EXHIBIT (c)(16)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of December 22, 1995, by
and between HOMEOWNERS GROUP, INC., a Delaware corporation (the "Company"), and
XXXX XXXXXXXXXX (the "Executive").
WITNESSETH:
WHEREAS, the Company desires to continue to employ the Executive, and
the Executive desires to continue to be employed by the Company, pursuant to the
provisions contained in this Employment Agreement (the "Agreement");
NOW, THEREFORE, in consideration of the premise, and the respective
covenants and agreements of each of the Company and the Executive contained in
this Agreement, each of the Company and the Executive agrees as follows:
ARTICLE I
EMPLOYMENT
1.1 THE COMPANY. The Company employs the Executive and the Executive
accepts such employment. Subject to the direction of the Board of Directors of
the Company and the Executive Committee thereof, the Executive shall serve as
the Chairman of the Board, President and Chief Executive Officer of the Company.
The Executive shall have such responsibilities, perform such duties and exercise
such power and authority as are inherent in, or incident to, the offices of
Chairman of the Board, President and Chief Executive Officer. The Executive
shall devote his full business time and attention, and his best efforts, to the
diligent performance of such duties.
1.2 SUBSIDIARY CORPORATIONS. The Executive shall serve as the Chairman
of the Board, President and Chief Executive Officer of each and every one of the
Company's direct and indirect subsidiary corporations, including without
limitation Homeowners Marketing Services, Inc., a Florida corporation ("HMS"),
Homeowners Association of America, Inc., a Florida corporation ("HAA"), and HOMS
Insurance Agency, Inc., a Florida corporation ("HOMS").
ARTICLE II
TERM
Subject to the provisions of Article VI below, the term of this
Agreement shall be for a period of five years, commencing as of January 1, 1996
and expiring on December 31, 2000. Unless either party shall give to the other
written notice of termination on or before June 30, 2000, the term of this
Agreement shall, on December 31, 2000, be extended for a period of three years,
commencing as of January 1, 2001 and expiring on December 31, 2003.
ARTICLE III
SALARY
3.1 INITIAL SALARY. In full payment for the obligations to be performed
by the Executive during the term of this Agreement, the Company shall pay to the
Executive a salary at an annual rate equal to the sum of (a) Three Hundred
Seventy-Seven Thousand Two Hundred Eleven Dollars ($377,211) and (b) a cost of
living adjustment for the 1995 calendar year determined pursuant to the
provisions of that certain Employment Agreement dated as of June 1, 1992 by and
between the Company and the Executive (the "Previous Agreement") (subject to
applicable payroll and/or other taxes required by law to be withheld).
3.2 ADJUSTMENT OF SALARY. As promptly as practicable after the
conclusion of each of the Company's fiscal years during the term of the
Executive's employment hereunder, the certified public accountants regularly
retained by the Company shall determine the increase, if any, in the cost of
living, using as the basis of such computation the current applicable Consumer
Price Index published by the Bureau of Labor Statistics of the United States
Department of Labor (the "Index").
Any such increase shall be computed as follows:
(a) The Index number in the column for Miami, Florida,
entitled "all items," for the month of January shall be the "Current Index
Number" and the corresponding Index number for the immediately preceding
January, commencing with January 1995, shall be the "Base Index Number."
(b) The increase in the cost of living shall be determined by
dividing the Current Index Number by the Base Index Number and subtracting the
integer 1 from the quotient thereof, and then multiplying the remainder by One
Hundred Percent (100%) in accordance with the following formula:
Increase Current Index Number - 1 x 100%
in = --------------------
Cost of Living Base Index Number
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(c) The percentage increase in the cost of living, multiplied
by the Executive's then current salary, shall be the increase required to be
determined pursuant to this Section 3.2.
(d) If the publication of the Consumer Price Index is
discontinued for any reason, then the parties shall utilize comparable
statistics of the cost of living for the City of Miami, Florida, the City of
Fort Lauderdale, Florida, Dade County, Florida, or Broward County, Florida, as
computed and published by an agency or instrumentality of the United States of
America or by a responsible financial periodical or recognized authority then to
be selected by the parties.
(e) In the absence of fraud or manifest error, any
determination made by the Company's accountants pursuant to this Section 3.2
shall be conclusive and binding upon the Company and the Executive.
