EXHIBIT 10.6
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT is made this 20th day of August, 2001, (the
"Agreement") between XXXXXXXXXX.XXX, INC., a Delaware corporation (the
"Company"), and XXXXX XXXXXXX (the "Executive").
PRELIMINARY STATEMENTS
A. The Company desires to employ the Executive on the terms and subject to
the conditions set forth in this Agreement. B. The Executive is willing to make
his services available to the Company on the terms and subject to the conditions
hereinafter set forth.
C. The Compensation Committee ("Compensation Committee") of the Board of
Directors of the Company (the "Board") has approved the execution and delivery
by the Company of this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and mutual covenants set
forth herein, the parties agree as follows:
1. Employment. The Company hereby agrees to continue to employ the
Executive and the Executive hereby agrees to continue to serve the Company, on
the terms and conditions set forth in this Agreement.
2. Term of Agreement. Subject to the terms and conditions hereof, the
term of the Executive's employment pursuant to this Agreement (the "Term") shall
be three years and such Term shall automatically extend by one day for each day
elapsed, so that at all times the Term shall be for a three-year period;
provided, however, if at any time the Company or the Executive delivers a
written notice to the other (an "Expiration Notice") to the effect that the
Agreement shall expire on a date specified in the Expiration Notice that is
three years after the date the Expiration Notice is delivered to the Company or
the Executive, as the case may be, then the Term shall expire on the date
specified in the Expiration Notice.
3. Position and Duties. The Executive shall serve as the President,
Product Development, of the Company, shall perform substantially the same duties
as he currently performs and shall have substantially the same authority as he
currently exercises. The Executive shall report to, and shall have such other
powers and duties as may from time to time be delegated to him by, the Chief
Executive Officer or, if there is no Chief Executive Officer, the highest
ranking executive officer of the Company, or, following a Change in Control (as
defined below), the senior executive, board or committee established pursuant to
the terms of the Change of Control that is responsible for the unit or division
of which the Company has become a part; provided that such duties are generally
consistent with his present duties and with the Executive's position. The
Executive shall devote substantially all of his working time and efforts during
normal business hours to the business and affairs of the Company in
substantially the same manner (both as to working time and effort) as the
Executive has devoted to the Company in the past; provided, that it shall not be
a violation of this Agreement for the Executive to (i) serve on corporate, civic
or charitable boards or committees, and (ii) deliver lectures or fulfill
speaking engagements, so long as such activities are approved by the executive
or body to which the Executive reports and do not interfere with the performance
of the Executive's responsibilities as an employee of the Company in accordance
with this Agreement.
4. Place of Performance. In connection with his employment by the
Company, the Executive shall be based at the Company's principal executive
offices except for required travel on the Company's business.
5. Compensation and Related Matters.
(a) Base Salary. The Executive shall receive a base salary, payable in
substantially equal bi-weekly installments, at the annual rate of at least
$210,000 during each fiscal year during the Term, or such greater amount as
shall be determined by the Compensation Committee or the entire Board, in its
sole discretion (the "Base Salary"). The Base Salary shall be reviewed at least
annually for merit increases and may, by action and in the discretion of the
Compensation Committee or the Board, be increased at any time or from time to
time. Any increase in the Base Salary or other compensation granted by the
Compensation Committee or the Board shall in no way limit or reduce any other
obligation of the Company under this Agreement and, unless otherwise specified
by the Compensation Committee or the Board, once established at an increased
specified rate, the Base Salary shall not thereafter be reduced.
(b) Incentive Compensation. In addition to the Base Salary, during the
Term the Executive shall be entitled to receive an annual bonus (the "Annual
Bonus") for each fiscal year for which the Company achieves its budgeted EBITDA
target (the "Target"), in an amount equal to fifty percent (50%) of the
Executive's Base Salary for such fiscal year. The Target for each fiscal year
shall be approved by the Compensation Committee not later than 90 days after the
beginning of each fiscal year. For purposes of this Section, the term "EBITDA"
means the Company's earnings before income taxes, depreciation and amortization,
as determined in accordance with generally accepted accounting principles,
consistently applied with the Company's past practices, and as reflected in the
Company's audited financial statements for the relevant fiscal year. If the
Company does not achieve the Target for any fiscal year, no Annual Bonus shall
be payable for such fiscal year. The Annual Bonus payable with respect to any
fiscal year (net of any tax or other amount properly withheld therefrom) shall
be paid by the Company to the Executive within sixty (60) days after the end of
the fiscal year; provided, that (i) any amount paid shall be subject to increase
or decrease based upon the results of the Company's audited financial statements
with respect to such year, (ii) the amount of Annual Bonus payable for any
fiscal year during which the Term expires or this Agreement is terminated shall
be prorated and payable only with respect to the portion of the fiscal year
during which the Executive was employed by the Company and (iii) no Annual Bonus
shall be payable with respect to any fiscal year during which the Executive's
employment is terminated by the Company for Cause, or by the Executive for other
than Good Reason. In addition to the Annual Bonus, the Executive shall be
entitled to receive such other bonuses or incentive compensation as the
Compensation Committee may determine in its sole discretion, taking into
consideration such criteria as it shall deem relevant.
