AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement") made and
entered into as of the 1st day of December, 1996, by and between XXXXXXXXX SIGN
COMPANY, a Texas corporation ("Employer"), and XXXXX X. XXXXXXXX ("Employee").
W I T N E S S E T H:
WHEREAS, Employee is a party to that certain Employment Agreement, dated
December 1, 1990 with Xxxxxxxxx Holdings, Inc., a Delaware corporation (k/n/a
Independence Capital Corporation) (the "Original Agreement"); and
WHEREAS, Employer desires to employ Employee and Employee desires to be
employed by Employer effective as of the Effective Date (as hereinafter
defined), in accordance with the terms and conditions set forth hereinafter and
that this Agreement, amend, restate and supersede, in all respects the Original
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, the parties to this Agreement agree as follows:
1. EMPLOYMENT AND DUTIES. Employer hereby employs Employee and Employee hereby
accepts such employment and agrees to devote his full time and best efforts
to the diligent and faithful performance of his duties as may be assigned
by the Board of Directors of Employer.
2. TERM OF EMPLOYMENT. This Agreement shall commence on January 1, 1997 (the
"Effective Date"), and continue for a term of four years ending on December
31, 2000, unless sooner terminated as herein provided. Unless either party
elects to terminate this Agreement at the end of the original, or any
renewal term, by giving the other party notice of such election at least
thirty (30) days before the expiration of the then current term, this
Agreement shall be deemed to have been renewed for an additional term of
one (1) year commencing on the date after the expiration of the then
current term.
3. COMPENSATION. (a) BASE SALARY. As compensation for Employee's services
hereunder, Employer shall pay Employee a salary of not less than $125,000
per year as shall be fixed by the Board of Directors from time to time
("Base Salary") payable in reasonable periodic
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installments in accordance with Employer's regular payroll practices in
effect from time to time.
(b) EXPENSES. Employee shall be reimbursed such ordinary and necessary
expenses reasonably incurred by Employee in the pursuit of Employer's
business upon receipt of vouchers therefor and in accordance with
Employer's regular reimbursement procedures and practices in effect from
time to time.
(c) BONUS. Employee shall be eligible to receive a bonus of up to sixty
percent (60%) of his Base Salary, such bonus to be based on quantitative
and qualitative factors as determined from time to time by the Board of
Directors of Employer, the existence and amounts of which shall be in
Employer's sole discretion.
(d) BENEFITS. Employee shall be entitled to vacations, insurance and such
other employee benefits as are provided from time to time to comparable
employees of Employer.
4. CHANGE IN CONTROL. (a) DEFINITION. For purposes of this Agreement a
"change in control of the Employer" shall mean the occurrence of any of
the following events: (i) there shall be consummated (x) any
consolidation or merger of the Employer in which the Employer is not the
continuing or surviving corporation or pursuant to which shares of the
Employer's Common Stock would be converted into cash, securities or other
property, other than a merger of the Employer in which the holders of the
Employer's Common Stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving corporation
immediately after the merger, or (y) any sale, lease, exchange or other
transfer (excluding transfer by way of pledge or hypothecation), in one
transaction or a series of related transactions, of all, or substantially
all, of the assets of the Employer, except, with respect to (x) and (y)
above, any transaction in which the Employee is, or will become, an
investor in the buying group or its affiliates (ii) the shareholders of
the Employer approve any plan or proposal for the liquidation or
dissolution of the Employer, (iii) any "person" (as such term is defined
in Section 3(a)(9) or Section 13(d)(3) under the Securities Exchange Act
of 1934, as amended (the "1934 Act") or any "group" (as such term is used
in Rule 13d-5 promulgated under the 1934 Act), other than the Employer or
any successor of the Employer or any subsidiary of the Employer or any
employee benefit plan of the Employer or any subsidiary (including such
plan's trustee) or Geneve Holdings, Inc. and its subsidiaries or
affiliates, becomes, without the prior approval of the board of directors
of the Employer, a beneficial owner for purposes of Rule 13d-3
promulgated under the 1934 Act, directly or indirectly, of securities of
the Employer representing 50.0% or more of the Employer's then
outstanding securities having the right to vote in the election of
directors of the Employer, or (iv) during any period of two consecutive
years, individuals who, at the beginning of such period constituted the
entire
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board of directors of the Employer, cease for any reason (other than
death) to constitute a majority of the directors of the Employer, unless
the election, or the nomination for election, by the Employer's
shareholders, of each new director of the Employer was approved
by a vote of at least two-thirds of the directors of the Employer then
still in office who were directors of the Employer at the beginning of the
period.
