENT

          This Retirement Agreement (this “Agreement”) is entered into as of September 30, 2004 between
Technology Solutions Company, a Delaware corporation (the “Company”), and Paul R. Peterson (the
“Employee”).

          WHEREAS, the Employee currently serves as Senior Vice President, General Counsel and Secretary
of the Company and as a director and officer of subsidiaries of the Company; and

          WHEREAS, the Company and the Employee desire to set forth herein their mutual agreement with
respect to all matters relating to (i) the Employee’s retirement and resignation as an officer of,
and cessation of employment with, the Company, (ii) the Employee’s retirement and resignation as a
director and officer of subsidiaries of the Company and (iii) the Employee’s release of claims, all
upon the terms set forth herein.

          NOW, THEREFORE, in consideration of the mutual promises and agreements contained herein, the
adequacy and sufficiency of which are hereby acknowledged, the Company and the Employee hereby
agree as follows:

          1. Retirement; Termination of Employment. The Employee hereby retires and resigns as
Senior Vice President, General Counsel and Secretary of the Company and from all directorships and
offices of the Company’s subsidiaries and from all other positions (if any) with the Company and
its affiliates, effective as of the date hereof (the “Retirement Date”). On the Retirement Date,
the Employee shall cease to be an officer and employee of, or have any other position with, the
Company and a director of and officer with any of the Company’s subsidiaries.

          2. Payment of Accrued Obligations. (a) The Company shall pay all Accrued Obligations
(as defined in Section 2(b) hereof) to the Employee as soon as reasonably practicable following the
Retirement Date; provided, however, that any portion of the Accrued Obligations subject to plans or
policies of the Company shall be determined and paid in accordance with the terms of the relevant
plan or policy as applicable to the Employee.

          (b) For purposes of this Agreement, “Accrued Obligations” shall mean, the following:

    (i) the Employee’s current base salary through the Retirement Date to the extent not
theretofore paid; and

    (ii) any vacation pay and expense reimbursements accrued by the Employee as of the
Retirement Date to the extent not theretofore paid.

 

 

          3. Additional Payments and Benefits. Provided that the Employee has not revoked the
release contained in Section 9 hereof, and provided further that the Employee complies with Section
7 hereof, the Company shall make the payments and provide the benefits set forth in this Section 3:

          (a) During the period commencing on the day next following the Retirement Date and ending one
year following the Retirement Date, the Company shall pay to the Employee amounts which in the
aggregate are equal to the Executive’s current annual base salary of $250,000 per year, payable in
accordance with the Company’s regular payroll practices as then in effect;

          (b) Employee shall received an additional payment of $100,000 payable in five monthly
payments of $20,000 per month with the first payment due and payable November 1, 2004. During the
period commencing October 1, 2004 and ending February 28, 2005, Employee agrees to make himself
available to provide legal advice and counsel so long as such advice and counsel does not exceed
two days (16 hours) per month and can be provided at a time and in a manner that does not interfere
with any educational training, outside director obligations, and/or other profit or non-profit
employment activities that Employee may be involved with during this period. In order to assist
Employee in providing advice and counsel, during this period employee shall be compensated for all
expenses incurred in conjunction therewith, be permitted to retain use of his corporate lap top
computer, and remain on the Company’s voice mail and email.

          (c) The medical, dental and vision insurance benefits currently being provided to the Employee
by the Company shall continue to be provided to the Employee by the Company during the period
commencing on the Retirement Date and ending one year following the Retirement Date, subject to any
modifications thereto applicable to active employees of the Company. During such period, the
Company shall deduct from amounts payable to the Employee amounts equal to the amounts that would
have been payable by the Employee for such coverage, and at the times such amounts would have been
payable, if the Employee had continued as an active employee of the Company.

          4. Retained Stock Options. Each of the following options to purchase shares of the Company’s
Common Stock granted to the Employee which shall be outstanding on the Retirement Date: (i) shall
not expire at the close of business on the Retirement Date; (ii) if unvested shall vest in full on
the Retirement Date; and (iii) may be exercised following the Retirement Date in accordance with
the option agreement terms applicable to vested options:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	Adjusted Exercise Price	 	 	 	Number of Shares	 
	 	Option Grant Date	 	 	(Per Share)	 	 	 	Currently Subject To Option	 
	 	June 23, 1997
	 	 	$	2.626	 	 	 	 	3750	 	 
	 	June 25, 1998
	 	 	$	3.595	 	 	 	 	3333	 	 
	 	June 24, 1999
	 	 	$	1.48	 	 	 	 	272,269	 	 
	 	June 8, 2000
	 	 	$	5.44	 	 	 	 	25,000	 	 
	 	February 5, 2001
	 	 	$	3.718	 	 	 	 	50,000	 	 
	 	January 25, 2002
	 	 	$	1.99	 	 	 	 	75,000	 	 
	 	February 4, 2003
	 	 	$	0.97	 	 	 	 	50,000	 	 
	 	August 1, 2003
	 	 	$	1.00	 	 	 	 	250,000	 	 
	 

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          Should the Company adopt an option exchange program prior to October 1, 2005 Employee shall be
offered the opportunity to participate.

