EXHIBIT 10f
XXXXX & XXXXX, INC.
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into by and between
XXXXX & XXXXX, INC., hereinafter called the "Company," and X.
XXXXX XXXXX, hereinafter called "Employee," effective July 29,
1999.
BACKGROUND
Employee is the Chairman, President and Chief Executive
Officer of the Company. The Company desires to continue to
obtain the benefit of services by the Employee, and the Employee
desires to continue to render services to the Company.
The Compensation Committee of the Board of Directors (the
"Compensation Committee") and the Board of Directors (the
"Board") of the Company have determined that it is in the best
interests of the Company and its shareholders to recognize the
substantial contribution that the Employee has made and is
expected to make in the future to the Company's business and to
continue to retain his services in the future. The Compensation
Committee and the Board recognize that the possibility of a
Change in Control (as hereinafter defined) exists and that the
threat of or the occurrence of a Change in Control can result in
significant distractions of its Chairman, President and Chief
Executive Officer because of the uncertainties inherent in such a
situation. The Compensation Committee and the Board have
determined that it is essential and in the best interest of the
Company and its shareholders to retain the services of Employee
in the event of a threat or occurrence of a Change in Control and
thereafter, without alteration or diminution of his continuing
leadership role in determining and implementing the strategic
objectives of the Company. Moreover, the Compensation Committee
and the Board recognize that unlike other key personnel
throughout the Company who participate in the Company's Stock
Performance Plan and, therefore, would have the benefit of the
immediate vesting of stock interests granted to them pursuant to
that Plan in the event of a Change in Control, Employee is not a
participant in that Plan.
In order to induce Employee to remain in the employ of the
Company, and to continue providing the leadership that has
defined the unique sales-driven culture of the Company, and
consistently improved the quality and financial performance of
the Company, Company and Employee desire to replace the
Employment Agreement entered into in April of 1993 with this
Agreement, and desire to set forth in this Agreement the terms
and conditions of the Employee's employment with the Company, and
to provide the Employee with certain benefits and assurances in
the event of a Change in Control (as defined below).
Accordingly, in consideration of the mutual covenants and
representations set forth below, the Company and Employee agree
as follows:
TERMS
1. DEFINITIONS. "Company" means Xxxxx & Xxxxx, Inc. and
with respect to paragraph 9, hereof, also means its subsidiaries,
affiliated companies and any company operated or supervised by
the Company, as well as any successor entity formed by merger or
acquisition, including any company that may acquire a majority of
the stock of Xxxxx & Xxxxx, Inc. "Employee" means X. Xxxxx Xxxxx
and with respect to paragraph 10 hereof also means any company or
business in which Employee has a controlling or managing
interest.
2. EMPLOYMENT. The Company hereby employs or continues to
employ Employee upon the terms and conditions set forth in this
Agreement.
3. TERM. The term of the Agreement shall be continuous
until terminated by either party as provided herein. This
Agreement supersedes all prior employment agreements or
arrangements existing as between the Company and the Employee.
4. EXTENT OF DUTIES. At the time of execution of this
Agreement, Employee shall be employed as Chairman of the Board,
President and Chief Executive Officer of the Company. Employee
shall perform the duties associated with such positions and shall
commit such of his time and effort required in completing and
fulfilling those duties and responsibilities commensurate with
and like in amount to the time committed by the Employee in
fulfilling the same as of the execution hereof. During the term
of his employment under this Agreement, Employee shall not
directly or indirectly engage in the insurance business in any of
its phases, either as a broker, agent, solicitor, consultant or
participant, in any manner or in any firm or corporation engaged
in the business of insurance or re-insurance, except for account
of the Company or as directed by the Company.
5. COMPENSATION. During the term of this Agreement, Employee
shall be compensated as follows:
(a) The Company shall pay to the Employee an annual
base salary payable in bi-weekly installments.
(b) The Company shall pay to the Employee an annual
cash bonus payable by February 15 following the calendar year in
which earned.
