Exhibit 10.3
EMPLOYMENT AGREEMENT, effective as of October 1, 1991, by and
between XXXXXXX INDUSTRIES, INC., a Delaware corporation having its principal
address at 000 Xxxxx Xxxxxxxx, Xxxxxxx, Xxxxxx 00000 (the "Employer"), and
XXXXXX XXXX, an individual residing at Xxxx Xxx Xxxx, (X.X. Xxx 00) Xxxx
Xxxxxxx, Xxx Xxxx 00000 (the "Executive").
WITNESSETH:
WHEREAS, the parties desire to provide for the employment of the
Executive by the Employer as set forth in this agreement (this agreement
being hereinafter called the "Agreement").
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth, the parties hereto covenant and agree as follows:
1. Term of Employment.
The Employer agrees to employ the Executive, and the Executive hereby
accepts such employment, as Chairman of the Board of Directors of the
Employer, for a term commencing as of October 1, 1991 and ending on December
31, 1993 (the "Initial Term"). The Initial Term shall be automatically
extended for one (1) additional year as of December 31, 1993, and thereafter
for one (1)additional year as of December 31 of each succeeding calendar
year, until either party hereto gives written notice, on or prior to August
31 of any such calendar year, of its intention not to extend the Initial Term
(as then extended) for one (1) additional calendar year, in which case the
Executive's employment hereunder shall terminate on December 31 of that
calendar year during which such notice is given. The preceding two sentences
notwithstanding, the Executive's employment hereunder may be terminated
earlier in accordance with Section 4 hereof. Subject to earlier termination
as provided in Section 4 hereof, the Executive's term of employment
hereunder, including the Initial Term and all additional one (1) year
extensions thereof, is hereinafter referred to as the "Employment Period."
2. Duties and Authority.
a. During the Employment Period the Executive shall serve as
Chairman of the Board of. Directors of the Employer. The Executive shall
devote his best efforts and full working time and attention to services for
the Employer. The Executive agrees to hold any other office or position with
the Employer or any of the Employer's subsidiaries without additional
compensation if elected or appointed to such office or position.
b. The Executive shall be responsible to identify and propose
to the Employer's Board of Directors persons suitable to serve as President
of the Employer.
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3. Compensation.
a. As compensation for the Executive's services in all
capacities during the Employment Period, the Employer shall pay the Executive
the following:
(i) a base salary at the rate of $480,000 per annum (the "Base
Salary"), to be paid in equal installments in accordance with
normal payroll practices of the Employer but not less frequently than
monthly;
(ii) a payment, upon execution of this Agreement, equal to
the amount of the reasonable legal fees incurred by the Executive in
connection with the preparation and negotiation of this Agreement;
(iii) a discretionary cash incentive bonus (the
"Bonus") for the period beginning October 1, 1991 and ending on
December 31, 1991, and for each subsequent calendar year or part
thereof during which the Executive is employed, the amount of such
Bonus to be determined by the Employer acting in good faith.
(iv) an option (the "Option") to acquire five hundred
thousand (500,000) shares of common stock of the Employer, such Option
to be in the form and subject to the terms and conditions expressed in
Exhibit A attached hereto.
b. The Executive shall be entitled to reimbursement for
reasonable business and travel expenses incurred in the performance of his
duties in accordance with the Employer's normal reimbursement practices.
c. Subject to the terms of the applicable plan and/or program,
the Executive shall participate in all bonus, incentive, stock option,
pension, disability and health plans and programs and all fringe benefit
plans maintained by or on behalf of the Employer and in which senior
executives of the Employer are entitled to participate.
