EMPLOYMENT AGREEMENT dated Monday, September 28, 1998 by and between X.X.
Xxxxxxxxx Corporation, a Delaware corporation, (the `Company') and Xxxxxxxxx X.
Xxxxxx (the `Executive').
WHEREAS, the transaction pursuant to which the Company has been separated
from its former parent company (the `Spinoff') has been consummated as of July
1, 1998, and
WHEREAS, Executive is currently serving as an executive of the Company or of
its subsidiary, X.X. Xxxxxxxxx, Inc.; and
WHEREAS, Executive is willing so to continue his employment on the terms
hereinafter set forth in this agreement (the `Agreement');
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the parties
agree as follows:
1. Term of Employment. Subject to the provisions of Section 8 of this
Agreement, Executive shall be employed by the Company or by X.X. Xxxxxxxxx, Inc.
for a period (the `Employment Term') commencing on the date hereof (the
`Commencement Date') and ending on the third anniversary of the Spinoff. On the
third and each succeeding anniversary of the Spinoff, the Employment Term shall
automatically be extended for one additional year unless, not later than ninety
days prior to such anniversary, the Company or the Executive shall have given
notice of its or his intention not to extend the Employment Term.
2. Position. (a) Executive shall serve as a senior executive officer of the
Company or of X.X. Xxxxxxxxx, Inc. In such position, Executive shall have such
duties and authority as shall be determined from time to time by the Board of
Directors of the Company (the `Board') or its designee.
(b) During the Employment Term, Executive will devote substantially all of
his business time and best efforts to the performance of his duties hereunder
and will not engage in any other business, profession or occupation for
compensation or otherwise which would conflict with the rendition of such
services either directly or indirectly, without the prior written consent of the
Board; provided that nothing herein shall be deemed to preclude Executive from
serving on business, civic or charitable boards or committees, as long as such
activities do not materially interfere with the performance of Executive's
duties hereunder.
3. Base Salary. Company shall pay Executive an annual base salary (the `Base
Salary') at the initial annual rate of $230,000, payable in equal monthly
installments or otherwise in accordance with the payroll and personnel practices
of the Company from time to time. Base Salary shall be reviewed annually by the
Board or a committee thereof to which the Board may from time to time have
delegated such authority (the `Committee') for possible increase (but not
decrease) in the sole discretion of the Board or the Committee, as the case may
be.
4. Bonus. With respect to each fiscal year all or part of which is contained
in the Employment Term, Executive shall be eligible to participate in the
Company's Annual Incentive Plan or any successor plan thereto, with a target
bonus opportunity of 60% of Base Salary and a maximum bonus opportunity not less
than that for which he is eligible on the date hereof (the `Bonus').
5. Additional Compensation. As further compensation, Executive will be
eligible for participation in all bonuses, long-term incentive compensation and
stock options and other equity participation arrangements (at the same
opportunity as that applicable in the ordinary course on the Effective Date)
made available generally to senior executives of the Company.
6. Employee Benefits. During the Employment Term, Executive shall be
eligible, on the same basis as he is currently eligible, for employee benefits
(including fringe benefits, vacation, pension and profit sharing plan
participation and life, health, accident and disability insurance) no less
favorable than those benefits for which he is eligible immediately prior to the
Commencement Date.
7. Business Expenses. Reasonable travel, entertainment and other business
expenses incurred by Executive in the performance of his duties hereunder shall
be reimbursed by the Company in accordance with Company policies from time to
time.
8. Termination of Employment. Each of Executive and the Company may
terminate the employment of Executive hereunder at any time in accordance with
this Section 8. Executive's entitlements hereunder in the event of any such
termination shall be as set forth in this Section 8. The provisions of this
Section 8 shall survive any nonrenewal of this Agreement by the Company pursuant
to Section 1.
(a) For Cause by the Company. If Executive's employment is terminated by the
company for Cause, he shall be entitled to receive his Base Salary through the
Date of Termination, as hereinafter defined. All other benefits due Executive
following Executive's termination of employment pursuant to this Section 8(a)
shall be determined in accordance with the plans, policies and practices of the
Company.
