Exhibit 10.15
Xx. Xxxxxx X. Xxxxxxx
March 1, 1998
Page 1
March 1, 1998
Xx. Xxxxxx X. Xxxxxxx
Xxxxxxx & Associates, Inc.
c/o Xxxxxxxxxxxx Xxxx & Xxxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Xx. Xxxxxxx:
This letter (the "Agreement") constitutes our agreement on the terms of
employment of Xxxxxx X. Xxxxxxx ("Executive") by Fine Host Corporation
("Company").
1. Employment
Company agrees to employ Executive during the term of this
Agreement as President and Chief Executive Officer of Company,
reporting to the Board of Directors or the Special Committee
thereof. In that capacity, Executive shall have the rights,
powers and duties prescribed by present Article V, Section 9,
of the Company's Bylaws (a copy of which is attached as
Exhibit A).
Executive accepts employment as President and Chief Executive
Officer of Company and agrees to devote substantially all of
his working time and effort to his exercise of the powers, and
his performance of the duties, of that office; provided,
however, that Company acknowledges that Executive is also
Chairman of the Board and President of Xxxxxxx & Associates,
Inc. and, as such, has continuing duties and obligations to,
and must continue to devote a limited amount of time and
attention to the business of, that corporation, and Company
agrees that nothing in this Agreement shall preclude him from
continuing to doing so, or from engaging in charitable
activities and community affairs, or from managing his
personal investments and affairs, provided that such
activities, in the aggregate, do not interfere in any material
respect with his duties hereunder.
2. Term of Employment
Executive's employment under this Agreement shall be for a
term (the "Term") commencing on the date hereof and, subject
to the terms of this Agreement, terminating on December 31,
1998, unless sooner terminated as provided in Paragraph 8 or
9.
3. Salary and Additional Payment
Company shall pay Executive a salary of $100,000 per month.
The initial monthly $100,000 payment for the month of March
shall be paid simultaneously with the execution of this
Agreement and the monthly payments for the following months
shall be paid on the first day of each month thereafter.
Company shall pay an additional $100,000 to Executive on the
second day of January, 1999. All payments shall be made
subject to any withholding or similar tax required under
applicable law.
4. Expenses
Executive is authorized to incur reasonable expenses in
carrying out his duties and responsibilities under this
Agreement and Company shall pay directly, or reimburse
Executive for, all business expenses reasonably incurred by
him in carrying out his duties and responsibilities under this
Agreement, subject to documentation in accordance with Company
policy.
5. Vacation
During the Term Executive shall be entitled to three weeks of
paid vacation.
6. Success Payment
Commencing not later than 45 days after the date of this
Agreement, Company and Executive agree to negotiate in good
faith to establish mutually agreeable arrangements for payment
to Executive (whether in cash, stock of the Company, stock
options, phantom stock, or some other form) of incentive
compensation based upon mutually agreed performance criteria
and goals, and to agree upon that arrangement within 90 days
of the date of this Agreement or such additional time as may
be mutually agreed upon.
7. Director and Officer Liability Insurance
During the Term and continuing for a period of three (3) years
thereafter, Company shall maintain in force Director and
Officer Liability Insurance in the aggregate amount of not
less than $20 million including Executive as an officer
covered under that policy; provided, however, that if the
aggregate annual premiums for such insurance at any time
during such period shall exceed 125% of the per annum rate of
premium currently paid by the Company for such insurance on
the date of this Agreement (which amount is represented by the
Company to be $600,000), then Company shall provide the
maximum coverage then available to the Company at an annual
premium equal to 125% of such rate.
8. Termination For Cause
The Company may terminate Executive's employment without Cause
(as hereinafter defined) and may terminate for Cause only
after written notice to Executive specifying, in reasonable
detail, the reasons for that termination for Cause. If Company
terminates Executive's employment for Cause, it shall be
obligated to pay all amounts due to Executive to and including
the date of termination, and, except with respect to any
matter involved in the termination for Cause, shall remain
obligated to provide the Director and Officer Liability
Insurance provided by Paragraph 7 and the Indemnity provided
by Paragraph 10 and the Bylaws, but shall not be obligated for
any other payments after the date of that termination.
"Cause" shall mean:
(i) Executive's conviction of, or plea to, a felony,
under federal or state law;
(ii) Executive's theft, larceny or embezzlement from
or fraud upon, the Company;
(iii) Executive's wilful misconduct in the performance
of his duties under this Agreement.
