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SECOND AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Second Amended and Restated Employment Agreement (this
"Agreement") is made by and between XXX XXXXX, INC., a Delaware corporation
(the "Company"), having its principal offices at 000 Xxxxxx Xxxxx, Xxxxxxx,
Xxxxx 00000, and Xxxxxx X. Xxxxx (the "Employee"), an individual residing at
000 Xxxxx Xxxx, Xxxxxxx, Xxxxx 00000.
W I T N E S S E T H :
WHEREAS, the Company and the Employee entered into that certain First
Amended and Restated Employment Agreement, dated as of May 21, 1992, providing
for, among other things, Employee's employment by the Company for the period
commencing January 1, 1992 and ending December 31, 1996; and
WHEREAS, the Company desires to amend, restate and extend the terms of
the Company's Employment Agreement with Xx. Xxxxx as provided herein;
NOW, THEREFORE, in consideration of the premises and the other mutual
covenants contained herein, the Company and Employee hereby agree as follows:
1. Employment. The Company hereby agrees to employ Employee, and
Employee hereby agrees to render his exclusive service to the Company, in his
current capacity of Chief Executive Officer and Chairman of the Board of
Directors of the Company, with such duties as may be assigned to him from time
to time by the Board of Directors for the period commencing on the date hereof
and ending on December 31, 2001 (the "Employment Period"), subject to earlier
termination as hereinafter provided.
2. Place of Employment. Unless otherwise agreed by the Company
and Employee, throughout the Employment Period of this Agreement, Employee's
business office shall be located in Midland, Texas, at such location as may be
specified by the Board of Directors of the Company.
3. Base Compensation. Employee shall be compensated by the
Company at a minimum base rate of Two Hundred Seventy Nine Thousand Two Hundred
Sixty and No/100 Dollars ($279,260.00) per annum, payable semi-monthly on the
fifteenth and final days of each month during the Employment Period, subject to
such increases and additional payments as may be determined from time to time
by the Board of Directors of the Company in its sole discretion. Such
compensation shall be in addition to any group insurance, pension, profit
sharing and other employee benefits, including the Company's
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existing employee benefit plans, which are extended from time to time to
Employee in the discretion of the Board of Directors of the Company and for
which Employee is eligible. Subject to such rules and procedures as are from
time to time specified by the Company, the Company shall also reimburse
Employee for all reasonable expenses incurred by him on behalf of the Company.
4. Performance of Services. Employee shall devote his full
working time to the business of the Company; provided, however, Employee shall
be excused from performing any services for the Company hereunder during
periods of temporary incapacity and during vacations conforming to the
Company's standard vacation policy, without thereby in any way affecting the
compensation to which he is entitled hereunder.
5. Noncompetition. Employee agrees that during his employment by
the Company and for so long thereafter as he is receiving Severance Benefit
Payments (as such term is defined in Paragraph 10 hereof), he will not,
directly or indirectly, either through any kind of ownership (other than
ownership of securities of publicly held corporations of which Employee owns
less than one percent (1%) of any class of outstanding securities) or as a
director, officer, agent, employee or consultant, engage in the business of
marketing products and services which are competitive with the products and
services marketed by the Company within the States of Texas, Wyoming, New
Mexico, Montana or North Dakota. It is expressly agreed that the remedy at law
for breach of this covenant is inadequate and that injunctive relief shall be
available to prevent the breach thereof.
6. Continuing Obligations. In order to induce the Company to
enter into this Agreement, the Employee hereby agrees that all documents,
records, techniques, business secrets and other information which have come
into his possession from time to time during his employment by the Company or
which may come into his possession during his employment hereunder, shall be
deemed to be confidential and proprietary to the Company and the Employee
further agrees to retain in confidence any confidential information known to
him concerning the Company and its subsidiaries and their respective businesses
so long as such information is not publicly disclosed. In the event of a
breach or threatened breach by the Employee of the provisions of this Paragraph
6, the Company shall, in addition to any other available remedies, be entitled
to an injunction restraining Employee from disclosing, in whole or in part, any
such information or from rendering any services to any person, firm or
corporation to whom any of such information may have been disclosed or is
threatened to be disclosed.
