Exhibit 99.4
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into as of March 23,
1998 by and between Xxxxxx Xxxxxxxx, an individual ("Berglass"), and DEP
Corporation, a Delaware corporation (the "Company").
W I T N E S S E T H:
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WHEREAS, Berglass is currently the Chairman, President and Chief Executive
Officer of the Company; and
WHEREAS, the Board of Directors of DEP has determined that it is in the
best interests of DEP and the stockholders of DEP that Berglass' continued
employment by the Company be assured and the terms of such employment
established pursuant to this Agreement; and
WHEREAS, Berglass is willing to enter into an employment agreement on the
terms and conditions set forth herein;
NOW THEREFORE, in consideration of the mutual covenants set forth herein,
and for other good and valuable consideration, receipt of which is hereby
acknowledged, the parties do hereby agree as follows:
A G R E E M E N T:
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1. EMPLOYMENT BY THE COMPANY AND TERM.
(a) POSITION AND REPORTING. Subject to the terms set forth herein,
the Company agrees to employ Berglass as Chairman, President and Chief Executive
Officer and Berglass hereby accepts such employment. During the term of his
employment hereunder, Berglass will report solely and directly to the Board of
Directors of the Company (the "Board"). During the term of his employment
hereunder, the Company will nominate and recommend Berglass for re-election as a
director at each annual meeting of stockholders coinciding with the expiration
of his term as a director.
(b) FULL TIME AND BEST EFFORTS. During the term of his employment
with the Company; Berglass will devote substantially all of his business time,
except for sick leave, vacations and approved leaves of absence, and use his
best efforts to advance the business and welfare of the Company. During the
term of Berglass' employment, he will not engage in any other employment or
business activities that would be directly harmful or detrimental to, or that
may compete with, the business and affairs of the Company, or that would
interfere with his duties hereunder. However, the foregoing will not prevent
Berglass from devoting a reasonable amount of time to personal investment, civic
and charitable activities.
(c) DUTIES. Berglass' duties during the term of his employment
hereunder shall be consistent with those in effect immediately prior to the
execution of this Agreement and shall be such as are customarily associated with
his position in a corporation of the size and nature of the Company, consistent
with the Bylaws of the Company. Berglass' principal place of business shall be
in Los Angeles, California or its neighboring communities, subject to normal and
reasonable requirements for business travel. Subject to the authority of the
Board of Directors, Berglass shall have the authority to hire or terminate, and
to establish compensation for all subordinate officers and employees of the
Company and to establish stock option levels for all non-executive officer
subordinate employees of the Company.
(d) COMPANY POLICIES. The employment relationship between the
parties will be governed by the general employment policies and practices of the
Company, including but not limited to those relating to protection of
confidential information and assignment of inventions, except that when the
terms of this Agreement differ from or are in conflict with the Company's
general employment policies or practices, this Agreement will control.
(e) TERM. The term of this Agreement ("Employment Term") will begin
as of March 23, 1998 and end on March 23, 2003. Such term shall automatically
be renewed for additional one year terms unless either party has given written
notice to the other at least six months prior to the expiration of this
Agreement.
2. COMPENSATION AND BENEFITS.
(a) SALARY. Berglass will receive for services to be rendered
hereunder a base salary at the annual rate of Five Hundred Sixty-Five Thousand
Three Hundred and Fifty Four Dollars ($565,354) payable at least as frequently
as every other week and subject to payroll deductions as may be necessary or
customary in respect of the Company's salaried employees. Such amount, as it
may be increased from time to time hereunder, is referred to herein as the "Base
Salary". The Base Salary will be subject to review at least annually and to
increase (but not decrease) at such times and in such amounts as the Board may
approve. In the event that the Company, in its sole discretion, from time to
time determines to increase the Base Salary, such increased amount shall, from
and after the effective date of the increase, constitute "Base Salary" for
purposes of this Agreement.