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(c) Stock Options. During the Term, the Executive shall be entitled to
receive stock option grants, no less frequently than annually. The number of
stock options and the terms and conditions of stock options granted to the
Executive shall be determined by the Compensation Committee in its discretion;
provided, that beginning in 2002, the Executive shall be granted stock options
to purchase at least 50,000 shares of the Company's common stock during each
calendar year.
(d) Expenses. During the Term, the Company, in accordance with its expense
reimbursement policies and procedures in effect for senior management employees
from time to time, shall reimburse the Executive for all reasonable expenses
actually paid or incurred by the Executive in the course of and pursuant to the
business of the Company.
(e) Other Benefits. The Executive shall be entitled to participate in or
receive benefits under any employee benefit plan or arrangement made available
generally by the Company to its executives, subject to and on a basis consistent
with the terms, conditions and overall administration of such plan or
arrangement. The Company shall also provide the Executive such coverage under
any directors and officers liability policies it maintains as is provided to its
other senior management employees. Nothing paid or provided to the Executive
under any plan or arrangement presently in effect or made available in the
future shall be deemed to be in lieu of the Base Salary or any other obligation
payable to the Executive pursuant to this Agreement.
(f) Vacation. The Executive shall be entitled to the number of paid
vacation days in each calendar year determined by the Company from time to time
for its senior executive officers. The Executive shall also be entitled to all
paid holidays given by the Company to its senior executive officers.
(g) Perquisites and Fringe Benefits. The Executive shall be entitled to
continue to receive all perquisites and fringe benefits provided or available to
senior executive officers of the Company in accordance with present practice and
as may be changed from time to time with respect to all senior executive
officers of the Company.
(h) Working Facilities. The Company shall furnish the Executive with an
office, a secretary and such other facilities and services suitable to his
position and adequate for the performance of his duties hereunder.
6. Other Offices. The Executive agrees to serve without additional
compensation as an officer and/or director of any of the Company's present or
future subsidiaries; provided, that the Executive shall be indemnified for
serving in any and all such capacities on a basis no less favorable than may be
from time to time provided to other senior executives of the Company.
7. Restrictive Covenants.
(a) Noncompetition. The Executive agrees that he will not, either during
the Term and for a period of one year following any termination of this
Agreement, directly or indirectly, engage in, operate, have any investment or
interest or otherwise participate in any manner (whether as an employee,
officer, director, partner, agent, security holder, creditor, consultant or
otherwise) in any sole proprietorship, partnership, corporation or business or
any other person or entity that engages, directly or indirectly, in
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a Competing Business; provided, that the Executive may continue to hold
Company securities and/or acquire, solely as an investment, shares of capital
stock or other equity securities of any company which are publicly traded, so
long as the Executive does not control, acquire a controlling interest in, or
become a member of a group which exercises direct or indirect control of, more
than five percent (5%) of any class of capital stock of such corporation. For
purposes of this Agreement, the term "Competing Business" means the ownership,
operation, management or distribution of an on-line service that provides sports
news, information and content and/or that markets, sells or otherwise
distributes sports-related products, whether such service is accessed through
the Internet, a commercial on-line service or otherwise.