(c) If the Employee's employment is terminated as of a
date other than the end of the Company's fiscal year end, the
bonus amount shall be calculated to the end of the calendar
quarter in which the termination occurs and annualized through
the end of the then fiscal year of the Company, and paid to the
Employee, or his written designated beneficiary or estate, as the
case may be.
(d) The Employee shall participate in and receive
comparable benefits as are provided by the Company to its other
personnel from time to time except as modified or amplified by
this Agreement.
6. CHANGE IN CONTROL. For purposes of this Agreement, a
"Change in Control" shall mean any of the following events:
(a) An acquisition (other than directly from the
Company) of any voting securities of the Company (the "Voting
Securities") by any "Person" (as the term person is used for
purposes of Section 13(d) or 14(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act")), immediately after
which such Person has "Beneficial Ownership" (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of thirty
percent (30%) or more of the combined voting power of the
Company's then outstanding Voting Securities; provided, however,
in determining whether a Change in Control has occurred, Voting
Securities which are acquired in a "Non-Control Acquisition" (as
hereinafter defined) shall not constitute an acquisition which
would cause a Change in Control. A "Non-Control Acquisition"
shall mean an acquisition by (i) an employee benefit plan (or a
trust forming a part thereof) maintained by (A) the Company or
(B) any corporation or other Person of which a majority of its
voting power or its voting equity securities or equity interest
is owned, directly or indirectly, by the Company (for purposes of
this definition, a "Subsidiary") (ii) the Company or its
Subsidiaries; (iii) any Person in connection with a "Non-Control
Transaction" (as hereinafter defined); or (iv) Employee or his
family members.
(b) The individuals who, as of July 29, 1999, are
members of the Board (the "Incumbent Board"), cease for any
reason to constitute at least two-thirds of the members of the
Board; provided, however, that if the election, or nomination for
election by the Company's common stockholders, of any new
director was approved by a vote of at least two-thirds of the
Incumbent Board, such new director shall, for purposes of this
Plan, be considered as a member of the Incumbent Board; provided
further, however, that no individual shall be considered a member
of the Incumbent Board if such individual initially assumed
office as a result of either an actual or threatened "Election
Contest" (as described in Rule 14a-11 promulgated under the
Exchange Act) or other actual threatened solicitation of proxies
or consents by or on behalf of a Person other than the Board (a
"Proxy Contest") including by reason of any agreement intended to
avoid or settle any Election Contest or Proxy Contest; or
(c) Approval by stockholders of the Company of:
(i) a merger, consolidation or reorganization
involving the Company, unless such merger consolidation or
reorganization is a "Non-Control Transaction." A "Non-Control
Transaction" shall mean a merger, consolidation or reorganization
of the Company where:
(A) the stockholders of the company,
immediately before such merger, consolidation or reorganization,
own directly or indirectly immediately following such merger,
consolidation or reorganization, at least seventy percent (70%)
of the combined voting power of the outstanding voting securities
of the corporation resulting from such merger or consolidation or
reorganization (the "Surviving Corporation") in substantially the
same proportion
as their ownership of the Voting Securities
immediately before such merger, consolidation or reorganization,
(B) the individuals who were members of the
Incumbent Board immediately prior to the execution of the
agreement providing for such merger, consolidation or
reorganization constitute at least two-thirds of the members of
the board of directors of the Surviving Corporation, or a
corporation beneficially directly or indirectly owning a majority
of the Voting Securities of the Surviving Corporation, and
(C) no Person other than (i) the Company,
(ii) any Subsidiary, (iii) any employee benefit plan (or any
trust forming a part thereof) maintained by the Company, the
Surviving Corporation, or any Subsidiary, or (iv) any Person who,
immediately prior to such merger, consolidation or reorganization
had Beneficial Ownership of thirty percent (30%) or more of the
then outstanding Voting Securities), has Beneficial Ownership of
thirty percent (30%) or more of the combined voting power of the
Surviving Corporation's then outstanding voting securities.
(ii) A complete liquidation or dissolution of the
company; or
(iii) An agreement for the sale or other
disposition of all or substantially all of the assets of the
Company to any Person (other than a transfer to a Subsidiary).
