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EXHIBIT 10(s)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, effective as of the 8th day of December, 0000
(xxx "Xxxxxxxxx"), xx xxx xxxxxxx XXXXXX XXXXXX LIME & MINERALS, INC., a Texas
corporation (herein, together with its successors and permitted assigns,
"Employer") and XXXXXXX X. XXXXX ("Employee").
WITNESSETH
WHEREAS, Employer desires to employ Employee, and Employee desires to be
so employed, on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, Employer and Employee hereby agree as follows:
1. Employment.
(a) Employer hereby employs Employee to serve, subject to the
supervision and control of Employer's Board of Directors (the "Board"), as
Employer's President and Chief Executive Officer ("CEO"), and to undertake and
discharge, in accordance with the terms and conditions of this Agreement, such
duties, functions, and responsibilities for Employer and its subsidiaries as are
from time to time assigned to Employee by the Board. Employer hereby
acknowledges that Employee will continue to reside in Virginia and hereby agrees
to establish and maintain an office of Employer in a location in Virginia to be
mutually agreed between Employee and the Executive Committee of the Board.
(b) Employer hereby agrees to use its best efforts to cause the Board to
nominate, and the shareholders of Employer to elect, Employee as a director of
Employer ("Director") at each successive annual meeting of shareholders of
Employer for so long as Employee serves as CEO. Employer hereby also agrees to
use its best efforts to cause the Board to name Employee to the Executive
Committee of the Board for so long as Employee serves as a Director and CEO.
2. Term; Termination of Employment.
(a) Employee's employment under this Agreement shall commence as
of December 8, 2000, and shall continue until December 31, 2003, and for
successive one-year periods thereafter (the "Employment Term"), unless either
Employee or Employer gives at least one-year's prior written notice of intent
not to renew the Employment Term, or Employee's employment is terminated earlier
by Employee or Employer as hereinafter provided. Immediately upon termination of
Employee's employment hereunder for any reason (other than death), Employee
hereby agrees to resign as a Director and as a director, officer, employee and
agent of each of Employer's subsidiaries.
(b) Employee may terminate his employment under this Agreement at
any time, by giving at least three (3) months prior written notice of such
termination to Employer. In the event that Employee terminates his employment
under this Agreement prior to or later than nine (9) months after a Change in
Control (as defined below), Employee shall be entitled to no Severance Payments
(as defined below). In the event that Employee terminates his employment under
this Agreement within nine (9) months after a Change in Control, Employee shall
be entitled to Severance Payments in the amount and under the circumstances set
forth in subsection 2(f) below.
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(c) Employer may terminate Employee's employment under this
Agreement at any time, for any reason or for no reason, immediately by giving
written notice to Employee. In the event that Employer terminates Employee's
employment under this Agreement for Cause (as defined below), Employee shall be
entitled to no Severance Payments. In the event that Employer terminates
Employee's employment under this Agreement without Cause, Employee shall be
entitled to Severance Payments in the amount and under the circumstances set
forth in subsection 2(f). For purposes of this Agreement, "Cause" shall be
deemed to exist if (1) Employee commits fraud, theft, larceny, or any other
crime (other than minor misdemeanors); (2) Employee fails or refuses to obey
lawful instructions of the Board or of any committee thereof or commits any
willful misconduct or disloyalty; (3) Employee is guilty of habitual insobriety,
habitual inattention to his duties, functions, or responsibilities, or repeated
negligence in the performance of his duties, functions, or responsibilities; or
(4) Employee otherwise commits a material breach of this Agreement.
(d) Employee's employment under this Agreement shall terminate
automatically upon the death or disability of Employee, or upon the expiration
of the Employment Term after Employee or Employer has given the notice of
non-renewal provided for in subsection 2(a). For purposes of this subsection
2(d), Employee shall be deemed to be disabled when he is deemed disabled under
Employer's disability policy for executive officers as in effect at that time.
In the event that Employee's employment under this Agreement terminates due to
death, disability, or non-renewal of the Employment Term, Employee shall be
entitled to no Severance Payments.