(b) Unauthorized Disclosure. During the Term and for a period of two years
following any termination of this Agreement, the Executive shall not, without
the written consent of the Board or a person authorized thereby, disclose to any
person, other than an employee of the Company (or its subsidiaries) or a person
to whom disclosure is reasonably necessary or appropriate in connection with the
performance by the Executive of his duties as an executive of the Company, any
confidential information obtained by him while in the employ of the Company with
respect to any of the Company's customers, suppliers, creditors, lenders,
investment bankers, methods of distribution or methods of marketing; provided,
however, that confidential information shall not include any information known
generally to the public (other than as a result of unauthorized disclosure by
the Executive). Notwithstanding the foregoing, nothing herein shall be deemed
to restrict the Executive from disclosing Confidential Information to the extent
required by law.
(c) Nonsolicitation of Employees. During the Term and for a period of two
years following any termination of this Agreement, the Executive shall not
directly or indirectly, for himself or for any other person, firm, corporation,
partnership, association or other entity, attempt to employ or enter into any
contractual arrangement with any employee or former employee of the Company,
unless such employee or former employee has not been employed by the Company for
a period in excess of six months.
(d) Injunction. It is recognized and hereby acknowledged by the Company
and the Executive that a breach by the Executive of any of the agreements
contained in this Section 7 may cause irreparable harm or damage to the Company
or its subsidiaries, the monetary amount of which may be virtually impossible to
ascertain. As a result, the Executive and the Company agree that the Company
and any of its subsidiaries shall be entitled to an injunction issued by any
court of competent jurisdiction enjoining and restraining any and all violations
of such agreements by the Executive or his associates, affiliates, partners or
agents, and that such right to an injunction shall be cumulative and in addition
to whatever other remedies the Company may possess.
8. Termination. The Executive's employment under this Agreement may be
terminated without any breach of this Agreement only on the following
circumstances:
(a) Death. The Executive's employment under this Agreement shall terminate
automatically upon his death.
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(b) Disability. If, as a result of the Executive's incapacity due to
physical or mental illness, the Executive is absent from the performance of his
duties under this Agreement for a period of three months during any twelve-month
period, and within 10 days after written notice of termination is given, the
Executive does not return to the performance of his duties under this Agreement,
the Company may terminate the Executive's employment under this Agreement for
"Disability."
(c) Cause. The Company may at any time terminate the Executive's
employment under this Agreement for Cause. For purposes of this Agreement,
"Cause" means: (i) the willful and continued failure by the Executive to
substantially perform his duties under this Agreement (other than any such
failure resulting from the Executive's incapacity due to physical or mental
illness or from the termination of this Agreement by the Executive for Good
Reason), after a demand for substantial performance is delivered to the
Executive by the Company specifically identifying the manner in which the
Company believes the Executive has not substantially performed his duties, and
the Executive shall have failed to resume substantial performance of such duties
within thirty (30) days of receiving such demand, (ii) the willful engaging by
the Executive in criminal conduct (including embezzlement and criminal fraud)
which is demonstrably and materially injurious to the Company, monetarily or
otherwise, or (iii) the conviction of the Executive of a felony (other than a
traffic violation) or the conviction of the Executive of a misdemeanor which
impairs the Executive's ability substantially to perform his duties with the
Company. For purposes of this paragraph, no act, or failure to act, on the
Executive's part shall be considered "willful" unless done, or omitted to be
done, by him not in good faith and without reasonable belief that his action or
omission was in the best interest of the Company. Notwithstanding anything
herein to the contrary, the Executive shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to the
Executive a copy of a resolution, duly adopted by the affirmative vote of not
less than a majority of the members of the Board then in office (other than the
Executive) at a meeting of the Board called and held for such purpose (after
reasonable notice to the Executive and an opportunity for him, together with his
counsel, to be heard before the Board), finding that in the good faith opinion
of the Board the Executive was guilty of conduct set forth in clause (i), (ii)
or (iii), above, and specifying the particulars thereon in detail.
(d) Termination by the Executive. The Executive may terminate his
employment under this Agreement (i) for Good Reason, or (ii) if his health
should become impaired to any extent that makes the continued performance of his
duties under this Agreement hazardous to his physical or mental health or his
life, provided that the Executive shall have furnished the Company with a
written statement from a qualified doctor to such effect and provided, further,
that at the Company's request and expense the Executive shall submit to an
examination by a doctor selected by the Company and such doctor shall have
concurred in the conclusion of the Executive's doctor.
