EMPLOYMENT AGREEMENT
EXHIBIT
10.18
This Employment Agreement (“Agreement”) is entered into as of this 18th day of
April, 2006, by and between COMMEMORATIVE BRANDS, INC., and its Affiliates,
XXXXXX PUBLISHING COMPANY, EDUCATIONAL COMMUNICATIONS, INC. and any successors
thereto (collectively referred to as the “Company”) and XXX XXXXXX
(“Executive”).
The parties hereby agree as follows:
Employment. Executive
will serve the Company in the position of Vice President Human Resources of
Commemorative Brands, Inc. and its Affiliates, Xxxxxx Publishing Company,
Educational Communications, Inc. and any other companies subsequently
acquired and will perform such duties as from time to time shall be
determined by the Board of Directors of the Company, and will perform,
faithfully and diligently, the services and functions performed and will carry
out the functions of his/her office and furnish his/her best advice,
information, judgment and knowledge with respect to the business of the
Company. Executive agrees to perform such duties as hereinabove
described and to devote full-time attention and energy to the business of the
Company. Executive will not, during the term of employment under this
Agreement, engage in any other business activity if such business activity
would
impair Executive’s ability to carry out his duties under this
Agreement.
Term. Contingent
upon successful completion of a criminal background investigation, reference
check and pre-employment drug screen, this Agreement shall be effective April
18, 2006 and end on March 31, 2007, and shall thereafter renew for successive
one-year terms, unless two months’ notice is given by either party to the other
party of non-renewal. However, this Agreement may be terminated at any time
by
either part in accordance with Section 6 hereof.
Compensation
and Other Benefits.
Salary. The
salary compensation to be paid by the Company to Executive and which Executive
agrees to accept from the Company for services performed and to be performed
by
Executive hereunder shall be an annual gross amount, before applicable
withholding and other payroll deductions, of $170,000, payable in equal
bi-weekly installments of $6,538.46, subject to such changes as the Board of
Directors of the Company may, in its sole discretion, from time to time
determine.
Benefits. Executive
shall be entitled to participate in such employee benefit programs, plans and
policies (including incentive bonus plans and incentive stock option plans)
as
are maintained by the Company and as may be established for the employees of
the
Company from time to time on the same basis as other executive employees are
entitled thereto, except to the extent such plans are duplicative of benefits
otherwise provided to Executive under this Agreement (e.g.
severance). It is understood that the establishment, termination or
change in any such Executive employee benefit programs, plans or policies shall
be at the option of the Company in the exercise of its sole discretion, from
time to time, and any such termination or change in such program, plan or policy
will not affect this Agreement so long as Executive is treated on the same
basis
as other executive employees participating in such program, plan or policy,
as
the case may be. Upon termination of employment under this Agreement,
without regard to the manner in which the termination was brought about,
Executive’s rights in such employee benefit programs, plans or policies shall be
governed solely by the terms of the program, plan or policy itself and not
this
Agreement. Executive shall be entitled to four (4) weeks annual paid
vacation concurrent with this Agreement and otherwise in accordance with the
Company’s personnel policy for his years of service completed as an employee of
the Company (and, to the extent applicable, the Company’s
predecessors).
Working
Facilities. During the term of his/her
employment under this Agreement, Executive shall be furnished with a private
office, stenographic services and such other facilities and services as are
commensurate with his position with the Company and adequate for the performance
of his duties under this Agreement.
Expenses. During
the term of his employment under this Agreement, Executive is authorized to
incur reasonable out-of-pocket expenses for the discharge of his/her duties
hereunder and the promotion of business of the Company, including expenses
for
entertainment, travel and related items, that are incurred in accordance with
the Company’s policies. The Company shall reimburse Executive for all
such expenses upon presentation by Executive from time to time of itemized
accounts of expenditures incurred in accordance with Company
policies.
Termination. The
employment relationship between Executive and the Company is “at-will”, which
means that Executive’s employment under this Agreement may be terminated with or
without cause or reason by either the Company or Executive at any
time. Payment to Executive upon his termination is governed by the
following terms and conditions.