Other than for Cause; Termination for Good Reason
If Company terminates Executives's employment other than for
Cause, or if Executive terminates in a Termination for Good
Reason, Company shall pay Executive all amounts due to
Executive to and including the date of that termination, shall
remain obligated to provide the Director and Officer Liability
Insurance provided by Paragraph 7 and the Indemnity provided
by Paragraph 10 and by the Bylaws, and, in addition, shall pay
Executive the greater of: (x) the aggregate of all amounts
which would be due Executive from the date of that termination
through and including January 2, 1999, or (y) $350,000.
"Termination for Good Reason" shall mean termination by
Executive by reason of any of the following:
(i) a reduction in Executive's compensation;
(ii) a material diminution of Executive's rights,
powers, and duties, or a change in his title or
office;
(iii) any change in the Executor's reporting
responsibility being solely to the Board of
Directors or the Special Committee thereof;
(iv) material failure of the Company to perform its
obligations under this Agreement;
(v) failure by the Company to maintain Director and
Officer Liability Insurance as required by
Paragraph 7.
9. Death, Disability, Change of Control
Death
In the event Executive's employment is terminated by reason of
Executive's death, the Company shall pay to Executive's estate
or beneficiaries, as the case may be, all amounts due to
Executive to and including the date of termination, shall
remain obligated to provide the Director and Officer Liability
Insurance provided by Paragraph 7 and the Indemnity provided
by Paragraph 10 and the Bylaws, and, in addition, 50% of the
greater of: (x) the aggregate of all amounts which would be
due Executive from the date of that termination through and
including January 2, 1999, or (y) $350,000.
Disability
In the event Executive's employment is terminated due to his
Disability (as hereinafter defined), Company shall pay to
Executive all amounts due Executive to and including the date
of termination for Disability, shall remain obligated to
provide the Director and Officer Liability Insurance provided
by Paragraph 7 and the Indemnity provided by Paragraph 10 and
by the Bylaws, and, in addition, shall pay Executive 50% of
the greater of: (x) the aggregate of all amounts which would
be due Executive from the date of that termination through and
including January 2, 1999, or (y) $350,000.
Disability shall have the meaning given to such term under the
terms of the Company's disability program. Absent such a
program, it shall mean a physical or mental condition which,
in the reasonable judgment of Company, renders Executive
unable or incompetent to carry out his duties and obligations
under this Agreement.
Change of Control
In the event of a Change of Control (as hereinafter defined),
the Company shall, simultaneously with the Change of Control,
pay to Executive all amounts due Executive to and including
the date of that Change of Control, shall remain obligated to
provide the Director and Officer Liability Insurance provided
by Paragraph 7 and the Indemnity provided by Paragraph 10 and
by the Bylaws, and, in addition, shall pay Executive the
greater of: (x) the aggregate of all amounts which would be
due Executive from the date of that Change of Control through
and including January 2, 1999, or (y) $350,000.
"Change of Control" shall mean the occurrence of any one or
more of the following events:
(a) the acquisition by any person or group of
beneficial ownership of more than 50% of
either the then outstanding Stock or the
combined voting power of the then
outstanding voting securities of the
Company entitled to vote generally on the
election of directors;
(b) individuals who, as of the date hereof,
constitute the Board (the "Incumbent
Directors") cease for any reason to
constitute at least a majority of the
Board; provided that any individual who
becomes a director after the date hereof
whose election, or nomination for
election by the Company's stockholders
was approved by a vote or written consent
of more than 50% of the directors then
comprising the Incumbent Directors shall
be considered as though such individual
were an Incumbent Director, but
excluding, for this purpose, any such
individual whose initial assumption of
office is in connection with an actual or
threatened election contest relating to
the election of the directors of the
Company (as such terms are used in Rule
14a-11 under the Securities Exchange Act
of 1934, as amended ("1934 Act")); or
(c) aproval by the stockholders of the
Company of (i) a merger, reorganization
or consolidation, (ii) a liquidation or
dissolution of the Company, or (iii) the
sale or other disposition of all or
substantially all of the assets of the
Company to an unaffiliated third party.