(f) The Executive's then current salary shall be adjusted as
of January 1 of each year, commencing as of January 1, 1997, in accordance with
the provisions of this Section 3.2 and such adjustment shall remain in effect
during such year.
3.3 PAYMENT OF SALARY. Payments of salary shall be made to the
Executive in installments from time to time on the same dates payments of salary
are generally made to all senior management employees of the Company.
ARTICLE IV
BONUS
The Executive may receive an annual bonus in an amount
determined by the Board of Directors of the Company, in its discretion, if and
when so determined by the Board of Directors.
ARTICLE V
CERTAIN FRINGE BENEFITS
5.1 GENERALLY. The Executive shall be entitled to receive such benefits
and to participate in such benefit plans as are generally provided from time to
time by the Company to its senior management employees; provided, however, that
nothing contained in this Section 5.1 shall be construed to obligate the Company
to provide any specific benefits to its employees generally.
5.2 VACATIONS. The Executive shall be entitled to vacation time on an
annual basis in accordance with such policies as are from time to time adopted
by the Company's Board of Directors with respect to its senior management
employees.
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5.3 AUTOMOBILE. The Company shall provide the Executive a luxury
automobile for use by the Executive in connection with the performance of his
duties under this Agreement. The Executive shall be entitled to receive
reimbursement for such automobile expenses as are incurred by the Executive in
connection with the performance of his duties under this Agreement. Such
reimbursement shall include the cost of operating the automobile, the cost of
maintenance of such automobile and the cost of insurance of such automobile.
5.4 STOCK OPTIONS. The Executive shall be entitled to participate in
the Company's stock option plans as may from time to time be in effect and to
receive such incentive or other stock options as may from time to time be
granted to him thereunder; provided, however, that nothing contained in this
Section 5.4 shall be construed to obligate the Company, its Board of Directors
or any committee of its Board of Directors to grant any incentive or other stock
option whatsoever to the Executive.
5.5 LIFE INSURANCE. The Company shall purchase and maintain in effect
one or more term insurance policies on the life of the Executive in an aggregate
amount of not less than One Million Dollars ($1,000,000). The beneficiary of
each such policy shall be the person or persons who shall from time to time be
designated in writing by the Executive to the Company. In the absence of any
written designation to the contrary, the beneficiary of all such insurance
policies shall be the Executive's spouse.
5.6 INCOME TAX RETURNS AND ESTATE PLANNING. The Company shall pay for
the cost of preparation of the Executive's annual federal income tax returns and
for reasonable estate planning advice that the Executive receives from time to
time.
5.7 REIMBURSEMENT OF MEDICAL EXPENSES. The Company shall reimburse the
Executive for the full amount of any medical, dental and optical expenses not
covered under any group medical plan from time to time in effect for the benefit
of Company employees generally. Such coverage shall include without limitation
mental health care and treatment and other medical, dental and optical expenses
not covered under the Company's health care plan now or hereafter in effect. The
Company may satisfy its obligation to the Executive under this Section 5.7 by
providing excess medical, dental, optical and other health care insurance
coverage for the Executive's benefit.
5.8 ANNUAL PHYSICAL EXAMINATION. To the extent not covered by any group
medical plan from time to time in effect for the benefit of Company employees
generally or other insurance coverage provided by the Company for the benefit of
the Executive, the Company shall reimburse the Executive for the full cost of a
complete annual physical examination.
5.9 BUSINESS AND ENTERTAINMENT EXPENSES. The Company shall reimburse
the Executive for all reasonable business and entertainment expenses related to
the Executive's position with the Company.
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ARTICLE VI
TERMINATION OF EMPLOYMENT
6.1 CERTAIN DEFINITIONS. The following terms shall have the following
respective meanings when utilized in this Agreement:
(a) "Bonus" shall mean, as of a given date, the most recent
annual bonus awarded by the Company to the Executive.
(b) "Cause" shall mean any action by the Executive or any
inaction by the Executive which constitutes:
(i) fraud, embezzlement, misappropriation, dishonesty
or breach of trust;
(ii) a felony or moral turpitude;
(iii) a material breach or violation of any or all of
the covenants, agreements and obligations of the
Executive set forth in this Agreement, other than as
the result of the Executive's death or Disability (as
hereinafter defined);
(iv) 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
(v) 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 a result of the Executive's death or
Disability;
provided, however, that if the basis for any termination of the Executive's
employment by the Company as set forth in the Termination Notice (as hereinafter
defined) delivered by the Company to the Executive is any or all of the
definitions of Cause set forth in Sections 6.1(b)(iii), 6.1(b)(iv) or 6.1(b)(v)
of this Agreement, then, in such event, the Executive shall have fifteen (15)
days from and after the date of his receipt of such Termination Notice to
present a reasonable plan to cure such action or inaction specified in the
Termination Notice, which plan may require more than fifteen (15) days to cure
the specified action or inaction, but such plan must be reasonably satisfactory
to the Company and the Executive must proceed diligently to effectuate such
plan.