(b) PARTICIPATION IN INSURANCE AND BENEFIT PLANS. During the
Employment Term, DEP shall maintain in full force and effect, at its expense,
the $1,000,000 life insurance policy heretofore maintained by it on Berglass'
life (the "Berglass Life Policy"). In addition, Berglass and his wife will be
entitled to participate in any insurance, hospitalization, medical, dental,
health, accident, disability or similar plan or program of the Company now
existing or established hereafter until such time, in the case of each such
person, as he or she shall be entitled to medical and hospital benefits under
Medicare. In the event Berglass or his wife is not eligible to participate in
any plan or program of the Company under the general provisions thereof, the
Company will make arrangements for such participation (including any necessary
amendment of the applicable plan) if permitted by applicable law and, except as
otherwise provided in Sections 5(d), 5(e) and 6(c) if the cost of doing so is
not unreasonable or if such cost
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is reimbursed to the Company by the affected person. Following the Employment
Term, or if later the termination of Berglass' employment, the provision of any
benefit to Berglass' wife pursuant to this Section 2(b) shall be at her election
and expense. The Company may, in its sole discretion and from time to time,
amend, eliminate or establish additional benefit programs as it deems
appropriate. Berglass will also participate in all fringe benefits offered by
the Company to any of its senior Executives.
3. INCENTIVE, BONUS AND OPTION PLANS. During the Employment Term,
Berglass will be entitled to participate in the bonus plan set forth in Exhibit
A attached hereto. Upon expiration of such plan, a new performance bonus
program will be developed, which shall provide the opportunity for Berglass to
receive future bonuses on a basis: (a) no less favorable than provided under the
plan set forth in Exhibit A; and (b) no less favorable than those applying to
other senior Executives of the Company. In addition, Berglass will, during the
Employment Term, be entitled to participate on terms and conditions appropriate
to his position and responsibilities at the Company in deferred compensation,
retirement, stock option and other compensation plans of the Company currently
or hereafter made available by the Company to senior Executives of the Company
4. PERQUISITES, VACATIONS AND REIMBURSEMENT OF EXPENSES. During the term
of the Berglass' employment:
(a) The Company will furnish Berglass with, and Berglass will be
allowed full use of, office facilities, automobiles (including maintenance,
repairs and insurance), secretarial and clerical assistance and other Company
property and services commensurate with his position and of at least comparable
quality, nature and extent to those made available to Berglass prior to the date
hereof or, if greater, those made available to other senior Executives of the
Company from time to time.
(b) Berglass will be allowed four weeks paid vacation per year to be
taken at such times as Berglass may designate.
(c) The Company will reimburse Berglass for all monies which he has
expended for purposes of the Company's business, including entertainment, such
reimbursement to be effected in accordance with Company reimbursement practices,
policies and procedures as in effect prior to the date hereof. The parties
agree that Berglass shall be entitled to first class travel and accommodations
in connection with all business travel on behalf of the Company.
5. TERMINATION OF EMPLOYMENT.
(a) DEFINITIONS. The following definitions will apply to Sections 5
and 6 as applicable:
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(i) JUST CAUSE. The term "Just Cause" means: (A) conviction
of a felony involving moral turpitude, or (B) willful gross neglect or
willful gross misconduct in carrying out Berglass' duties under this
Agreement, resulting in material economic harm to the Company, unless
Berglass believed in good faith that such conduct was in, or not contrary
to, the best interests of the Company.
(ii) DISABILITY. The term "Disability" means the inability of
Berglass due to illness (mental or physical), accident, or otherwise, to
perform his duties for any period of 180 consecutive days, as determined by
an independent physician selected by the Company and reasonably acceptable
to Berglass or his legal representative. Any return to work from a period
of disability must be authorized by Berglass' physician.
(iii) GOOD REASON. The term "Good Reason" means: (A) a
material breach of this Agreement by the Company; (B) without Berglass'
prior written consent, assignment to Berglass of duties materially
inconsistent in any respect with his position or any other action by the
Company that results in a material diminution in Berglass' position,
authority, duties or responsibilities, it being expressly understood that a
change in Berglass' reporting responsibility so that he does not report
directly and solely to the Board will constitute "Good Reason"; (C) any
transaction in which the Company becomes a subsidiary of another
corporation or which is described in clause (iii) of the definition of
"Change in Control" in Section 6(a) below; (D) reduction, without Berglass'
prior written consent, of Berglass' Base Salary, or his bonus or other cash
incentive compensation opportunity; (E) any material reduction of fringe
benefits provided to Berglass; (F) assignment of Berglass, without his
prior written consent, to a Company office located more than 25 miles from
Berglass' current office location; or (G) the Company's failure to obtain
an agreement from any successor or assign of the Company to assume and to
agree to perform this Agreement.