(b) Death or Disability. Executive's employment hereunder shall terminate
upon his death and may be terminated by the Company upon his Disability during
the Employment Term. Upon termination of Executive's employment hereunder upon
the Executive's Disability or death, Executive or his estate (as the case may
be) shall be entitled to receive Base Salary through the date of such
termination, plus a pro-rata portion of target Bonus, based on the number of
whole or partial months from the beginning of the bonus period to the Date of
Termination. In addition, if Executive's employment is terminated as a result of
Disability, Executive shall continue to be eligible to participate in all
health, medical and dental benefit plans of the Company, until age 65 in
accordance with the terms, conditions and elections, if any, applicable to or in
effect with respect to Executive at the time of termination of employment.
(c) Without Cause by the Company Not Following a Change in Control. If,
during the Employment Term and prior to a Change in Control, as hereinafter
defined, or more than two years after a Change in Control, Executive's
employment is terminated by the Company without Cause, Executive shall be
entitled to the following benefits:
(i) Base Salary through the Date of Termination at the rate in effect at
the time of Notice of Termination, as defined in Section 8(g) herein, is
given, or if higher, at the rate in effect immediately prior to the event
or circumstance leading to the termination of employment, plus all other
amounts to which Executive is entitled under any compensation or benefit
plan of the Company.
(ii) In lieu of any further salary payments to Executive for periods
subsequent to the date of termination, the Company shall pay as severance
pay, not later than the fifth day following the Date of Termination, a
severance payment (the `Severance Payment') equal to two times the sum of
(A) Base Salary at the rate in effect on the date Notice of Termination is
given, or if higher, at the rate in effect immediately prior to the event
or circumstance leading to the termination of employment, plus (B) target
Bonus, paid in lump sum without reduction for time value of money.
(iii) Continued eligibility to participate in all health, medical and
dental benefit plans of the Company for which Executive was eligible
immediately prior to the time of the Notice of Termination, or comparable
coverage, for two years, or, if sooner, until comparable health insurance
coverage is available to Executive in connection with subsequent employment
or self-employment. The coverage for which Executive shall continue to be
eligible under this Section shall be made available at no greater cost or
tax cost to Executive than that applicable to Executive at the time of
termination of employment.
(iv) Term life insurance equivalent in coverage, and at no greater cost
or tax cost to Executive, to that elected by Executive at the time of the
Notice of Termination, until the last day of the second calendar year
beginning after termination of employment, or, if sooner, until comparable
life insurance coverage is available to Executive in connection with
subsequent employment or self-employment.
(d) Termination Within Two Years Following a Change in Control. If, during
the Employment Term and within two years following a Change in Control,
Executive's employment is terminated by the Company without Cause, or by the
Executive for Good Reason, as hereinafter defined, Executive shall be entitled
to the payments and benefits set forth in Section 8(c), except that for purposes
of this Section 8(d), references in such Section to `two' times or `two' years
shall be changed to `three' times and `three' years. In addition, Executive
shall be entitled to receive, for the three years following termination of
employment or, if sooner, until subsequently employed or self-employed, (i) all
perquisites and similar benefits he was receiving immediately prior to the time
of Notice of Termination, (ii) reimbursement of expenses relating to financial
planning services, up to a maximum amount per year equal to the average of such
amounts paid to Executive for the two calendar years preceding the Date of
Termination and (iii) reimbursement of expenses relating to outplacement
services, subject to a maximum reimbursement under this clause (iii) of $25,000.
For purposes of this Agreement, termination of employment after the
commencement of negotiations with a potential acquiror or business combination
partner shall be deemed to be a termination of employment within two years
following a Change in Control if such negotiations result in a transaction with
such acquiror or business combination partner which constitutes a Change in
Control.
(e) Retirement. If during the Employment Term, Executive retires at normal
retirement age under the Company's qualified pension plan or any successor plan,
Executive shall be entitled to the payments and benefits specified in Section
8(b) as if his employment had terminated as a result of Disability.
(f) Voluntary Termination of Employment. If during the Employment Term,
Executive terminates his employment under circumstances other than those
specified in this Section 8, Executive shall be entitled to the payments and
benefits specified in Section 8(a).