(c) "Compensation" shall mean the sum of the Executive's
Salary (as hereinafter defined) and Bonus.
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(d) "Disability" shall mean any mental or physical illness,
condition, disability or incapacity which prevents the Executive from reasonably
discharging his duties and responsibilities as an officer of the Company. If any
disagreement or dispute shall arise between the Company and the Executive as to
whether the Executive suffers from any Disability, then, in such event, the
Executive shall submit to the physical or mental examination of a physician
licensed under the laws of the State of Florida, who is mutually agreeable to
the Company and the Executive, and such physician shall determine whether the
Executive suffers from any Disability. In the absence of fraud or bad faith, the
determination of such physician shall be final and binding upon the Company and
the Executive. The entire cost of such examination shall be paid for solely by
the Company.
(e) "Good Reason" shall mean:
(i) the assignment by the Board of Directors or the
Executive Committee of the Board of Directors to the
Executive, without his express written consent, of
duties and responsibilities which results in the
Executive having less significant duties and
responsibilities or exercising less significant power
and authority than he had, or duties and
responsibilities or power and authority not
comparable to that of the level and nature which he
had, immediately prior to such assignment;
(ii) the removal of the Executive from, or a failure
to reappoint the Executive to, his then current
position or positions with the Company or its
subsidiaries or affiliates, except (A) with the
Executive's express written consent or (B) in
connection with any termination of the Executive's
employment by the Company as the result of the
Executive's Protracted Disability (as hereinafter
defined) or for Cause;
(iii) the reduction of the Executive's Salary or the
reduction of any or all of the Executive's benefits
set forth in Article V above;
(iv) the Company's failure to perform on a timely
basis its obligations under this Agreement;
(v) the Company's requiring the Executive, without
his express written consent, to travel on Company
business to an extent substantially greater than the
Executive's business travel obligations immediately
prior to such time;
(vi) the Company's requiring the Executive, without
his express written consent, to change his place of
permanent residency to place outside of Broward
County, Florida;
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(vii) the Company's moving its executive offices to a
place outside of Broward County, Florida, without the
Executive's express written consent; or
(viii) the failure of the Company to obtain the
express written assumption of, and agreement to
perform on a timely basis, the Company's obligations
under this Agreement by any successor to the Company
as required by Article IX of this Agreement.
(f) "Protracted Disability" shall mean any Disability which
prevents the Executive from reasonably discharging his duties and
responsibilities as an officer of the Company for a period of twelve (12)
consecutive months.
(g) "Salary" shall mean, as of a given date, the Executive's
then current annual salary.
(h) "Termination Date" shall mean a specific date not less
than forty-five (45) nor more than ninety (90) days from and after the date of
any Termination Notice upon which the Executive's employment by the Company
shall be terminated in accordance with the provisions of this Agreement.
(i) "Termination Notice" shall mean a written notice which
sets forth (i) the specific provision of this Agreement relied upon to terminate
the Executive's employment, (ii) in reasonable detail the facts and
circumstances claimed to provide the basis for the termination of the
Executive's employment, and (iii) a Termination Date.
6.2 TERMINATION OF EMPLOYMENT.
(a) Notwithstanding the provisions of Article II hereof, this
Agreement (i) shall automatically terminate upon the death of the Executive
pursuant to the provisions of Section 6.3 hereof, (ii) may be terminated at any
time by the Company pursuant to the provisions of Sections 6.4 or 6.5 hereof,
and (iii) may be terminated at any time by the Executive pursuant to the
provisions of Section 6.6 hereof.
(b) If either the Company or the Executive shall desire to
terminate the Executive's employment by the Company pursuant to any of the
provisions of Sections 6.4, 6.5 or 6.6 of this Agreement, then, in such event,
the party causing such termination shall provide a Termination Notice to the
other party.