Termination by
Company for Cause. The
following events or circumstances are deemed “Cause” for Executive’s
termination.
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Executive’s
indictment of, or plea of nolo contendere to, a felony or other crime
involving moral turpitude;
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Executive’s
material breach of a contractual obligation to the Company or any
of its
Affiliates (as defined below);
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Executive’s
failure to perform, or gross negligence in the performance of, Executives
material duties and responsibilities to the Company or any of its
Affiliates; or
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Executive’s
substantial, wrongful damage to property of the
Company.
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If the Executive is terminated for Cause, upon payment by the Company to
Executive of all salary earned but unpaid through the termination date, accrued
and unused vacation, and any accrued and unpaid bonus to the date of such
termination, the Company shall have no further liability to Executive for
compensation in accordance herewith, and Executive will not be entitled to
receive any other salary, the Termination Payments or Termination Benefits
(as
such terms are defined below) except aforesaid vacation and any accrued
bonus. For purposes of this Agreement, “Affiliates” means all persons
and entities directly or indirectly controlling, controlled by or under common
control with the Company, where control may be by management authority, equity
interest or otherwise.
Termination
by Company Without Cause. In the event of the
termination of Executive’s employment under this Agreement by the Company
without Cause the Executive will be entitled to receive 26 bi-weekly payments
equal to the average of his bi-weekly base salary in effect within the two
years
preceding the termination (including, for these purposes, average bi-weekly
base
salary of Executive from the Company’s predecessors) (“Termination Payments”),
less legally required withholdings. In addition to the Termination
Payments, Executive will be entitled to elect the continuation of health
benefits under COBRA and the Company will pay the COBRA premiums for a maximum
of 12-months, beginning on the date that Executive’s health coverage ceases due
to his termination, accrued but unused vacation, and any accrued bonus
(“Termination Benefits”). If Executive obtains employment while he is
entitled to receive the Termination Payments and the Termination Benefits,
each
Termination Payment shall be reduced by the amount of his average bi-weekly
compensation to be received in connection with his new employment and the
payment of the Termination Benefits shall cease upon Executive becoming covered
under the new employer’s health coverage plan. The combination of the
Termination Payments and the Termination Benefits constitute the sole amount
to
which Executive is entitled if termination is without Cause.
Termination
by Executive Without Good Reason.
Executive may terminate his employment
under this Agreement
without Good Reason as defined in Paragraph 6.4 below upon the giving of 90
days
written notice of termination. In the event of such termination, in
lieu of the 90 day notice period, the Company may elect to pay Executive
compensation for the notice period (or any remaining portion thereof), plus
unused accrued vacation and any accrued unpaid bonus, in which event Executive’s
services to the company will be terminated immediately. No
Termination Payments or Termination Benefits other than as set forth in Section
6.3 shall be payable upon Executive’s termination of this Agreement without Good
Reason.
Termination
by Executive With Good
Reason. Executive may
terminate his/her employment under this Agreement for Good
Reason. For purposes of this Agreement, “Good Reason” shall
mean:
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Without
Executive’s consent, the assignment to Executive of substantial duties
inconsistent with Executive’s then-current position, duties,
responsibilities and status with the Company, or any removal of Executive
from his titles and offices, except in connection with the termination
of
Executive’s employment under this Agreement by Company or as a result of
Executive’s death or permanent disability (as defined in the Company’s or
Executive’s disability insurance
policies);
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The
Company requiring Executive to relocate anywhere other than Austin,
or
Dallas, Texas without Executive’s consent;
or
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A
decrease in Executive’s salary from the salary in effect upon the date
hereof that is inconsistent with or not commensurate with Executive’s then
current position in the Company.
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In the event of termination under this Section 6.4, the Company shall pay to
Executive the same Termination Payments and Termination Benefits to which
Executive would have been entitled had he/she been terminated by the Company
without Cause.
Death
or Permanent Disability. Executive’s
employment under this Agreement shall terminate upon Executive’s death or
permanent disability (as defined in the Company’s or Executive’s disability
insurance policies). Other than accrued but unused vacation and any
accrued by unpaid bonus, no Termination Payments or Termination Benefits shall
be payable upon Executive’s death or permanent disability.
Release
Agreement. The Termination
Payments and Termination Benefits pursuant to Section 6 are conditioned upon
your signing a release of claims in the form provided by the Company (the
"Release Agreement") within twenty-one days of the date on which you give or
receive, as applicable, notice of termination of your employment and upon your
not revoking the Employee Release thereafter.
Notwithstanding
anything to the contrary in this Agreement, (i) except to the extent required
by
law, no payment will be due and payable under this Section 6 until the later
of
the next regular Company payday following the effective date of the Release
Agreement or that date which is in accordance with the requirements of clause
(ii) hereof and (ii) in the event that at the time that Executive’s employment
with the Company terminates the Company is publicly traded (as defined in
Section 409A of the Internal Revenue Code), any amounts payable under this
Section 6 that would otherwise be considered deferred compensation subject
to
the additional twenty percent (20%) tax imposed by Section 409A if paid within
six (6) months following the date of termination of Company employment shall
be
paid at the later of the time otherwise provided in Section 6 or the time that
will prevent such amounts from being considered deferred
compensation.
Confidentiality. The
Company and its Affiliates possess confidential information, proprietary
information goodwill and trade secrets, which is important to
their business. Immediately upon Executive’s execution of
this Agreement and during the course of Executive’s employment with the Company,
the Company will give Executive confidential information, proprietary
information, goodwill and trade secrets belonging to the Company and its
Affiliates that Executive did not have or have access to prior to Executive’s
execution of this Agreement to enable Executive to perform his/her duties and
responsibilities hereunder. During and after the term of employment
under this Agreement, Executive agrees that he/she shall not, without the
express written consent of Company, directly or indirectly communicate or
divulge to, or use for his own benefit or for the benefit of any other person,
firm, association or corporation, any of Company’s or its Affiliates’ trade
secrets, confidential information, proprietary information or goodwill, which
trade secrets, confidential information, proprietary data and goodwill were
communicated to or otherwise learned or acquired by Executive during his
employment relationship with Company (“Confidential Information”), except that
Executive may disclose such matters to the extent that disclosure is required
(a) at Company’s direction or (b) by a court or other governmental agency of
competent jurisdiction. As long as such matters remain trade secrets,
confidential information, proprietary information or goodwill, Executive shall
not use such trade secrets, confidential information, proprietary information
or
goodwill in any way or in any capacity other than as expressly consented to
by
Company.
Covenant
not to Compete or Solicit. Ancillary to the
Company’s commitments as set forth herein, including but not limited to, the
obligation to provide Executive with the Company’s and its Affiliates’
confidential information, proprietary information, trade secrets and goodwill
and Executive’s agreement not to improperly use or disclose the Company’s and
its Affiliates’ proprietary information, trade secrets or goodwill, the receipt
and sufficiency of which is hereby acknowledged, and to avoid the actual or
threatened misappropriation of the Company’s and its Affiliates’ confidential
information, proprietary information, trade secrets or goodwill, Executive
agrees to the following covenants:
Executive
agrees to refrain during his employment under this Agreement and for one year
after the termination of his employment under this agreement for any reason,
without written permission of the Company, from becoming involved in any way,
within the boundaries of the United States, in the business of manufacturing,
designing, servicing or selling, the type of jewelry or fine paper or other
scholastic, licensed sports, insignia, recognition or affinity products
manufactured or sold (or then contemplated to be manufactured or sold) by the
Company, its divisions, subsidiaries and/or other affiliated entities
(Affiliates), including but not limited to, as an employee, consultant,
independent representative, partner representative, partner or
proprietor. For the avoidance of doubt, these restrictions shall
apply, but shall not be limited to, Xxxxx-Xxxxx, Jostens, Visant and
Intergold.
Executive
also agrees to refrain during his/her employment under this Agreement, and
in
the event of the termination of his/her employment under this Agreement for
any
reason, for one year thereafter, without written permission from the Company,
from diverting, taking, soliciting, licensed sports, insignia, recognition
or
affinity business of any customer of the Company, its divisions, subsidiaries
and/or affiliated entities, or any potential customer of the Company, its
divisions, subsidiaries and/or affiliated entities whose identity became known
to Executive through his employment by the Company and to which the Company
has
made a written business proposal or provided written pricing information before
the termination of Executive’s employment under this Agreement.
Executive
agrees to refrain during his employment under this Agreement, and in the event
of the termination of his employment under this Agreement for any reason for
a
period of one year thereafter, from inducing or attempting to influence any
employee or independent representative of the Company, its divisions,
subsidiaries, and/or affiliated entities to terminate his or his employment
or
association with the Company or such other entity.
Executive
further agrees that the covenants in Sections 8.1, 8.2 and 8.3 are made to
protect the legitimate business interests of the Company, including interests
in
the Company’s “Confidential Information,” as defined in Section 7 of this
Agreement, and not to restrict his mobility or to prevent him from utilizing
his
skills. In signing this Agreement, Executive gives the Company
assurance that he/she has carefully read and considered all the terms and
conditions of this Agreement, including the restraints imposed on him/her under
Section 7 and 8. Executive agrees without reservation that these
restraints are necessary for the reasonable and proper protection of the Company
and its Affiliates and that each and every one of the restraints is reasonable
in respect to subject matter, length of time and geographic
area. Executive further agrees that, were he/she to breach any of the
covenants contained in Section 7 and 8, the damage to the Company and its
Affiliates would be irreparable. Executive therefore agrees that the
Company, in addition to any other remedies available to it, shall be entitled
to
preliminary and permanent injunctive relief against any breach or threatened
breach by him/her of any of those covenants, without having to post
bond. Executive and the Company further agree that, in the event that
any provision of Section 7 and 8 is determined by any court of competent
jurisdiction to be unenforceable by reason of its being extended over too great
a time, too large a geographic area or too great a range of activities, that
provision shall be deemed to be modified to permit its enforcement to the
maximum extent permitted by law. It is also agreed that each of the
Company's Affiliates shall have the right to enforce all of Executive’s
obligations to that Affiliate under this Agreement, including without limitation
pursuant to Section 7 and 8.
Controlling
Law and Performability. The execution, validity,
interpretation and performance of this Agreement will be governed by the laws
of
the state of Texas.
Reparability. If
any provision of this Agreement is rendered or declared illegal or
unenforceable, all other provisions of this Agreement will remain in full force
and effect.
Notices. Any
notice required or permitted to be given under this Agreement shall be
sufficient if in writing and if sent by certified mail (return receipt
requested) addressed as follows:
| If to Executive: | Xxx Xxxxxx | |
| If to the Company: | Commemorative Brands, Inc. | |
| 0000 Xxxxxx X Xxxx | ||
| Xxxxxx, Xxxxx 00000 | ||
| Attention: Xxx Xxxxxxxx, President & CEO | ||
Any address or other change to the above shall be in writing to the other party
to become effective.
Assignment. The
rights and obligations of the Company under this Agreement shall inure to the
benefit of and be binding upon its successors and assigns. The rights
and obligations of Executive under this Agreement are of a personal nature
and
shall neither be transferred nor assigned in whole or in party by
Executive.
Non-Waiver. No
waiver of or failure to assert any claim, right, benefit or remedy hereunder
shall operate as a waiver of any other claim, right, benefit or remedy of the
company or Executive.
Review
and Consultation. Executive
acknowledges that he/she has had a reasonable time to review and consider this
Agreement and has been given the opportunity to consult with an
attorney.
Entire
Agreement and Amendments. This
Agreement contains the entire agreement of Executive and the company relating
to
the matters contained in this Agreement and supersedes all prior agreements
and
understandings, oral or written, between Executive and the Company with respect
to the subject matter in this Agreement. This Agreement may be
changed only by an agreement in writing by Executive and the
Company.
IN
WITNESS WHEREOF, the parties have executed this Agreement on the date and year
first above written.
| COMMERATIVE BRANDS, INC. | |||
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By:
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/s/ XXX XXXXXXXX | |
| Name | |||
| Title | |||
| EXECUTIVE | |||
| /s/ XXX XXXXXX | |||
| Xxx Xxxxxx | |||
