EMPLOYMENT AGREEMENT
--------------------
EMPLOYMENT AGREEMENT (this "Agreement") dated as of July 15, 2002,
between XXXXXX XXXXXXX LTD., a Bermuda company (the "Company"), and Xxxxxx X.
Xxxxx (the "Executive").
The Company desires to hire the Executive and the Executive desires
to become employed by the Company on the terms and conditions set forth in this
Agreement.
Accordingly, the Company and the Executive hereby agree as follows:
1. EMPLOYMENT, DUTIES AND ACCEPTANCE.
1.1 EMPLOYMENT, DUTIES. The Company hereby agrees to employ the
Executive for the Term (as defined in Section 2.1), to render exclusive and
full-time services to the Company, in the capacity of chief financial officer of
the Company and to perform such other duties consistent with such position
(including service as a director or officer of any affiliate of the Company if
elected) as may be assigned by the Company's President, Chief Executive Officer
and Chairman of the Board of Directors ("C.E.O."); PROVIDED, however, that the
Executive may participate in civic, charitable, and industry organizations to
the extent that such participation does not materially interfere with the
performance of Executive's duties hereunder. The Executive's title shall be
Senior Vice President and Chief Financial Officer, or such other titles of at
least equivalent level consistent with the Executive's duties from time to time
as may be assigned to the Executive by the Company, and the Executive shall have
all authorities as are customarily and ordinarily exercised by executives in
similar positions in similar businesses of similar size in the United States.
1.2 ACCEPTANCE. The Executive hereby accepts such employment and
agrees to render the services described above. During the Term, and consistent
with the above, the Executive agrees to serve the Company faithfully and to the
best of the Executive's ability, to devote the Executive's entire business time,
energy and skill to such employment, and to use the Executive's best efforts,
skill and ability to promote the Company's interests.
1.3 LOCATION. The duties to be performed by the Executive hereunder
shall be performed primarily at the Company's offices in Clinton, New Jersey,
subject to reasonable travel requirements consistent with the nature of the
Executive's duties from time to time on behalf of the Company.
2. TERM OF EMPLOYMENT.
-------------------
2.1 TERM. The term of the Executive's employment under this Agreement
(the "Term") shall commence on July 15, 2002 or such earlier date in respect of
which the Executive provides at least three days advance written notice to the
Company (the "Effective Date"), and shall end on the earlier of (i) the fifth
anniversary of the Effective Date or (ii) the date on which the Term is
terminated pursuant to Section 4.
3. COMPENSATION; BENEFITS.
-----------------------
3.1 SALARY. As compensation for all services to be rendered pursuant
to this Agreement, the Company agrees to pay to the Executive during the Term a
base salary, payable monthly in arrears, at the initial annual rate of $425,000
(the "Base Salary"). On each anniversary of the Effective Date or such other
appropriate date during each year of the Term when the salaries of executives at
the Executive's level are normally reviewed, the C.E.O. shall review the Base
Salary and determine if, and by how much, the Base Salary should be increased.
All payments of Base Salary or other compensation hereunder shall be less such
deductions or withholdings as are required by applicable law and regulations.
3.2 BONUS. Executive shall be eligible to participate in the
Company's annual incentive program as in effect from time to time for executives
at the Executive's level which will provide a competitive bonus opportunity for
the achievement of certain objectives to be determined by the C.E.O. Initially,
the Executive's participation shall be in the discretionary bonus program
designated the "Xxxxxx Xxxxxxx Annual Incentive Plan for 2002 and Subsequent
Years."
3.3 STOCK OPTIONS. Executive will receive options to purchase Company
common stock according to the following. The exercise price for each grant below
shall be equal to the mean of the high and low price of Company common stock on
the grant date. Unless otherwise specified in this Agreement, each grant shall
have a term of ten years from the grant date.
3.3.1 On the Effective Date, the Company will grant the Executive
an option to purchase 300,000 shares of Company common stock. A portion of such
options representing 60,000 shares shall vest on each date immediately preceding
each of the first through fifth anniversaries of the Effective Date.