(g) Notice and Date of Termination. (i) Any purported termination of
employment by the Company or by Executive shall be communicated by written
Notice of Termination to the other party hereto in accordance with Section 17(i)
hereof. For purposes of this Agreement, a `Notice of Termination' shall mean a
notice which 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 employment under the provision so
indicated. If the event or circumstance on which the proposed termination of
employment is based is susceptible of cure, the Notice of Termination shall not
be delivered until Executive or the Company, as the case may be, has had at
least 30 days to effect such cure, and unless such event or circumstance
persists at the end of such cure period.
(ii) `Date of Termination' shall mean (A) if employment is terminated
for Disability, thirty (30) days after Notice of Termination is given
(provided that Executive shall not have returned to the full-time
performance of his duties during such thirty (30) day period), (B) if
employment is terminated by reason of death, the date of death, and (C) if
employment is terminated for any other reason, the date specified in the
Notice of Termination (which, in the case of a termination of employment by
the Company for Cause shall not be less than ten (10) days after the date
such Notice of Termination is given); provided that if within thirty (30)
days after any Notice of Termination is given the party receiving such
Notice of Termination notifies the other party that a dispute exists
concerning the termination, the Date of Termination shall be the date on
which the dispute is finally determined, either by mutual written agreement
of the parties, by a binding arbitration award, or by a final judgment,
order or decree of a court of competent jurisdiction (which is not
appealable or the time for appeal therefrom having expired and no appeal
having been perfected); provided further that the Date of Termination shall
be extended by a notice of dispute only if such notice is given in good
faith and the party giving such notice pursues the resolution of such
dispute with reasonable diligence.
(h) Any provision of this Agreement to the contrary notwithstanding,
Executive shall be obligated to execute a general release of claims in favor of
the Company, in the form used generally by the Company in connection with
termination of employment from time to time, as a condition to receiving
benefits and payments under this Agreement.
9. Definitions. (a) `Cause' shall mean (i) Executive's willful and continued
failure substantially to perform the duties of his position (other than as a
result of total or partial incapacity due to physical or mental illness or as a
result of a termination by Executive for Good Reason, as hereinafter defined),
(ii) any willful act or omission by the Executive constituting dishonesty, fraud
or other malfeasance, which in any such case is demonstrably injurious to the
financial condition or business reputation of the Company or any of its
affiliates, or (iii) the Executive's conviction of a felony under the laws of
the United States or any state thereof or any other jurisdiction in which the
Company or any of its subsidiaries conducts business which materially impairs
the value of Executive's services to the Company or any of its subsidiaries.
For purposes of this definition, no act or failure to act shall be deemed
`willful' unless effected by Executive not in good faith and without a
reasonable belief that such action or failure to act was in or not opposed to
the best interests of the Company.
(b) `Change in Control' shall mean the occurrence of any of the following
events after July 14, 1998:
(i) Any `person,' as such term is used in Section 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the `Exchange Act') (other
than the Company, any trustee or other fiduciary holding securities under
an employee benefit plan of the Company, or any company owned directly or
indirectly by the shareholders of the Company in substantially the same
proportions as their ownership of stock of the Company), is or becomes the
`beneficial owner' (as defined in rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing 20% or
more of the combined voting power of the Company's then outstanding
securities;
(ii) During any period of two consecutive years commencing on July 14,
1998, individuals who at the beginning of such period constitute the Board,
and any new director (other than a director designated by a person (as
defined above) who has entered into an agreement with the Company to effect
a transaction described in subsections (i), (iii) or (iv) of this
definition) whose election by the Board or nomination for election by the
Company's shareholders was approved by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute at least a
majority thereof;
(iii) The shareholders of the Company have approved a merger or
consolidation of the Company with any other company and all other required
governmental approvals of such merger or consolidation have been obtained,
other than (A) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being converted into
voting securities of the surviving entity) more than 60% of the combined
voting power of the voting securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation or (B) a
merger or consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no person (as defined above)
becomes the beneficial owner (as defined above) of more than 20% of the
combined voting power of the Company's then outstanding securities; or
(iv) The shareholders of the Company have approved a plan of complete
liquidation of the Company or an agreement for the sale or disposition by
the Company of all or substantially all of the Company's assets, and all
other required governmental approvals of such transaction have been
obtained.