(c) If this Agreement shall be terminated pursuant to any of
the provisions of this Article VI, the Company shall be discharged from all of
its obligations to the Executive under this Agreement upon the payment to the
Executive of the amount set forth in the Section of this Article VI pursuant to
which such termination shall occur. The Executive's sole and exclusive remedy
for
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the termination of this Agreement, regardless of whether such termination shall
be initiated by the Company or the Executive, and regardless of whether such
termination shall be with or without Cause, shall be the payment by the Company
to the Executive of the amount set forth in the Section of this Article VI
pursuant to which such termination shall occur.
6.3 TERMINATION UPON DEATH OF EXECUTIVE. If during the term of this
Agreement the Executive shall die, then the employment of the Executive by the
Company shall automatically terminate on the date of the Executive's death. In
such event, not more than thirty (30) days after the date of the Executive's
death, the Company shall pay to the Executive's estate or as otherwise directed
by the Executive's personal representative, an amount in cash equal to the
Executive's Compensation (subject to applicable payroll and/or other taxes
required by law to be withheld) determined as of the date of the Executive's
death.
6.4 DISABILITY OF EXECUTIVE.
(a) In the event that at any time during the term of this
Agreement the Executive shall suffer any Disability, then the Company shall be
obligated to continue to pay in the ordinary and normal course of its business
to the Executive or his legal representative, as the case may be, the
Executive's Compensation (subject to applicable payroll and/or other taxes
required by law to be withheld) from the date that the Executive shall first
suffer any such Disability to the date that the Executive's employment by the
Company shall be terminated pursuant to any of the provisions of this Agreement.
(b) In the event that the Executive shall suffer any
Protracted Disability during the term of this Agreement, then the Company may
terminate the Executive's employment under this Agreement. In such event, in
addition to any other benefits which may have been provided by the Company to
the Executive or his legal representative, as the case may be, pursuant to the
provisions of Section 6.4(a) above, not later than the Termination Date
specified in the Termination Notice delivered by the Company to the Executive or
his legal representative, as the case may be, the Company shall pay to the
Executive or as otherwise directed by the Executive's legal representative an
amount in cash equal to the Executive's Compensation (subject to applicable
payroll and/or taxes required by law to be withheld) determined as of the date
of such Termination Notice. Subsequent to such Termination Date, the Executive
or his legal representative, as the case may be, shall also be entitled to
receive any benefits which may be payable under any disability insurance policy
or disability plan provided to the Executive by the Company.
6.5 TERMINATION OF EMPLOYMENT BY COMPANY.
(a) The Company may terminate this Agreement at any time with
Cause. In such event, the Company shall be obligated to continue to pay in the
ordinary and normal course of its business to the Executive only his Salary
(subject to applicable payroll and/or other taxes required by law to be
withheld) through the Termination Date set forth in the Termination Notice.
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(b) The Company may terminate this Agreement at any time
without Cause. If any such termination shall occur on or before December 31,
2000, then, in such event, not later than the Termination Date specified in the
Termination Notice, the Company shall pay to the Executive, in cash, an amount
equal to (i) the Executive's Compensation, determined as of the date of the
Termination Notice, multiplied by (ii) the greater of (A) the number of years
and any portion of a year remaining in the term of this Agreement or (B) three
(subject to applicable payroll and/or other taxes required by law to be
withheld). If any such termination shall occur after December 31, 2000, then, in
such event, not later than the Termination Date specified in the Termination
Notice, the Company shall pay to the Executive, in cash, an amount equal to (i)
the Executive's Compensation, determined as of the date of the Termination
Notice, multiplied by (ii) three (subject to applicable payroll and/or other
taxes required by law to be withheld).
6.6 TERMINATION OF EMPLOYMENT BY EXECUTIVE.
(a) The Executive may terminate this Agreement at any time
with Good Reason. If any such termination shall occur on or before December 31,
2000, then, in such event, not later than the Termination Date specified in the
Termination Notice, the Company shall pay to the Executive, in cash, an amount
equal to (i) the Executive's Compensation, determined as of the date of the
Termination Notice, multiplied by (ii) the greater of (A) the number of years
and any portion of a year remaining in the term of this Agreement or (B) three
(subject to applicable payroll and/or other taxes required by law to be
withheld). If any such termination shall occur after December 31, 2000, then, in
such event, not later than the Termination Date specified in the Termination
Notice, the Company shall pay to the Executive, in cash, an amount equal to (i)
the Executive's Compensation, determined as of the date of the Termination
Notice, multiplied by (ii) three (subject to applicable payroll and/or other
taxes required by law to be withheld).