(e) Upon any termination of Employee's employment under this
Agreement, other than a termination of Employee's employment by Employer without
Cause pursuant to subsection 2(c) or a termination by Employee within nine (9)
months after a Change in Control pursuant to subsection 2(b), Employee, his
personal representatives, or his estate, as the case may be, shall be entitled
to receive only the Base Salary (as defined below), Benefits (as defined below),
and Bonuses (as defined below) paid or provided to or earned by Employee
hereunder in respect of Employee's service through the date of such termination
and no other compensation. For purposes of this subsection 2(e), no EBITDA Bonus
(as defined below) shall be deemed to be earned by Employee in respect of a
given fiscal year unless he remains actively employed under this Agreement
through June 30 of such year, and, in the event that Employee's employment
hereunder terminates between July 1 and December 31 of such year, he shall be
deemed to have earned a EBITDA Bonus in respect of such year to the extent and
in proportion to the percentage by which EBITDA has improved through the fiscal
quarter end (i.e., June 30, September 30, or December 31) closest to the date of
such termination (whether such termination occurs before or after such fiscal
quarter end) (a "Proportional EBIDTA Bonus").
(f) (1) In the event that Employer terminates Employee's
employment under this Agreement without Cause pursuant to subsection 2(c), or
Employee terminates his employment under this Agreement within nine (9) months
after a Change in Control pursuant to subsection 2(b), Employee shall be
entitled to receive the Base Salary, Benefits, and Bonuses paid or provided to
or earned by Employee hereunder in respect of Employee's service through the
date of such termination and, in addition, shall be entitled to receive
severance payments (the "Severance Payments") in the amount and under the
circumstances set forth in this subsection 2(f). Except in the case of a Change
in Control as provided in paragraph 2(f)(3), the Severance Payments shall
consist of a continuation of Employee's annual Base Salary, Benefits, and
Bonuses in effect on the date of termination, paid and provided on the same
periodic and other bases as provided for in subsections 3(a) and (b) below, as
if Employee's employment hereunder were continuing. In the case of a Change in
Control after which Employee elects to receive his Severance Payments in a
lump-sum as provided in paragraph 2(f)(3), the Severance Payments shall be paid
in a lump-sum as provided therein, calculated based upon Employer's
out-of-pocket costs to provide the Base Salary, Benefits, and Bonuses with no
discounting for present value, no tax gross-up or discount, and no effort to pay
for or otherwise provide comparable Benefits to Employee. For purposes of
subsection 2(f), """Bonuses"" shall mean the aggregate of the EBITDA Bonus and
Discretionary Bonus (as defined below)
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earned or awarded in respect of the last full fiscal year during which Employee
was employed under this Agreement immediately preceding Employee's termination,
shall be considered to be the bonus continuation for the severance period at
issue, and shall be separate and apart from the payment of any EBITDA or
Discretionary Bonus paid or earned in respect of that last full fiscal year and
from any Proportional EBITDA Bonus to which Employee may be entitled for the
year in which the termination occurs.
(2) In the event that Employer terminates Employee's
employment under this Agreement without Cause pursuant to subsection 2(c) prior
to a Change in Control or after two (2) years after a Change in Control,
Employee shall be entitled to Severance Payments equal to his then-current
annual Base Salary, Benefits, and Bonuses for one (1) year.