          5. COBRA Coverage. Pursuant to the Consolidated Omnibus Budget Reconciliation Act of
1985 (“COBRA”), the Employee may elect to continue coverage for the Employee and his dependents
under the Company’s medical, dental and vision insurance policies for a period of up to 18 months
following the first anniversary of the Retirement Date and the Employee shall pay all expenses
relating to such coverage in accordance with COBRA.

          6. Federal and State Withholding. The Company shall deduct from the amounts payable
to the Employee pursuant to this Agreement the amount of all required federal and state withholding
taxes in accordance with the Employee’s Form W-4 on file with the Company and all applicable social
security taxes.

          7. Noncompetition and Nondisclosure. The Employee shall comply with his obligations
under Paragraph 8 of the Employment Agreement dated as of November 22, 1994 (the “Employment
Agreement”), between the Employee and the Company.

          8. Remedies; Scope of Covenants. The following provisions shall apply to the
covenants of the Employee contained in Section 7 hereof:

          (a) without limiting the right of the Company to pursue all other legal and equitable remedies
available for violation by the Employee of the covenants contained in Section 7 hereof, it is
expressly agreed by the Employee and the Company that such other remedies cannot fully compensate
the Company for any such violation and that the Company shall be entitled, in addition to other
rights and remedies existing in its favor, to a restraining order or orders and other injunctive
relief to prevent any such violation or any continuing violation thereof;

          (b) the Company and the Employee each intends and agrees that the covenants contained in
Section 7 hereof are reasonably designed to protect the Company’s trade secrets and other legally
protectable business interests without unnecessarily or unreasonably restricting the Employee’s
business opportunities, but that if in any action before any court or agency legally empowered to
enforce the covenants contained in Section 7 hereof any term, restriction, covenant or promise
contained therein is found to be unreasonable or otherwise unenforceable, then such term,
restriction, covenant or promise shall be deemed modified to the extent necessary to make it
enforceable by such court or agency; and

          (c) the Employee agrees that he will submit himself to the personal jurisdiction of the courts
of the State of Illinois in any action by the Company to obtain injunctive or other relief.

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          9. General Release. The Employee, on behalf of himself and anyone claiming through
him, hereby agrees not to sue the Company or any of its divisions, subsidiaries, affiliates or
other related entities (whether or not such entities are wholly owned) or any of the past, present
or future directors, officers, administrators, trustees, fiduciaries, employees, agents or
attorneys of the Company or any of such other entities, or the predecessors, successors or assigns
of any of them (hereinafter referred to as the “Released Parties”), and agrees to release and
discharge, fully, finally and forever, the Released Parties from any and all claims, causes of
action, lawsuits, liabilities, debts, accounts, covenants, contracts, controversies, agreements,
promises, sums of money, damages, judgments and demands of any nature whatsoever, in law or in
equity, both known and unknown, asserted or not asserted, foreseen or unforeseen, which the
Employee ever had or may presently have against any of the Released Parties arising from the
beginning of time up to and including the date on which this Agreement is executed, including,
without limitation, all matters in any way related to the Employee’s employment by the Company or
any of its affiliates, the terms and conditions thereof, any failure to promote the Employee and
the termination or cessation of the Employee’s employment with the Company or any of its
affiliates, and including, without limitation, any and all claims arising under the Civil Rights
Act of 1964, as amended, the Civil Rights Act of 1991, the Civil Rights Act of 1866, the Age
Discrimination in Employment Act, the Older Workers’ Benefit Protection Act, the Family and
Medical Leave Act, the Americans With Disabilities Act, the Employee Retirement Income Security Act
of 1974, the Illinois Human Rights Act, the Chicago or Cook County Human Rights Ordinance or any
other federal, state, local or foreign statute, regulation, ordinance or order, or pursuant to any
common law doctrine; provided, however, that nothing contained in this Section 9 shall apply to, or
release the Company from, any obligation of the Company (i) contained in this Agreement or in any
benefit plan of the Company in which the Employee participates or (ii) to indemnify the Employee
pursuant to the Company’s certificate of incorporation or by-laws. The consideration offered
herein is accepted by the Employee as being in full accord, satisfaction, compromise and settlement
of any and all claims or potential claims, and the Employee expressly agrees that he is not
entitled to, and shall not receive, any further recovery of any kind from the Company or any of the
other Released Parties, and that in the event of any further proceedings whatsoever based upon any
matter released herein, neither the Company nor any of the other Released Parties shall have any
further monetary or other obligation of any kind to the Employee, including any obligation for any
costs, expenses or attorneys’ fees incurred by or on behalf of the Employee. The Employee agrees
that he has no present or future right to employment with the Company or any of the other Released
Parties and that he will not apply for or otherwise seek employment with any of them.