4. Termination of Employment.
a. The Executive's employment hereunder shall terminate upon
the Executive's death, and the Employer shall have the right to terminate the
Executive's employment upon his permanent disability. A permanent disability
is a physical or mental disability which results in the Executive's inability
to substantially perform his duties hereunder for a period of 90 consecutive
days or for a period of 120 days within any period of 12 consecutive months,
except that a permanent disability shall not include a physical or mental
disability which occurs in connection with the Executive's employment
hereunder. In the event of termination by reason of death or permanent
disability, the Employer's obligation to pay further compensation hereunder
shall cease on the date of termination, except that the Executive (or, in the
case of death, his beneficiaries, or his estate if no beneficiary has been
named)shall be entitled to receive his Base Salary and Bonus prorated on a
calendar day basis through the date of such termination.
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b. The Employer may terminate the Executive's employment
hereunder for Cause (as defined below) upon not less than 30 days prior
written notice specifying such cause. If the Executive's' employment
hereunder is terminated for Cause, the Executive shall forfeit the Option
effective as of the date of the termination of his employment, but the Option
shall remain exercisable for the 30 day period following the Executive's
receipt of written notice required under this Section 4(b). For purposes of
this Agreement, the term "Cause" shall mean (i) the Executive's willful and
continued failure to substantially perform his duties hereunder, (ii) the
engaging by the Executive in willful misconduct which is demonstrably and
materially injurious to the Employer, or (iii) the Executive's conviction of
a felony for a crime of moral turpitude. For purposes of this Section 4(c),
no act, or failure to act, on the Executive's part shall be considered
"willful" unless done, or omitted to be done, by him not in good faith and
without reasonable belief that his action or omission was in the best
interest of the Employer. The Executive shall not be terminated for Cause in
the case of actions or omissions described in clauses (i) or (ii) of this
Section 4(b) unless the Employer shall have given the Executive an
opportunity to cure any such actions or omissions during the 30 day period
after the Executive's receipt of written notice required under this Section
4(b).
c. The Executive's employment hereunder may be terminated by
the Employer without Cause upon not less than 90 days prior written notice.
In such event, the Executive shall continue to receive his Base Salary
otherwise payable pursuant to Section 3 hereof as if his employment had
continued for the remainder of the Employment Period. The Employer shall
determine in good faith whether the Bonus should be payable for a calendar
year in which the Executive is terminated by the Employer without Cause.
d. The Executive shall also have the right to resign
voluntarily from employment during the Employment Period by written notice to
the Employer at least 60 days prior to the effective date of the resignation.
Upon his resignation, the Executive shall be entitled to receive any accrued
but unpaid Base Salary. The Employer shall have discretion whether or not to
award the Executive a Bonus for any calendar year in which he resigns.
e. If the Executive's employment shall terminate by expiration
of the Employment Period in accordance with Section 1 hereof, or if his
employment is terminated for Cause pursuant to Section 4(b), or if the
Executive shall voluntarily resign for any reason, the Executive's right to
receive the Base Salary (except any accrued and unpaid salary), the Bonus,
and any other compensation and benefits to which he would otherwise be
entitled under this Agreement shall be forfeited as of the date of
termination of employment, except as expressly provided below:
(i) If the Initial Term of this Agreement shall not have been
extended for an additional one-year period and the Executive's
employment hereunder shall terminate by expiration of the Employment
Period, in accordance with Section 1 hereof, on December 31, 1993, the
Executive shall be entitled to receive the Bonus for calendar year 1993
in accordance with Section 3(a)(iii) hereof.
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(ii) If the Initial Term of this Agreement shall be extended for
one or more additional one-year periods and the Executive's employment
hereunder shall terminate by expiration of the Employment Period, in
accordance with Section 1 hereof, on December 31 of any calendar year
succeeding calendar year 1993, the Executive shall be entitled to
receive the Bonus for such succeeding calendar year in accordance with
Section 3(a)(iii) hereof.
f. Except as provided in Section 4(b) hereof, the Executive's
death or termination of employment shall not affect his rights under the
Option.