(iv) NOTICE OF TERMINATION. The term "Notice of Termination"
means a notice which indicates the specific termination provision in this
Agreement relied upon and sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of employment
under the provision so indicated. Any purported termination of employment
by the Company or by Berglass must be communicated by written Notice of
Termination to the other party hereto in accordance with Section 11(a)
hereof. With respect to any termination of employment by Berglass for Good
Reason, Berglass will have 180 days following the occurrence of any event
described in Section 5(a)(iii) to provide the Company with Notice of
Termination, and may not do so thereafter.
(v) TERMINATION DATE. The term "Termination Date" means:
(i) if Berglass terminates his employment for Good Reason, the date that is
60 days after Notice of Termination is given and (ii) if Berglass'
employment is terminated by the Company other than for Just Cause, death or
Disability, the date that is 30 days after Notice of Termination is given.
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(b) TERMINATION BY THE COMPANY FOR JUST CAUSE. The Board may
terminate Berglass' employment with the Company at any time for Just Cause,
immediately upon notice to Berglass of the circumstances leading to such
termination for Just Cause. In the event that Berglass' employment is
terminated for Just Cause, Berglass will receive payment for all accrued salary
and vacation time through the Termination Date, which in this event will be the
date upon which Notice of Termination is given; and the Company shall continue
to provide the benefits specified under Section 2(b) as specified therein.
Except as set forth in this paragraph (b), the Company will have no further
obligation to pay severance of any kind whether under this Agreement or
otherwise nor to make any payment in lieu of notice. Berglass shall have the
right, by notice in writing to the Company, to receive an assignment of the
Berglass Life Policy, upon payment to the Company of the cash surrender value
thereof.
(c) TERMINATION BY BERGLASS FOR GOOD REASON. Berglass will have the
right, at his election, to terminate his employment with the Company by written
notice to the Company to that effect for a period of 180 days following any
occurrence constituting Good Reason; PROVIDED, HOWEVER, that termination for
Good Reason will not be effective until Berglass gives written notice specifying
the occurrence constituting Good Reason and, PROVIDED that if such occurrence is
curable, the Company fails to correct it within 10 days after the receipt of the
applicable notice.
(d) TERMINATION BY THE COMPANY WITHOUT JUST CAUSE OR BY BERGLASS FOR
GOOD REASON. In the event that Berglass' employment is terminated by the
Company (other than pursuant to Section 5(b)) or such employment is terminated
by Berglass for Good Reason, (and in either such case Berglass is not entitled
to benefits pursuant to Section 6(b)), the Company agrees to pay or provide to
Berglass as termination compensation the following:
(i) A single lump sum payment, payable in cash within five
days of the Termination Date, equal to the sum of:
(A) the accrued portion of any Base Salary and
vacation through the Termination Date; plus
(B) an amount representing bonus and all other cash
incentive compensation for such period determined by multiplying:
(I) the greater of the following ("Assumed Incentive
Compensation"): (x) the average of such bonus and other cash
incentive compensation accrued for each of the three preceding
full years, (y) the amount of such bonus and other cash incentive
compensation accrued for the immediately preceding year, and (z)
the projected amount of such bonus and other cash incentive
compensation for the year in which termination occurs, based upon
the most recent available interim results of operations and
projected results of operations for the remainder of such year,
prepared by the Company in the normal course of its business; by
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(II) the fraction of the year of termination elapsed
prior to the Termination Date; plus
(C) the total amount of:
(I) Berglass' Base Salary in effect upon the
Termination Date for the remaining part of the Employment Term,
plus
(II) incentive compensation for the remaining part of
the Employment Term, at the rate per year of the Assumed
Incentive Compensation,
less standard withholdings for tax and social security purposes.
(ii) All stock options, restricted stock or other equity
awards then held by Berglass will automatically be deemed amended, without
further action on the part of the Company or Berglass, so that (A) all
options will be fully vested and not subject to forfeiture or expiration by
reason of Berglass' termination, and will be subject to exercise in full
until the end of the Employment Term or their normal expiration date,
whichever comes first; and (B) all restricted stock or other equity awards
subject to vesting prior to the end of the Employment Term will be fully
vested and all restrictions thereon will lapse.