(c) `Disability' shall mean the Executive's inability, as a result of
physical or mental incapacity, to perform the duties of his position for a
period of six (6) consecutive months or for an aggregate of six (6) months in
any twelve (12) consecutive month period. Any question as to the existence of
the Disability of Executive as to which Executive and the Company cannot agree
shall be determined in writing by a qualified independent physician mutually
acceptable to Executive and the Company. If Executive and the Company cannot
agree as to a qualified independent physician, each shall appoint such a
physician and those two physicians shall select a third who shall make such
determination in writing. The determination of Disability made in writing to
the Company and Executive shall be final and conclusive for all purposes of the
Agreement.
(d) `Good Reason' means:
(i) Removal from, or failure to be reappointed or reelected to,
Executive's position as specified in Section 2 (other than as a result of a
promotion).
(ii) Material diminution in Executive's title, position, duties or
responsibilities, or the assignment to Executive of duties that are
inconsistent, in a material respect, with the scope of duties and
responsibilities associated with Executive's position as specified in
Section 2.
(iii) Reduction in Base Salary or target or maximum Bonus opportunity,
reduction in level of participation in long term incentive, stock option
and other equity award, benefit and other plans for senior executives or
other material breach of this Agreement by the Company.
(iv) Relocation of the executive's principal workplace without his
consent to a location outside the New York metropolitan area.
10. Certain Payments. (a) If any of the payments or benefits received or to
be received by Executive in connection with a Change in Control or Executive's
termination of employment, whether or not pursuant to this Agreement (such
payments or benefits, excluding the Gross-Up Payment, as hereinafter defined,
shall hereinafter be referred to as the `Total Payments') will be subject to an
excise tax as provided for in Section 4999 of the Internal Revenue Code (the
`Code') (the `Excise Tax'), the Company shall pay to Executive an additional
amount (the `Gross-Up Payment') such that the net amount retained by the
Executive, after deduction of any Excise Tax on the Total Payments and any
federal, state and local income and employment taxes and Excise Tax upon the
Gross-Up Payment, shall be equal to the Total Payments; provided, however, that
if the Total Payments are less than 360% of the Executive's Base Amount, as
defined in section 280G(b)(3) of the Code, the Executive shall not be entitled
to the Gross-Up Payment, and the Total Payments shall be reduced as provided for
in Section 10(d) below.
(b) For purposes of determining whether any of the Total Payments will be
subject to the Excise Tax and the amount of such Excise Tax, (i) all of the
Total Payments shall be treated as `parachute payments' (within the meaning of
section 280G(b)(2) of the Code) unless, in the opinion of tax counsel (`Tax
Counsel') reasonably acceptable to Executive and selected by the accounting firm
acting as the `Auditor', as defined below, such payments or benefits (in whole
or in part) do not constitute parachute payments, including by reason of section
280G(b)(4)(A) of the Code, (ii) all `Excess parachute payments' within the
meaning of section 280G(b)(1) of the Code shall be treated as subject to the
Excise Tax unless, in the opinion of Tax Counsel, such excess parachute payments
(in whole or in part) represent reasonable compensation for services actually
rendered (within the meaning of section 280G(b)(4)(B) of the Code) in excess of
the Base Amount allocable to such reasonable compensation, or are otherwise not
subject to the Excise Tax, and (iii) the value of any noncash benefits or any
deferred payment or benefit shall be determined by the Auditor in accordance
with the principles of sections 280G(d)(3) and (4) of the Code. For purposes of
determining the amount of the Gross-Up Payment, the Executive shall be deemed to
pay federal income tax at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and
local income taxes at the highest marginal rate of taxation in the state and
locality of Executive's residence or, if higher, in the state and locality of
Executive's principal place of employment, on the date of termination (or if
there is no date of termination, then the date on which the Gross-Up Payment is
calculated for purposes of this Section 10), net of the maximum reduction in
federal income taxes which could be obtained from deduction of such state and
local taxes.
