Exhibit 10.32
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement ("Agreement") is made effective this 28th
day of February 2006, by and between Delta Mutual, Inc., a Delaware Corporation
(the "Company"), and Xxxxx X. Xxxxx (the "Executive").
Company desires to employ Executive and Executive desires to enter into the
employ of Company in such capacity and on the terms and conditions contained in
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the
parties, intending to be legally bound, agree as follows:
1. Employment.
Company hereby agrees to employ Executive as it's President and Chief
Executive Officer and Executive hereby accepts such employment in
accordance with the terms of this Agreement and the terms of employment
applicable to employees of Company, in general. In the event of any
conflict or ambiguity between the terms of this Agreement and the terms of
employment applicable to employees of the Company in general, the terms of
this Agreement shall prevail. Election or appointment of Executive to
another office or position, regardless whether such position is inferior to
Executive's initial position, shall not be a breach of this Agreement.
Executive hereby represents and warrants that he has the legal capacity to
execute and perform this Agreement and that it is a valid and binding
agreement against him according to its terms. In addition, Executive
represents and warrants that he knows of no reason why he is not physically
capable of performing his obligations under this Agreement in accordance
with its terms.
2. Duties of Executive.
Executive shall have such powers and duties as are commensurate with those
positions as described in the Company's bylaws and as may be assigned to
him from time to time by the Company's Board of Directors (the "Board").
Except for periods of illness, incapacity, vacation periods and other
periods of authorized absence, all in accordance with Company's regular
practice for principal executive officers. Executive shall devote all of
his business time, attention, skills and efforts exclusively to the
business and affairs of Company and its subsidiaries and shall perform his
duties in a professional, ethical and business-like manner. Executive, will
not, during the term of this Agreement, directly or indirectly engage in
any other business, either as an employee, employer, consultant, principal,
officer, director, advisor, or in any other capacity, either with or
without compensation, without the prior written consent of the Company.
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3. Compensation.
For all services rendered by Executive in any capacity required hereunder
during the term of this Agreement, including, without limitation, services
as an employee, officer, director, or member of any committee of Company,
or any subsidiary, affiliate or division thereof, Executive shall be
compensated as follows:
A. A fixed salary of $180,000 per year ("Base Salary"), payable
in accordance with the customary payroll practices of the
Company, but in no event less frequently than monthly.
Notwithstanding the previous sentence of this Paragraph 3.A.,
Executive agrees to accept a minimum monthly salary of $6,500
until such time as the financial condition of the Company (as
determined by the Board, in its sole discretion) permits the
payment of his full monthly salary of $15,000. Executive
agrees that the Company will record as his accrued salary the
difference (if any) between the actual monthly salary paid to
Executive and $6,500 and that the Company shall have no
further accrued salary liability to Executive. The Base Salary
shall be reviewed not later than the end of each calendar year
that Executive is employed by Company. Company may directly or
indirectly withhold from any payments made under this
Agreement all Federal, state, city, local or other taxes as
shall be required pursuant to law or governmental regulation
or ruling.
B. Bonus. Executive shall be included, in a manner consistent
with his position, in any bonus system, bonus pool, incentive
compensation, profit sharing, deferred compensation or similar
plan or program for its principal executive officer, senior
executives, officers or employees that may be implemented from
time to time by the Board.
C. Stock Options. Executive shall be included, in a manner
consistent with his position, in any stock option plan(s) for
its principal executive officer, senior executives, officers
and/or employees of Company in general, that may be
established from time to time by the Board.
