EXHIBIT 10(p)
CONTRACT TERMINATION AGREEMENT
This Contract Termination Agreement (this "Agreement") is made and
entered into effective as October 31, 2002 (the "Effective Date") by and among
Xxxxxxxx, Inc., a Delaware Corporation ("Xxxxxxxx"), Xxxxx X. Xxxxx, III, an
individual ("Xxxxx"), and Xxxxx Communications, Inc. ("NCI").
BACKGROUND
X. Xxxxxxxx, Xxxxx and NCI previously entered into that certain
Promotion Agreement, effective as of November 1, 2001 (the "Promotion
Agreement").
B. The parties wish to terminate the Promotion Agreement as of the
Effective Date of this Agreement.
C. The parties further wish to enter into and document a new
promotional agreement (the "New Agreement") on the terms set forth
below.
AGREEMENT
1. TERMINATION OF PROMOTION AGREEMENT. Xxxxxxxx, Xxxxx and NCI hereby agree
that, as of the Effective Date of this Agreement, the Promotion Agreement
is hereby terminated by mutual agreement. All parties acknowledge and agree
that each party properly performed all obligations and duties required of
it or him up through the Effective Date of this Agreement; provided,
however, that Xxxxxxxx shall promptly calculate and pay to Xxxxx all unpaid
fees for director compensation consistent with the fees paid to other
outside Directors. All parties further acknowledge and agree that all
future obligations and duties required of each party after the Effective
Date of this Agreement shall be governed by the terms of the New Agreement
(and this Agreement) and that all parties are hereby released from future
obligations based upon or arising under the Promotion Agreement.
In this regard, all of the Options granted to Xxxxx pursuant to Sections 16
through 21, inclusive, of the Promotion Agreement (i.e., the second through
seventh Options, inclusive) are hereby cancelled in accordance with the
terms of Sections 16 through 21, inclusive. In addition, Xxxxxxxx shall
have no obligation to grant to Xxxxx additional options for 10,000 shares
pursuant to Section 22 of the Promotion Agreement, but Xxxxx shall be
entitled, as long as he serves as a Director of Xxxxxxxx, to receive
outside Director compensation (consistent with Board policy) separate from
this Agreement or the New Agreement. With respect to the first Option for
40,000 shares granted to Xxxxx pursuant to Section 15 of the Promotion
Agreement, however, Xxxxx shall have the right to exercise such first
Option up until the earlier of (a) November 1, 2007 or (b) the date of
termination of the New
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Agreement by Xxxxxxxx if occurring prior to October 31, 2004,
notwithstanding the termination of the Promotion Agreement as of the
Effective Date of this Agreement.
2. NEW AGREEMENT. Xxxxxxxx, Xxxxx and NCI (or an affiliate of Xxxxx at his
election) hereby agree to document and enter into the New Agreement,
effective as of the Effective Date of this Agreement. The terms of the New
Agreement shall require the performance of substantially the same duties
and obligations as each party was obligated to provide under the terms of
the Promotion Agreement, except that Xxxxx shall be obligated to continue
the Services (as defined in the Promotion Agreement) up through January 15,
2007, and shall be paid an additional $50,000 for this extension in
quarterly installments of $12,500 commencing December 1, 2005. In this
regard, however, Xxxxxxxx shall not be obligated to grant any additional
stock options to Xxxxx for Services, but shall be obligated to pay the
following (annual) cash amounts (in quarterly installments commencing
December 1 for the first three years) during the following periods (in
addition to the annual consulting fee):
November 1, 2002 - October 31, 2003 $200,000
November 1, 2003 - October 31, 2004 $300,000
November 1, 2004 - October 31, 2005 $300,000
November 1, 2005 - January 15, 2007 $400,000
(payable 100% on
January 15, 2007)
The final $400,000 annual amount may, at Xxxxxxxx'x election, be paid in
cash, registered common stock of Xxxxxxxx (valued at fair market value on
the date of the stock issuance), or some combination thereof.
3. TIMING. The parties shall work together in the best of good faith to
execute and deliver the New Agreement by January 31, 2003.
4. BINDING OBLIGATION. Even though the definitive New Agreement may not be
signed and delivered until a later date, Section 2 of this Agreement and
the obligation of each party (or, at Xxxxx'x election, an affiliate of NCI)
to enter into the New Agreement on the terms specified in Section 2 are
binding and enforceable.
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In Witness Whereof, the parties have entered into this Agreement as of the
Effective Date.
Xxxxxxxx, Inc. Xxxxx X. Xxxxx, III
By: /s/ Xxxxxxx X. Xxxxxx, Xx. By: /s/ Xxxxx X. Xxxxx, III
------------------------- -----------------------
Xxxxxxx X. Xxxxxx, Xx. Xxxxx X. Xxxxx, III
Chairman, President and
Chief Executive Officer
Xxxxx Communications, Inc.
By: /s/ Xxxxx X. Xxxxx, III
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Xxxxx X. Xxxxx, III
President
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