3.3.2 On the first anniversary of the Effective Date, the Company
will grant the Executive an option to purchase 62,500 shares of Company common
stock. A portion of such options representing 15,625 shares shall vest on each
date immediately preceding each of the second through fifth anniversaries of the
Effective Date.
3.3.3 On the second anniversary of the Effective Date, the Company
will grant the Executive an option to purchase 62,500 shares of Company common
stock. A portion of such options representing 20,833 shares shall vest on the
third and fourth anniversaries of the Effective Date. A portion of such options
representing 20,834 shares shall vest on the fifth anniversary of the Effective
Date.
3.4 RESTRICTED STOCK. On the Effective Date, the Company shall award
the Executive 15,000 Company common shares of restricted stock. A portion of
such restricted stock representing 3,000 shares shall vest on each date
immediately preceding each of the first through fifth anniversaries of the
Effective Date.
3.5 SIGNING BONUS. The Company shall pay to the Executive on the
Effective Date a bonus in the amount of $100,000 ("Signing Bonus"). If the
Company terminates the Executive for Cause (as defined below) or if the
Executive terminates employment with the
2
Company other than with Good Reason (as defined below), in either event before
the first anniversary of the Effective Date, the Executive shall repay to the
Company, within 30 days of such termination, the net, after-tax amount of the
Signing Bonus.
3.6 BUSINESS EXPENSES. The Company shall pay or reimburse the
Executive for all reasonable expenses actually incurred or paid by the Executive
during the Term in the performance of the Executive's services under this
Agreement, subject to and in accordance with applicable expense reimbursement
and related policies and procedures as in effect from time to time.
3.7 VACATION. During the Term, the Executive shall be entitled to an
annual, five weeks paid vacation period.
3.8 BENEFITS. During the Term, the Executive shall be entitled to
participate in those defined benefit, defined contribution, group insurance,
medical, dental, disability and other benefit plans of the Company as from time
to time in effect and on a basis no less favorable than any other executive at
the Executive's level. Notwithstanding this Section 3.8, the Executive shall not
be eligible to participate in the Company's current supplemental employee
retirement plan, known as the Xxxxxx Xxxxxxx Corporation Supplemental Employee
Retirement Plan, nor any successor or replacement plan.
3.9 PERQUISITES. During the Term, the Executive shall be entitled to
receive the following perquisites:
3.9.1 Company furnished automobile at a level no less favorable
than any other executive at the Executive's level;
3.9.2 Reimbursement net of taxes of annual financial planning
services at a level no less favorable than any other executive at the
Executive's level;
3.9.3 Reimbursement net of taxes on a one-time basis for legal
expenses associated with estate planning at a level no less favorable than any
other executive at the Executive's level;
3.9.4 Facsimile machine for use at the Executive's home;
3.9.5 Annual physical examination; and
3.9.6 Reasonable initiation and annual fees for membership in the
Executive's choice of any dining/business club as required to conduct the
Company's business.
3.10 RELOCATION ASSISTANCE. The Company will provide the Executive
the following relocation assistance net of taxes:
3.10.1 Furnished housing at Company expense for a twelve-month
period to a maximum of $4,500 per month;
3
3.10.2 Assistance with travel to and from the Executive's
permanent home during the first year of the Term including reimbursement of
weekend travel expenses to a twelve month maximum of $25,000;
3.10.3 Reimbursement of closing costs on the purchase of a home in
the Perryville, New Jersey area, provided the Executive purchases such home
within two years of the Effective Date; and
3.10.4 Reimbursement for relocation of household goods provided
the Executive relocates to a home in the Perryville, New Jersey area within two
years of the Effective Date.