(b) The Executive may terminate this Agreement at any time
without Good Reason. In such event, the Company shall be obligated to continue
to pay in the ordinary and normal course of its business to the Executive only
his Salary (subject to applicable payroll and/or other taxes required by law to
be withheld) through the Termination Date set forth in the Termination Notice.
ARTICLE VII
TERMINATION OF EMPLOYMENT
SUBSEQUENT TO A CHANGE IN CONTROL OF THE COMPANY
7.1 CHANGE IN CONTROL OF THE COMPANY DEFINED. For purposes of this
Article VII, the term "Change in Control of the Company" shall mean any change
in control of the Company of a nature which would be required to be reported (a)
in response to Item 6(e) of Schedule 14A of Regulation 14A, as in effect on the
date of this Agreement, promulgated under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), (b) in response to Item 1 of the Current
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Report on Form 8-K, as in effect on the date of this Agreement, promulgated
under the Exchange Act, or (c) in any filing by the Company with the Securities
and Exchange Commission; provided, however, that, without limitation, a Change
in Control of the Company shall be deemed to have occurred if:
(i) any "person" (as such term is defined in Sections
13(d)(3) and 14(d)(2) of the Exchange Act), other
than the Company, any majority-owned subsidiary of
the Company or any compensation plan of the Company
or any majority-owned subsidiary of the Company,
becomes the "beneficial owner" (as such term is
defined in Rule 13d-3 of the Exchange Act), directly
or indirectly, of securities of the Company (whether
by merger, consolidation, reorganization or
otherwise) representing fifteen percent (15%) or more
of the combined voting power of the Company's then
outstanding securities;
(ii) during any period of two consecutive years
during the term of this Agreement, the individuals
who at the beginning of such period constitute the
Board of Directors of the Company cease for any
reason to constitute at least a majority of such
Board of Directors, unless the election of each
director who was not a director at the beginning of
such period has been approved in advance by directors
representing at least two-thirds of the directors
then in office who were directors at the beginning of
such period;
(iii) any "person" (as such term is defined in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act),
other than the Company, any subsidiary of the Company
or any compensation, retirement, pension or other
employee benefit plan or trust of the Company or any
subsidiary of the Company, becomes the "beneficial
owner" (as such term is defined in Rule 13d-3
promulgated under the Exchange Act), directly or
indirectly, of securities of HMS, HAA or HOMS,
respectively, or any successor to HMS, HAA or HOMS,
respectively (whether by merger, consolidation,
reorganization or otherwise) representing a majority
of the combined voting power of the then outstanding
securities of HMS, HAA or HOMS, as the case may be;
(iv) the Company shall merge or consolidate with or
into another corporation or other entity, or enter
into a binding agreement to merge or consolidate with
or into another corporation or other entity, other
than a merger or consolidation which would result in
the voting securities of the Company outstanding
immediately prior thereto continuing to represent
(either by remaining outstanding or by being
converted into voting securities of the surviving
corporation or entity) not less than eighty-five
percent (85%) of the combined voting power of the
voting securities of the Company or such surviving
corporation or entity outstanding immediately after
such merger or consolidation;
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(v) HMS shall merge or consolidate with or into
another corporation or other entity, or enter into a
binding agreement to merge or consolidate with or
into another corporation or other entity, other than
a merger or consolidation which would result in the
voting securities of HMS outstanding immediately
prior thereto continuing to represent (either by
remaining outstanding or by being converted into
voting securities of the surviving corporation or
entity) not less than a majority of the combined
voting power of the voting securities of HMS or such
surviving corporation or entity outstanding
immediately after such merger or consolidation;
(vi) HAA shall merge or consolidate with or into
another corporation or other entity, or enter into a
binding agreement to merge or consolidate with or
into another corporation or other entity, other than
a merger or consolidation which would result in the
voting securities of HAA outstanding immediately
prior thereto continuing to represent (either by
remaining outstanding or by being converted into
voting securities of the surviving corporation or
entity) not less than a majority of the combined
voting power of the voting securities of HAA or such
surviving corporation or entity outstanding
immediately after such merger or consolidation;
(vii) HOMS shall merge or consolidate with or into
another corporation or other entity, or enter into a
binding agreement to merge or consolidate with or