For purposes of this Agreement, "Good Reason" means, without the Executive's
prior written consent, the occurrence of any one or more of the following: (A)
any action by the Company which results in a material diminution in the nature
or status of the Executive's position, authority, duties or responsibilities;
(B) a failure by the Company to pay any amounts of Base Salary, Annual Bonus or
other amounts payable hereunder, or to comply with its other obligations and
agreements contained herein; (C) a failure of the Company to obtain an agreement
from any successor to the Company to assume and agree to perform this Agreement,
as contemplated in Section 10(c) hereof; (D) Executive
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no longer reports directly to the person(s) specified in Section 3 hereof, or
(E) any purported termination by the Company of the Executive's employment that
is not effected pursuant to a Expiration Notice or a Notice of Termination
satisfying the requirements of Section 2 or subsection 8(e), respectively, and
otherwise in accordance with the terms of this Agreement, and for purposes of
this Agreement, no such termination shall be effective. Notwithstanding anything
in this Agreement to the contrary, Good Reason shall not be deemed to exist as a
result of one or more of the following: (i) changes in the nature or status of
the Executive's position, authority, duties or responsibilities solely as a
result of the Company becoming part of a unit or division of a larger entity
pursuant to or following a Change of Control; (ii) any change in the Executive's
title(s), so long as the Executive's duties remain generally consistent with
those he presently performs; or (iii) so long as the Executive remains
responsible for the Company's content programming and production functions and
fantasy sports operations, the delegation to other executives or employees of
the Company of other responsibilities or duties that are presently performed by
the Executive or may be delegated to him from time to time.
The Executive's right to terminate his employment for Good Reason shall not
be affected by his incapacity due to physical or mental illness, nor shall the
Executive's continued employment constitute consent to, or a waiver of his
rights with respect to, any circumstances constituting Good Reason. With
respect to the matters set forth in clauses (A), (B), (C) and (D), above, the
Executive shall give the Board thirty (30) days prior written notice of his
intent to terminate this Agreement, and the Company shall have the right to cure
any such breach or alleged breach within such 30-day period.
(e) Notice of Termination. Any termination of the Executive's employment by
the Company or by the Executive (other than termination pursuant to Section
8(a), above) shall be communicated by written Notice of Termination to the other
party hereto given in accordance with Section 12. For purposes of this
Agreement, a "Notice of Termination" shall mean a written notice which indicates
the specific termination provision in this Agreement relied upon and sets forth
in reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision so indicated. The
failure by the Executive to set forth in any Notice of Termination any fact or
circumstance which contributes to a showing of Good Reason shall not waive any
right of the Executive hereunder or preclude the Executive from asserting such
fact or circumstance in enforcing his rights hereunder.
(f) Date of Termination. "Date of Termination" shall mean (i) if the
Executive's employment is terminated by his death, the date of his death, (ii)
if the Executive's employment is terminated for Disability, thirty (30) days
after Notice of Termination is given (provided that the Executive shall not have
returned to the performance of his duties during such thirty (30) day period),
(iii) if the Executive's employment is terminated by the Company for Cause, the
date specified in the Notice of Termination after the expiration of any cure
periods, and (iv) if the Executive's employment is terminated for any other
reason, the date on which a Notice of Termination is given after the expiration
of any cure periods; provided, that if within thirty (30) days after any Notice
of Termination one party notifies the other party that a dispute exists
concerning the termination, the Date of Termination shall be the date finally
determined to be the Date of Termination, either by mutual written agreement of
the parties or by a binding and final arbitration award or an adjudication by a
court of competent jurisdiction
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(and in such event the Company shall continue to perform its obligations
hereunder until the date so determined).
9. Compensation Upon Termination or During Disability.
(a) Death. If the Executive's employment is terminated by reason of his
death, the Company shall pay to such person as the Executive shall have
designated in a notice filed with the Company, or, if no such person has been
designated, to his estate, any unpaid amounts of his Base Salary or Annual Bonus
accrued prior to the date of his death; and upon making such payments, the
Company shall have no further liability hereunder (other than for reimbursement
for reasonable business expenses incurred prior to the date of the Executive's
death pursuant to Section 5(c)); provided, that the Executive's spouse,
beneficiaries or estate shall also be entitled to receive any amounts or other
benefits payable pursuant to any pension or employee benefit plan, life
insurance policy or other plan, program or policy then maintained or provided by
the Company in accordance with the terms thereof. In addition, all unvested
Awards (as defined in the Company's 1997 Incentive Compensation Plan),
including, but not limited to, stock options and/or unvested restricted Company
securities, held by the Executive on the Date of Termination shall continue to
vest in accordance with the vesting schedule for such Awards then in effect, and
upon vesting shall (x) in the case of stock options, become exercisable and (y)
in the case of restricted Company securities, no longer be subject to forfeiture
or any other conditions or restrictions on transfer. Moreover, each such stock
option that vests pursuant to the preceding sentence, together with any
previously vested and unexercised stock options, shall be exercisable in
accordance with their respective terms for a period of one (1) year following
the date on which it becomes vested (or, in the case of any previously vested
and unexercised options, one (1) year following the Date of Termination) or, if
earlier, until the then scheduled expiration date(s) of such options.