For purposes of this definition, "person" means such term as
used in Securities Exchange Commission ("SEC") Rule 13d-5(b)
under the Securities Exchange Act of 1934 (the "1934 Act");
"beneficial owner" means such term as defined in SEC Rule
13d-3 under the 1934 Act; "group" means such term as defined
in Section 13(d) of the 1934 Act; and "Stock" means the common
stock of the Company, par value $.01 per share, or any other
common stock that the Company may issue from time to time.
10. Indemnification
In addition to, and without limitation of, the indemnification
provided Executive by the provision of Article VIII of the
Restated Certificate of Incorporation of the Company and by
the provisions of Article VIII Section 8 of the current
Bylaws, a copy of which Certificate of Incorporation and Bylaw
sections are attached as Group Exhibit B (or any amendment
thereof permitting broader indemnification than that provided
prior to such amendment), all Expenses (as hereinafter
defined) incurred by or on behalf of Executive in any
Proceeding (as hereinafter defined) shall be paid by Company
within thirty (30) days after receipt by Company from
Executive of a statement or statements requesting such advance
or advances, from time to time, whether before, or after, the
final disposition of the Proceeding. Such statement or
statements shall reasonably evidence the Expenses incurred in
connection therewith and shall contain an undertaking
("Undertaking") by the Executive to repay such amounts if it
shall ultimately be determined that the Executive is not
entitled to be indemnified under the provisions of Article
VIII Section 8 of the current Bylaws (or the Bylaws as amended
to provide broader indemnification). The Undertaking shall
provide that if Executive has commenced proceedings in a court
of competent jurisdiction to secure a determination that such
Executive should be indemnified by the Company, there shall be
no obligation to repay the Company during the pendency of such
proceeding.
The termination of any Proceeding by settlement or upon a plea
of nolo contendere or its equivalent, shall not, of itself (i)
adversely affect the rights of Executive to indemnification,
or (ii) create a presumption that Executive did not meet any
particular standard of conduct or have any particular belief
or that a court has determined that indemnification or
contribution is not permitted by applicable law.
Executive's rights of indemnification and advancement of
expenses provided by this Agreement shall not be deemed
exclusive of any other rights to which such Executive may now
or in the future be entitled under applicable law, the
certificate of incorporation, Bylaws, agreement, vote of
stockholders or resolution of the Board of the Company.
Subject to the Undertaking, Expenses incurred by Executive in
connection with Executive's request for indemnification or
advances hereunder shall be borne by the Company. In the event
that Executive is a party to or intervenes in any proceeding
in which the validity or enforceability of the Agreement is at
issue or seeks an adjudication or award in arbitration to
enforce Executive's rights under, or to recover damages for
breach of, the Agreement, Executive, upon prevailing in whole
or in part in such action, shall be entitled to recover from
the Company and shall be indemnified by the Company against
any Expenses actually and reasonably incurred by Executive in
that proceeding.
When Executive makes a claim seeking to avoid repayment to the
Company pursuant to an Undertaking, either Executive or the
Company shall have the right, but not the obligation, to have
a determination made by Independent Counsel, at the expense of
the Company, as to whether indemnification of the Executive is
proper under applicable Delaware law. If selected by the
Executive, such Independent Counsel shall be reasonably
satisfactory to the Company; if selected by the Company, such
Independent Counsel shall be reasonably satisfactory to the
Executive. (If both Executive and Company are unable to agree
on such Independent Counsel, then each shall designate an
Independent Counsel, who, together, shall select the
Independent Counsel who will make the determination.) If a
determination has been made by Independent Counsel in writing
in accordance with the preceding sentence, no determination
inconsistent therewith by other legal counsel, by the Board or
by stockholders of Company shall be of any force or effect,
provided, however, that Executive shall maintain all rights
specified in the preceding paragraph of this Section 10.
"Independent Counsel" shall mean a law firm or a member of a
law firm that neither is presently, nor in the past five (5)
years has been, retained to represent: (1) the Executive
seeking indemnification with respect to which such Independent
Counsel is to be retained, or by the Company, in any matter
material to the Executive or the Company, as the case may be,
or (ii) any other party to the action, suit, investigation or
Proceeding giving rise to a claim for indemnification
hereunder. Notwithstanding the foregoing, the term
"Independent Counsel" shall not include any person who, under
the applicable standards of professional conduct then
prevailing, would have a conflict of interest in representing
either the Company or the Executive seeking indemnification
hereunder in an action to determine the Executive's right to
indemnification under this Agreement.
"Proceeding" shall mean an action, suit or proceeding, whether
civil, criminal, administrative or investigative, and any
appeal therefrom.