(iii) All benefits provided under Section 2(b) will continue as
specified herein.
(A) Notwithstanding the foregoing, to the extent any
such benefit referred to in Section 2(b) cannot be provided through
the applicable plan of the Company, the Company will provide such
benefit outside of the plan or will provide a cash lump sum payment
equal to the value of such additional benefit.
(B) The Company shall meet its obligation under (A),
above, in connection with its group medical/dental plan for the period
ending on the date Berglass ceases to be eligible for continuation
coverage under the Company's group medical/dental plan pursuant to the
provisions of COBRA, by providing the continuation of such coverage at
Company expense, contingent upon the Berglass' timely election of such
coverage under COBRA.
(C) To the extent required to avoid adverse tax
consequences under Section 105(h) of the Internal Revenue Code of 1986
(the "Code"), the Company's payments under this Section 5(d)(iii) will
be recognized by Berglass in his taxable income and Berglass will
receive, in addition, a "gross-up" payment to hold Berglass from and
to insulate him from all of the effects of any income or other tax
liability attributable to such recognized income; provided that such
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gross-up shall, if necessary, be limited consistent with principles of
paragraph 6(c)(v), below.
(iv) Berglass shall have the right, by notice in writing to
the Company, to receive an assignment of the Berglass Life Policy, upon
payment to the Company of the cash surrender value thereof.
(e) TERMINATION BY REASON OF DEATH OR DISABILITY. This Agreement
will terminate upon the death of Berglass; and Berglass' employment hereunder
may be terminated by Berglass or the Company, at either of their election, upon
Berglass' Disability. In the event Berglass' employment is terminated as the
result of death or Disability, except as set forth in the following sentence,
Berglass, or his estate or legal representative, will be entitled to receive the
accrued portion of any Base Salary and vacation through the Termination Date,
plus any unreimbursed business expenses, plus for the remainder of the
Employment Term: (i) periodically not less frequently than every other week in
accordance with the Company's normal payroll practice, payments at the rate of
his then Base Salary; and (ii) at the normal and customary time for payment of
bonuses and all other cash incentive compensation, incentive compensation for
the remaining part of the Employment Term, at the rate per year of the Assumed
Incentive Compensation; in each case subject to any applicable withholdings for
tax and social security purposes. In addition, all benefits provided in Section
2(b) will continue as specified therein. The payments provided in this Section
5(e) will be reduced by the amount of any payments made to Berglass pursuant to
any disability or life insurance policy (other than the Berglass Life Policy)
provided by the Company for this purpose, which insurance policy is in addition
to any other insurance benefits provided to Berglass as a benefit hereunder.
6. BENEFITS UPON CHANGE OF CONTROL.
(a) DEFINITIONS. In addition to the definitions provided in Section
5, the following definition will apply to this Section 6:
CHANGE IN CONTROL. The term "Change in Control" means the
occurrence of any of the following events after the date of this Agreement:
(i) Berglass, Xxxxxx Xxxxxxxx and any controlled affiliate
thereof (collectively, the "Berglass Family") is no longer the Beneficial
Owner of securities of the Company representing 26% or more of the combined
voting power of the Company's then outstanding securities. For purposes of
this Agreement, the term "Beneficial Owner" shall have the meaning given to
such term in Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"); provided, however, that the Berglass Family
shall be deemed to be the Beneficial Owner of any securities of the Company
which are owned by the Berglass Family but subject to call options by third
parties unless and until such options are exercised;
(ii) individuals who at the beginning of any period of two
consecutive years constitute the Board, and any new director (other than a
director designated by a Person who has entered into an agreement with the
Company to effect a transaction
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described in clauses (i) or (iv)) whose election by the Board or nomination
for election by the Company's stockholders was approved by a vote of at
least two-thirds (2/3) of the directors then still in office who either
were directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any reason to
constitute at least a majority thereof. For purposes of this Agreement,
the term "Person" is used as such term is used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act");
provided, however, that the term shall not include the Company, any trustee
or other fiduciary holding securities under an employee benefit plan of the
Company, or any corporation owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions as their
ownership of stock of the Company;
(iii) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation (or other entity),
other than (i) 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 entity) more than 66-2/3% of the
combined voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation
or (ii) a merger or consolidation is effected to implement a
recapitalization of the Company (or similar transaction) in which the
Berglass Family remains the Beneficial Owner of securities of the Company
representing at least 26% of the combined voting power of the Company's
securities outstanding upon consummation of such transaction; or
(iv) the stockholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's
assets.