(c) In the event that the Excise Tax is finally determined to be less than
the amount taken into account hereunder in calculating the Gross-Up Payment,
Executive shall repay to the Company, at the time that the amount of such
reduction in Excise Tax is finally determined, the portion of the Gross-Up
Payment attributable to such reduction (including that portion of the Gross-Up
Payment attributable to the Excise Tax and federal, state and local income and
employment taxes imposed on the Gross-Up Payment being repaid by the Executive
to the extent that such repayment results in a reduction in Excise Tax and/or a
federal, state or local income or employment tax deduction) plus interest on the
amount of such repayment at 120% of the rate provided in section 1274(b)(2)(B)
of the Code. In the event that the Excise Tax is determined to exceed the
amount taken into account hereunder in calculating the Gross-Up Payment
(including by reason of any payment the existence or amount of which cannot be
determined at the time of the Gross-Up Payment), the Company shall make an
additional Gross-Up Payment in respect of such excess (plus any interest,
penalties or additions payable by the Executive with respect to such excess) at
the time that the amount of such excess is finally determined. The Executive
and the Company shall each reasonably cooperate with the other in connection
with any administrative or judicial proceedings concerning the existence or
amount of liability for Excise Tax with respect to the Total Payments.
(d) If the Total Payments would constitute an Excess parachute payment, but
are less than 360% of the Base Amount, such payments shall be reduced to the
largest amount that may be paid to the Executive without the imposition of the
Excise Tax or the disallowance as deductions to the Company under Section 280G
of the Code of any such payments.
(e) All determinations under this Section 10 shall be made by a nationally
recognized accounting firm selected by the Executive (the `Auditor'). The
Company shall cooperate in good faith in making such determinations and in
providing the necessary information for this purpose.
11. Indemnification. The Company will indemnify Executive (and his legal
representative or other successors) to the fullest extent permitted (including a
payment of expenses in advance of final disposition of a proceeding) by
applicable law, as in effect at the time of the subject act or omission, or by
the Certificate of Incorporation and By-Laws of the Company, as in effect at
such time or on the Commencement Date, or by the terms of any indemnification
agreement between the Company and Executive, whichever affords or afforded
greatest protection to Executive, and Executive shall be entitled to the
protection of any insurance policies the Company may elect to maintain generally
for the benefit of its directors and officers (and to the extent the Company
maintains such an insurance policy or policies, Executive shall be covered by
such policy or policies, in accordance with its or their terms to the maximum
extent of the coverage available for any Company officer or director), against
all costs, charges and expenses whatsoever incurred or sustained by him or his
legal representatives (including but not limited to any judgment entered by a
court of law) at the time such costs, charges and expenses are incurred or
sustained, in connection with any action, suit or proceeding to which Executive
(or his legal representatives or other successors) may be made a party by reason
of his having accepted employment with the Company or by reason of his being or
having been a director, officer or employee of the Company, or any subsidiary of
the Company, or his serving or having served any other enterprise as a director,
officer or employee at the request of the Company. Executive's rights under
this Section 11 shall continue without time limit for so long as he may be
subject to any such liability, whether or not the Employment Term may have
ended.
12. Non-Competition. (a) Executive acknowledges and recognizes the highly
competitive nature of the businesses of the Company and its affiliates and
accordingly agrees that during the Employment Term and for a period of one year
after the termination thereof;
(i) The Executive will not directly or indirectly engage in any business
which is in competition with any line of business conducted by the Company
or its affiliates (including without limitation by performing or soliciting
the performance of services for any person who is a customer or client of
the Company or any of its affiliates) whether such engagement is as an
officer, director, proprietor, employee, partner, investor (other than as a
holder of less than 1% of the outstanding capital stock of a publicly
traded corporation), consultant, advisor, agent, sales representative or
other participant, in any location in which the Company or any of its
affiliates conducted any such competing line of business.
(ii) Executive will not directly or indirectly assist others in engaging
in any of the activities in which Executive is prohibited from engaging in
by clause (i) above.
