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EXHIBIT 10.74
EMPLOYMENT AGREEMENT
This employment agreement (the "Agreement") is effective as of April 17,
2001 (the "Effective Date"), by and between FIDELITY NATIONAL FINANCIAL, INC., a
Delaware corporation (the "Company"), and XXXXX X. XXXXXXXX (the "Employee"). In
consideration of the mutual covenants and agreements set forth herein, the
parties agree as follows:
1. Employment and Duties. Subject to the terms and conditions of this
Agreement, the Company employs the Employee to serve in an executive and
managerial capacity as Executive Vice President, General Counsel, and the
Employee accepts such employment and agrees to perform such reasonable
responsibilities and duties commensurate with the aforesaid positions as set
forth in the Articles of Incorporation and the Bylaws of the Company and as
directed by the Company's Chief Executive Officer.
2. Term. The term of this Agreement shall commence on the Effective Date
and shall continue for a period of three (3) years ending April 17, 2004,
subject to prior termination as set forth in Section 7, below (the "Term"). The
Term may be extended at any time upon mutual agreement of the parties.
3. Salary. During the Term, the Company shall pay the Employee a minimum
base annual salary, before deducting all applicable withholdings, of Three
Hundred Thousand Dollars ($300,000) per year, payable at the times and in the
manner dictated by the Company's standard payroll policies. Such minimum base
annual salary may be periodically reviewed and increased (but not decreased) at
the discretion of the Compensation Committee of the Board of Directors to
reflect, among other matters, cost of living increases and performance results.
4. Other Compensation and Fringe Benefits. In addition to any executive
bonus, pension, deferred compensation and stock option plans which the Company
may from time to time make available to the employee upon mutual agreement, the
Employee shall be entitled to the following:
(a) The standard Company benefits enjoyed by the Company's other top
executives.
(b) Payment by the Company of the Employee's initiation and membership
dues in all social and/or recreational clubs as deemed necessary and
appropriate by the Employee to maintain various business relationships
on behalf of the Company; provided, however, that the Company shall
not be obligated to pay for any of the Employee's personal purchases
and expenses at such club.
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(c) Provision by the Company during the Term and any extensions thereof to
the Employee and his dependents of medical and other insurance
coverage under the Company's Executive Medical Plan.
(d) Provision by the Company of supplemental disability insurance
sufficient to provide two-thirds of the Employee's pre-disability
minimum base annual salary.
(e) An annual incentive bonus for each calendar year included in this
Agreement calculated pursuant to a formula substantially similar to
(and the formula of which will not yield a bonus less than) the FY
2001 Incentive Plan adopted by the Compensation Committee of the
Company with a target bonus based upon 100% of base annual salary, a
copy of which is attached hereto as Exhibit A ("Incentive Bonus");
provided, however, that the Employer's stockholders approve an annual
incentive bonus plan containing substantially the terms of the
Incentive Bonus prior to its payment in accordance with Section 162(m)
of the Internal Revenue Code of 1986, as amended, and the regulations
promulgated thereunder. The annual bonus shall be paid no later than
March 15th of the following year and is fully vested at the end of
each year in the event of a non-renewal of this Agreement by the
Company. Subject to Section 7 below, the annual bonus shall be
pro-rated for any partial employment year.
The Company shall deduct from all compensation payable under this Agreement
to the Employee any taxes or withholdings the Company is required to deduct
pursuant to state and federal laws or by mutual agreement between the parties
5. Vacation. For and during each year of the Term and any extensions
thereof, the Employee shall be entitled to reasonable paid vacation periods
consistent with his position with the Company. In addition, the Employee shall
be entitled to such holidays consistent with the Company's standard policies or
as the Company's Board of Directors may approve.
6. Expense Reimbursement. In addition to the compensation and benefits
provided herein, the Company shall, upon receipt of appropriate documentation,
reimburse the Employee each month for his reasonable travel, lodging,
entertainment, promotion and other ordinary and necessary business expenses.