7. Property of Company. All data, drawings and other records and
written material prepared or compiled by Employee or furnished to Employee
while in the employ of the Company shall be the sole and exclusive property of
the Company, and
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none of such data, drawings or other records, or copies thereof, shall be
retained by Employee upon termination of his employment.
8. Surviving Provisions. The provisions of Paragraphs 5 (for so
long as the Employee is receiving Severance Benefit Payments), 6 and 7 of this
Agreement shall continue to be binding upon Employee in accordance with their
terms, notwithstanding termination of Employee's employment hereunder for any
reason.
9. Termination for Good Cause. It is agreed and understood that
the Company cannot terminate the employment of the Employee under this
Agreement except for good cause, and that, without prejudice to the generality
of the right to terminate for good cause, each of the following contingencies
shall be good cause:
(a) Should Employee by reason of injury or illness become
incapable for more than one hundred fifty (150) consecutive days of
satisfactorily performing his duties as an employee under this
Agreement;
(b) Should Employee for reasons other than illness or
injury absent himself from his duties without the consent of the
Company for more than ten (10) consecutive days;
(c) Should Employee commit a crime punishable by
imprisonment;
(d) Should Employee during the Employment Period engage
in any activity that would in the opinion of the Board of Directors of
the Company constitute a material conflict of interest with the
Company; provided that termination for cause based on this
subparagraph (d) shall not be effective unless the Employee shall have
received written notice from the Board of Directors of the Company of
such activity (which notice shall also include a demand for the
Employee to cease the activity giving rise to the conflict of
interest) 30 days prior to his termination and the Employee has failed
after receipt of such notice to cease all activities creating the
conflict of interest; or
(e) Should Employee be negligent or inefficient in the
performance of his duties hereunder, or otherwise fail to comply with
the terms and conditions of this Agreement; provided that termination
for cause based on this subparagraph (e) shall not be effective unless
the Employee shall have received written notice from the Board of
Directors of the Company (which notice shall include a description of
the reasons and
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circumstances giving rise to such notice) 30 days prior to his
termination and the Employee has failed after receipt of such notice
to satisfactorily discharge the performance of his duties hereunder or
to comply with the terms of this Agreement, as the case may be.
The Company may for good cause terminate Employee's employment under
this Agreement without advance notice, except as otherwise specifically
provided for in subparagraphs (d) and (e) above. Termination shall not affect
any of the Company's other rights and remedies.
10. Severance Benefit Payment. The Company shall provide Employee
with a severance benefit payment in an amount equal to the Employee's then
existing annual base pay (or an amount equal to the Employee's base pay for the
balance of the term hereof if less than one year) (the "Severance Benefit
Payment") upon (i) the occurrence of any one of the events specified in
subparagraphs (a) through (d) below and (ii) Employee's resignation from
employment (each, a "Severance Event"):
(a) Without the express written consent of Employee, the
assignment of Employee to any duties inconsistent with his position,
duties, responsibilities or status with the Company as such exist as
of the date hereof or a reduction of his duties or responsibilities
for reasons other than good cause;
(b) Any failure of the Company to obtain the assumption
of the obligation to perform this Agreement by any successor as
contemplated in Paragraph 13 hereof;
(c) Any failure by the Company or its stockholders, as
the case may be, to re-elect the Employee to the corporate offices of
Chief Executive Officer and Director, or upon his removal from any
such office for reasons other than good cause; or
(d) Any breach by the Company (or any successor) of any
of the provisions of this Agreement or any failure by the Company to
carry out any of its obligations hereunder for reasons other than good
cause.
The Severance Benefit Payment shall be paid to Employee in
semi-monthly installments in the same amounts and at the same times as
Employee's base pay was being paid at the time of the Severance Event, until
the full amount of the Severance Benefit Payment has been paid.