(d) Notwithstanding the foregoing, a Change in Control
shall not be deemed to occur solely because any Person (the
"Subject Person") acquired "Beneficial Ownership of more than the
permitted amount of the then outstanding Voting Securities as a
result of the acquisition of Voting Securities by the Company
which, by reducing the number of Voting Securities then
outstanding, increases the proportional number of shares
Beneficially Owned by the Subject Persons, provided that if a
Change in Control would occur (but for the operation of this
sentence) as a result of the acquisition of Voting Securities by
the Company, and after such share acquisition by the Company, the
Subject Person becomes the Beneficial Owner of any additional
Voting Securities which increases the percentage of the then
outstanding Voting Securities Beneficially Owned by the Subject
Person, then a Change in Control shall occur.
7. TERMINATION. Subject to the provisions of Section 8,
this Agreement may be terminated:
(a) by mutual consent of the Company and
Employee;
(b) by Employee upon thirty (30) days
written notice to the Company; or
(c) by the Company upon thirty (30) days
written notice to Employee.
Termination of Employee's employment under this Agreement
shall not release either Employee or the Company from obligations
hereunder arising or accruing through the date of such
termination nor from the post-termination provisions of this
Agreement. Termination may be
without cause and no cause need be
stated in notice of termination. On notice of termination of or
by the Employee, the Company has the power to suspend the
Employee from all duties on the date notice is given, and to
immediately require return of all Confidential Information as
described in the Agreement.
8. PROVISIONS APPLICABLE TO EMPLOYMENT IN THE EVENT OF A
CHANGE IN CONTROL.
(a) If a Change in Control shall occur and if, prior
to the third anniversary of the Change in Control, (i) the
Employee is terminated, or (ii) the Employee resigns due to the
occurrence of any Adverse Consequences, as defined below, then
the Employee shall be entitled to receive as severance pay, in
lieu of any further salary subsequent to the date of termination,
an amount in cash equal to 2 times the following: 3 times the
sum of Employee's annual base salary and Employee's most recent
annual bonus as of the effective date of the Change in Control, ,
multiplied by a factor of 1 plus the percentage representing the
percentage increase, if any, in the price of the common stock of
the Company between the date of execution of this Agreement and
the close of business on the first business day following the
date upon which public announcement of the Change in Control is
made. All benefits enjoyed by the Employee prior to the Change
in Control shall continue for a period of 3 years after the date
of termination. The severance sum shall be paid by the Company
to SunTrust Bank in Daytona Beach, Florida ("SunTrust"), as
Escrow Agent, prior to the effective date of the Change in
Control, for deposit into an interest-bearing account pursuant to
an escrow agreement acceptable to Employee, Company and SunTrust
which provides that upon Employee's delivery of written
confirmation of his termination, or his resignation due to the
occurrence of an Adverse Consequence, the Escrow Agent shall
immediately, without delay, pay the severance sum, in its
totality, to Employee, plus interest accruing from the date of
termination or occurrence of an Adverse Consequence, and which
further provides that, absent receipt of such notice from
Employee, the funds held in escrow will revert to the Company on
the on the first business day following the third anniversary of
the Change in Control date. If the continuation of any benefit
provided to the Employee violates any law or statute the Employer
shall pay to the Employee the cash equivalent of any benefit lost
by the Employee.