(b) ELIGIBILITY FOR BENEFITS. The Company agrees to pay to Berglass
the benefits specified in Section 6(c) hereof if (i) there is a Change in
Control during the term of this Agreement and (ii) within the period commencing
on the date of the Change in Control, or (if earlier) the date of any agreement
by the Company to enter into the transaction resulting in such Change in
Control, and ending two years after the Change in Control (A) the Company
terminates the employment of Berglass for any reason other than Just Cause,
death or Disability or (B) Berglass voluntarily terminates employment with the
Company for Good Reason. A Change of Control will be deemed to have occurred
during the term of this Agreement, for purposes of this paragraph 6(b), if an
agreement is entered into during the term of this Agreement for a transaction
resulting in a Change of Control, notwithstanding that the Change of Control
transaction is not completed until after the Employment Term.
(c) BENEFITS UPON TERMINATION OF EMPLOYMENT. If Berglass is entitled
to benefits pursuant to Section 6(b) hereof, in lieu of any payments and
benefits provided in Section 5 the Company agrees to pay or provide to Berglass
as termination compensation the following:
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(i) A single lump sum payment, payable in cash within five
days of the Termination Date, equal to the sum of:
(A) the accrued portion of any Base Salary and
vacation through the Termination Date; plus
(B) an amount representing bonus and all other cash
incentive compensation for such period determined by multiplying:
(I) the Assumed Incentive Compensation, by
(II) the fraction of the year of termination elapsed
prior to the Termination Date; plus
(C) 299% of the sum of:
(I) Berglass' Base Salary in effect upon the
Termination Date, plus
(II) the Assumed Incentive Compensation.
(ii) All stock options, restricted stock or other equity
awards then held by Berglass will automatically be deemed amended, without
further action on the part of the Company or Berglass, so that (A) all
options will be fully vested and not subject to forfeiture or expiration by
reason of the Berglass' termination, and will be subject to exercise in
full for the remainder of their stated term; and (B) all restricted stock
or other equity awards will be fully vested and all restrictions thereon
will lapse.
(iii) All benefits provided under Section 2(b) will continue as
set forth in Section 5(b) above.
(iv) Berglass shall have the right, by notice in writing to the
Company, to receive an assignment of the Berglass Life Policy, upon payment
to the Company of the cash surrender value thereof.
(v) In the event that any amount or benefit that may be paid
or otherwise provided to Berglass by the Company or any affiliated company,
whether pursuant to this Agreement or otherwise (collectively, "Covered
Payments"), is or may become subject to the tax imposed under Code Section
4999 ("Excise Tax"), the Company will pay to Berglass a "Reimbursement
Amount" equal to the total of: (A) any Excise Tax on the Covered Payments,
plus (B) any Federal, state, and local income taxes, employment and excise
taxes (including the Excise Tax) on the Reimbursement Amount (but without
reduction for any Federal, state, or local income or employment taxes on
such Covered Payments), plus (C) the product of any deductions disallowed
for Federal, state or local income tax purposes because of the inclusion of
the Reimbursement Amount in Berglass' adjusted gross income multiplied by
the highest applicable marginal
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rate of Federal, state, and local income taxation, respectively, for the
calendar year in which the Reimbursement Amount is to be paid. For
purposes of this Section 6(c)(v), Berglass will be deemed to pay
(Y) Federal income taxes at the highest applicable marginal rate of Federal
income taxation for the calendar year in which the Reimbursement Amount is
to be paid and (Z) any applicable state and local income taxes at the
highest applicable marginal rate of taxation for the calendar year in which
such Reimbursement Amount is to be paid, net of the maximum reduction in
Federal income taxes which could be obtained from the deduction of such
state or local taxes if paid in such year (determined without regard to
limitations on deductions based upon the amount of Berglass' adjusted gross
income).