(b) Disability. During any period that the Executive fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
the Executive shall continue to receive his Base Salary and any Annual Bonus
until the Executive's employment is terminated pursuant to Section 8(b) hereof,
or until the Executive terminates his employment pursuant to Section 8(d)(ii)
hereof, whichever first occurs. If the Executive's employment is terminated by
reason of his Disability, the Company shall pay to the Executive any unpaid
amounts of his Base Salary or Annual Bonus accrued prior to the date of such
termination; and upon making such payments, the Company shall have no further
liability hereunder (other than for reimbursement for reasonable business
expenses incurred prior to the date of such termination pursuant to Section
5(c)); provided, that the Executive shall also be entitled to receive any
amounts or other benefits payable pursuant to any pension or employee benefit
plan, life insurance policy or other plan, program or policy then maintained or
provided by the Company in accordance with the terms thereof. In addition, all
unvested Awards, including but not limited to stock options and/or unvested
restricted Company securities, held by the Executive on the Date of Termination
shall continue to vest in accordance with the vesting schedule for such Awards
then in effect, and upon vesting shall (x) in the case of stock options, become
exercisable and (y) in the case of restricted Company securities, no longer be
subject to forfeiture or any other conditions or restrictions on transfer.
Moreover, each such stock option that vests pursuant to the preceding sentence,
together with any previously vested and unexercised stock options, shall be
exercisable in accordance with their
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respective terms for a period of one (1) year following the date on which it
becomes vested (or, in the case of any previously vested and unexercised
options, one (1) year following the Date of Termination) or, if earlier, until
the then scheduled expiration date(s) of such options. Notwithstanding anything
in this section to the contrary, all such vesting of Awards shall discontinue
immediately, and any unexercised options shall terminate and be cancelled
immediately upon a breach by the Executive of the provisions of Section 7 hereof
or the Executive's acceptance of employment with another entity.
(c) Cause; Other than for Good Reason. If the Executive's employment is
terminated by the Company for Cause, or by the Executive for other than Good
Reason, the Company shall pay the Executive his Base Salary and accrued vacation
pay through the Date of Termination at the rate in effect at the time Notice of
Termination is given (or on the Date of Termination if no Notice of Termination
is required hereunder) plus all other amounts to which the Executive is entitled
under any plan, program, policy or practice of the Company or otherwise at the
time such payments are due and such payments shall, assuming the Company is in
compliance with the provisions of this Agreement, fully discharge the Company's
obligations hereunder.
(d) Good Reason; Other than Cause or Disability. If the Company terminates
the Executive's employment other than for Cause or Disability, or the Executive
terminates his employment for Good Reason, then:
(i) within thirty (30) days after the Date of Termination, the
Company shall pay the Executive an amount equal to the sum of: (i) his accrued
but unpaid Base Salary through the Date of Termination at the rate in effect at
the time Notice of Termination is given (or the Date of Termination where no
Notice of Termination is required hereunder) and (ii) a pro rata portion of the
most recent Annual Bonus paid to the Executive (taking into consideration any
accrued but unpaid Annual Bonus which is paid pursuant to this Section 9(d)(i))
based on the number of days elapsed in the current fiscal year prior to the Date
of Termination, together with any accrued incentive compensation and other
amounts to which the Executive is then entitled under any plan, policy, practice
or program of the Company at the time such payments are due; and
(ii) in lieu of any further salary, incentive compensation or other
payments for periods subsequent to the Date of Termination, and as a severance
benefit to the Executive, the Company will pay to the Executive in equal bi-
weekly installments for a period of two (2) years following the date of
termination an amount equal to the sum of (i) two (2) times the Executive's
annual Base Salary in effect at the time Notice of Termination is given (or the
Date of Termination where no Notice of Termination is required hereunder), plus
(ii) an amount equal to the two (2) times the greater of (x) the average Annual
Bonus paid to the Executive for the prior three years or (y) the amount of the
most recent Annual Bonus paid to the Executive.