D. Additional Benefits. Except as modified by this Agreement,
Executive shall be entitled to participate in the Company's
group health insurance plan and any other benefit plans
(including pension or retirement plans) as are made available
to its principal executive, senior executives, officers and/or
employees of the Company in general. Notwithstanding the
foregoing, nothing in this Agreement shall preclude the
amendment or termination of the Company's group health
insurance plan or any other benefit plan or program, provided
that such amendment or termination is applicable to all
employees of Company. In addition, Executive shall be entitled
to be paid for vacation days, sick days and holidays in
accordance with the Company's current paid time off policies
for senior executives, provided that Executive shall be
entitled to not less than fifteen (15) days of paid vacation
per calendar year during the period that this Agreement is in
effect. The carry-over of any unused vacation days will be
governed by and in accordance with Company policy. Additional
periods of absence due to illness, incapacity or personal
leave, if any, shall be granted at the discretion of the Board
which, in its sole discretion, may compensate Executive during
periods of additional absence.
E. Business Expenses. Company shall pay or reimburse Executive
for all reasonable, necessary and usual business expenses
incurred by Executive in connection with the performance of
his duties and obligations under this Agreement, subject to
Executive's presentation of appropriate documentation and
receipts and in accordance with such procedures as Company may
from time to time establish for its principal executive
officer, senior executives and/or officers, consistent with
the need to preserve any deductions to which Company may be
entitled for Federal tax purposes.
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4. Term and Termination
A. This Agreement shall commence on March 11, 2006 and shall
continue in effect for a period of three (3) years (the
"Term").
B. Termination For Cause. Company may discharge Executive at any
time for "Cause" which shall be defined as any of the
following: 1) any act of fraud, misappropriation, self
dealing, personal dishonesty or moral turpitude; 2) willful
misconduct; 3) indictment of a crime that constitutes a
felony; 4) breach by Executive of any of his obligations
regarding confidential information as set forth in Section 5
of this Agreement; 5) if Executive fails or refuses (through
habitual neglect or otherwise) to perform material assigned
duties; 6) if Executive engages in conduct that causes
material harm or damage to Company, including Company's
reputation or standing; 7) any material violation of Company
policy, that is not cured within ten (10) days after receipt
of written notice from Company; or 8) any material breach of
any provision of this Agreement. In addition to applicable
law, Company may discharge Executive for "Cause" in the event
Executive becomes physically or mentally disabled and is
therefore substantially unable to carry out his duties for a
period of 120 days or more in any twelve-month period. In the
event of a termination for "Cause", Company shall provide five
(5) days written notice to Executive ("Termination Notice")
and Executive shall be ineligible for any additional Base
Salary, severance or other payments or benefits under this
Agreement or otherwise after the date of termination specified
in the Termination Notice.
C. Other Termination. If Executive's employment is terminated by
Company for any reason other than death or for "Cause" (as
defined in Section 4.B.), then Company agrees to continue
Executive's Base Salary for six (6) months or until such time
as Executive commences other full-time employment, whichever
occurs earlier. Executive may terminate this Agreement at any
time providing at least sixty (60) days written notice to
Company ("Executive's Termination Notice"). If Executive
terminates this Agreement, then Company may, upon receipt of
Executive's Termination Notice, immediately relieve Executive
of all obligations and duties under this Agreement, provided
that Executive's then current Base Salary and benefits shall
continue until the termination date specified in Executive's
Termination Notice.
D. Termination For Change In Control. If Executive's employment
is terminated without Cause upon a consolidation, merger or
the sale of substantially all the assets of Company to another
corporation or entity in which Company is not the surviving
entity, then Executive shall be entitled to receive a lump sum
payment upon such termination equal to the greater of: 1) 100%
of his then current Base Salary plus 100% of his incentive
compensation for the prior fiscal year or 2) 100% of his then
current Base Salary plus 100% of his projected annual
incentive compensation for the remainder of the Term of this
Agreement, and Executive shall not be entitled to any further
payments pursuant to this Agreement.
5. Other Duties During and After Term.
A. Confidential Information. Executive recognizes and
acknowledges that all information pertaining to the affairs,
business, clients or customers of the Company or any of its
subsidiaries or affiliates (any and all such entities being
hereinafter referred to as the "Business"), as such
information may exist from time to time, other than
information that Company has previously made publicly
available or which is in the public domain, is confidential
information and is unique and valuable asset of the Business,
access to and knowledge of which are essential to the
performance of Executive's duties under this Agreement.
Executive shall not divulge to any person, firm, association,
corporation or governmental agency, any information concerning
the affairs, business, clients or customers of the Business
(except such information as is required by law to be divulged
to a government agency or pursuant to lawful process), or make
use of any such information for his own purposes or for the
benefit of any person, firm, association or corporation
(except the Business) and shall use his reasonable and best
efforts to prevent the disclosure of any such information by
others. All records, memoranda, letters, books, papers,
reports, accountings, experience or other data, and other
records and documents relating to the Business, whether made
by Executive or otherwise coming into his possession, are
confidential information and are, shall be, and remain
property of the Business. No copies shall be made which are
not retained by the Business, and Executive agrees, on
termination of his employment or on demand of Company, to
deliver same to Company.
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B. Remedies. Company's obligation to make payments or provide for
any benefits under this Agreement shall cease upon a violation
of the preceding provision of this Section 5. Executive
acknowledges that Company may be severely and irreparably
damaged in the event Executive violates the provision of
Section 5.A. above, and that the extent of the damage may be
difficult or impossible to determine. Therefore, Executive
agrees that the Company shall be entitled to equitable relief,
including a preliminary as well as a permanent injunction
(without the necessity of posting bond). Executive's agreement
as set forth in Section 5 shall (i) continue throughout the
duration of Executive's employment with Company; and (ii)
survive Executive's termination of this Agreement and/or
Executive's employment with Company, whether or not such
termination of Executive is voluntary, is the result of
termination of Executive by Company with or without Cause, or
is the result of a change in control.
6. Notices.
Any notice required by this Agreement or given in connection with it,
shall be in writing and shall be given to the appropriate party by
personal delivery or by certified mail, postage prepaid, or recognized
overnight delivery services;
If to Company:
Delta Mutual, Inc.
Attn: Chief Financial Officer
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
If to Executive:
Xxxxx X. Xxxxx
00 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
7. Final Agreement.
This Agreement supercedes all prior understandings or agreements
(whether written or oral) between Executive and Company or any of its
subsidiaries and affiliates and sets forth the entire understanding
between the parties with respect to the subject matter hereof. This
Agreement may not be modified except by written amendment duly executed
by both parties.
8. Governing Law.
This Agreement shall be construed and enforced in accordance with the
laws of the State of Pennsylvania.
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9. Headings.
Headings used in this Agreement are provided for convenience only and
shall not be used to construe meaning or intent.
10. No Assignment.
Neither this Agreement nor any interest in this Agreement may be
assigned by Executive without the prior written consent of Company,
which may be withheld by Company at Company's absolute discretion.
11. Severability.
If any provision of this Agreement or application thereof to anyone or
under any circumstances is adjudicated to be invalid or unenforceable
in any jurisdiction, then this Agreement, including all of the
remaining terms, will remain in full force and effect as if such
invalid or unenforceable provision had never been included.
12. Arbitration.
The parties agree that they will use their best efforts to amicably
resolve any dispute arising out of or relating to this Agreement. Any
controversy, claim or dispute that cannot be so resolved shall be
settled by final binding arbitration in accordance with the rules of
the American Arbitration Association and judgment upon the award
rendered by the arbitrator or arbitrators may be entered in any court
having jurisdiction thereof. Any such arbitration shall be conducted in
Philadelphia, Pennsylvania, or such other place as may be mutually
agreed upon by the parties. Within fifteen (15) days after commencement
of the arbitration, each party shall select one person to act as
arbitrator, and the two arbitrators so selected shall select a third
arbitrator within ten (10) days of their appointment. Each party shall
bear its own costs and expenses and an equal share of the arbitrator's
expenses and administrative fees of arbitration.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
DELTA MUTUAL, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------
Xxxxxx X. Xxxxxx
Vice President and CFO
EXECUTIVE
By: /s/ Xxxxx X. Xxxxx
-------------------------
Xxxxx X. Xxxxx
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