into another corporation or other entity, other than
a merger or consolidation which would result in the
voting securities of HOMS outstanding immediately
prior thereto continuing to represent (either by
remaining outstanding or by being converted into
voting securities of the surviving corporation or
entity) not less than a majority of the combined
voting power of the voting securities of HOMS or such
surviving corporation or entity outstanding
immediately after such merger or consolidation;
(viii) the Company shall sell, lease, exchange,
transfer, convey or otherwise dispose of all or
substantially all of its assets, or enter into a
binding agreement for the sale, lease, exchange,
transfer, conveyance or other disposition of all or
substantially all of its assets, in one transaction
or in a series of related transactions;
(ix) any of HMS, HAA or HOMS shall sell, lease,
exchange, transfer, convey or otherwise dispose of
all or substantially all of its respective assets, or
enter into a binding agreement for the sale, lease,
exchange, transfer, conveyance or other disposition
of all or substantially all of its respective assets,
in one transaction or in a series of related
transactions;
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(x) the Company shall liquidate or dissolve, or any
plan or proposal shall be adopted for the liquidation
or dissolution of the Company; or
(xi) any of HMS, HAA or HOMS shall liquidate or
dissolve, or any plan or proposal shall be adopted
for the liquidation or dissolution of any of HMS, HAA
or HOMS.
7.2 TERMINATION OF EMPLOYMENT AFTER CHANGE IN CONTROL OF COMPANY.
(a) Notwithstanding the provisions of Articles II and VI of
this Agreement, in the event that there shall occur any Change in Control of the
Company and at any time subsequent to the date of any such Change in Control of
the Company, either the Company shall terminate the employment of the Executive
without Cause or the Executive shall terminate his employment for Good Reason,
then, in any such event, the following shall occur:
(i) Not later than the Termination Date specified in
the Termination Notice delivered by the Company to
the Executive, or by the Executive to the Company, as
the case may be, the Company shall pay to the
Executive an amount, in cash, equal to his "base
amount," as such term is defined in Section 280G of
the Internal Revenue Code of 1986, as amended, and
the rules and regulations promulgated thereunder,
determined as of the date of the Termination Notice,
multiplied by Two and Ninety-Nine One Hundredths
(2.99) (the "Change in Control Termination Amount")
(subject to applicable payroll and/or other taxes
required by law to be withheld); and
(ii) Any and all stock options granted to the
Executive under any stock option plan of the Company
as may from time to time be in effect, which shall
not by their terms have vested on or before such
Termination Date, shall vest on such Termination
Date.
(b) The Change in Control Termination Amount shall be
determined by the Company's regularly retained certified public accountants in
consultation with the Company's regularly retained attorneys. In making such
determination, the Company's regularly retained certified public accountants and
attorneys shall liberally construe the provisions of the Internal Revenue Code
of 1986, as amended, and the applicable rules and regulations thereunder. In the
absence of fraud or manifest error, any determination made pursuant to this
Section 7.2(b) shall be conclusive and binding upon the Company and the
Executive.
(c) Notwithstanding anything to the contrary set forth in
Sections 7.2(a) and 7.2(b) above, the amount paid by the Company to the
Executive shall be limited to the maximum amount which will not constitute a
"parachute payment," as such term is defined in Section 280G(b)(2) of the
Internal Revenue Code of 1986, as amended. This limitation shall first be
applied to amounts provided pursuant to clause (ii) of Section 7.2(a) hereof
(otherwise included in the
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calculation of a parachute payment) to the extent thereof and then to amounts
provided pursuant to clause (i) of Section 7.2(a) hereof.
ARTICLE VIII
CERTAIN RESTRICTIONS ON THE EXECUTIVE
8.1 CERTAIN RESTRICTIONS. The Executive covenants and agrees with the
Company as follows:
(a) He shall not at any time, directly or indirectly, for
himself or any other person, firm, corporation, partnership, association or
other entity (collectively, a "Person") which competes in any manner with the
Company or any of its subsidiaries or affiliates in the United States of America
or its territories and possessions or any other countries in which the Company
as of the date of termination of this Agreement conducts its business directly
or indirectly through any of its subsidiaries or affiliates (collectively, the
"Territory"), employ, attempt to employ or enter into any contractual
arrangement for employment with, any employee or former employee of the Company
or any of its subsidiaries or affiliates, unless such former employee shall not
have been employed by the Company or any of its subsidiaries or affiliates for a
period of at least one year.