7. Termination.
(a) For Cause. The Company may terminate this Agreement immediately for
cause upon written notice to the Employee, in which event the Company
shall be obligated to pay the Employee that portion of the minimum
base annual salary due him through the date of termination. Cause
shall be
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limited to (i) the persistent failure to perform duties consistent
with a commercially reasonable standard of care; (ii) the willful
neglect of duties; (iii) criminal or other illegal activities
involving dishonesty; or (iv) a material breach of this Agreement.
(b) Without Cause. Either party may terminate this Agreement immediately
without cause by giving written notice to the other. If the Company
terminates under this Section 7(b), then it shall pay to the Employee
an amount equal to the product of (i) the Employee's minimum annual
base salary in effect as of the date of termination, plus the greater
of either (x) the highest bonus paid for any year during which this
Agreement was in effect, or (y) Employee's minimum base salary in
effect as of the date of termination ("Base Year Bonus"), times (ii)
the number of years (including partial years) remaining in the Term or
the number 2 (two), whichever is greater. The Company shall make such
payment in a lump sum on or before the fifth day following the date of
termination, or as otherwise directed by the Employee. In addition,
all options granted to the Employee which had not vested as of the
date of termination hereunder shall vest immediately and the Company
shall maintain in full force and effect for the continued benefit of
the Employee for the number of years (including partial years)
remaining in the Term, all employee benefit plans and programs in
which the Employee was entitled to participate immediately prior to
the date of termination, provided that the Employee's continued
participation is possible under the general terms and provisions of
such plans and programs. In the event that the Employee's
participation in any such plan or program is prohibited, the Company
shall, at its expense, arrange to provide the Employee with benefits
substantially similar to those which the Employee would otherwise have
been entitled to receive under such plans and programs for which his
continued participation is prohibited. If the Employee terminates
under this Section 7(b), then the Company shall be obligated to pay
the Employee the minimum annual base salary due him through the date
of termination.
(c) Disability. If the Employee fails to perform his duties hereunder on
account of illness or other incapacity for a period of nine
consecutive months, then the Company shall have the right upon written
notice to the Employee to terminate this Agreement without further
obligation by paying the Employee the minimum base annual salary,
without offset, for the remainder of the Term in a lump sum or as
otherwise directed by the Employee.
(d) Death. If the Employee dies during the Term, then this Agreement shall
terminate immediately and the Employee's legal representatives shall
be entitled to receive the minimum annual base salary for the
remainder of
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the Term in a lump sum or as otherwise directed by the Employee's
legal representative.
(e) Mitigation. The Employee shall not be required to mitigate the amount
of any payment provided for in this Section 7 by seeking other
employment or otherwise, nor shall any compensation or other payments
received by the Employee after the date of termination reduce any
payments due under this Section 7.
(f) Effect of Termination. Termination for any reason or for no reason
shall not constitute a waiver of the Company's rights under this
Agreement nor a release of the Employee from any obligation hereunder
except his obligation to perform his day-to-day duties as an employee.
8. Severance Payment.
(a) The Employee may terminate his employment hereunder for "Good Reason,"
which for purposes of this Agreement shall mean a "change in control
of the Company." A "change in control of the Company," for purposes of
this Agreement, shall be deemed to have occurred if (i) there shall be
consummated (x) any consolidation or merger of the Company other than
a consolidation or merger of the Company in which the holders of the
Company's Common Stock immediately prior to the merger own more than
50% of the voting securities of the surviving corporation immediately
after the merger, or (y) any sale, lease exchange or other transfer
(in one transaction or a series of related transactions) of all, of
substantially all, of the assets of the Company, or (ii) the
stockholders of the Company approve any plan or proposal for the
liquidation or dissolution of the Company, or (iii) any "person" (such
as that term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934 (the "Exchange Act")), other than the Company or
any "person" who, on the date hereof, is a director or officer of the
Company, is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), of securities of the Company
representing 30% or more of the combined voting power of the Company's
then outstanding securities, or (iv) during any period of two (2)
consecutive years during the Term or any extensions thereof,
individuals, who, at the beginning of such period, constitute the
Board of Directors, cease for any reason to constitute at least a
majority thereof, unless the election of each director who was not a
director at the beginning of such period has been approved in advance
by directors representing at least two-thirds of the directors then in
office who were directors at the beginning of the period.