7. NO OBLIGATION TO MITIGATE DAMAGES. In the event of a termination of
Berglass' employment for any reason, Berglass will not be required to seek other
employment or to mitigate any of the Company's obligations under this Agreement,
and no amount payable hereunder will be reduced (a) by any claim the Company may
assert against Berglass or (b) by any compensation or benefits earned by
Berglass as a result of employment by another employer, self-employment or from
any other source after such termination of employment with the Company;
PROVIDED, HOWEVER, that the benefits provided pursuant to Sections 5(d)(iii) and
6(c)(iii) will terminate at such time as Berglass becomes eligible for
comparable benefits as the result of employment by another Person.
8. PROPRIETARY INFORMATION OBLIGATIONS. During Berglass' employment
pursuant to this Agreement, Berglass will have access to and become acquainted
with confidential and proprietary information of the Company and its
subsidiaries, including, but not limited to, information or plans regarding
customer relationships, personnel, or sales, marketing, and financial operations
and methods; trade secrets; formulas; devices; secret inventions; processes; and
other compilations of information, records, and specifications (collectively
"Proprietary Information"). Berglass will not disclose any such Proprietary
Information directly or indirectly, or use it in any way, either during
Berglass' employment pursuant to this Agreement or at any time thereafter,
except as required in the course of his employment for the Company or as
authorized in writing by the Company. Notwithstanding the foregoing, nothing
contained herein shall prevent Berglass from making use of any knowledge or
information properly in his possession in the course of any business or
consulting activities in which he may engage following the termination of his
employment by the Company. Notwithstanding the foregoing, Proprietary
Information will not include (a) information which is or becomes generally
public knowledge or public except through disclosure by Berglass in violation of
this Agreement and (b) information that may be required to be disclosed by
applicable law.
9. MISCELLANEOUS.
(a) NOTICES. Any notices provided hereunder must be in writing and
will be deemed effective upon the earlier of two days following personal
delivery (including personal delivery by telecopy or telex), or the fourth day
after mailing by first class mail to the recipient at the address indicated
below:
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To the Company:
0000 Xxxx Xxx Xxxxx
Xxxxxx Xxxxxxxxx, XX 00000
Attn: Secretary
Telecopier No: (000) 000-0000
With a copy to:
To Berglass:
00000 Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000
or to such other address or to the attention of such other person as the
recipient party will have specified by prior written notice to the sending
party.
(b) SEVERABILITY. Any provision of this Agreement which is deemed
invalid, illegal or unenforceable in any jurisdiction will, as to that
jurisdiction and subject to this Section be ineffective to the extent of such
invalidity, illegality or unenforceability, without affecting in any way the
remaining provisions hereof in such jurisdiction or rendering that or any other
provisions of this Agreement invalid, illegal, or unenforceable in any other
jurisdiction. If any covenant should be deemed invalid, illegal or
unenforceable because its scope is considered excessive, such covenant will be
modified so that the scope of the covenant is reduced only to the minimum extent
necessary to render the modified covenant valid, legal and enforceable.
(c) ENTIRE AGREEMENT. This document constitutes the final, complete,
and exclusive embodiment of the entire agreement and understanding between the
parties related to the subject matter hereof and supersedes and preempts any
prior or contemporaneous understandings, agreements, or representations by or
between the parties, written or oral; provided that nothing contained herein
shall affect the continuation of Berglass' rights to indemnification from the
Company pursuant to any and all contract, bylaw or charter provisions which may
be in effect on the date hereof. Without limiting the generality of the
foregoing, the parties expressly agree that the agreement between them dated
August 15, 1998 pursuant to the Company's Retention and Severance Plan shall be
terminated and of no further effect.
(d) COUNTERPARTS. This Agreement may be executed on separate
counterparts, any one of which need not contain signatures of more than one
party, but all of which taken together will constitute one and the same
agreement.
(e) SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and
inure to the benefit of and be enforceable by Berglass, Berglass' wife (as
provided in Section 2(b)) and the Company, and their respective successors and
assigns, except that Berglass may not assign any of his duties hereunder and he
may not assign any of his rights hereunder without the prior written consent of
the Company. The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. Failure of the Company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall be a breach of this
Agreement and shall entitle Berglass to terminate his employment and receive
compensation from the Company in the same amount and on the same terms to which
he would be entitled hereunder if he terminated his employment for Good Reason.