(3) In the event that Employer terminates Employee's
employment under this Agreement without Cause pursuant to subsection 2(c) at any
time within two (2) years after a Change in Control, or Employee terminates his
employment under this Agreement pursuant to subsection 2(b) at any time within
nine (9) months after a Change in Control, then, notwithstanding anything to the
contrary contained in this Agreement, Employee shall be entitled to Severance
Payments equal to his then-current annual Base Salary, Benefits, and Bonuses for
the greater of the number of full and partial years remaining between the date
of termination of employment and the end of the two-year period following the
Change in Control, or one (1) year. In the case of Severance Payments related to
a termination of employment after a Change in Control, or Severance Payments
related to a termination of employment before a Change in Control which
Severance Payments continue after a Change in Control, the Severance Payments,
or any remaining portion thereof, shall, at the election of Employee, be payable
in a lump sum, net of withholding for all applicable taxes and other amounts
which may be properly withheld, within thirty (30) calendar days following such
election. For purposes of this Agreement, a""Change in Control" shall be deemed
to occur if, but only if, (a) Inberdon Enterprises Ltd. ("Inberdon") and its
affiliates and associates, on a collective basis, cease to beneficially own,
directly or indirectly, at least forty percent (40%) of the then-outstanding
common stock of Employer, or (b) the current shareholders of Inberdon and their
affiliates and associates, on a collective basis, cease to beneficially own,
directly or indirectly, at least fifty percent (50%) of the then-outstanding
common stock of Inberdon.
(4) Employee acknowledges and agrees that the Severance
Payments provided for herein shall be in full and total satisfaction and
settlement of any and all claims, suits, demands, judgments, actions, and causes
of action, of whatever nature, which at the time of such termination Employee
then has or may have against Employer or any affiliate, subsidiary, Director,
officer, employee, agent, or shareholder of Employer or of any of its
subsidiaries, arising by virtue of any thing whatsoever, including without
limitation claims based upon this Agreement, claims based upon other agreements,
claims based upon quasi-contract, claims sounding in tort, employment
discrimination claims, claims under the Employee Retirement Income Security Act
of 1974, and claims under any other federal, state, or local statute,
regulation, or common law. Employee and Employer further agree that, except in
the case of a termination of Employee's employment under this Agreement after a
Change in Control pursuant to paragraph 2(f)(3), prior to payment by Employer of
any Severance Payment or Payments, Employee and Employer shall each execute and
deliver irrevocable mutual general releases of Employer and all affiliates,
subsidiaries, Directors, officers, employees, agents, and shareholders of
Employer and all of its subsidiaries, and of Employee and his heirs and
executors, and releasing Employer, Employee, and such persons from all such
claims, in form and content reasonably acceptable to Employer, Employee, and
their respective counsel.
3. Compensation.
(a) In consideration of the services to be rendered by Employee
under this Agreement, Employer shall pay Employee a salary (the "Base Salary"")
at an annual rate of at least U.S. $240,000 per annum. During the first (1st)
quarter of each calendar year, commencing with the first (1st) quarter 2002, the
Board or the Compensation Committee of the Board shall review and may, in its
discretion, increase the
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Base Salary, effective retroactive to January 1 of that year, and shall
determine the amount of any bonus that Employee is to be awarded with respect to
the previous year based on the percentage increase in EBITDA (the "EBITDA
Bonus"). In addition to the EBITDA Bonus, Employee shall be awarded such
additional bonuses, from time to time, as the Board or the Compensation
Committee of the Board may in its discretion determine (a "Discretionary
Bonus"). The Base Salary shall be payable on a periodic basis, in arrears, in
accordance with Employer's customary payroll practices for its executives from
time to time, net of withholding for all applicable taxes and other amounts
which may be properly withheld. Employee's EBITDA Bonus, if any, shall be paid
within fifteen (15) calendar days after Employer publicly announces its year-end
results for the previous fiscal year in respect of which the EBITDA Bonus is to
be calculated and paid. Discretionary Bonuses, if any, shall be determined and
paid as the Board or the Compensation Committee of the Board may in its
discretion determine.
(b) During the course of his employment under this Agreement,
Employee shall be entitled to participate in all employee health insurance, life
insurance, sick leave, long-term disability, and other fringe benefit programs
of Employer, to the extent and on the same terms and conditions (subject,
however, to the terms and conditions of any such programs) as from time to time
are accorded other employees serving as executive officers of Employer (the
"Benefits").
(c) Employee shall also be entitled to at least four (4) weeks
paid vacation each calendar year, commencing with 2001, at times to be mutually
agreed upon between Employee and the Executive Committee of the Board.