(e) Acceleration of Vesting; Sale of Shares. Unless the Company terminates
the Executive's employment for Cause, the Executive terminates his employment
for other than Good Reason or the Executive's employment is terminated due to
his death or Disability, upon (i) termination of the Executive's employment or
(ii) a Change of Control, all unvested Awards, including, but not limited to
stock options and/or restricted Company securities, held by the Executive on the
Date of Termination shall immediately vest and upon vesting shall (x) in the
case of stock options, become
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exercisable and (y) in the case of restricted Company securities, no longer be
subject to forfeiture or any other conditions or restrictions on transfer.
Moreover, each such stock option that is deemed vested pursuant to the preceding
sentence, together with any previously vested and unexercised stock options,
shall be exercisable by the Executive in accordance with their respective terms
for a period of one (1) year following the Date of Termination or the date of
the Change in Control, as the case may be, or, if earlier, until the then
scheduled expiration date(s) of such options. The Company shall provide the
Executive such cooperation and assistance as may reasonably be necessary to
effect cashless exercises of such stock options and the sale of any such
restricted Company security beneficially owned by the Executive at the Date of
Termination. Furthermore, upon a Change of Control caused by CBS Broadcasting
Inc. ("CBS") or any of its affiliates, pursuant to the issuance of securities by
the Company to CBS or any affiliate thereof, becoming the "beneficial owner"
(within the meaning of Rule 13d-3 promulgated under the Exchange Act), directly
or indirectly, of securities of the Company representing forty percent (40%) or
more of the combined voting power of the Company's outstanding securities
entitled to vote generally in the election of directors (a "CBS Change of
Control"), in addition to the accelerated vesting of Awards as set forth in this
Section 9(e), the Executive shall be entitled, in the Executive's sole
discretion, upon written notice to the Company within 60 days after the date of
the CBS Change of Control, to surrender any or all stock options then held by
such Executive with an exercise price greater than the Fair Market Value
(defined below) of the Company's common stock on the date of such CBS Change of
Control to the Company in exchange for shares of common stock of the Company
awarded pursuant to the Plan at an exchange rate of one share of common stock
for every two options surrendered. For the purposes of this Agreement, the "Fair
Market Value" of the Company's common stock as of any given date shall be (i)
the closing sale price per share reported on a consolidated basis for the common
stock as listed on the Nasdaq National Market or the principal stock exchange or
market on which the common stock is traded on the date as of which such value is
being determined or, if there is no sale on that date, then on the last previous
day on which a sale was reported or (ii) if the common stock is not listed on an
exchange or market, the fair market value of the common stock as determined by
the Board.
For purposes of this Agreement, a "Change in Control" means and shall be
deemed to have occurred if: (i) any person, entity or "group", within the
meaning of Sections 13(d)(3) and 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), other than (A) the Company, its
subsidiaries or any employee benefit plan established and maintained by the
Company or its subsidiaries, or (B) the Executive or any of the Executive's
affiliates, becomes the "beneficial owner" (within the meaning of Rule 13d-3
promulgated under the Exchange Act), directly or indirectly, of securities of
the Company representing forty percent (40%) or more of the combined voting
power of the Company's then outstanding securities entitled to vote generally in
the election of directors; (ii) the individuals who, as of the date hereof
constitute the Company's Board of Directors (as of the date hereof, the
"Incumbent Board") cease for any reason to constitute a majority of the Board of
Directors, provided that any person becoming a director subsequent to the date
hereof whose election, or nomination for election by the Company's stockholders
was approved by a vote of at least a majority of the directors then comprising
the Incumbent Board (other than the election or nomination of an individual
whose initial assumption of office is in connection with an actual or threatened
election contest relating to the election of the directors of the Company, as
such terms are used in Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) shall be, for purposes of this Agreement,
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considered as though such person were a member of the Incumbent Board; or (iii)
the shareholders of the Company approve (A) a reorganization, merger or
consolidation with respect to which persons who were the shareholders of the
Company immediately prior to such reorganization, merger or consolidation do
not, immediately thereafter, own more than 50% of the combined voting power
entitled to vote generally in the election of directors of the reorganized,
merged or consolidated company's then outstanding voting securities, (B) a
liquidation or dissolution of the Company, or (C) the sale of all or
substantially all of the assets of the Company, unless the approved
reorganization, merger, consolidation, liquidation, dissolution or sale is
subsequently abandoned.