Where the context requires, the term Company shall include any successor to its
business and/or assets as aforesaid which assumes and agrees to perform this
Agreement by operation of law, or otherwise.
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(f) AMENDMENTS. No amendments or other modifications to this
Agreement may be made except by a writing signed by both parties. No amendment
or waiver of this Agreement requires the consent of any individual, partnership,
corporation or other entity not a party to this Agreement. Nothing in this
Agreement, express or implied, is intended to confer upon any third person any
rights or remedies under or by reason of this Agreement.
(g) CHOICE OF LAW. All questions concerning the construction,
validity and interpretation of this Agreement will be governed by the laws of
the State of California without giving effect to principles of conflicts of law.
10. ARBITRATION.
(a) Any disputes or claims arising out of or concerning Berglass'
employment or termination by the Company, whether arising under theories of
liability or damages based upon contract, tort or statute, will be determined
exclusively by arbitration before a single arbitrator in accordance with the
employment arbitration rules of the American Arbitration Association, except as
modified by this Agreement. The arbitrator's decision will be final and binding
on both parties. Judgment upon the award rendered by the arbitrator may be
entered in any court of competent jurisdiction. In recognition of the fact that
resolution of any disputes or claims in the courts is rarely timely or cost
effective for either party, the Company and Berglass enter this mutual agreement
to arbitrate in order to gain the benefits of a speedy, impartial and
cost-effective dispute resolution procedure.
(b) Any arbitration will be held in Berglass' place of employment
with the Company. The arbitrator must be an attorney with substantial
experience in employment matters, selected by mutual agreement of the parties.
If the parties are unable to agree to an arbitrator within 30 days following a
demand for arbitration hereunder, an arbitrator meeting the foregoing experience
requirement shall be selected by alternately striking names from a list of five
such persons provided by the American Arbitration Association (AAA) office
located nearest to the place of employment, following a request by the party
seeking arbitration for a list of five such attorneys. If either party fails to
strike any of the names from the list, the arbitrator will be selected from the
list by the other party.
(c) Each party will have the right to take the deposition of one
individual and any expert witness designated by the other party. Each party
will also have the right to propound requests for production of documents to any
party and the right to subpoena documents and witnesses for the arbitration.
Additional discovery may be made only where the arbitrator selected so orders
upon a showing of substantial need. The arbitrator will have the authority to
entertain a motion to dismiss and/or a motion for summary judgment by any party
and will apply the standards governing such motions under the Federal Rules of
Civil Procedure.
(d) The Company and Berglass agree that they will attempt, and they
intend that they and the arbitrator should use their best efforts in that
attempt, to conclude the arbitration proceeding and have a final decision from
the arbitrator within 120 days from the date of selection of the arbitrator;
PROVIDED, HOWEVER, that the arbitrator will be entitled to extend such
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120-day period for one additional 120-day period. The arbitrator will deliver a
written award with respect to the dispute to each of the parties, who must
promptly act in accordance therewith.
(e) The Company will pay any and all reasonable fees and expenses
incurred by Berglass in seeking to obtain or enforce any rights or benefits
provided by this Agreement, including all reasonable attorneys' and experts'
fees and expenses, accountants' fees and expenses, and court costs (if any) that
may be incurred by Berglass in pursuing a claim for payment of compensation or
benefits or other right or entitlement under this Agreement, PROVIDED that
Berglass shall refund to the Company any amounts so paid, and shall not be
entitled to any further such payment if the Arbitrator shall rule against
Berglass on all claims asserted by him and shall determine, in writing, that
such claims were without any substantial basis.
(f) In a contractual claim under this Agreement, the arbitrator must
act in accordance with the terms and provisions of this Agreement and applicable
legal principles and will have no authority to add, delete or modify any term or
provision of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the date it is last executed below by either party.
/s/ Xxxxxx Xxxxxxxx
-------------------------------------
XXXXXX XXXXXXXX
DEP CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chairman, Compensation & Management
Stock Option Committee
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