(iii) Executive will not directly or indirectly induce any employee of
the Company or any of its affiliates to engage in any activity in which
Executive is prohibited to engage by this Section, or to terminate his or
her employment with the Company or any of its affiliates, and will not
directly or indirectly employ or offer employment to any person who was
employed by the Company or any of its affiliates unless such person shall
have ceased to be employed by the Company or any of its affiliates for a
period of at least 12 months.
(iv) Executive will not directly or indirectly solicit subscribers or
suppliers of the Company or telephone companies for which the Company
serves as sales agent or induce any such person to terminate its
relationships with the Company.
(b) It is expressly understood and agreed that although Executive and the
Company consider the restrictions contained in this Section 12 to be reasonable,
if a final judicial determination is made by a court of competent jurisdiction
that the time or territory or any other restriction contained in this Agreement
is an unenforceable restriction against Executive, the provisions of this
Agreement shall not be rendered void but shall be deemed amended to apply as to
such maximum time and territory and to such maximum extent as such court may
judicially determine or indicate to be enforceable. Alternatively, if any court
of competent jurisdiction finds that any restriction contained in this Agreement
is unenforceable, and such restriction cannot be amended so as to make it
enforceable, such finding shall not affect the enforceability of any of the
other restrictions contained herein.
13. Confidentiality; Nondisparagement. (a) Executive will not at any time
(whether during or after his employment with the Company) disclose or use for
his own benefit or purposes or the benefit or purposes of any other person,
firm, partnership, joint venture, association, corporation or other business
organization, entity or enterprise other than the Company and any of its
subsidiaries or affiliates, any trade secrets, information, data, or other
confidential information relating to customers, development programs, costs,
marketing, trading, investment, sales activities, promotion, credit and
financial data, manufacturing processes, financing methods, plans, employees,
organizational structure or the business and affairs of the Company generally,
or of any subsidiary or affiliate of the Company, provided that the foregoing
shall not apply to information which is not unique to the Company or which is
generally known to the industry or the public other than as a result of
Executive's breach of this covenant. Executive agrees that upon termination of
his employment with the Company for any reason, he will return to the Company
immediately all memoranda, books, papers, plans, information, letters and other
data, and all copies thereof or therefrom, in any way relating to the business
of the Company and its affiliates, except that he may retain personal notes,
notebooks and diaries. Executive further agrees that he will not retain or use
for his account at any time any trade names, trademark or other proprietary
business designation used or owned in connection with the business of the
Company or its affiliates.
(b) Executive will not at any time (whether during or after his employment
with the Company) knowingly make any statement, written or oral, or take any
other action relating to the Company or its officers or directors that would
disparage or otherwise harm the Company, its business or its reputation or those
of any of its officers and directors.
14. Material Inducement; Specific Performance. Executive acknowledges and
agrees that the covenants entered into by Executive in Section 12 and 13 are
essential elements of the parties' agreement as expressed herein, are a material
inducement for the Company to enter into this Agreement and the breach thereof
would be a material breach of this Agreement. Executive further acknowledges
and agrees that the Company's remedies at law for a breach or threatened breach
of any of the provisions of Section 12 or Section 13 would be inadequate and, in
recognition of this fact, Executive agrees that, in the event of such a breach
or threatened breach, in addition to any remedies at law, the Company, without
posting any bond, shall be entitled to obtain equitable relief in the form of
specific performance, temporary restraining order, temporary or permanent
injunction or any other equitable remedy which may then be available.
15. Litigation Support. Executive agrees that he will assist and cooperate
with the Company in connection with the defense or prosecution of any claim that
may be made against or by the Company or its affiliates, or in connection with
any ongoing or future investigation or dispute or claim of any kind involving
the Company or its affiliates, including any proceeding before any arbitral,
administrative, judicial, legislative, or other body or agency, including
testifying in any proceeding, to the extent such claims, investigations or
proceedings relate to services performed or required to be performed by
Executive, pertinent knowledge possessed by Executive, or any act or omission by
Executive. Executive further agrees to perform all acts and to execute and
deliver any documents that may be reasonably necessary to carry out the
provisions of this Section.