3.11 CHANGE OF CONTROL. The Executive shall be covered under the
Company's Change in Control Agreement as in effect from time to time for
executives at the Executive's level. Any amounts and/or benefits payable, paid
or provided to the Executive under such Change in Control Agreement shall be in
lieu of and not in addition to amounts and/or benefits payable or provided under
this Agreement. Notwithstanding any provision of this Agreement or the Company's
Change in Control Agreement to the contrary, in the event that the Executive is
entitled to a bonus according to the terms of the Company's Change in Control
Agreement, such bonus shall be no less than 60% of the Executive's Base Salary
on the date the Executive's employment terminates.
4. TERMINATION.
4.1 TERMINATION EVENTS.
4.1.1 Executive's employment and the Term shall terminate
immediately upon the occurrence of any of the following:
(i) the death of the Executive;
(ii) the physical or mental disability of the Executive, whether
totally or partially, such that the Executive is unable to perform the
Executive's material duties, for a period of not less than one hundred and
eighty (180) consecutive days; or
(iii) notice of termination for "Cause". As used herein, "Cause"
means (i) conviction of, or plea of guilty to, a felony (except for motor
vehicle violations; (ii) the Executive engages in conduct that constitutes gross
misconduct or fraud in connection with the Executive's duties; or (iii) material
breach of the Agreement that the Executive has not cured to the Company's
reasonable satisfaction within thirty (30) days after the Company has provided
the Executive written notice of the breach.
4.1.2 The Executive may immediately resign the Executive's
position for Good Reason and, in such event, the Term shall terminate. As used
herein, "Good Reason" means without the Executive's consent (i) material change
in Executive's position causing it to be of materially less stature or
responsibility; (ii) a change in Executive's reporting relationship; or (iii)
relocation of the Executive's principal business location by the Company of
greater than fifty (50) miles.
4
4.1.3 The Company may terminate the Executive's employment thirty
(30) days following notice of termination without Cause given by the Company
and, in such event, the Term shall terminate.
4.1.4 The Executive may voluntarily resign the Executive's
position effective thirty (30) days following notice to the Company of the
Executive's intent to voluntarily resign without Good Reason and, in such event,
the Term shall terminate.
4.1.5 The date upon which Executive's employment and the Term
terminate pursuant to Section 2.1(i) or this Section 4.1 shall be the
Executive's "Termination Date" for all purposes of this Agreement.
4.2 PAYMENTS UPON A TERMINATION EVENT.
4.2.1 Following any termination of the Executive's employment, the
Company shall pay or provide to the Executive, or the Executive's estate or
beneficiary, as the case may be, (i) Base Salary earned through the Termination
Date; (ii) the balance of any earned but as yet unpaid, annual cash incentive or
other incentive awards; (iii) a payment representing the Executive's accrued but
unused vacation; (iv) any vested, but not forfeited benefits on the Termination
Date under the Company's employee benefit plans in accordance with the terms of
such plans; and (v) benefit continuation and conversion rights to which the
Executive is entitled under the Company's employee benefit plans.
4.2.2 Following a termination by the Company without Cause or by
the Executive for Good Reason, the Company shall pay or provide to the Executive
in addition to the payments in Section 4.2.1 above, (i) Base Salary in effect on
the Termination Date and an annual cash incentive payment equal to a percentage
of the Executive's Base Salary on the Termination Date equal to the average
percentage of base salaries paid as bonuses to the executives of the Company at
the Executive's level under the Company's annual incentive program (provided,
however, that if the Executive's termination under this Section 4.2.2 occurs
within one year of the termination or retirement of the C.E.O., that such annual
incentive payment shall be no less than 60% of the Executive's Base Salary on
the Termination Date), payable monthly for two years following the Termination
Date; (ii) continued benefits provided under Section 3.8 and perquisites under
Section 3.9 for two years following the Termination Date; (iii) for stock
options vested on the Termination Date, Executive shall have two years from the
Termination Date to exercise such vested options; (iv) executive level career
transition assistance services by a firm selected by the Executive and approved
by the Company; and (v) provided the Executive's employment is terminated
pursuant to this Section 4.2.2 within one year of the termination or retirement
of the C.E.O. who is C.E.O. on the Effective Date, full vesting of all granted
stock options and restricted stock which the Executive may exercise for a period
of two years following the Termination Date. Notwithstanding any other provision
of this Agreement, as consideration for the pay and benefits that the Company
shall provide the Executive pursuant to Sections 4.2.2, 4.2.3 or 4.2.4, the
Executive or the Executive's estate or beneficiary, as the case may be, shall
provide the Company an enforceable waiver and release agreement in a form that
the Company normally requires.