(d) Employer hereby agrees to use its best efforts to cause the
Compensation Committee of the Board to grant to Employee (1) 30,000 stock
options, effective December 31, 2000, or as soon thereafter as practicable, at
the higher of the fair market value of a share of Employer's common stock on the
date of grant, or the price per share at which such shares are offered in
Employer's upcoming rights offering to existing shareholders; and (2) 50,000
stock options, effective June 30, 2001, at the fair market value of a share of
Employer's common stock on such date. Employer also agrees to use its best
efforts to cause the Board and the shareholders of Employer to approve any
necessary amendments to Employer's Amended and Restated Stock Option Plan or the
adoption of a new Employer Plan to ensure that such options can be granted to
Employee on such dates under such plan.
(e) Employer shall reimburse Employee for expenses reasonably
paid or incurred by Employee in connection with the performance of his duties,
functions, and responsibilities under this Agreement, provided that Employee
shall document all such expenses in accordance with Employer's procedures in
effect from time to time, including but not limited to the following reasonable
expenses incurred by Employee in performing his duties, responsibility, and
functions for Employer under this Agreement in Dallas, Texas: travel to and from
his home in Virginia, to Dallas, and lodging and other expenses in the Dallas
area, all subject to mutual agreement between Employee and the Executive
Committee of the Board. In addition, Employer shall provide to Employee in Texas
the use of a late model motor vehicle suitable to Employee's executive position
and shall pay the reasonable costs of maintaining and operating such vehicle
pursuant to the customary practices of Employer. Such vehicle shall promptly be
returned to Employer, in the same condition as provided to Employee, reasonable
wear and tear excepted, upon the termination of Employee's employment for any
reason.
(f) In respect of Employee's employment under this Agreement,
Employer shall maintain directors and officer's liability insurance having
coverage limits at least as high as presently being maintained by Employer if
the same shall be reasonably available in the judgment of the Board.
4. Confidential Information. Employee hereby agrees that he shall not,
during his employment under this Agreement or at any time thereafter, furnish,
disclose, or reveal to any third party, firm, or person (except in the course
of, and only to the extent required for, the proper performance of his duties,
functions, and responsibilities hereunder), nor use or appropriate to his own
personal use or benefit or permit any third party, firm, or other person to use
or benefit from, any information of any kind or character
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related in any manner to Employer or its affiliates or subsidiaries, including
without limitation information with respect to it or their financial condition,
products, businesses, operations, plans, employees, customers, suppliers,
vendors, or prospective employees, customers, suppliers, or vendors, whether or
not acquired, learned, obtained, or developed by Employee alone or in
conjunction with others ("Confidential Information""). Upon the termination of
his employment under this Agreement for any reason, Employee shall promptly
return to Employer all papers, documents, films, blueprints, drawings, magnetic
tapes, diskettes, and other storage media (of any kind) in his possession either
containing or reflecting Confidential Information, or otherwise relating to
Employer or any of its affiliates or subsidiaries, and shall not retain copies
thereof.