16. Legal Fees. The Company will pay or reimburse Executive, as incurred,
all legal fees and costs incurred by Executive in enforcing his rights under the
Agreement, if Executive's position substantially prevails. Following a Change
in Control, the Company will pay or reimburse Executive, as incurred, for all
such fees and costs unless Executive's claim was frivolous or was brought or
pursued by Executive in bad faith.
17. Miscellaneous. (a) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
(b) Entire Agreement/Amendments. This Agreement contains the entire
understanding of the parties with respect to the employment of Executive by the
Company. There are no restrictions, agreements, promises, warranties, covenants
or undertakings between the parties with respect to the subject matter herein
other than those expressly set forth herein and in the incentive compensation
and other employee benefit plans and arrangements of the Company referenced
herein. This Agreement may not be altered, modified, or amended except by
written instrument signed by the parties hereto.
(c) No Waiver. The failure of a party to insist upon strict adherence to any
term of this Agreement on any occasion shall not be considered a waiver of such
party's rights or deprive such party of the right thereafter to insist upon
strict adherence to that term or any other term of this Agreement.
(d) Severability. In the event that any one or more of the provisions of
this Agreement shall be or become invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
of this Agreement shall not be affected thereby.
(e) Assignment. This Agreement shall not be assignable by Executive and
shall be assignable by the Company only with the consent of Executive except as
set forth in Section 17(h); provided that no such assignment by the Company
shall relieve the Company of any liability hereunder, whether accrued before or
after such assignment.
(f) No Mitigation. Executive shall not be required to mitigate the amount of
any payment provided for in this Agreement by seeking other employment or
otherwise, and no such employment, if obtained, or compensation or benefits
payable in connection therewith, shall reduce any amounts or benefits to which
Executive is entitled hereunder except as provided for in Sections 8(c) and (d).
(g) Arbitration. Any dispute between the parties to this Agreement arising
from or relating to the terms of this Agreement or the employment of Executive
by the Company shall be submitted to arbitration in New York, New York under the
auspices of the American Arbitration Association.
(h) Successors; Binding Agreement
(i) The Company will require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially
all of the business and/or assets of the Company to expressly assume and
agree to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no such succession had
taken place. Such assumption and agreement shall be obtained prior to the
effectiveness of any such succession. As used in this Agreement, `Company'
shall mean the Company as hereinbefore defined and any successor to its
business and/or assets as aforesaid which assumes and agrees to perform
this Agreement by operation of law, or otherwise. Prior to a Change in
Control, the term `Company' shall also mean any affiliate of the Company to
which Executive may be transferred and the Company shall cause such
successor employer to be considered the `Company' bound by the terms of
this Agreement and this Agreement shall be amended to so provide.
Following a Change in Control the term `Company' shall not mean any
affiliate of the Company to which Executive may be transferred unless
Executive shall have previously approved of such transfer in writing, in
which case the Company shall cause such successor employer to be considered
the `Company' bound by the terms of this Agreement and this Agreement shall
be amended to so provide.
(ii) This Agreement shall inure to the benefit of and be binding upon
personal or legal representatives, executors, administrators, successors,
heirs, distributers, devisees and legatees. If Executive should die while
any amount would still be payable to Executive hereunder if Executive
had continued to live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement to the
devisee, legatee or other designee of Executive or, if there is no such
designee, to the estate of Executive.
(i) Notice. For the purpose of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the
Executive at the address appearing from time to time in the personnel records of
the Company and to the Company at the address of its corporate headquarters,
directed to the attention of the Board with a copy to the Secretary of the
Company, or in either case to such other address as either party may have
furnished to the other in writing in accordance herewith, except that notice of
change of address shall be effective only upon receipt.
(j) Withholding Taxes. The Company may withhold from any amounts payable
under this Agreement such Federal, state or local taxes as shall be required to
be withheld pursuant to any applicable law or regulation.
(k) Counterparts. This Agreement may be signed in counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.
Xxxxxxxxx X. Xxxxxx
__________________________
X.X. XXXXXXXXX CORPORATION
By:_______________________
Title:
