TBC MANAGEMENT, LTD.
AMENDMENT NO. 3 TO EMPLOYMENT AGREEMENT
June ____, 2002
THIS AMENDMENT NO. 3 TO EMPLOYMENT AGREEMENT (the "Third Amendment") is
made this ___ day of ___________, 2002 by and between Xxxxxx X. Xxxxxxxxx
("Employee") and TBC Management, Ltd., a Texas limited partnership (the
"Company") and agreed to and accepted by Xxxxxx Boats & Motors, Inc., a Texas
corporation ("Xxxxxx Boats"). All capitalized terms, if not otherwise defined
herein, shall have the meanings ascribed in the "Letter Agreement" (as
hereinafter defined).
WHEREAS, Employee, Company and Xxxxxx Boats are parties to a certain
Letter Agreement dated November 16, 1999, as amended by an Amendment to
Employment Agreement dated April 5, 2001 and an Amendment No. 2 to Employment
Agreement dated March ___ 2002, which set forth the terms and conditions of
Employee's employment (together, the "Letter Agreement"); and
WHEREAS, the Company desires to propose continued employment to
Employee by way of this Third Amendment and amend the terms of the Letter
Agreement in certain respects.
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby amend the Letter
Agreement as follows and all other terms, conditions and covenants shall remain
unchanged:
1. (A) Employee and Company agree that the Letter Agreement is hereby
amended by deleting the first sentence of Section 2 of the Letter Agreement in
its entirety and replacing it with the following:
"2. Extent of Service. The term of this employment contract
with the Company shall expire on the sixth anniversary of the Effective Date (as
defined in paragraph 3 hereof) of this Letter Agreement, unless sooner
terminated in accordance with the terms hereof. The expiration hereof shall not
terminate employment, it shall merely terminate the contractual provisions of
this Letter Agreement."
(B) By adding to Section 5 of the Letter Agreement the
following sentence as the last sentence thereof:
"All non-qualified stock options granted to Employee under the
Xxxxxx Boats & Motors, Inc. 1995 Incentive Plan during the 1995 calendar year
shall be modified from a ten (10) year life from the date of grant to a twelve
(12) year life from the date of grant. Accordingly, such options shall not
expire until May 17, 2007. Accordingly, the life of all option agreements
covering such options shall automatically, and without further action on the
part of any party hereto, be extended and shall expire on May 17, 2007."
(C) By deleting Section 9 of the Letter Agreement in its
entirety and replacing it with the following:
"9. Termination; Resignation; Severance. This Letter Agreement
may be terminated as follows:
(a) For Cause. This Agreement may be terminated for Cause (as
hereinafter defined) at any time by the Company effective immediately upon
written notice to the Employee, and upon such termination, or in the event of
resignation by Employee (other than resignation during the sixty (60) day period
following a Change of Control), all of the Employee's rights to payments (other
than payment for services already rendered and expenses incurred through the
date of such termination or resignation) and any other benefits otherwise due
hereunder shall cease on the date of such termination or resignation.
The Company shall have "Cause" for termination of the Employee
if any of the following has occurred:
(i) Employee's gross neglect or willful failure to
perform substantially his duties hereunder, which failure (if
it can be cured) is not cured within thirty (30) days after
written notice of such failure from the Company to Employee;
(ii) an act or acts on Employee's part constituting a
crime which involves dishonesty or breach of trust or
constituting a felony under the laws of the United States or
any state thereof, upon Employee's conviction therefor;
(iii) any fraud, embezzlement, misappropriation of
funds or any crime of moral turpitude by Employee; or
(iv) the Employee has breached any material provision
or covenant contained in this Letter Agreement, which breach
(if it can be cured) shall not have been cured within thirty
(30) days after written notice of such breach from the Company
to Employee.
(b) Without Cause. This Agreement may be terminated without
Cause at any time by the Company effective immediately upon written notice to
the Employee, and upon such termination, the Employee shall receive from the
Company the greater of:
(i) the amount of salary payable, plus accrued bonus,
if any, during the remaining portion of the term of this
Letter Agreement, which amounts shall be payable in the same
manner as such compensation would have been payable had you
not been terminated, provided that the Company may elect to
pay or you may elect to receive such compensation as a lump
sum payment; or
(ii) one (1) month severance for each full year of
service with Xxxxxx Boats and one-twelfth (1/12) of one (1)
month's severance for each full calendar month of service
during any partial year of service with Xxxxxx Boats, which
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amounts shall be payable in the same manner as such
compensation would have been payable had you not been
terminated, provided that the Company may elect to pay or you
may elect to receive such compensation as a lump sum payment.
(c) Resignation; Change of Control. In the event you submit
your resignation within the sixty (60) day period after the date of a Change of
Control, then you will be entitled to receive 2.99 times your annual
compensation with proration of the annual bonus, if any, for the year in which
the Change of Control occurs, which amounts shall be payable over a three-year
period in the same manner as such compensation would have been payable had you
not resigned; provided, the Company may elect to pay or you may elect to receive
such compensation as a lump sum payment. Notwithstanding any other provision in
this Letter Agreement, any action taken, omission or event caused by Tracker
Marine, L.L.C., or any of its affiliates, shall not be deemed a Change of
Control unless Tracker Marine, L.L.C., or any of its affiliates, shall have
acquired fifty percent (50%) plus one (1) share of the common stock of Xxxxxx
Boats determined on a fully diluted basis, and, in which case, the maximum
Change of Control payment you will receive will be equal to one (1) month of
salary for each full year of service with Xxxxxx Boats and the sixty (60) day
period within which you may resign shall commence upon the date you receive
written notice of such Change of Control."
(D) By deleting Section 10(c) of the Letter Agreement in its
entirety.
(E) By adding to Section 11(b) of the Letter Agreement the
following sentence as the last sentence thereof: "Notwithstanding the
foregoing, in the event this Letter Agreement is not renewed upon any
expiration hereof, the non-compete provision herein shall be
eliminated.
2. The Letter Agreement, as amended by this Third Amendment, continues
in full force and effect. Except as expressly set forth herein, this Third
Amendment shall not affect the Letter Agreement dated November 16, 1999 nor any
of the agreements or other documents referred to therein.
IN WITNESS WHEREOF, the parties have executed this Third Amendment as
of the Effective Date.
TBC MANAGEMENT, LTD., a Texas limited partnership
By:
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Title:
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Address for Notices: EMPLOYEE
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Xxxxxx X. Xxxxxxxxx
(Signatures continued on the next succeeding page)
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AGREED TO AND ACCEPTED this ____ day of _____________, 2002.
XXXXXX BOATS & MOTORS, INC., a Texas corporation
By:
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Title:
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By:
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Title: Chairman of the Compensation
Committee of the Board of Directors
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