(b) If the Employee terminates his employment for Good Reason, or, if
after a change in control of the Company, the Company shall terminate
the Employee's employment in breach of this Agreement or pursuant to
Section 7(b), then:
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(i) The Company shall pay the Employee his minimum base annual
salary due him through the date of termination.
(ii) In lieu of any further salary and bonus payments or other
payments due to the Employee for periods subsequent to the date
of termination, the Company shall pay, as severance to the
Employee, an amount equal to the product of (A) the Employee's
minimum base annual salary in effect as of the date of
termination plus the Base Year Bonus, multiplied by (B) the
number of years (including partial years) remaining in the Term
or the number 2 (two), whichever is greater.
(iii) All options granted to the Employee which had not vested as of
the date of termination hereunder shall vest immediately; and
(iv) The Company shall maintain in full force and effect, for the
continued benefit of the Employee for the number of years
(including partial years) remaining in the Term, all employee
benefit plans and programs in which the Employee was entitled
to participate immediately prior to the date of termination,
provided that the Employee's continued participation is
possible under the general terms and provisions of such plans
and programs. In the event that the Employee's participation in
any such plan or program is prohibited, the Company shall, at
its expense, arrange to provide the Employee with benefits
substantially similar to those which the Employee would
otherwise have been entitled to receive under such plans and
programs from which his continued participation is prohibited.
(c) For purposes of this Section 8 and Section 7 hereof, the Employee
shall not be required to mitigate the amount of any payment
provided for in Sections 7 and 8 by seeking other employment or
otherwise, nor shall any compensation or other payments received
by the Employee after the date of termination reduce any payments
due under such Sections.
9. Indemnification for Taxes. The Company shall indemnify Employee for
any and all taxes, penalties, additions to tax and interest on tax deficiencies
of any kind (collectively, "Taxes") with respect to any and all payments and
benefits provided by this Agreement or other agreements with Employee which are
subject (if at all) to the excise tax ("Excess Tax") pursuant to Section 4999 of
the Internal Revenue Code of 1986, as amended. This indemnification shall extend
to any and all Taxes with respect to any and all reimbursements hereunder such
that, on a net-after-tax basis, Employee is in the same position that Employee
would have been in if no payments made by Company to Employee had been subject
to the Excise Tax (and, therefore, no indemnification payments hereunder had
been necessary).
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10. Non-Delegation of Employee's Rights. The obligations, rights and
benefits of the Employee hereunder are personal and may not be delegated,
assigned or transferred in any manner whatsoever, nor are such obligations,
rights or benefits subject to involuntary alienation, assignment or transfer.
11. Confidential Information. The Employee acknowledges that in his
capacity as an employee of the Company he will occupy a position of trust and
confidence and he further acknowledges that he will have access to and learn
substantial information about the Company and its operations that is
confidential or not generally known in the industry including, without
limitation, information that relates to purchasing, sales, customers, marketing,
and the Company's financial position and financing arrangements. The Employee
agrees that all such information is proprietary or confidential, or constitutes
trade secrets and is the sole property of the Company. The Employee will keep
confidential, and will not reproduce, copy or disclose to any other person or
firm, any such information or any documents or information relating to the
Company's methods, processes, customers, accounts, analyses, systems, charts,
programs, procedures, correspondence or records, or any other documents used or
owned by the Company, nor will the Employee advise, discuss with or in any way
assist any other person, firm or entity in obtaining or learning about any of
the items described in this Section 11. Accordingly, the Employee agrees that
during the Term and at all times thereafter he will not disclose, or permit or
encourage anyone else to disclose, any such information, nor will he utilize any
such information, either along or with others, outside the scope of his duties
and responsibilities with the Company.