(f.) Maintenance of Benefit. Unless the Executive is terminated for Cause,
the Company shall maintain in full force and effect, for the continued benefit
of the Executive and/or his family for two (2) years after termination for any
reason, all employee medical, health and hospitalization plans and programs in
which the Executive and/or his family was entitled to participate in immediately
prior to the Date of Termination provided that the continued participation of
the Executive and/or his family is possible under the general terms and
provisions of such plans and programs. In the event that the participation of
the Executive and/or his family in any such plan or program is barred, the
Company shall arrange to provide the Executive and/or his family with benefits
substantially similar to those which the Executive and/or his family would
otherwise have been entitled to receive under such plans and programs from which
his or their continued participation is barred.
10. Successors.
(a) This Agreement is personal to the Executive and without the prior
written consent of the Company shall not be assignable by the Executive other
than by will or the laws of descent and distribution. This Agreement and all
rights of the Executive hereunder shall inure to the benefit of and be enforce
able by the Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devises and legatees. If the
Executive dies while any amounts would still be payable to him hereunder, all
such amounts, unless otherwise provided herein, shall be paid in accordance with
the terms of this Agreement to the Executive's personal or legal representatives
or, if there be no such persons, the Executive's estate.
(b) This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns.
(c) 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, by agreement in form and substance
satisfactory to the Executive, to assume expressly 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. Failure of the
Company to obtain such assumption and agreement prior to the effectiveness of
any such succession shall be a breach of this Agreement and shall entitle the
Executive to compensation from the Company in the same amount and on the same
terms as he would be entitled to hereunder if he terminated his employment for
Good Reason, except for purposes of implementing the foregoing, the date on
which any such succession becomes effective shall be deemed the Date of
Termination. As used in this Agreement, the term "Company" means the Company as
hereinbefore defined and any successor to its business and/or
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assets as aforesaid which executes and delivers an assumption and agreement
provided for in this Section 10(c) or which otherwise becomes bound by all the
terms and provisions of this Agreement by operation of law, or otherwise.
11. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or
limit the Executive's continuing future participation in any benefit, bonus,
incentive or other plans, programs, policies or practices provided by the
Company or any of its subsidiaries and for which the Executive may qualify, nor
shall anything herein limit or otherwise affect such rights as the Executive may
have under any stock option or other agreements with the Company or any of its
subsidiaries. Except as herein specifically provided, amounts which are vested
benefits or which the Executive is otherwise entitled to receive under any plan,
policy, practice or program of the Company or any of its subsidiaries at or
subsequent to the Date of Termination shall be payable in accordance with such
plan, policy, practice or program.
12. Notice. All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:
If to the Executive:
If to the Company: XxxxxxXxxx.xxx, Inc.
0000 X. Xxxxxxx Xxxxx Xxxx
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attn: Chief Executive Officer
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notices and communications shall be effective
when actually received by the addressee.
13. Miscellaneous.
(a) This Agreement has been approved by the Compensation Committee. No
provisions of this Agreement may be modified, waived or discharged unless such
modification, waiver or discharge is agreed to in a writing signed by the
Executive and such officer as may be specifically designed by the Compensation
Committee or the Board.
(b) The failure by either party hereto to insist upon compliance with any
condition or provision of this Agreement shall not be deemed a waiver of such
condition or provision or any other provision hereof.
(c) No agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement and this Agreement
supersedes any other agreement or understanding between the Company and the
Executive relating to the Executive's employment and any compensation or
benefits in respect thereof (including, without limitation, the Prior Employment
Agreement).
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(d) The Company may withhold from any accounts payable under this Agreement
all Federal, state or other taxes as legally shall be required.
(e) The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of Florida, without
reference to principles of conflicts of laws.
(f) The invalidity or unenforceability of any provision or provisions of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
(g) This Agreement may be executed in several counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Employment Agreement as
of the date and year first above written.
XXXXXXXXXX.XXX, INC.
By: /s/ Xxxxxxx Xxxx
-----------------
Xxxxxxx Xxxx
President and Chief Executive Officer
/s/ Xxxxx Xxxxxxx
------------------
Xxxxx Xxxxxxx
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