11. Expenses of Agreement
Promptly after Executive's submission to the Company of
invoices therefor, Company shall pay or reimburse Executive
for the reasonable attorneys fees and expenses incurred by
Executive in connection with the drafting and negotiation of
this Agreement and of the success payment to be negotiated
pursuant to Paragraph 6, up to a limit of $7,500.
12. Headings.
The headings of the paragraphs of this Agreement are inserted
for convenience only and shall not be deemed to constitute
part of this Agreement or to affect the construction thereof.
13. Entire Agreement; Modification and Waiver.
This Agreement contains the entire understanding of the
parties with respect to the terms and conditions of
Executive's employment by Company. No waiver, supplement,
modification or amendment of this Agreement shall be binding
unless executed in writing by each of the parties hereto,
provided that no supplement, modification, or amendment shall
be executed by Executive on behalf of the Company. No waiver
of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provisions hereof
(whether or not similar).
14. Notices.
All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been
duly given if (i) delivered by hand and receipted for by the
party to whom said notice or other communication shall have
been directed, or (ii) mailed by certified or registered mail
with postage prepaid, on the third business day after the date
on which it is so mailed:
If to Executive:
c/x Xxxxxxx & Associates, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
with a copy to:
Xxxxxxxxxxxx Xxxx & Xxxxxxxxx
0000 Xxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
If to Company:
0 Xxxxxxxxx Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxx, Esq.
with a copy to:
Xxxxxxx Xxxx & Xxxxxxxxx
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx
or to such other address as may be furnished by the party to
receive notice to the other.
15. Governing Law
This Agreement is governed by, and construed in accordance
with, the laws of the State of New York with respect to
contracts made and to be performed entirely therein, and
without regard to choice of law or principles thereof.
16. Survival.
The provision of Paragraphs 7 and 10 of this Agreement shall
survive any termination of the Executives Employment with the
Company and shall be binding upon the successors and assigns
of the Company and shall issue to the benefit of the
successors, assigns, heirs and personal representatives of the
Executive.
17. Identical Counterparts.
This Agreement may be executed in one or more counterparts,
each of which shall for all purposes be deemed to be an
original but all of which together shall constitute one and
the same Agreement. Only one such counterpart signed by the
party against whom enforceability is sought needs to be
produced to evidence the existence of this Agreement.
Please indicate your agreement by signing and returning a copy of this letter.
FINE HOST CORPORATION
By:________________________
AGREED:
-----------------------------
Xxxxxx X. Xxxxxxx
1328679.04
EXHIBIT A
ARTICLE V
Section 9. President: The President shall, when present, preside at all
meetings of the stockholders, and, in the absence of the Chairman of the Board
of Directors, at meetings of the Board of Directors. He shall have power to call
special meetings of the stockholders or of the Board of Directors or of the
Executive Committee at any time. He shall be the chief executive officer of the
Corporation, and shall have the general direction of the business, affairs and
property of the Corporation, and of its several officers, and shall have and
exercise all such powers and discharge such duties as usually pertain to the
office of President.
GROUP EXHIBIT B
CERTIFICATE OF INCORPORATION, ARTICLE VIII
The Corporation shall indemnify each person who is or was a director, officer or
employee of the Corporation (including the heirs, executors, administrators or
estate of such person) or is or was serving at the request of the Corporation as
a director, officer or employee of another corporation, partnership, joint
venture, trust or other enterprise, to the fullest extent permitted under
subsections 145(a), (b) and (c) of the Delaware General Corporation Law or any
successor statute.
The indemnification provided by this Article VIII shall not be deemed exclusive
of any other rights to which any of those seeking indemnification or advancement
of expenses may be entitled under any by-law, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office, and shall
continue as to a person who has ceased to be a director, officer, employee or
agent and shall inure to the benefit of the heirs, executors and administrators
of such a person.
BYLAWS, ARTICLE VIII
Section 8. Indemnification of Officers and Directors: The Corporation
shall indemnify any and all of its directors or officers, including former
directors or officers, and any employee, who shall serve as an officer or
director of any corporation at the request of this Corporation, to the fullest
extent permitted under and in accordance with the laws of the State of Delaware;
provided, however, that the Corporation shall not be permitted to indemnify any
person in connection with any proceeding initiated by such person, unless such
proceeding is authorized by a majority of the directors of the Corporation.