(b) "Adverse Consequences" is defined to mean any of
the following that the Employee, in good faith, believes to have
occurred:
(i) any material breach of this Agreement by the
Company;
(ii) the assignment to the Employee of any duties
inconsistent with, or any diminution in, the Employee's status or
responsibilities presently in effect;
(iii) the failure of the Company to follow
Employee's recommendations concerning operations and management
of the Company, dividend policy of the Company, and strategic
direction of the Company;
(iv) the failure by the Company to provide the
Employee with suitable office space and adequate and appropriate
support staff and secretarial assistance and other administrative
support;
(v) a reduction by the Company in the Employee's
salary or bonus, or a failure by the Company, without good
reason, to increase Employee's salary and bonus in accordance
with past practice from year to year;
(vi) the reduction or cessation of quarterly
dividend payments to shareholders of the Company equaling at
least 25% of earnings of the Company without delivery of money,
stock or other consideration with value that equals or exceeds
the income that shareholders would otherwise derive from such
quarterly dividend payments;
(vii) a change in the principal place of the
Employee's employment to a location outside of Daytona Beach,
Florida;
(viii) the failure by the Company to provide
the Employee with insurance and other benefits that are, in the
judgment of Employee, commensurate with those benefits currently
supplied by Company;
(ix) the failure of any successor to the Company
to assume and agree to perform this Agreement; or
(x) the taking of any other action by the Company
where the intent or likely result of the action is to cause the
Employee to resign or be terminated.
9. CONFIDENTIAL INFORMATION; NON-PIRACY COVENANTS. (a)
Employee recognizes and acknowledges that the Confidential
Information (as hereafter defined) constitutes valuable, secret,
special, and unique assets of Company. Employee covenants and
agrees that, during the term of this Agreement and following
termination (whether voluntary or involuntary), he or she will
not disclose the Confidential Information to any person, firm,
corporation, association, or other entity for any reason or
purpose without the express written approval of Company and will
not use the Confidential Information except in Company's
business. It is expressly understood and agreed that the
Confidential Information is the property of Company and must be
immediately returned to Company upon demand therefor. The term
Confidential Information includes each, every, and all written
documentation related to Company or its business that is not
public information, whether furnished by Company or compiled by
Employee, including but not limited to: (1) lists of the
Company's customers, companies, accounts and records pertaining
thereto; (2) customer lists, prospect lists, policy forms,
and/or rating information, expiration dates, information on risk
characteristics, information concerning insurance markets for
large or unusual risks, and all types of written information
customarily used by Company or available to the Employee; (3)
information related to any of Company's programs and marketing
strategies; (4) information known to Employee but not reduced to
written or recorded form; (5) underwriting information received
from customers; and (6) Employee's recollection of Confidential
Information.
(b) For a period of three (3) years following
termination of Employment (whether voluntary or involuntary),
Employee specifically agrees not to solicit, accept, nor service,
directly or indirectly, as insurance solicitor, insurance agent,
insurance broker, insurance wholesaler, managing general agent,
consultant, or otherwise, for Employee's accounts or the accounts
of any other agent, or broker, or insurer, either as officer,
director, stockholder, owner, partner, employee, promoter,
consultant, manager, or otherwise, any insurance or bond business
of any kind or character from any person, firm, corporation, or
other entity, that is a customer or account of the Company during
the term of this Agreement or from any prospective customer or
account to whom the Company made proposals while Employee was
employed by Company. Should a court of competent jurisdiction
declare any of the covenants set forth in this paragraph
unenforceable due to an unreasonable restriction of duration,
geographical area or otherwise, each of the parties hereto agrees
that such court shall be empowered to rewrite or reform any such
covenant and shall grant Company injunctive relief reasonably
necessary to protect its interest.
(c) Employee agrees that Company shall have the right
to communicate the terms of this Agreement to any third parties,
including but not limited to, any past, present or prospective
employer of Employee. Employee waives any right to assert any
claim for damages against Company or any officer, employee or
agent of Company arising from disclosure of the terms of this
paragraph.
(d) In the event of the breach or threatened breach of
the provisions of this paragraph, Company shall be entitled to
injunctive relief as well as any other applicable remedies at law
or in equity.
10. ORGANIZING COMPETITIVE BUSINESSES; SOLICITING COMPANY EMPLOYEES.
Employee agrees that so long as he is working for
Company he will not undertake the planning or organizing of any
business activity competitive with the work he performs.
Employee acknowledges that the Company has made a significant
investment in developing and training a competent work force.
Employee agrees that he will not, for a period of two (2) years
following termination of employment with Company, directly or
indirectly, solicit any of the Company's employees to work for
Employee or any other competitive company.
