EXHIBIT 10.185
FIRST AMENDMENT
This First Amendment to the Amended and Restated Agreement dated as of
July 26, 1999 is the First Amendment to that certain Amended and Restated
Agreement dated June 4, 1999, by and between Catalina Lighting, Inc. a Florida
corporation (the "Company") and Xxxxx X. Xxxxxxx (the "Executive").
RECITALS
I. The Company and the Executive entered into an Agreement, dated May
7, 1998, which was subsequently amended by addendum dated March 3, 1999 and was
subsequently amended and restated on June 4, 1999 (the "Amended and Restated
Agreement"); and
II. The Company and the Executive wish to enter into this First
Amendment to the Amended and Restated Agreement.
NOW, THEREFORE, each of the parties agrees as follows:
A. SECTION 3 OF THE AMENDED AND RESTATED AGREEMENT IS HEREBY DELETED IN
ITS ENTIRETY AND SHALL BE REPLACED BY THE FOLLOWING SECTION 3.
3. COMPENSATION FOLLOWING CHANGE OF CONTROL
Subject to the terms and conditions of this Agreement, following a
change in control of the Company, as defined in Section 2(i), the Executive
shall be entitled to the following benefits:
(i) The Company shall notify the Executive of the date as of which
there occurs a change in control of the Company, provided that the failure of
the Company to so notify Executive shall not affect any of the Executive's
rights under this Agreement. If there is a change in control of the Company and
the Company terminates the Executive's employment with the Company (either
actually or constructively) within 13 weeks after the date of the change in
control of the Company, the Company within 5 business days of the Executive's
termination of employment shall pay the Executive an amount equal to two times
the Executive's base salary and an amount equal to two times the annual benefits
which the Company has provided to the Executive prior to the change in control,
including but not limited to payments for medical insurance and automobile lease
payments. For purposes of this First Amended and Restated Agreement use of the
term "Company" shall also refer to the successor/acquiror
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of the Company if a change in control occurs, as defined in Section 2(i).
(ii) If (a) there is a change in control of the Company and (b)the
Company does not terminate Executive's employment with the Company within 13
weeks after the date of the change in control of the Company and (c) Executive
works for the Company through the end of the 13th week after the change in
control of the Company (subject to absences by Executive that are consistent
with the Company's sick leave, vacation and other absence policies as in effect
as of the Effective Date), then within 5 business days after the end of the 13th
week following the change in control, the Company shall pay the Executive an
amount equal to two times the Executive's base salary in effect as of the date
of change in control and an amount equal to two times the annual benefits which
the Company has provided to the Executive prior to the change in control,
including but not limited to payments for medical insurance and automobile lease
payments, provided however that the Company shall not be obligated to make the
payment which otherwise would be due the Executive provided for in this Section
3(ii) if prior to the date such payment otherwise would be due the Executive has
executed an employment agreement with the Company on terms acceptable to
Executive in his sole discretion. If, after a change in control of the Company,
the Executive shall terminate his employment with the Company prior to the end
of the thirteen (13) weeks (other than on account of Executive's death or
disability or as a result of a constructive discharge by the Company), the
Company shall pay the Executive's full base salary through the date of
termination of the Executive's employment at the rate in effect at the time of
the Executive's termination of employment, plus any other amounts to which the
Executive is entitled under any compensation plan of the Company, at the time
such payments are due, but the Executive shall not be entitled to the payment
provided for in Section 3(i).
(iii) In the event of a dispute regarding this agreement and the
Executive is the prevailing party, the Company shall also pay the Executive
reasonable legal fees and expenses incurred by the Executive in seeking to
obtain or enforce any right or benefit provided by this Agreement.
(iv) When used herein the term "base salary" shall mean the greater of
the annual salary of the Executive at the time of change in control or
termination occurs or (2) $190,000;
B. SECTION 4 OF THE AMENDED AND RESTATED AGREEMENT IS HEREBY DELETED IN ITS
ENTIRETY AND SHALL BE REPLACED BY THE FOLLOWING SECTION 4.
4. SEVERANCE COMPENSATION WHEN THERE IS NO CHANGE IN CONTROL. In the event there
is no change in control as defined in Section 2(1) of the Agreement, and the
Executive is terminated without "cause" (as defined in Section 8 (iii) below),
the Executive shall be entitled to the following benefits:
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(i) payment of a lump sum amount equal to the Executive's
base salary and an amount equal to the annual
benefits which the Company has provided to the
Executive, including but not limited to payments for
medical insurance and/or automobile lease payments;
provided however, if the Executive is terminated
"without cause" and a change in control occurs within
six (6) months subsequent to such termination date,
then the Executive shall be entitled to receive an
additional payment of one year's base salary and an
amount equal to the annual benefits which the Company
has provided to the Executive, including but not
limited to payments for medical insurance and/or
automobile lease payments. In no event shall the
Executive be entitled to payment both under this
Section 4 and the change in control provisions of
Section 3.
(ii) the Executive shall not be entitled to receive this
severance amount if the Executive is terminated with
"cause";
(iii) "Cause" shall mean any action by the Executive or any
inaction by the Executive which is reasonably
believed by the Company to constitute:
(a) fraud, embezzlement, misappropriation,
dishonesty or breach of trust;
(b) a felony or moral turpitude;
(c) material breach or violation of any or all
of the covenants, agreements and obligations
of the Executive, other than as the result
of the Executive's death or Disability;
(d) a willful or knowing failure or refusal by
the Executive to perform any or all of his
material duties and responsibilities as an
officer of the Company, other than as the
result of the Executive's death or
Disability; or
(e) gross negligence by the Executive in the
performance of any or all of his material
duties and responsibilities as an officer of
the Company, other than as the result of the
Executive's death or disability; provided,
however, that in the event that the basis
for any termination of the Executive's
employment by the Company as set forth in
the termination notice delivered by the
Company to the Employee is any or all of the
definitions of Cause set forth in Section
4(iii)(c ) or Section 4(iii)(e) of this
Agreement, then, in such event, the Employee
shall have thirty (30) days from and after
the date of his receipt of such Termination
Notice to cure the action or inaction
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specified therein to the reasonable
satisfaction of the Company.
C. SECTION 9 OF THE AMENDED AND RESTATED AGREEMENT IS HEREBY DELETED IN ITS
ENTIRETY AND SHALL BE REPLACED BY THE FOLLOWING SECTION 9.
9. In the event of a change in control or the Executive is terminated
without cause pursuant to Section 4 of this Agreement, all stock options
previously issued to the Executive which are unvested at such time shall vest
immediately and the Executive shall have up to three months from his termination
date to exercise these and all other stock options of the Company held by the
Executive.
In witness whereof, the parties have signed this First Amendment to the
Amended and Restated Agreement as of the 26th day of July, 1999.
CATALINA LIGHTING, INC.
BY: /s/ XXXXXX XXXXX
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Xxxxxx Xxxxx
Chairman, President and Chief Executive Officer
ACCEPTED AND AGREED:
By: /s/ XXXXX X. XXXXXXX
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Xxxxx X. Xxxxxxx
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