EXHIBIT 10.2.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is dated as of August 15,
---------
1996, between Signature Resorts, Inc., a Maryland corporation (the "Company"),
-------
and Xxxxxx X. Xxxxxxxxx (the "Executive").
---------
1. Employment. The Company hereby agrees to employ the Executive, and
----------
the Executive hereby agrees to be employed by the Company, on the terms and
conditions set forth herein.
2. Term. The employment of the Executive by the Company as provided in
----
Section 1 will commence on August 20, 1996 and will terminate at 12:01 a.m. on
August 14, 1998 (the "Expiration Date") unless automatically extended or sooner
---------------
terminated as hereinafter provided (such period, the "Employment Period").
-----------------
Unless terminated by the Executive or the Company prior to July 1, 1998, this
Agreement shall automatically renew on the terms set forth herein for a second
two-year period. If so renewed, no later than May 1, 2000, the Company shall
notify the Executive with written notice as to whether the Company intends to
further renew or extend the Agreement (including proposals for such further
renewal which the Executive may accept, reject or negotiate, at his discretion).
3. Position, Duties and Responsibilities.
-------------------------------------
(a) Position. The Executive hereby agrees to serve as Chief Operating
--------
Officer and Secretary of the Company. In addition, for so long as the Executive
is an employee of the Company and is elected by the Company's stockholders, the
Executive hereby agrees to serve as a member of the Board. The Executive
understands that his position as a member of the Board is subject to the
nomination by the Company; provided that the Executive shall be a member of the
Board with a three-year term prior to the time the Company consummates any
public offering of securities and the Company agrees to use permissible
commercially reasonable efforts (subject to the exercise of its fiduciary
duties) to cause the nomination and election of the Executive to the Board
following any such public offering, subject to the terms and conditions of this
Agreement. The Executive shall devote his best efforts and substantially full
business time and attention to the performance of services to the Company in his
capacity as an officer thereof and as may reasonably be requested by the Board.
The Company shall retain full direction and control of the means and methods by
which the Executive performs the above services.
(b) Place of Employment. During the term of this Agreement, the
-------------------
Executive shall perform the services required by this Agreement at the Company's
place of business in the Los Angeles, California or San Francisco, California
metropolitan area; provided, however, that the Company will require the
Executive to travel extensively to other locations on the Company's business.
(c) Other Activities. Except with the prior written approval of the
----------------
Board (which the Board may grant or withhold in its sole and absolute
discretion), the Executive, during the Employment Period, will not (i) accept
any other employment, (ii) serve on the board of directors or similar body of
any other business entity (except as otherwise set forth below), or (iii)
engage, directly or indirectly, in any other business activity (whether or not
pursued for pecuniary advantage) that is or may be competitive with, or that
might place him in a competing position to, that of the Company or any of its
affiliates. Notwithstanding the foregoing, the Company agrees that the
Executive (or affiliates of the Executive) shall be permitted (i) to
undertake the activities set forth in Section 8 and (ii) to make any other
passive personal investment that is not in a business activity that is directly
or indirectly competitive with the Company.
4. Compensation and Related Matters.
--------------------------------
(a) Salary. During the Employment Period, the Company shall pay the
------
Executive a salary of not less than $280,000 during the first full year and at
such salary as determined by the Compensation Committee of the Board during the
second and subsequent years of the Executive's employment with the Company. All
salary is to be paid consistent with the standard payroll practices of the
Company (e.g., timing of payments and standard employee deductions, such as
----
income tax withholdings, social security, etc.). The Executive's performance
and salary shall be subject to review at the end of each fiscal year consistent
with the standard practices of the Company.
(b) Business Expenses. The Company shall reimburse the Executive in
-----------------
connection with the conduct of the Company's business upon presentation of
sufficient evidence of such expenditures consistent with the Company's policies
as in place from time to time.