          10. Successors; Binding Agreement. This Agreement shall inure to the benefit of and
be enforceable by the Employee and by his personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. In the event of the death
of the Employee while any amounts are payable to the Employee hereunder, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms of this Agreement to such
person or persons designated in writing by the Employee to receive such amounts or, if no person is
so designated, to the Employee’s estate.

          11. Notices. All notices and other communications required or permitted under this
Agreement shall be in writing and shall be deemed to have been duly given by a party hereto when
delivered personally or by overnight courier or five days after deposit in the United

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States mail, postage prepaid to the following address of the other party hereto (or to such
other address of such other party as shall be furnished in accordance herewith):

If to the Company, to:

Technology Solutions Company

205 North Michigan Avenue

Suite 1500

Chicago, Illinois 60601

If to the Executive, to:

Mr. Paul R. Peterson

436 South Thurlow

Hinsdale, Illinois 60521

          12. Governing Law; Validity. The interpretation, construction and performance of this
Agreement shall be governed by and construed and enforced in accordance with the internal laws of
the State of Illinois without regard to the principle of conflicts of laws.

          13. Entire Agreement. This Agreement constitutes the entire agreement and
understanding between the parties with respect to the subject matter hereof and supersedes and
preempts any prior understandings, agreements or representations by or between the parties, written
or oral, which may have related in any manner to the subject matter hereof, including, but not
limited to, the Employment Agreement, which shall have no further force or effect as of the date
that the last of the parties executes this Agreement, except for: Paragraph 8 thereof as
contemplated by Section 7 hereof; and Paragraphs 9, 10, 11, 17. The existence of any claim or cause
of action by the Employee against the Company, whether based on this Agreement or otherwise, shall
not create a defense to the enforcement by the Employer of Paragraph 8 of the Employment Agreement.

          14. Counterparts. This Agreement may be executed in two counterparts, each of which
shall be deemed to be an original and both of which together shall constitute one and the same
instrument.

          15. Miscellaneous. No provision of this Agreement may be modified or waived unless
such modification or waiver is agreed to in writing and executed by the Employee and by a duly
authorized officer of the Company. No waiver by either party hereto at any time of any breach by
the other party hereto of, or compliance with, any condition or provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. Failure by the Employee or the Company
to insist upon strict compliance with any provision of this Agreement or to assert any right which
the Employee or the Company may have hereunder shall not be deemed to be a waiver of such provision
or right or any other provision or right of this Agreement.

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          16. No Admission. Nothing in this Agreement is intended to, or shall be construed as,
an admission by the Company or any of the other Released Parties that it violated any law,
interfered with any right, breached any obligation or otherwise engaged in any improper or illegal
conduct with respect to the Employee or otherwise. The Company, for itself and the other Released
Parties, hereby expressly denies any such illegal or wrongful conduct.

          17. ACKNOWLEDGMENT BY EMPLOYEE. BY EXECUTING THIS AGREEMENT, THE EMPLOYEE EXPRESSLY
ACKNOWLEDGES THAT HE HAS READ THIS AGREEMENT CAREFULLY, THAT HE FULLY UNDERSTANDS ITS TERMS AND
CONDITIONS, THAT HE HAS BEEN ADVISED TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTING THIS AGREEMENT,
THAT HE HAS BEEN ADVISED THAT HE HAS 21 DAYS WITHIN WHICH TO DECIDE WHETHER OR NOT TO EXECUTE THIS
AGREEMENT AND THAT HE INTENDS TO BE LEGALLY BOUND BY IT. DURING A PERIOD OF SEVEN DAYS FOLLOWING
THE DATE OF HIS EXECUTION OF THIS AGREEMENT, THE EXECUTIVE SHALL HAVE THE RIGHT TO REVOKE THE
RELEASE CONTAINED IN SECTION 9 OF THIS AGREEMENT OF CLAIMS UNDER THE AGE DISCRIMINATION IN
EMPLOYMENT ACT BY SERVING WITHIN SUCH PERIOD WRITTEN NOTICE OF REVOCATION. IF THE EMPLOYEE
EXERCISES HIS RIGHTS UNDER THE PRECEDING SENTENCE, HE SHALL FORFEIT ALL AMOUNTS PAYABLE TO HIM
PURSUANT TO SECTION 3 OF THIS AGREEMENT.

          IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by a duly authorized
officer of the Company and the Employee has executed this Agreement as of the day and year first
above written.

	 	 	 	 	 
	

	 	TECHNOLOGY SOLUTIONS COMPANY	 	 
	 
	 	 	 	 
	

	 	/s/ MICHAEL R. GORSAGE (September 15, 2004)	 	 
	

	 	

	 	 
	

	 	          Michael R. Gorsage	 	 
	 
	 	 	 	 
	

	 	EMPLOYEE	 	 
	 
	 	 	 	 
	

	 	/s/ PAUL R. PETERSON	 	 
	

	 	
	 	 
	

	 	          Paul R. Peterson	 	 

6exv10w13

 

EXHIBIT 10.13

TRANSITION AGREEMENT

Technology Solutions Company, a Delaware corporation, (“TSC”), and Timothy P. Dimond
(“Employee”) enter into this Transition Agreement (the “Agreement”) effective as of September 30,
2004.

Reference is hereby made to that certain Employment Agreement, dated as of January 21, 2002, by and
between Employee and TSC (the “Employment Agreement”).

In consideration of the agreements and covenants contained in this Agreement, TSC and Employee
agree as follows:

	 	1.  	Termination of CFO Role: Effective September 30, 2004, Employee will no longer
serve in the role of TSC Senior Vice President and Chief Financial Officer.
	 
	 	2.  	Notice of Termination of Employment Agreement: Employee’s Employment Agreement and
Employee’s employment with TSC shall terminate on March 31, 2005 “Termination Date.” The
period of employment between the effective date of this Agreement and the Termination Date
shall be the “Transition Period.”
	 
	 	3.  	Duties: During the Transition Period, Employee will be available, as and when
mutually convenient, to provide transitional assistance to TSC, on an as requested basis,
for up to approximately 24 to 32 hours per month.
	 
	 	4.  	Exclusivity: During the Transition Period, Employee will be free to provide
services for compensation to, or to otherwise accept employment with, any other entity and
in any capacity.
	 
	 	5.  	Compensation: During the Transition Period, TSC will continue to pay Employee his
current salary of $20,833 per month.
	 
	 	6.  	Bonus: Employee will not be eligible for any further bonuses.
	 
	 	7.  	Benefits: During the Transition Period, Employee will remain an active employee
and, accordingly, will remain eligible for standard TSC full-time employee benefits;
however, Employee will not accrue additional vacation days during the
Transition Period.
Employee’s accrued vacation balance will not be reduced for any vacation carryover
restrictions and will be paid to employee shortly after Employee’s termination. Following
the Termination Date, Employee shall be entitled to begin COBRA coverage, at Employee’s
cost, in accordance with the laws covering same.

 

 

	 	8.  	Stock Options: Employee will not be eligible for any additional stock option
grants. Employee’s existing options will continue to vest, as usual, during the
Transition Period. Employee’s existing options will not receive acceleration or other
special treatment but be treated in accordance with the associated option agreements.
	 
	 	9.  	Termination: Employee will not be entitled to the severance payments, option
acceleration, bonus payments, notice period or change in control payments set forth in the
Employment Agreement. Employee shall be entitled only to those payments and benefits
expressly set forth herein.
	 
	 	10.  	Entire Agreement: This Agreement taken together with the Employment Agreement
constitutes the entire agreement between TSC and Employee. Neither Employee nor TSC may
modify this Agreement by oral agreements, promises or representations. The parties may
modify this Agreement only by a written instrument signed by the parties. In the event of
a direct conflict between this Agreement and the Employment Agreement, the terms of this
Agreement shall govern.

Employee acknowledges that he has read, understood and accepts the provisions of this
Agreement.

	 	 	 	 	 	 	 
	

	 	   Technology Solutions Company
	 	 	 	Employee
	 
	 	 	 	 	 	 
	By:

	 	/s/ Michael R. Gorsage
	 	 	 	/s/ Timothy P. Dimond
	

	 	
	 	 	 	

	 
	 	 	 	 	 	 
	Position: Chief Executive Officer	 	 	 	 
	 
	 	 	 	 	 	 
	Date: September 27, 2004	 	 	 	Date: September 27, 2004

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