5. Covenant Not To Compete; No Raid or Solicitation.
(a) Employee agrees that, without the prior written consent of
Employer, he shall not, during his employment under this Agreement, and for one
(1) year following Employee's termination of his employment pursuant to
subsection 2(b) other than within nine (9) months after a Change in Control, for
six (6) months following the expiration of the Employment Term as a result of
Employee's notice of non-renewal given pursuant to subsection 2(a), for six (6)
months following Employer's termination of Employee's employment pursuant to
subsection 2(c) for Cause, for three (3) months following Employee's termination
of his employment pursuant to subsection 2(b) within nine (9) months after a
Change in Control, and for three (3) months following Employer's termination of
Employee's employment pursuant to subsection 2(c) without Cause (collectively,
the "Noncompetition Period"), engage or participate, directly or indirectly,
whether as an owner, partner, limited partner, member, director, officer,
employee, agent, consultant, or representative, in any business or other
enterprise competing, directly or indirectly, with Employer or any of its
affiliates or subsidiaries, whether now existing or hereafter created or
acquired (all the foregoing being collectively referred to herein as the
"Companies"), within the Noncompetition Areas (as defined below). A business or
other enterprise shall be deemed to be "competing" with the Companies if, within
any Noncompetition Area, it conducts (1) any line of business which the
Companies, or any of them, then conducts or has conducted within such
Noncompetition Area at any time within the one (1) year preceding the date of
termination of Employee's employment; and (2) any line of business which the
Companies, or any of them, plans, as of the date of termination of Employee's
employment, to enter within such Noncompetition Area within the one-year period
following the termination of Employee's employment. For purposes of this
Agreement, the term "Noncompetition Areas" shall mean all those geographic areas
where the Companies, or any of them, is doing business or competing for business
at the date of termination of Employee's employment for any reason. For purposes
of this subsection 5(a), a business enterprise shall be deemed to be conducting
"business" within the Noncompetition Areas if it maintains manufacturing,
production, quarrying, sales, or distribution facilities within the
Noncompetition Areas, or solicits or services customers located within such
Noncompetition Areas. Notwithstanding anything to the contrary contained in this
subsection 5(a), the described restrictions on Employee's activities shall not
be deemed to include Employee's direct or indirect beneficial ownership of any
equity securities in a publicly-traded business or other entity, which
securities do not constitute more than two percent (2%) of the relevant class of
equity security issued and outstanding, or give Employee "control" (as such term
is used in the Securities Act of 1933 and the rules and regulations promulgated
thereunder) of such entity.
(b) During the Noncompetitive Period, Employee shall also not,
either alone or with or on behalf of any third party, firm, or other person,
solicit, induce, or influence any third party, firm, or other person to: (1)
solicit, divert, take away, or induce customers (wherever located) of any of the
Companies to avail themselves of the services or products of others which are
competitive with those of any of the Companies, or sell or furnish or seek to
sell or furnish such services or products to such customers; or (2) solicit,
divert, take away, or induce any employee of any of the Companies to leave the
employ of the Companies, or hire or employ or seek to hire or employ any person
who, at any time within six (6) months preceding such action, was an employee of
any of the Companies. For purposes of this subsection 5(b), the term "customers"
shall include any and all individuals, business organizations and entities, and
governmental agencies, no matter how organized and regardless of whether they
are organized for profit or
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not, with which any of the Companies has or had agreements, contracts, or
arrangements, to which any of the Companies has sold any product or provided any
service, or with which any of the Companies has conducted business negotiations,
in each such case at any time within three (3) years prior to the termination of
Employee's employment under this Agreement.
(c) In the event that any court of competent jurisdiction shall
determine that any restriction on Employee contained in this Section 5 is
illegal, invalid, or unenforceable by reason of the nature, scope, temporal
period, or geographic area of such restriction, or for any other reason, the
parties agree that such restriction shall be modified and reformed to the
minimum extent necessary so that such restriction, as so modified and reformed,
shall be legal, valid, and enforceable in such jurisdiction. In such event, such
restriction as so modified and reformed shall continue in effect in such
jurisdiction and such restriction, as existing prior to such modification and
reformation, shall continue in full force and effect in all other jurisdictions.
It is the intention of the parties that all restrictions on Employee contained
herein shall be enforceable for the benefit of Employer to the maximum possible
extent.
6. Enforcement.
(a) Employee recognizes and agrees that, in the event of a breach
of any of the provisions of Section 4 or 5 by Employee, Employer may suffer
irreparable harm and not have an adequate remedy at law. Accordingly, Employee
hereby agrees that, in the event of a breach or threatened breach by Employee of
any of the provisions contained in such Sections, Employer shall be entitled, in
addition to all other remedies which may be available to Employer, to equitable
relief, including without limitation enforcement of such provision by temporary
restraining order, preliminary and permanent injunction, and decree of specific
performance.