5. Notices.
Any notice or other communication hereunder shall be made in
writing by hand-delivery or telecopier (and, if by telecopier, followed by a
copy either delivered by hand within three days thereafter or sent by
registered first-class mail on the next business day) and shall be deemed to
have been delivered and received when delivered by hand, if personally
delivered, and when receipt acknowledged, if telecopied, as follows: (a) if
to the Executive at the address shown at the beginning of this Agreement and
at the following telecopier numbers: (000) 000-0000 and (000) 000-0000 or to
such other person(s) or address(es) or telecopier number(s) as the Executive
shall have furnished to the Employer in writing, and (b) if to the Employer
at the address shown at the beginning of this Agreement and at the following
telecopier number: (000) 000-0000, attention of the Board of Directors, with
copies to Foulston & Siefkin, 000 Xxxxxx Xxxxxxxxx Xxxxxx, Xxxxxxxx at
Xxxxxxx, Xxxxxxx, Xxxxxx 00000, Attention: Xxxxx X. Xxxx, Esq., telecopier
number (000) 000-0000, or to such other person(s) or address(es) or
telecopier number(s) as such persons or the Company shall have furnished to
the Executive in writing.
6. Assignability.
This Agreement shall not be assignable by the Employer except to
a majority-owned subsidiary or parent entity of the Employer and shall be
binding upon and inure to the benefit of the Employer and its successors and
assigns. This Agreement shall not be assignable by the Executive, but it
shall be binding upon, and to the extent provided in Section 4(a) shall inure
to the benefit of, the Executive's heirs, executors, administrators and legal
representatives.
7. Entire Agreement.
This Agreement supersedes all prior understandings between the
Executive and the Employer as to the subject matter hereof.
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8. Waivers, Amendments and Further Agreements.
Neither this Agreement nor any term or condition hereof,
including without limitation the terms and conditions of this Section 8, may
be waived, modified or amended in whole or in part as against the Employer or
the Executive except by written instrument executed by each of the parties
expressly stating that it is intended to operate as a waiver, modification or
amendment of this Agreement or the applicable term or condition hereof. Each
of the parties hereto agrees to execute all such further instruments and
documents and to take all such further action as the other party may
reasonably require in order to effectuate the terms and purposes of this
Agreement.
9. Severability.
In case one or more of the provisions contained in this Agreement
shall be or become invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
10. No Conflicting Obligations.
The Executive represents and warrants to the Employer that the
Executive is not now under any obligation to anyone other than the Employer
and other entities of which he is a non-executive director and has no
interest which is inconsistent or in conflict with this Agreement, or which
would prevent, limit or impair, in any way, the Executive's performance of
any of the covenants or duties hereinabove set forth. However, subject to
Section 2 hereof, nothing herein shall be deemed to limit the Executive's
participation in, or pursuit of, non-conflicting business interests.
11. Survival.
Except as otherwise provided herein, the covenants, agreements,
representations and warranties contained in or made pursuant to this
Agreement shall survive the Executive's termination of employment,
irrespective of any investigation made by or on behalf of any party.
12. Governing Law.
This agreement shall be governed by and construed and enforced in
accordance with the law of the State of New York.
13. Arbitration.
Any dispute, controversy or claim arising out of or relating to
this Agreement or the breach thereof shall be finally settled by arbitration
by a single arbitrator in accordance with the rules then in effect of the
American Arbitration Association in an arbitration in New York, New York.
Judgment upon an award rendered by the arbitrator may be entered in any court
of competent jurisdiction.
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14. Headings.
The headings in this Agreement are solely for convenience of
reference and shall be given no effect in the construction or interpretation
of this Agreement.
15. Counterparts.
This Agreement may be executed in counterparts each of which
shall be deemed an original but which together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the parties have executed or caused to
be executed this Agreement effective as of the date first above written.
XXXXXXX INDUSTRIES, INC.
[Seal] By:/s/Xxxx X. Xxxxxxx
Name: Xxxx X. Xxxxxxx
Title: EVP Finance
Date: December 4, 1991
/s/Xxxxxx X. Xxxx
Xxxxxx Xxxx
Date: December 4, 1991
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