(b) RATIFICATION OF AGREEMENT UPON CHANGE OF CONTROL. If any of the
events described in Section 4(a) hereof constituting a change in control of
the Employer shall have occurred and Employer (or any successor to Employer
if the change of control of the Employer results from an asset sale) has
not, in writing, agreed to assume and perform the obligations of Employer
under this Agreement for the greater of the remaining term of this
Agreement or a period of one (1) year, then (i) if such change of control
of the Employer occurs prior to December 31, 1999, Employer shall pay
Employee a lump sum payment equal to four times (A) his then Base Salary
plus (B) the maximum earnable bonus such payment to be made within five (5)
business days of in control of the Company, or (ii) if such change of
control of the Employer occurs on or after December 31, 1999, Employer
shall be entitled to receive a lump sum payment equal to three times (A)
his then Base Salary plus (B) the greater of (x) 50% of the maximum
earnable bonus or (y) the most recent bonus earned, such payment to be made
within five (5) business days of the change of control of the Company.
Upon payment of such lump sum by Employer, neither Employer nor Employee
shall have any further obligations under this Agreement.
5. TERMINATION OF EMPLOYMENT. (a) DEATH OR DISABILITY. Employee's employment
shall terminate automatically upon Employee's death. If Employer
determines in good faith that the Disability of Employee has occurred,
Employee shall give to Employee written notice of its intention to
terminate Employee's employment. In such event, Employee's employment
shall terminate effective on the 30th day after delivery of such notice by
Employer. For purposes of this Agreement, "Disability" shall mean the
absence of Employee from his duties with Employer on a full-time basis for
90 consecutive days as a result of incapacity due to mental or physical
illness which is determined to be total and permanent by a physician
selected by Employer.
(b) DISCHARGE FOR CAUSE. Employer may terminate Employee's employment
for Cause. If Employer determines to terminate Employee's employment for
Cause, Employer shall give to Employee written notice thereof. In such
event, Employee's employment shall terminate effective on the 15th day
after delivery of such notice by Employer which notice shall contain a
resolution of the Board of Directors of Employer (or committee thereof)
terminating Employee's employment hereunder and specifying such Cause.
Prior to the 15th day after delivery of such notice by Employer, Employee
shall have had the opportunity to discuss such termination with the Board
of Directors (or a committee thereof) and if such Cause can be cured by
Employee, Employee shall have until the 15th day after delivery of such
notice to cure or correct such Cause in the sole determination of the
Board of Directors (or committee thereof). For purposes of this
Agreement, "Cause" shall mean (i) breach by Employee of the terms of this
Agreement which is demonstrably willful and deliberate on Employee's
part, or any other act which, in the reasonable judgment of the Board of
Directors of Employer, is committed in bad faith and is inconsistent with
the best interests of Employer, and, in any case, which is not remedied
prior to the effective termination date provided for herein, or (ii) the
conviction of Employee of a felony involving moral turpitude.
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(c) GOOD REASON. Employee's employment and any obligations of Employee
under this Agreement may be terminated by Employee for Good Reason. If
Employee determines to terminate his employment for Good Reason, Employee
shall give to Employer written notice thereof. In such event, Employee's
employment shall terminate effective on the 15th business day after delivery
of such notice by Employee. For purposes of this Agreement, "Good Reason"
shall mean
(i) the assignment to Employee of any duties inconsistent in any
significant respect with Employee's position (including status,
offices, titles and reporting requirements), authority, duties or
responsibilities as contemplated by Section 1 hereof, or any
other action by Employer which results in a significant
diminution in such position, authority, duties or
responsibilities, excluding for this purpose any action which is
remedied by Employer prior to the effective termination date
provided for herein; or
(ii) any breach by Employer of the terms of this Agreement, other than
an isolated or inadvertent failure not occurring in bad faith and
which is remedied by Employer prior to the effective termination
date provided for herein.
(d) OTHER. Employee's employment may be terminated by either Employer or
Employee for any reason whatsoever, effective 30 days following
delivery of notice thereof to the other.
6. OBLIGATIONS OF EMPLOYER UPON TERMINATION. (a) TERMINATION FOR DEATH,
DISABILITY, GOOD REASON OR OTHER THEN FOR CAUSE. If, prior to December
31, 1999, (i) Employer shall terminate Employee's employment other than
for Cause, or (ii) Employee shall terminate his employment for Good
Reason, or (iii) Employee's employment is terminated as a result of the
death or Disability of Employee, then Employer shall pay to Employee an
amount equal to four times (A) his Base Salary as of the date of
termination of employment plus (B) the maximum earnable bonus. If, on or
after December 31, 1999 but prior to the expiration of the term of this
Agreement, (i) Employer shall terminate Employee's employment other than
or Cause, or (ii) Employee shall terminate his employment for Good Reason,
or (iii) Employee's employment is terminated as a result of the death
or Disability of Employee, then Employer shall pay to Employee an amount
equal to three times (A) his Base Salary as of the date of termination of
employment plus (B) the greater of (x) 50% of the maximum earnable bonus
or (y) the most recent bonus earned. Such amounts to be paid under this
Section 6 (the "Termination Payments") shall be paid, if pursuant to the
first sentence hereof, in forty-eight equal monthly installments, or if
pursuant to the second sentence hereof, in thirty-six equal monthly
installments, commencing with the month following the
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termination. Employer's obligation to make such payments shall cease
immediately upon Employee's employment (as employee or paid
consultant or similar advisor) by any entity.
(b) TERMINATION FOR CAUSE OR OTHER THAN GOOD REASON. If, prior to
the expiration of the term of this Agreement (i) Employer
shall terminate Employee's employment for Cause or (ii) Employee terminates
his employment, excluding a termination for Good Reason, (x) this Agreement
shall terminate without further obligation to Employee, other than the
obligation to pay Employee his salary through the effective date of
termination.
(c) EXPIRATION OF AGREEMENT. Upon the termination of this Agreement
pursuant to notice given in accordance with Section 2 at the end of the
original or any renewal term, neither Employee nor Employer shall have
any obligation to the other under this Agreement, except pursuant to
Sections 8, 10 and 11 hereof.
7. EFFECT OF PAYMENTS. If the amount of any payment to be made to Employee
hereunder, together with the amount of any other payments from the
Employer, constitutes a "parachute payment" (within the meaning of Section
280G(b)(2) of the Internal Revenue Code of 1986, as amended (the "Code")),
the amount of such payment required to be made hereunder shall be reduced
(but not below zero) to an amount that, together with the amount of such
other payments from the Employer, is 2.99 times Employee's "base amount"
(within the meaning of Code Section 280G(b)(3)). If, after reduction to
zero of the amount payable hereunder, the amount of such other payments
from the Employer exceeds 2.99 times Employee's "base amount", no amount
shall be payable hereunder if such amount constitutes a "parachute payment".
8. CONFIDENTIAL INFORMATION. (a) ACKNOWLEDGMENT OF PROPRIETARY INTEREST.
Employee acknowledges the proprietary interest of Employer in all
Confidential Information. Employee agrees that all Confidential
Information learned by Employee during his employment with Employer or
otherwise, whether developed by Employee alone or in conjunction with
others or otherwise, is and shall remain the exclusive property of
Employer. Employee further acknowledges and agrees that his disclosure of
any Confidential Information will result in irreparable injury and damage
to Employer.
(b) CONFIDENTIAL INFORMATION DEFINED. "Confidential Information" means
all confidential and proprietary information of Employer, including without
limitation (i) information derived from reports, investigations,
experiments, research and work in progress, (ii) methods of operation,
(iii) market data, (iv) proprietary computer programs and codes, (v)
drawings, designs, plans and proposals, (vi) marketing and sales programs,
(vii) client lists, (viii) historical financial information and financial
projections, (ix) pricing formulae and policies, (x) all other concepts,
ideas, materials and information prepared or performed for or by Employer
and (xi) all information related to the business, products, purchases or
sales of Employer or any of its suppliers and customers, other than
information that is publicly available.
(c) COVENANT NOT TO DIVULGE CONFIDENTIAL INFORMATION. Employer is
entitled to prevent the disclosure of Confidential Information. As a
portion of the consideration for the employment of Employee and for the
compensation being paid to Employee by
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Employer, Employee agrees at all times during the term of his employment
hereunder and thereafter to hold in strict confidence and not to
disclose or allow to be disclosed to any person, firm or corporation,
other than to persons engaged by Employer to further the business of
Employer, and not to use except in the pursuit of the business of
Employer, the Confidential Information, without the prior written
consent of Employer.
(d) RETURN OF MATERIALS AT TERMINATION. In the event of any termination
or cessation of his employment with Employer for any reason, Employee shall
promptly deliver to Employer all documents, data and other information
derived from or otherwise pertaining to Confidential Information. Employee
shall not take or retain any documents or other information, or any
reproduction or excerpt thereof, containing or pertaining to any
Confidential Information.
9. NONCOMPETITION. (a) NONCOMPETITION AGREEMENT. So long as Employee is
receiving Termination Payments hereunder, Employee shall not do any of the
following:
(i) engage directly or indirectly, alone or as a shareholder,
partner, director, officer, employee of or consultant to any
other business organization, in any business activities that:
(1) relate to the business of Employer (the "Designated
Industry"); or
(2) were either conducted by Employer prior to the termination
of Employee's employment hereunder or proposed to be
conducted by Employer at the time of such termination;
(ii) divert to any competitor of Employer in the Designated Industry
any customer of Employer; or
(iii) solicit or encourage any director, officer, employee of or
consultant to Employer to end his relationship with Employer
or commence any such relationship with any competitor of
Employer in the Designated Industry.
(b) OWNERSHIP INTERESTS. Employee's noncompetition obligations hereunder
shall not preclude Employee from owning less than five percent of the
common stock of any publicly traded corporation conducting business
activities in the Designated Industry. If at any time the provisions of
this Section 9 are determined to be invalid or unenforceable by reason of
being vague or unreasonable as to area, duration or scope of activity, this
Section 9 shall be considered divisible and shall be immediately amended to
only such area, duration and scope of activity as shall be determined to be
reasonable and enforceable by the court or other body having jurisdiction
over the matter, and Employee
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agrees that this Section 9 as so amended shall be valid and binding as
though any invalid or unenforceable provision had not been included
herein.
(c) VIOLATION. If Employee shall violate the terms of this Section 9,
such violation shall permit Employer to immediately cease making
Termination Payments under Section 6.
10. SUCCESSORS. This Agreement shall be binding upon and inure to the benefit
of Employer and its successors and assigns and shall be binding upon
Employee, his heirs and legal representatives. This Agreement shall not be
assignable by Employee.
11. MISCELLANEOUS. (a) GOVERNING LAW, ENTIRE AGREEMENT, ETC. This Agreement
shall be governed by and construed in accordance with the laws of the State
of Texas, without reference to principles of conflict of laws. This
Agreement constitutes the entire agreement between Employer and Employee
pertaining to the subject matter hereof and supersedes all prior and
contemporaneous agreements, understandings, negotiations and discussions,
whether oral or written, between Employer and Employee and between Employee
and Xxxxxxxxx Holdings, Inc. in connection with his employment, including,
without limitation, the Original Agreement. The captions of this Agreement
are not part of the provisions hereof and shall have no force or effect.
This Agreement may not be amended or modified except by a written agreement
executed by the Employee and the Employer hereto or its successor.
(b) NOTICES. All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
If to Employee:
Xxxxx X. Xxxxxxxx
c/x Xxxxxxxxx Sign Company
0000 Xxxxxxx 00 Xxxx
Xxxxx, Xxxxx 00000
If to Employer:
Xxxxxxxxxx Sign Company
0000 Xxxxxxx 00 Xxxx
Xxxxx, Xxxxx 00000
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or to such other address as either party shall have furnished to the other
in writing in accordance herewith.
(c) SEVERABILITY. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
(d) WITHHOLDING. Employer may withhold from any amounts payable under
this Agreement such Federal, state or local taxes as shall be required to
be withheld pursuant to any applicable law or regulation.
IN WITNESS WHEREOF, Employee has hereunto set his hand and Employer has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.
XXXXXXXXX SIGN COMPANY
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
---------------------------------
Xxxxx X. Xxxxxxxx
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