(c) Other Benefits. The Executive shall be entitled to participate in
--------------
or receive health, welfare, life insurance, long-term disability insurance,
bonus plan and similar benefits as the Company provides generally from time to
time to its executives. The Company acknowledges that within a reasonable time
following the execution of this Agreement, it will execute an option agreement
substantially in the form attached as Exhibit A hereto (the "Option Agreement")
and will institute and grant the Executive benefits under the equity
participation plan substantially in the form attached as Exhibit B hereto (the
"Option Plan"). Except as otherwise set forth in this Section 4 and except with
respect to the Company's obligations under this Agreement with respect to the
Option Agreement and the Option Plan, nothing herein is intended, or shall be
construed to require the Company to institute or continue any, or any
particular, plan or benefits.
(d) Bonus. Upon completion of the Company's public offering, the
-----
Compensation Committee of the Board shall establish, monitor, and oversee an
incentive bonus program for the Executive which will provide for payment of a
cash bonus of up to 100% of the Executive's then annual base salary paid to the
Executive during the applicable fiscal year, if certain performance objectives
established by the Compensation Committee for the Executive (such as specified
targets of growth in revenues and earnings per share) are achieved. Such bonus
compensation would be prorated for the first fiscal year of the Executive's
employment ending on December 31, 1996. Such incentive program would provide
for specific partial bonus achievement hurdles in connection with this program
as well. Each subsequent year thereafter, the Compensation Committee of the
Board will monitor, review and modify this program as necessary to reflect the
Executive's contributions to the Company.
(e) Fringe Benefits. The Executive will be entitled to fringe
---------------
benefits as may be determined or granted from time-to-time by the Board.
2
(f) Vacation. The Executive shall be entitled to four vacation weeks
--------
(20 days) in each calendar year on a pro-rated basis. The Executive will be
entitled to all Company holidays.
(g) Performance Reviews. At the end of each fiscal year, the Board
-------------------
will review the Executive's job performance and will provide the Executive a
written review of the Executive's job performance during the prior year and
implement any Board determined revisions to the Executive's base salary, the
Executive's merit bonus, the Executive's prospective incentive compensation
package (including the Executive's participation in the Option Plan), the
Executive's title and/or the Executive's responsibility at the Company;
provided, however, that the provisions set forth in this Agreement with respect
to the Executive's compensation, the Option Agreement and the terms and
conditions of the Executive's employment at the Company cannot be modified by
the Board in a manner which would result in less favorable or beneficial terms
or conditions thereof being imposed on the Executive without the Executive's
full concurrence and consent.
5. Termination. The Executive's employment hereunder shall be, or may
-----------
be, as the case may be, terminated under the following circumstances:
(a) Death. The Executive's employment hereunder shall terminate upon
-----
his death.
(b) Disability. The Executive's employment hereunder shall terminate
----------
on the Executive's physical or mental disability or infirmity which, in the
opinion of a competent physician selected by the Board, renders the Executive
unable to perform his duties under this Agreement for more than 120 days during
any 180-day period.
(c) Cause. The Company may terminate the Executive's employment
-----
hereunder for "Cause." Cause shall mean (i) Employee's material breach of any
-----
of the terms of this Agreement, (ii) his conviction of a crime involving moral
turpitude or constituting a felony under the laws of any state, the District of
Columbia or of the United States, or (iii) his gross negligence, willful
misconduct or fraud in the performance of his duties hereunder.
(d) Employment-At-Will/Termination for Any Reason. Notwithstanding
---------------------------------------------
the term of this Agreement having a duration of two years and Sections 2 and 4
hereof referring to extensions of this Agreement and the annual salary to be
paid to the Executive during each of the first five full years of his employment
with the Company, nothing in this Agreement should be construed as to confer any
right of the Executive to be employed by the Company for a fixed or definite
term. Subject to Section 6 hereof, the Executive hereby agrees that the Company
may dismiss him under this Section 5(d) without regard (i) to any general or
specific policies (whether written or oral) of the Company relating to the
employment or termination of its employees, or (ii) to any statements made to
the Executive, whether made orally or contained in any document, pertaining to
the Executive's relationship with the Company. Notwithstanding anything to the
contrary contained herein, including Sections 2 and 4, the Executive's
employment with the Company is not for any specified term, is at will and may be
terminated by the Company at any time by delivery of a notice of termination to
the Executive, for any reason, with or without cause, without liability except
with respect to the payments provided for by Section 6.
3
(e) Voluntary Resignation. The Executive may voluntarily resign his
---------------------
position and terminate his employment with the Company at any time by delivery
of a written notice of resignation to the Company (the "Notice of Resignation").
---------------------
The Notice of Resignation shall set forth the date such resignation shall become
effective (the "Date of Resignation"), which date shall, in any event, be at
-------------------
least ten (10) days and no more than thirty (30) days from the date the Notice
of Resignation is delivered to the Company. At its option, the Company may
reduce such notice period to any length, upon thirty (30) days written notice to
the Executive.
(f) Notice. Any termination of the Executive's employment by the
------
Company shall be communicated by written Notice of Termination to the Executive.
For purposes of this Agreement, a "Notice of Termination" shall mean a notice
---------------------
that shall indicate the specific termination provision in this Agreement relied
upon and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive's employment under
the provision so indicated.
(g) "Date of Termination" shall mean (i) if the Executive's employment
-------------------
is terminated by his death, the date of his death, (ii) if the Executive's
employment is terminated by reason of his disability, the date of the opinion of
the physician referred to in Section 5(b), above, (iii) if the Executive's
employment is terminated by the Company for Cause pursuant to subsection 5(c)
above, or without Cause by the Company pursuant to subsection 5(d) above, the
date specified in the Notice of Termination and (iv) if the Executive
voluntarily resigns pursuant to subsection 5(e) above, the date of the Notice of
Resignation.
(h) Termination Obligations.
-----------------------
(i) The Executive hereby acknowledges and agrees that all
personal property and equipment furnished to or prepared by the Executive
in the course of or incident to his employment, belongs to the Company and
shall be promptly returned to the Company upon termination of the
Employment Period. "Personal property" includes, without limitation, all
-----------------
books, manuals, records, reports, notes, contracts, lists, blueprints, and
other documents, or materials, or copies thereof (including computer
files), and all other proprietary information relating to the business of
the Company. Following termination, the Executive will not retain any
written or other tangible material containing any proprietary information
of the Company.
(ii) Upon termination of the Employment Period, the Executive
shall be deemed to have resigned from all offices and directorships then
held with the Company or any affiliate.
(iii) The representations and warranties contained herein and
the Executive's obligations under Sections 5(h), 7, 8, 9 and 15 through 18
shall survive termination of the Employment Period and the expiration of
this Agreement. Nothing herein shall modify Employee's mediation and other
rights under this Agreement.
(i) Release. In exchange for the Company entering into the Agreement,
-------
the Executive agrees that, at the time of his resignation or termination from
the Company, he will resign from the Board and will execute a release acceptable
to the Company of all liability of the
4
Company and its officers, shareholders, employees and directors to the Executive
in connection with or arising out of his employment with the Company, except
with respect to any then-vested rights under the Company's Option Plan and
except with respect to any Severance Payments which may be payable to him under
the terms of the Agreement.
6. Compensation Upon Termination.
-----------------------------
(a) Death. If the Executive's employment shall be terminated pursuant
-----
to Section 5(a), the Company shall pay the Executive monthly his base salary
payable pursuant to Section 4(a) and one-twelfth of any bonus payable pursuant
to Section 4(d) at the most recent annual amount received, or entitled to be
received, by the Executive (the "Severance Payment") for a period of two years
following the Date of Termination. At the Executive's own expense, the
Executive's dependents shall also be entitled to any continuation of health
insurance coverage rights under any applicable law.
(b) Disability. If the Executive's employment shall be terminated by
----------
reason of disability pursuant to Section 5(c), the Executive shall receive the
Severance Payment for the lesser of two years or the duration of such
disability; provided that payments so made to the Executive during the
disability shall be reduced by the sum of the amounts, if any, payable to the
Executive at or prior to the time of any such payment under any disability
benefit plan of the Company. At the Executive's own expense, the Executive and
his dependents shall also be entitled to any continuation of health insurance
coverage rights under any applicable law.
(c) Cause. If the Executive's employment shall be terminated for
-----
Cause pursuant to Section 5(c) hereof, the Company shall pay the Executive his
salary and any bonus then payable pursuant to Section 4(d)) through the Date of
Termination. At the Executive's own expense, the Executive and his dependents
shall also be entitled to any continuation of health insurance coverage rights
under any applicable law.
(d) Other Terminations by the Company. If the Company shall terminate
---------------------------------
the Executive's employment without cause pursuant to Section 5(d) hereof, the
Company shall pay the Executive the Severance Payment for a period of two (2)
years from the Date of Termination. The Executive and his dependents shall also
be entitled to any continuation of health insurance coverage rights under any
applicable law.
(e) Voluntary Resignation. If the Executive terminates his employment
---------------------
with the Company pursuant to Section 5(g) hereof for "Good Cause", the Company
shall pay the Executive the Severance Payment for a period of two years from the
Date of Resignation. If the Executive terminates his employment with the
Company pursuant to Section 5(g) hereof without "Good Cause," the Company shall
have no obligation to compensate the Executive following the Date of
Resignation. In any event, at the Executive's own expense, the Executive and
his dependents shall be entitled to any continuation of health insurance
coverage rights under any applicable law.
For purposes of this Agreement, "Good Cause" shall mean, without the
express written consent of Executive, the occurrence of any of the following
events unless such events are substantially corrected within 30 days following
written notification by Executive to the
5
Company that he intends to terminate his employment hereunder for one of the
reasons set forth below:
(i) Any material alteration, reduction or diminution in the duties,
responsibilities and status of Executive's position;
(ii) a material breach by the Company of any provision of this
Agreement; and
(iii) the occurrence of a "Change in Control."
As used in this Agreement, "Change of Control" means the occurrence of
any of the following: (i) the adoption of a plan relating to the liquidation or
dissolution of the Company, (ii) the consummation of any transaction (including,
without limitation, any merger or consolidation) the result of which is that any
person or group, other than any of Xxxxx Xxxxxx, Xxxxxx X. Xxxxxx and Xxxxxx X.
Xxxxxxxxx or their affiliates (the "Principals"), becomes the "beneficial owner"
(as such term is defined in Rule 13d-3 and Rule 13d-5 under the Securities
Exchange Act of 1934), directly or indirectly, of more than 50% of the total
voting power of the total outstanding voting stock of the Company on a fully
diluted basis or (iii) the consummation of the first transaction (including,
without limitation, any merger or consolidation) the result of which is that any
person or group, other than the Principals, becomes the beneficial owner (as
defined above), directly or indirectly, of more than 50% of the total voting
power of the total outstanding voting stock of the Company.
The Executive understands that any voluntary resignation by him as a
result of any personal or family reasons not otherwise set forth in this Section
6(e) shall not constitute "Good Cause."
(f) The Company will be entitled to offset and reduce each month the
amount of the monthly Severance Payment otherwise payable to the Executive
hereunder by the amount of the Executive's prior month's earnings (if any) from
post-Company full time employment (including both salary, bonus and other cash
or cash equivalent compensation) at a subsequent full time employer or in
connection with a full time consulting practice or other self-employment or any
full time venture founded by the Executive; provided, however, that the Company
shall not be entitled to any Severance Payment offset or reduction as a result
of any earnings or income generated by the Executive from part-time consulting
work, unless and until such consulting work becomes a full time endeavor.
(g) In the event of any Termination pursuant to Section 5, the
Executive shall be entitled to retain any and all options to purchase capital
stock of the Company granted to the Executive pursuant to the terms and
conditions of the Option Agreement attached as Exhibit A hereto that have vested
as of the date of such Termination.
(h) Any Severance Payment made pursuant to this Section 6 shall be
payable in equal monthly installments over the required duration set forth in
Sections 6(a) through 6(e).
(i) The continuing obligation of the Company to make the Severance
Payment to the Executive is expressly conditioned upon the Executive complying
and continuing to comply
6
with his obligations and covenants under Sections 7 and 8 of this Agreement
following termination of employment with the Company.
7. Confidentiality and Non-Solicitation Covenants.
----------------------------------------------
(a) Confidentiality. In addition to the agreements set forth in
---------------
Section 5(h)(i), the Executive hereby agrees that the Executive will not, during
the Employment Period or at any time thereafter directly or indirectly disclose
or make available to any person, firm, corporation, association or other entity
for any reason or purpose whatsoever, any Confidential Information (as defined
below). The Executive agrees that, upon termination of his employment with the
Company, all Confidential Information in his possession that is in written or
other tangible form (together with all copies or duplicates thereof, including
computer files) shall be returned to the Company and shall not be retained by
the Executive or furnished to any third party, in any form except as provided
herein; provided, however, that the Executive shall not be obligated to treat as
confidential, or return to the Company copies of any Confidential Information
that (i) was publicly known at the time of disclosure to the Executive, (ii)
becomes publicly known or available thereafter other than by any means in
violation of this Agreement or any other duty owed to the Company by any person
or entity or (iii) is lawfully disclosed to the Executive by a third party. As
used in this Agreement the term "Confidential Information" means: information
------------------------
disclosed to the Executive or known by the Executive as a consequence of or
through his relationship with the Company, about the owners, customers,
employees, business methods, public relations methods, organization, procedures
or finances, including, without limitation, information of or relating to owner
or customer lists of the Company and its affiliates.
(b) Non-Solicitation. In addition, the Executive hereby agrees that
----------------
during the Employment Period and at all times thereafter, regardless of the
reason or circumstances of termination of employment with the Company, the
Executive will not, either on his own account or jointly with or as a manager,
agent, officer, employee, consultant, partner, joint venturer, owner or
shareholder or otherwise on behalf of any other person, firm or corporation, (i)
carry on or be engaged or interested directly or indirectly in, or solicit, the
manufacture or sale of goods or provision of services to any person, firm or
corporation which, at any time during the Employment Period has been or is a
customer of or in the habit of dealing with the Company in its business, (ii)
endeavor directly or indirectly to canvas or solicit in competition with Company
or to interfere with the supply of orders for goods or services from or by any
person, firm or corporation which during the Employment Period has been or is a
supplier of goods or services to Company or (iii) directly or indirectly solicit
or attempt to solicit away from Company any of its officers or employees or
offer employment to any person who, on or during the 6 months immediately
preceding the date of such solicitation or offer, is or was an officer or
employee of Company.
8. Covenant Not to Compete.
-----------------------
(a) The Executive agrees that during the Employment Period he will
devote substantially full-time to the business of the Company and not engage in
any competitive businesses. Subject to such full-time requirement and the
restrictions set forth below in this Section 8 and Section 3(c) above, the
Executive shall be permitted to continue his existing business investments and
activities and may pursue additional business investments; provided that
7
the Executive not serve as officer of any public company resulting from such
business investments. The Executive agrees that he shall not (i) invest in,
manage, consult or participate in any way in any other timeshare business (in
either an active or passive manner), (ii) participate in or advise any business
wherein timeshare is a relevant business segment or (iii) act for or on behalf
of any business that intends to enter or participate in the timeshare business,
in each case unless the independent members of the Company's Board of Directors
determine that such action is in the best interest of the Company.
Notwithstanding the foregoing, the Executive may purchase stock as a stockholder
in any publicly traded company, including any company which is involved in the
timeshare business; provided that the Executive does not own (together or
separately or through his affiliates) more than 5% of any company (other than
the Company) in the timeshare business. In addition, the Executive shall not
invest (directly or indirectly) in any timeshare property in the hospitality
business (including any condominium project) or any property where the business
plan therefor includes an intention to convert the property to timeshare, unless
the independent members of the Company's Board of Directors determine that such
an investment is in the best interest of the Company.
(b) Notwithstanding anything to the contrary in this Section 8 or
elsewhere in this Agreement, the Executive and/or affiliates thereof is
permitted, at his option, to pursue the development of a timeshare resort on
that certain property located on Harbor Island, San Diego, California, owed by
the Port of San Diego. In the event the Executive or affiliate thereof so
acquires such an interest, the Company has the option, at its election (which
the Company may exercise at any time), to require the Executive or affiliate
thereof to sell such interest to the Company at a price not to exceed 50% of the
cumulative actual, direct cost incurred by the Executive or affiliate thereof in
pursuing the development or acquisition of such property. In addition, at the
direction of the independent members of the Company's Board of Directors, at any
time following the decision by the Company not to acquire such interest, the
Executive agrees to sell his interest in such property, and to divest himself of
any interest in any affiliate possessing any controlling or managing interest
therein, within six months after receipt of notice from the Company to do so,
unless the independent members of the Board determine that such investment by or
interest held by the Executive is in the best interest of the Company.
(c) Further, notwithstanding anything to the contrary in this Section
8 or elsewhere in this Agreement, and without limiting the rights of the
Executive otherwise applicable under this Agreement, the Executive or affiliates
thereof is permitted to continue to meet its duties (i) as managing general
partner with respect to (A) a 225-unit condominium project in Long Beach,
California which is being marketed for whole share unit sales or long-term
residential use rather than vacation use (and with respect to which affiliates
of the Executive (the "KOAR Interests") currently own the unsold units in such
project, the balance having been sold to third parties) and (B) several retail
centers and a proposed office development project and (ii) as constituent
general partner of a number of partnerships, which partnerships include five
Embassy Suites hotels which are owned by partnerships controlled by affiliates
of the Executive (the "Prior Partnerships"). Such duties with respect to the
KOAR Interests and the Prior Partnerships may include the sale, refinancing,
restructuring and packaging thereof, and the formation of public or private
entities for such purpose, including the formation of a public real estate
investment trust ("REIT") for any or all of the properties owned by the KOAR
Interests or Prior Partnerships; provided the Executive not serve as an officer
or employee of such REIT. The Executive agrees, however, to continue to retain
third party management companies to
8
manage the properties owned by the KOAR Interests and the Prior Partnerships and
to employ personnel not employed by the Company to carry out the day-to-day
responsibilities of managing and overseeing such properties.
(d) The provisions of this Section 8 shall survive for two years
following any termination of employment, regardless of whether the termination
is for "Good Cause" or otherwise.
9. Injunctive Relief and Enforcement. In the event of breach by the
---------------------------------
Executive of the terms of Sections 5(h)(i), 7 or 8, and only following mediation
or attempted mediation as set forth in Section 16 below (unless the Company is
suffering irreparable injury, in which case Section 16 will not prevent the
Company from seeking injunctive relief against the Executive in any court or
forum), the Company shall be entitled to institute legal proceedings to enforce
the specific performance of this Agreement by the Executive and to enjoin the
Executive from any further violation of Sections 5(h)(i), 7 or 8 and to exercise
such remedies cumulatively or in conjunction with all other rights and remedies
provided by law and not otherwise limited by this Agreement. The Executive
acknowledges, however, that the remedies at law for any breach by him of the
provisions of Sections 5(h)(i), 7 or 8 may be inadequate. In addition, in the
event the agreements set forth in Sections 5(h)(i), 7 or 8 shall be determined
by any court of competent jurisdiction to be unenforceable by reason of
extending for too great a period of time or over too great a geographical area
or by reason of being too extensive in any other respect, each such agreement
shall be interpreted to extend over the maximum period of time for which it may
be enforceable and to the maximum extent in all other respects as to which it
may be enforceable, and enforced as so interpreted, all as determined by such
court in such action.
10. Notice. For the purposes of this Agreement, notices, demands and all
------
other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given when personally delivered when
transmitted by telecopy with receipt confirmed, or one day after delivery to an
overnight air courier guaranteeing next day delivery, addressed as follows:
If to the Executive: Xxxxxx X. Xxxxxxxxx
000 Xxxxxx X
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
If to the Company: Signature Resorts, Inc.
000 Xxxxxxxx Xxxx.
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
With a copy to: Xxxxxx & Xxxxxxx
000 Xxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxx Xxxxxxxxxxxx, Xx., Esq.
9
or to such other address as any party may have furnished to the others in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
11. Severability. The invalidity or unenforceability of any provision or
------------
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect; provided, however, that if any one or more of the terms contained in
Sections 5(h), 7 or 8 hereto shall for any reason be held to be excessively
broad with regard to time, duration, geographic scope or activity, that term
shall not be deleted but shall be reformed and constructed in a manner to enable
it to be enforced to the extent compatible with applicable law.
12. Assignment. This Agreement may not be assigned by the Executive, but
----------
may be assigned by the Company to any successor to its business and will inure
to the benefit and be binding upon any such successor.
13. Counterparts. This Agreement may be executed in several counterparts,
------------
each of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
14. Headings. The headings contained herein are for reference purposes
--------
only and shall not in any way affect the meaning or interpretation of this
Agreement.
15. Choice of Law. This Agreement shall be construed, interpreted and the
-------------
rights of the parties determined in accordance with the laws of the State of
Maryland (without reference to the choice of law provisions of Maryland), except
with respect to matters of law concerning the internal corporate affairs of any
corporate entity which is a party to or the subject of this Agreement, and as to
those matters the law of the jurisdiction under which the respective entity
derives its powers shall govern.
16. Mediation. Subject to any irreparable injury being suffered by the
---------
Company giving rise to the right of the Company to seek injunctive relief
against the Executive pursuant to Section 9 hereof, in the event that there
shall be a dispute among the parties arising out of or relating to this
Agreement, or the breach thereof, the parties agree that such dispute shall be
resolved by final and binding mediation in Los Angeles, California, before a
mediator and on terms and conditions mutually acceptable to the parties;
provided, however, that if the parties cannot agree on the terms and conditions
of such mediation, such terms and conditions shall be established by the
mediator. Any award issued as a result of such mediation shall be final and
binding between the parties thereto, and shall be enforceable by any court
having jurisdiction over the party against whom enforcement is sought. The fees
and expenses relating to such mediation (with the exception of the Executive's
attorneys' fees, if any) or any action to enforce a mediation award shall be
paid by the Company.
17. LIMITATION ON LIABILITIES. IF EITHER THE EXECUTIVE OR THE COMPANY IS
-------------------------
AWARDED ANY DAMAGES AS COMPENSATION FOR ANY BREACH OR ACTION RELATED TO THIS
AGREEMENT, A BREACH OF ANY COVENANT CONTAINED IN THIS AGREEMENT (WHETHER EXPRESS
OR IMPLIED BY EITHER LAW OR FACT), OR ANY OTHER CAUSE OF ACTION BASED IN WHOLE
OR IN
10
PART ON ANY BREACH OF ANY PROVISION OF THIS AGREEMENT, SUCH DAMAGES SHALL BE
LIMITED TO CONTRACTUAL DAMAGES AND SHALL EXCLUDE (I) PUNITIVE DAMAGES, AND (II)
CONSEQUENTIAL AND/OR INCIDENTAL DAMAGES (E.G., LOST PROFITS AND OTHER INDIRECT
----
OR SPECULATIVE DAMAGES). THE MAXIMUM AMOUNT OF DAMAGES THAT THE EXECUTIVE MAY
RECOVER FOR ANY REASON SHALL BE THE AMOUNT EQUAL TO ALL AMOUNTS OWED (BUT NOT
YET PAID) TO THE EXECUTIVE PURSUANT TO THIS AGREEMENT THROUGH ITS NATURAL TERM
OR THROUGH ANY SEVERANCE PERIOD, PLUS INTEREST ON ANY DELAYED PAYMENT AT THE
MAXIMUM RATE PER ANNUM ALLOWABLE BY APPLICABLE LAW FROM AND AFTER THE DATE(S)
THAT SUCH PAYMENTS WERE DUE.
18. WAIVER OF JURY TRIAL. TO THE EXTENT APPLICABLE, EACH OF THE PARTIES
--------------------
TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL
OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR
ANY
11
DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT.
19. Entire Agreement. This Agreement contains the entire agreement and
----------------
understanding between the Company and the Executive with respect to the
employment of the Executive by the Company as contemplated hereby, and no
representations, promises, agreements or understandings, written or oral, not
herein contained shall be of any force or effect. This Agreement shall not be
changed unless in writing and signed by both the Executive and the Board of
Directors of the Company.
20. The Executive's Acknowledgment. The Executive acknowledges (a) that
------------------------------
he has had the opportunity to consult with independent counsel of his own choice
concerning this Agreement, and (b) that he has read and understands the
Agreement, is fully aware of its legal effect, and has entered into it freely
based on his own judgment.
IN WITNESS WHEREOF, the parties have executed this Employment
Agreement as of the date and year first above written.
SIGNATURE RESORTS, INC.
/s/Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title:President
EXECUTIVE
/s/Xxxxxx X. Xxxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxxx
12
Exhibit A
Form of Option Agreement
13