(b) Except as set forth in subsection 6(a), any controversy or
claim arising out of or relating to this Agreement, or any breach thereof, shall
be settled by binding arbitration in the city in which Employer's principal
executive offices are located in accordance with the Commercial Arbitration
Rules of the American Arbitration Association, and judgment upon the award
rendered by the arbitrator(s) may be entered in any court having jurisdiction
thereof. The parties hereby agree to be bound by the decision of the
arbitrator(s).
7. Governing Law. This Agreement and the employment relationship between
Employer and Employee hereunder shall be governed by and construed and enforced
in accordance with the laws of the State of Texas, without regard to the
conflicts of law rules thereof.
8. Severability. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable (and, with respect to provisions contained in
Section 5, cannot be modified and reformed pursuant to subsection 5(c) such that
such provision is thereafter legal, valid, and enforceable), such provision
shall be severed and stricken from this Agreement, and in all other respects
this Agreement shall remain in full force and effect.
9. Only Agreement; Amendments. This Agreement constitutes the only
agreement between Employer and Employee concerning the within subject matter,
and supersedes any and all prior oral or written communications between Employer
and Employee regarding the within subject matter. No amendment, modification, or
supplement to this Agreement shall be effective, unless it is in writing and
signed by Employer and Employee.
10. Agreement Binding; Successors and Assigns. This Agreement has been
duly authorized on behalf of Employer by the Board. This Agreement is personal
in nature, and no party hereto shall assign or transfer this Agreement or any of
its or his respective rights or obligations hereunder without the prior written
consent of the other party hereto. This Agreement shall inure to the benefit of
and be binding upon Employer and Employee and their respective heirs,
successors, and permitted assigns.
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11. Notices. Any notice required or permitted to be given hereunder
shall be in writing and shall be delivered in person, by certified or registered
mail, return receipt requested, or by overnight courier, at the address set
forth opposite the intended recipient"s name below. Either party may by notice
to the other party hereto change the address of the party to whom notice is to
be given. The date of notice shall be the date delivered, if delivered in
person, or the date received, if delivered by mail or overnight courier.
12. Waiver. No waiver by any party to this Agreement of any violation,
breach, or default shall be effective unless the same shall be in writing and
signed. No waiver by any party of any violation, breach, or default shall be
construed to constitute a waiver of or consent to the present or future
violation, breach, or default of the same or of any other provision hereof.
13. No Reliance; Review by Attorney. Employee hereby acknowledges and
represents that he has had full opportunity to review financial statements and
other documents relating to Employer and to ask questions of Employer concerning
its condition, financial and otherwise, business, and prospects, but has relied
solely upon his independent analysis of Employer in deciding to execute this
Agreement, having received no representations or warranties from Employer
concerning its condition, financial or otherwise, business, or prospects. In
addition, Employee acknowledges and represents that he has had full opportunity
to review the terms and conditions of this Agreement with an attorney, that he
is executing this Agreement with full knowledge of the legal effect thereof
after advice of counsel, and that his execution of this Agreement and the
performance of his duties, functions, and responsibilities hereunder will not
conflict with, violate, breach, or constitute a default under any law,
ordinance, or regulation or any agreement, arrangement, or understanding to
which he is bound.
IN WITNESS WHEREOF, Employer and Employee have executed this
Agreement as of the date first set forth above.
UNITED STATES LIME &
MINERALS, INC.
By:
----------------------------------
Xxxxxx X Xxxxxxx, Esquire
Chairman of the Board of Directors
Employer's Address:
Xxxxxx X. Xxxxxxx, Esquire
Chairman, United States Lime &
Minerals, Inc.
c/o United States Lime & Minerals, Inc.
00000 Xxxxxxxx Xxxxx
Xxxxx 000
Xxxxxx, XX 00000
Witness: EMPLOYEE
---------------------- ----------------------------
Employee's Address: Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
c/o United States Lime & Minerals, Inc.
00000 Xxxxxxxx Xxxxx
Xxxxx 000
Xxxxxx, XX 00000