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11. Payment of Certain Costs of Employee. If a dispute arises
regarding a termination of the Employee or the interpretation or enforcement of
this Agreement, all legal fees and expenses incurred by the Employee in
contesting or disputing any such termination or seeking to obtain or enforce
any right or benefit provided for in this Agreement or in otherwise pursuing
his claim will be paid by the Company, to the extent the Employee prevails.
The Company further agrees to pay prejudgment interest on any money judgment
obtained by the Employee calculated at the NationsBank of Texas, N.A. prime
interest rate in effect from time to time from the date that payment(s) to him
should have been made under this Agreement.
12. Mitigation. The Employee is not required to mitigate the
amount of any payments to be made by the Company pursuant to this Agreement by
seeking other employment or otherwise. Notwithstanding the foregoing, if the
Employee secures other employment while he is entitled to receive Severance
Benefit Payments hereunder, such Severance Benefit Payments shall be reduced by
the amount of compensation received by Employee from such employment. Employee
shall notify the Company within fifteen (15) days after he accepts such new
employment of his monthly compensation from such employment.
13. Successors. (a) The Company will require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise)
to all or substantially all of the business and/or assets of the Company, by
agreement in form and substance satisfactory to the Employee, to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform if no such succession had
taken place. Failure of the Company to obtain such agreement prior to the
effectiveness of any such succession shall be a breach of this Agreement and
shall entitle the Employee to compensation from the Company in the same amount
and on the same terms as the Employee would be entitled hereunder if he were to
terminate his employment pursuant to subparagraphs 10(a), 10(b), 10(c) or
10(d). As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which executes and delivers the agreement provided for in this
Paragraph 13 or which otherwise becomes bound by all the terms and provisions
of this Agreement by operation of law.
(b) This Agreement shall inure to the benefit of and be
enforceable by the Employee's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If the
Employee should die during the term hereof, the Company shall pay an amount
equal to any amounts then payable to Employee hereunder, plus an amount equal
to three months' salary, with all such amounts to be paid to Employee's
devisee, legatee or other designee or, if there be no such designee, to his
estate.
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14. No Inconsistent Obligation. Employee represents and warrants
that he has not previously assumed any obligations inconsistent with those of
this Agreement.
15. Modification. This Agreement shall be in addition to all
previous agreements, written or oral, relating to Employee's employment by the
Company, and shall not be changed orally, but only by a written instrument to
which the Company and the Employee are both parties.
16. Binding Effect. This Agreement and the rights and obligations
hereunder shall be binding upon and inure to the benefit of the parties hereto
and their respective legal representatives, and shall also bind and inure to
the benefit of any successor of the Company by merger or consolidation or any
assignee of all or substantially all of its properties.
17. Bankruptcy. Notwithstanding anything in this Agreement to the
contrary, the insolvency or adjudication of bankruptcy of the Company, whether
voluntary or involuntary, shall terminate this Agreement and the rights and
obligations of the Company and Employee hereunder shall be of no further force
or effect.
18. Law Governing. This Agreement is made, accepted and delivered
in Midland County, Texas, is performable in Midland County, Texas, and it shall
be construed and enforced according to the laws of the State of Texas. Venue
shall lie in Midland County, Texas for the purpose of resolving and enforcing
any dispute which may arise under this Agreement and the parties agree that
they will submit themselves to the jurisdiction of the competent State or
Federal Court situated in Midland County, Texas.
19. Invalid Provision. In case any one or more of the provisions
contained in this Agreement shall be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be impaired thereby.
20. Notice. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when delivered or mailed by United States registered or
certified mail, return receipt requested, postage prepaid, addressed as
follows:
If to Employee:
Xxxxxx X. Xxxxx
000 Xxxxx Xxxx
Xxxxxxx, Xxxxx 00000
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If to Company:
Xxx Xxxxx, Inc.
000 Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, Xxxxx 00000
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
Dated to be effective as of the lst day of January, 1997.
EMPLOYEE XXX XXXXX, INC.
By: /s/ Xxxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxx Xxxxxxx X. Xxxxxxxxx, President
012\TBI\Employment Agreement DLE 97
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