5
4.2.3 Following a termination of the Executive's employment due to
death or disability, in addition to the amounts payable under Section 4.2.1, the
Company shall pay or provide to the Executive, or the Executive's estate or
beneficiary, as the case may be, (i) Base Salary in effect on the date of the
Executive's death or disability and an annual cash incentive equal to a
percentage of the Executive's Base Salary on the Termination Date equal to the
average percentage of base salaries paid as bonuses to the executives of the
Company at the Executive's level under the Company's annual incentive program,
payable monthly for two years following the Termination Date; (ii) continued
benefits provided under Section 3.8 and perquisites under Section 3.9 for two
years following the Termination Date; and (iii) extended term of any stock
options vested on the Executive's Termination Date.
4.2.4 In addition to the amounts payable under Section 4.2.1, if
the Term of this Agreement terminates pursuant to Section 2.1(i) and the Company
has not made an offer to the Executive of continuing employment for a term of at
least one additional year in the position and with the base salary, annual bonus
opportunity, pension and other perquisites and benefits, and other terms and
conditions (except of the nature described in Sections 3.3, 3.4, 3.5 and this
Section 4.2.4 and other nonrecurring items and events but specifically
including, without limitation, 4.2.2 and 4.2.3) no less favorable to the
Executive than those hereunder, the Executive shall be entitled to no further
payments or benefits, except that the Company shall pay to the Executive an
amount equal to the Executive's Base Salary in effect on the Termination Date
and annual cash incentive equal to a percentage of the Executive's Base Salary
on the Termination Date equal to the average percentage of base salaries paid as
bonuses to the executives of the Company at the Executive's level under the
Company's annual incentive program, monthly for one year following the
Termination Date.
4.3 No Mitigation. Upon termination of the Executive's employment with
the Company, the Executive shall be under no obligation to seek other employment
or otherwise mitigate the obligations of the Company under this Agreement.
5. PROTECTION OF CONFIDENTIAL INFORMATION; NON-COMPETITION.
5.1 The Executive acknowledges that the Executive's services will be
unique, that they will involve the development of Company-subsidized
relationships with key customers, suppliers, and service providers as well as
with key Company employees and that the Executive's work for the Company will
give the Executive access to highly confidential information not available to
the public or competitors, including trade secrets and confidential marketing,
sales, product development and other data and information which it would be
impracticable for the Company to effectively protect and preserve in the absence
of this Section 5 and the disclosure or misappropriation of which could
materially adversely affect the Company. Accordingly, the Executive agrees:
5.1.1 except in the course of performing the Executive's duties
provided for in Section 1.1, not at any time, whether before, during or after
the Executive's employment with the Company, to divulge to any other entity or
person any confidential information acquired by the Executive concerning the
Company's or its subsidiaries' or affiliates' financial affairs or business
processes or methods or their research, development or marketing programs or
plans, or any other of its or their trade secrets. The foregoing prohibitions
shall include, without
6
limitation, directly or indirectly publishing (or causing, participating in,
assisting or providing any statement, opinion or information in connection with
the publication of) any diary, memoir, letter, story, photograph, interview,
article, essay, account or description (whether fictionalized or not) concerning
any of the foregoing, publication being deemed to include any presentation or
reproduction of any written, verbal or visual material in any communication
medium, including any book, magazine, newspaper, theatrical production or movie,
or television or radio programming or commercial. In the event that the
Executive is requested or required to make disclosure of information subject to
this Section 5.1.1 under any court order, subpoena or other judicial process,
then, except as prohibited by law, the Executive will promptly notify the
Company, take all reasonable steps requested by the Company to defend against
the compulsory disclosure and permit the Company to control with counsel of its
choice any proceeding relating to the compulsory disclosure. The Executive
acknowledges that all information, the disclosure of which is prohibited by this
section, is of a confidential and proprietary character and of great value to
the Company and its subsidiaries and affiliates.
5.1.2 to deliver promptly to the Company on termination of the
Executive's employment with the Company, or at any time that the Company may so
request, all confidential memoranda, notes, records, reports, manuals, drawings,
blueprints and other documents (and all copies thereof) relating to the
Company's (and its subsidiaries' and affiliates') business and all property
associated therewith, which the Executive may then possess or have under the
Executive's control.
5.2 In consideration of the Company's entering into this Agreement,
the Executive agrees that at all times during the Term and thereafter, the
Executive shall not, directly or indirectly, for Executive or on behalf of or in
conjunction with, any other person, company, partnership, corporation, business,
group, or other entity (each, a "Person"):
5.2.1 until the first anniversary of the Termination Date, provide
services to a "Competitor" (as defined below), as an officer, director, greater
than 5% shareholder, owner, partner, joint venturer, or in any other capacity,
whether as an executive, independent contractor, consultant, advisor, or sales
representative; or
5.2.2 until the second anniversary of the Termination Date, (i)
call upon any Person who is or that is, at such Termination Date, engaged in
activity on behalf of the Company or any subsidiary or affiliate of the Company
for the purpose or with the intent of enticing such Person to cease such
activity on behalf of the Company or such subsidiary or affiliate; or (ii)
solicit, induce, or attempt to induce any past or current customer of the
Company to cease doing business in whole or in part with or through the Company
or a subsidiary or affiliate, or to do business with any Competitor.
For purposes of this Agreement, "Competitor" means, on any date, a
person or entity that is primarily engaged in a material line of business
conducted by the Company.
5.3 If the Executive commits a breach of any of the provisions of
Section 5.1 or 5.2 hereof, the Company shall have the right and remedy to have
the provisions of this Agreement specifically enforced by any court having
equity jurisdiction, it being acknowledged and agreed that any such breach will
cause irreparable injury to the Company and that money damages
7
will not provide an adequate remedy to the Company, and, if the Executive
attempts or threatens to commit a breach of any of the provisions of Section 5.1
or 5.2, the right and remedy to be granted a preliminary and permanent
injunction in any court having equity jurisdiction against the Executive
committing the attempted or threatened breach, it being agreed that each of such
rights and remedies shall be independent of the others and shall be severally
enforceable, and that all of such rights and remedies shall be in addition to,
and not in lieu of, any other rights and remedies available to the Company under
law or in equity.
5.4 If any of the covenants contained in Section 5.1, 5.2 or 5.3, or
any part thereof, hereafter are construed to be invalid or unenforceable, the
same shall not affect the remainder of the covenant or covenants, which shall be
given full effect, without regard to the invalid portions.
5.5 The period during which the prohibitions of Section 5.2 are in
effect shall be extended by any period or periods during which the Executive is
in violation of Section 5.2.
5.6 If any of the covenants contained in Section 5.1 or 5.2, or any
part thereof, are held to be unenforceable because of the duration of such
provision or the area covered thereby, the parties agree that the court making
such determination shall have the power to reduce the duration and/or area of
such provision so as to be enforceable to the maximum extent permitted by
applicable law and, in its reduced form, said provision shall then be
enforceable.
5.7 The parties hereto intend to and hereby confer jurisdiction to
enforce the covenants contained in Sections 5.1, 5.2 and 5.3 upon the courts of
any state within the geographical scope of such covenants. In the event that the
courts of any one or more of such states shall hold such covenants wholly
unenforceable by reason of the breadth of such covenants or otherwise, it is the
intention of the parties' hereto that such determination not bar or in any way
affect the Company's right to the relief provided above in the courts of any
other states within the geographical scope of such covenants as to breaches of
such covenants in such other respective jurisdictions, the above covenants as
they relate to each state being for this purpose severable into diverse and
independent covenants.
6. INTELLECTUAL PROPERTY.
----------------------
Notwithstanding and without limiting the provisions of Section 5, the
Company shall be the sole owner of all the products and proceeds of the
Executive's services hereunder, including, but not limited to, all materials,
ideas, concepts, formats, suggestions, developments, arrangements, packages,
programs and other intellectual properties that the Executive may acquire,
obtain, develop or create in connection with or during the Term, free and clear
of any claims by the Executive (or anyone claiming under the Executive) of any
kind or character whatsoever (other than the Executive's right to receive
payments hereunder), the Executive shall, at the request of the Company, execute
such assignments, certificates or other instruments as the Company may from time
to time deem necessary or desirable to evidence, establish, maintain, perfect,
protect, enforce or defend its right, title or interest in or to any such
properties.
8
7. INDEMNIFICATION.
----------------
In addition to any rights to indemnification to which the Executive
is entitled under the Company's charter and by-laws, to the extent permitted by
applicable law, the Company will indemnify, from the assets of the Company
supplemented by insurance in an amount determined by the Company, the Executive
at all times, during and after the Term, and, to the maximum extent permitted by
applicable law, shall pay the Executive's expenses (including reasonable
attorneys' fees and expenses, which shall be paid in advance by the Company as
incurred, subject to recoupment in accordance with applicable law) in connection
with any threatened or actual action, suit or proceeding to which the Executive
may be made a party, brought by any shareholder of the Company directly or
derivatively or by any third party by reason of any act or omission or alleged
act or omission in relation to any affairs of the Company or any subsidiary or
affiliate of the Company of the Executive as an officer, director or employee of
the Company or of any subsidiary or affiliate of the Company. The Company shall
use its best efforts to maintain during the Term and thereafter insurance
coverage sufficient in the determination of the Company to satisfy any
indemnification obligation of the Company arising under this Section 7.
8. NOTICES.
--------
All notices, requests, consents and other communications required or
permitted to be given hereunder shall be in writing and shall be deemed to have
been duly given if delivered personally, one day after sent by overnight courier
or three days after mailed first class, postage prepaid, by registered or
certified mail, as follows (or to such other address as either party shall
designate by notice in writing to the other in accordance herewith):
If to the Company, to:
Xxxxxx Xxxxxxx, Inc.
Xxxxxxxxxx Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000-0000
Attention: General Counsel
If to the Executive, to the Executive's principal residence as
reflected in the records of the Company.
9. GENERAL.
--------
9.1 This Agreement shall be effective only upon a favorable review of
the Executive's physical examination and a legal and financial background
review.
9.2 This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of New Jersey applicable to agreements
made between residents thereof and to be performed entirely in New Jersey.
9.3 The section headings contained herein are for reference purposes
only and shall not in any way affect the meaning or interpretation of this
Agreement.
9
9.4 This Agreement sets forth the entire agreement and understanding
of the parties relating to the subject matter hereof, and supersedes all prior
agreements, arrangements and understandings, written or oral, relating to the
subject matter hereof including, but not limited to, that certain letter
agreement between the Company and/or its subsidiary and the Executive dated May
29, 2001. No representation, promise or inducement has been made by either party
that is not embodied in this Agreement, and neither party shall be bound by or
liable for any alleged representation, promise or inducement not so set forth.
9.5 This Agreement, and the Executive's rights and obligations
hereunder, may not be assigned by the Executive, nor may the Executive pledge,
encumber or anticipate any payments or benefits due hereunder, by operation of
law or otherwise. The Company may assign its rights, together with its
obligations, hereunder (i) to any affiliate or (ii) to a third party in
connection with any sale, transfer or other disposition of all or substantially
all of any business to which the Executive's services are then principally
devoted, provided that no assignment pursuant to clause (ii) shall relieve the
Company from its obligations hereunder to the extent the same are not timely
discharged by such assignee.