(b) He shall not, during the term of this Agreement and for a
period of three years from and after the date of termination of this Agreement,
directly or indirectly, (i) acquire or own in any manner any interest in, or
loan any amount to, any Person which competes in any manner with the Company or
any of its subsidiaries or affiliates in the Territory, (ii) be employed by or
serve as an employee, agent, officer, or director of, or as a consultant to, any
Person, other than the Company and its subsidiaries and affiliates, which
competes in any manner with the Company or its subsidiaries or affiliates in the
Territory, or (iii) compete in any manner with the Company or its subsidiaries
or affiliates in the Territory. The foregoing provisions of this Section 8.1(b)
shall not prevent the Executive from acquiring and owning not more than three
percent (3%) of the equity securities of any Person whose securities are listed
for trading on a national securities exchange or are regularly traded in the
over-the-counter securities market.
(c) In the course of the Executive's employment by the
Company, the Executive will have access to confidential or proprietary
information of the Company and its subsidiaries and affiliates. The Executive
shall not at any time divulge or communicate to any Person, or use to the
detriment of the Company or its subsidiaries or affiliates, any such
confidential or proprietary information. The term "confidential or proprietary
information" shall mean information not generally available to the public,
including without limitation personnel information, financial information,
customer lists, supplier lists, ownership information, marketing plans and
analyses, trade secrets, know-how, computer software, management agreements and
procedures and techniques of operating and managing the business of the Company
and its subsidiaries and affiliates. The Executive acknowledges and agrees that
all confidential or proprietary information
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is and shall remain the property of the Company and its subsidiaries and
affiliates, and agrees to maintain all such confidential or proprietary
information in strictest confidence.
8.2 REMEDIES. It is recognized and acknowledged by each of the Company
and the Executive that a breach or violation by the Executive of any or all of
his covenants and agreements contained in Section 8.1 of this Agreement will
cause irreparable harm and damage to the Company and its subsidiaries and
affiliates in a monetary amount which would be virtually impossible to ascertain
and, therefore, will deprive the Company of an adequate remedy at law.
Accordingly, if the Executive shall breach or violate any or all of his
covenants and agreements set forth in Section 8.1 hereof, then the Company and
its subsidiaries and affiliates shall have resort to all equitable remedies,
including without limitation the remedies of specific performance and
injunction, both permanent and temporary, as well as all other remedies which
may be available at law.
8.3 INTENT. It is the intent of the parties that the restrictions set
forth in Section 8.1 hereof shall be enforced to the fullest extent permissible
under the laws and public policies of each jurisdiction in which enforcement of
such restrictions may be sought. If any provision contained in Section 8.1
hereof shall be adjudicated by a court of competent jurisdiction to be invalid
or unenforceable because of its duration or geographic scope, then such
provision shall be reduced by such court in duration or geographic scope or both
to such extent as to make it valid and enforceable in the jurisdiction where
such court is located, and in all other respects shall remain in full force and
effect.
ARTICLE IX
SUCCESSOR TO THE COMPANY
The Company shall require any successor, whether direct or
indirect, and whether by purchase, merger, consolidation or otherwise, to all or
substantially all of the business or properties and assets of the Company, to
execute and deliver to the Executive, not later than the date of the
consummation of any such purchase, merger, consolidation or other transaction, a
written instrument in form and in substance reasonably satisfactory to the
Executive and his legal counsel pursuant to which any such successor shall agree
to assume and to perform on a timely basis or to cause to be performed on a
timely basis all of the Company's covenants, agreements and obligations set
forth in this Agreement (a "Successor Agreement"). The failure of the Company to
cause any such successor to execute and deliver a Successor Agreement to the
Executive shall (a) constitute a breach of the provisions of this Agreement by
the Company and (b) be deemed to constitute a termination by the Executive of
his employment hereunder (as of the date upon which any such successor shall
succeed to all or substantially all of the business or properties and assets of
the Company) for Good Reason.
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ARTICLE X
ATTORNEYS' FEES
In the event that any litigation shall arise between the
Company and the Executive based, in whole or in part, upon this Agreement or any
or all of the provisions contained herein, then, in any such event, the
prevailing party in any such litigation shall be entitled to recover from the
non-prevailing party, and shall be awarded by a court of competent jurisdiction,
any and all reasonable fees and disbursements of trial and appellate counsel
paid, incurred or suffered by such prevailing party as the result of, arising
from, or in connection with, any such litigation.