12. Non-Competition During Employment Term. The Employee agrees that,
during the term and any extensions thereof, he will devote substantially all his
business time and effort, and give undivided loyalty, to the Company. He will
not engage in any way whatsoever, directly or indirectly, in any business that
is competitive with the Company or its affiliates, nor solicit, or in any other
manner work for or assist any business which is competitive with the Company or
its affiliates. In addition, during the Term and any extensions thereof, the
Employee will undertake no planning for or organization of any business activity
competitive with the work he performs as an employee of the Company, and the
Employee will not combine or conspire with any other employee of the Company or
any other person for the purpose of organizing any such competitive business
activity.
13. Return of Company Documents. Upon termination of this Agreement,
Employee shall return immediately to the Company all records and documents of or
pertaining to the Company and shall not make or retain any copy or extract of
any such record or document.
14. Location. The Employee shall not be required to move from Santa
Xxxxxxx County, California, to perform his duties hereunder during the Term
without his written consent.
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15. Improvements and Inventions. Any and all improvements or inventions,
which the Employee may make or participate in during the period of his
employment, shall be the sole and exclusive property of the Company. The
Employee will, whenever requested by the Company, execute and deliver any and
all documents which the Company shall deem appropriate in order to apply for and
obtain patents for improvements or inventions or in order to assign and convey
to the Company the sole and exclusive right, title and interest in and to such
improvements, inventions, patents or applications.
16. Actions. The parties agree and acknowledge that the rights conveyed by
this Agreement are of a unique and special nature and that the Company will not
have an adequate remedy at law in the event of a failure by the Employee to
abide by its terms and conditions nor will money damages adequately compensate
for such injury. It is, therefore, agreed between the parties that, in the event
of a breach by the Employee of any of his obligations contained in this
Agreement, the Company shall have the right, among other rights, to damages
sustained thereby and to obtain an injunction or decree of specific performance
from any court of competent jurisdiction to restrain or compel the Employee to
perform as agreed herein. The Employee agrees that this Section 17 shall survive
the termination of his employment and he shall be bound by its terms at all
times subsequent to the termination of his employment for so long a period as
Company continues to conduct the same business or businesses as conducted during
the Term or any extensions thereof. Nothing herein contained shall in any way
limit or exclude any other right granted by law or equity to the Company.
17. Amendment. This Agreement contains, and its terms constitute, the
entire agreement of the parties, and it may be amended only by a written
document signed by both parties to this Agreement.
18. Governing Law. California law shall govern the construction and
enforcement of this Agreement and the parties agree that any litigation
pertaining to this Agreement shall be adjudicated in courts located in
California.
19. Attorneys' Fees. If any party finds it necessary to employ legal
counsel or to bring an action at law or other proceedings against the other
party to enforce any of the terms hereof, the party prevailing in any such
action or other proceeding shall be paid by the other party its reasonable
attorneys' fees as well as court costs, all as determined by the court and not a
jury.
20. Notices. Any notice, request, or instruction to be given hereunder
shall be in writing and shall be deemed given when personally delivered or three
(3) days after being sent by United States Certified Mail, postage prepaid, with
Return Receipt Requested, to the parties at their respective addresses set forth
below:
To the Company: Fidelity National Financial, Inc.
0000 Xxxxx Xxxx
Xxxxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx
Executive Vice President
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To the Employee: Xxxxx X. Xxxxxxxx
0000 Xxx Xxx Xxxxxx
Xxxxx Xxxxxxx, XX 00000
21. Waiver of Breach. The Waiver by any party of any provisions of this
Agreement shall not operate or be construed as a waiver of any prior or
subsequent breach by the other party.
IN WITNESS WHEREOF the parties have executed this Agreement to be effective
as of the date first set forth above.
FIDELITY NATIONAL FINANCIAL, INC.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Xxxxxx X. Xxxxxx
Its: Executive Vice President
XXXXX X. XXXXXXXX
/s/ Xxxxx X. Xxxxxxxx
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