9.6 The respective rights and obligations of the parties hereunder
shall survive any termination of this Agreement or the Term to the extent
necessary to the intended preservation of such rights and obligations.
9.7 This Agreement may be amended, modified, superseded, canceled,
renewed or extended and the terms or covenants hereof may be waived, only by a
written instrument executed by both of the parties hereto, or in the case of a
waiver, by the party waiving compliance. The failure of either party at any time
or times to require performance of any provision hereof shall in no manner
affect the right at a later time to enforce the same. No waiver by either party
of the breach of any term or covenant contained in this Agreement, whether by
conduct or otherwise, in any one or more instances, shall be deemed to be, or
construed as, a further or continuing waiver of any such breach, or a waiver of
the breach of any other term or covenant contained in this Agreement.
9.8 This Agreement may be executed in two or more counterparts, each
of which shall he deemed to be an original but all of which together will
constitute one and the same instrument.
9.9 The parties acknowledge that this Agreement is the result of
arm's-length negotiations between sophisticated parties each afforded the
opportunity to utilize representation by legal counsel. Each and every provision
of this Agreement shall be construed as though both parties participated equally
in the drafting of same, and any rule of construction that a document shall be
construed against the drafting party shall not be applicable to this Agreement.
10. DISPUTE RESOLUTION.
---------------------
Subject to the rights of the Company pursuant to Section 5.3 above,
any controversy, claim or dispute arising out of or relating to this Agreement,
the breach thereof, or the Executive's employment by the Company shall be
settled by arbitration with three arbitrators. The arbitration will be
administered by the American Arbitration Association
10
in accordance with its National Rules for Resolution of Employment Disputes. The
arbitration proceeding shall be confidential, and judgment on the award rendered
by the arbitrator may be entered in any court having jurisdiction. Any such
arbitration shall take place in the Clinton, New Jersey area, or in any other
mutually agreeable location. In the event any judicial action is necessary to
enforce the arbitration provisions of this Agreement, sole jurisdiction shall be
in the federal and state courts, as applicable, located in New Jersey. Any
request for interim injunctive relief or other provisional remedies or
opposition thereto shall not be deemed to be a waiver or the right or obligation
to arbitrate hereunder. The arbitrator shall have the discretion to award
reasonable attorneys' fees, costs and expenses to the prevailing party. To the
extent a party prevails in any dispute arising out of this Agreement or any of
its terms and provisions, all reasonable costs, fees and expenses relating to
such dispute, including the parties' reasonable legal fees, shall be borne by
the party not prevailing in the resolution of such dispute, but only to the
extent that the arbitrator or court, as the case may be, deems reasonable and
appropriate given the merits of the claims and defenses asserted.
11. FREE TO CONTRACT.
-------------------
The Executive represents and warrants to the Company that Executive
is able freely to accept engagement and employment by the Company as described
in this Agreement and that there are no existing agreements, arrangements or
understandings, written or oral, that would prevent Executive from entering into
this Agreement, would prevent Executive or restrict Executive in any way from
rendering services to the Company as provided herein during the Term or would be
breached by the future performance by the Executive of Executive's duties
hereunder. The Executive also represents and warrants that no fee, charge or
expense of any sort is due from the Company to any third person engaged by the
Executive in connection with Executive's employment by the Company hereunder,
except as disclosed in this Agreement.
12. SUBSIDIARIES AND AFFILIATES.
As used herein, the term "subsidiary" shall mean any corporation or
other business entity controlled directly or indirectly by the corporation or
other business entity in question, and the term "affiliate" shall mean and
include any corporation or other business entity directly or indirectly
controlling, controlled by or under common control with the corporation or other
business entity in question.
11
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
XXXXXX XXXXXXX LTD.
By: /S/XXXXXXX X. XXXXXXXXXX
------------------------------------------
Xxxxxxx X. Xxxxxxxxxx
President, Chief Executive Officer
and Chairman of the Board of Directors
/S/XXXXXX X. XXXXX
------------------------------------------
Xxxxxx X. Xxxxx
12