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 GOVERNING LAW. This Agreement shall be governed by, and shall be
construed and interpreted in accordance, with the laws of the State of Florida,
without giving effect to the principles of conflicts of law thereof.
11.2 NOTICES. Any and all notices and other communications required or
permitted to be given pursuant to this Agreement shall be in writing and shall
be deemed to have been duly given when delivered by hand, or when delivered by
United States mail, by registered or certified mail, postage prepaid, return
receipt requested, to the respective parties at the following respective
addresses:
If to the Company: Homeowners Group, Inc.
0000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
If to the Executive: Xxxx Xxxxxxxxxx
000 Xxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000
or to such other address as either party may from time to time give written
notice of to the other in accordance with the provisions of this Section 11.2.
11.3 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the Company and the Executive with respect to the subject matter hereof
and supersedes all prior agreements, understandings, negotiations and
arrangements, both oral and written, between the Company and the Executive with
respect to such subject matter. Without limiting the generality of
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the immediately preceding sentence, and except as otherwise provided in Section
3.1 above, the Previous Agreement is superseded by this Agreement and shall be
of no further force or effect from and after January 1, 1996.
11.4 AMENDMENTS. This Agreement may not be amended or modified in any
manner, except by a written instrument executed by each of the Company and the
Executive.
11.5 BENEFITS; BINDING EFFECT. This Agreement shall be for the benefit
of, and shall be binding upon, each of the Company and the Executive and their
respective heirs, personal representatives, executors, legal representatives,
successors and assigns.
11.6 SEVERABILITY. The invalidity of any one or more of the words,
phrases, sentences, clauses or sections contained in this Agreement shall not
affect the enforceability of the remaining portions of this Agreement or any
part hereof, all of which are inserted conditionally on their being valid in
law. Except as otherwise provided in Section 8.3 above, if any one or more of
the words, phrases, sentences, clauses or sections contained in this Agreement
shall be declared invalid by any court of competent jurisdiction, then, in any
such event, this Agreement shall be construed as if such invalid word or words,
phrase or phrases, sentence or sentences, clause or clauses, or section or
sections had not been inserted.
11.7 NO WAIVERS. The waiver by either party of a breach or violation
of any provision of this Agreement by the other party shall not operate nor be
construed as a waiver of any subsequent breach or violation. The waiver by
either party to exercise any right or remedy it or he may possess shall not
operate nor be construed as a bar to the exercise of such right or remedy by
such party upon the occurrence of any subsequent breach or violation.
11.8 JURISDICTION AND VENUE; SERVICE OF PROCESS; WAIVER OF TRIAL BY
JURY.
(a) Any claim or dispute arising out of, connected with, or in
any way related to this Agreement which results in litigation shall be
instituted by the complaining party and adjudicated either in the Federal
District Court for the Southern District of Florida or in the Circuit Court for
Broward County, Florida, and each of the parties to this Agreement consent to
the personal jurisdiction of and venue in such courts. In no event shall either
party to this Agreement contest the jurisdiction or venue of such courts with
respect to any such litigation.
(b) Each of the Company and the Executive agrees that service
of any process, summons, notice or document, by United States registered or
certified mail, to its or his address set forth in or as provided in Section
11.2 above shall be effective service of such process, summons, notice or
document for any action, suit or proceeding brought against it or him by the
other party in the Federal District Court for the Southern District of Florida
or in the Circuit Court for Broward County, Florida.
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(c) In recognition of the fact that the issues which would
arise under this Agreement are of such a complex nature that they could not be
properly tried before a jury, each of the Company and the Executive waives trial
by jury.
11.9 HEADINGS. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of any or all of the provisions hereof.
11.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the separate parties in separate counterparts, each of which
shall be deemed to constitute an original and all of which shall be deemed to
constitute the one and the same instrument.
IN WITNESS WHEREOF, each of the parties hereto has executed and
delivered this Agreement on the date first written above.
HOMEOWNERS GROUP, INC.
By /s/ C. Xxxxxxx Xxxxxx
----------------------------
C. Xxxxxxx Xxxxxx,
Vice President and
Chief Financial Officer
/s/ Xxxx Xxxxxxxxxx
----------------------------
Xxxx Xxxxxxxxxx
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