11. PROTECTION OF COMPANY PROPERTY. All records, files
manuals, lists of customers, blanks, forms, materials, supplies,
computer programs and other materials furnished to the Employee
by the Company, used by him on its behalf, or generated or
obtained by him during the course of his employment, shall be and
remain the property of Company. Employee shall be deemed the
bailee thereof for the use and benefit of Company and shall
safely keep and preserve such property, except as consumed in the
normal business operations of Company. Employee acknowledges
that this property is confidential and is not readily accessible
to Company's competitors. Upon termination of employment
hereunder, the Employee shall immediately deliver to Company or
its authorized representative all such property, including all
copies, remaining in the Employee's possession or control.
12. ATTORNEY FEES AND EXPENSES. The Company shall pay all
legal fees and related expenses (including the costs of experts,
evidence and counsel) incurred by the Employee as they
become due as a result of the Employee seeking to obtain or enforce any
right or benefit provided by this Agreement or by any other plan
or arrangement maintained by the Company under which the Employee
is or may be entitled to receive benefits.
13. SUCCESSORS AND ASSIGNS.
(a) This Agreement shall be binding upon and shall
inure to the benefit of the Company, its successors and assigns
and the Company shall require any successor or assign 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 or assignment had taken
place. The term "Company" as used herein shall include such
successors and assigns. The term "successors and assigns" as
used herein shall mean a corporation or other entity acquiring
all or substantially all the assets and business of the Company
(including this Agreement) whether by operation of law or
otherwise.
(b) Neither this Agreement nor any right or interest
hereunder shall be assignable or transferable by the Employee,
his beneficiaries or legal representatives, except by will or by
the laws of descent and distribution. This Agreement shall inure
to the benefit of and be enforceable by the Employee's legal
personal representative.
14. NOTICES. Any notices required or permitted to be given
under this Agreement shall be sufficient in writing and if sent
by Certified Mail to:
Employee at:
000 Xxxxx Xxxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxx 00000
and to the Company at:
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attn: General Counsel
or such other address as either shall give to the other in
writing for this purpose.
15. WAIVER OF BREACH. The waiver of either party of a
breach of any provision of the Agreement shall not operate or be
construed as a waiver of any subsequent breach by the other
party.
16. ENTIRE AGREEMENT. This instrument contains the entire
Agreement of the parties. All contracts entered into which are
dated prior to this Agreement are considered null and void.
Employee agrees that no verbal or other statement; inducement or
representation relied upon by Employee for the execution of this
Agreement has been made to Employee which is not contained in
this Agreement. This Agreement may not be changed orally but
only by an agreement in writing
signed by the party against whom
enforcement of any waiver, change, modification, extension or
discharge is south. A waiver by Company of any condition or term
in this Agreement shall not be construed to have any effect on
the remaining terms and conditions nor shall said waiver, if any,
be construed as permanent or binding for the future.
17. SETTLEMENT OF CLAIMS. The Company's obligation to make
the payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any
circumstances, including, without limitation, any set-off,
counterclaim, defense, recoupment, or other right which the
Company may have against the Employee or others.
18. FLORIDA LAW TO GOVERN; VENUE. This Agreement shall be
governed by and construed according to the laws of the State of
Florida without giving effect to the conflict of law principles
thereof. Any action brought by any party relating to this
Agreement shall be brought and maintained in a court of competent
jurisdiction in Volusia County, Florida.
IN WITNESS WHEREOF, the parties have executed this Agreement
effective as of the date first set forth above.
WITNESSES:
/S/ XXXXXXX XXXXX /S/ X. XXXXX XXXXX
------------------ ___________________________________
X. XXXXX XXXXX
/S/ XXXXXX X. XXXXXXX
_____________________
as to Employee
WITNESSES: XXXXX & XXXXX, INC.
/S/ XXXXXXX XXXX By: /S/ XXX XXXXXXXXX
____________________ ___________________________
Xxx Xxxxxxxxx
Executive Vice President
/S/ XXXXXX X. XXXXXXX
_______________________
as to Xxxxx & Xxxxx
