EMPLOYMENT AGREEMENT RE: M. XXX XXXXXXX
THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into by and
between Diversified Corporate Resources, Inc., a Texas corporation (herein
referred to as the "Company"), and M. Xxx Xxxxxxx (herein referred to as the
"Executive").
W I T N E S S E T H:
WHEREAS, the Company desires to continue to employ the Executive and
the Executive desires to continue to be employed by the Company; and
WHEREAS, the purpose of this document is to set forth the terms and
conditions of such employment.
NOW THEREFORE, for and in consideration of the mutual advantages and
benefits accruing respectively to the parties hereto, the mutual promises
hereinafter made and the acts to be performed by the respective parties hereto,
the Company and the Executive do hereby contract and agree as follows:
1. Employment. The Company hereby employs the Executive as the
President of the Company, and the Executive hereby accepts such employment, to
perform the duties and render services as herein set forth. Such employment
shall continue during the term of this Agreement.
2. Term. Except in the case of earlier termination as herein
specifically provided, the Executive's employment with the Company pursuant to
this Agreement shall be for a period of three (3) years beginning January 1,
1997 and ending December 31, 1999 (the "Termination Date"). The parties agree
that the Termination Date then in effect shall be automatically extended for one
(1) year unless (a) the Agreement has already been terminated for some reason
permitted hereunder, or (b) one of the parties hereto shall give written notice
to the other at least six (6) months in advance of the Termination Date then in
effect.
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3. Base Compensation. As base compensation for the services of
Executive during the term hereof, the Company shall pay the Executive a salary
at an annual rate to be fixed from time to time by the Board of Directors of the
Company but in no event less than $125,000.00 plus any additional compensation
which the Board of Directors of the Company may from time to time determine. The
Executive's salary hereunder shall be paid in equal semi-monthly installments
(subject to reduction for such payroll and withholding deductions as may be
required by law), and may be paid, in whole or in part, by one or more of the
subsidiaries (the "Subsidiaries") of the Company.
In addition to the Executive's base salary, the Executive shall be
entitled to each of the following (at the Company's expenses unless otherwise
indicated): (a) the right to receive an annual bonus pursuant to (i) the stock
bonus plan adopted by the Board of Directors of the Company at its meeting on
December 27, 1996, (ii) any bonus plans now in effect or hereafter adopted by
any of the Subsidiaries, and (iii) such other bonus plan(s) which the Board of
Directors of the Company may hereafter adopt, (b) health insurance coverage now
or hereafter in effect which shall provide for payment of health, dental and
related expenses incurred during the term of this Agreement with respect to the
Executive, the Executive's spouse or the Executive's children, and which shall
contain such benefits and options as shall be made available to other executives
of the Company and/or the Subsidiaries, (c) the right to participate in any and
all 401(k) plans and Section 125 plans now in effect or hereafter adopted by the
Company, (d) the right to participate in (i) the Executive Stock Option Plan
heretofore adopted by the Board of Directors, (ii) any and all stock options
which have been or may hereafter be granted to the Executive in his capacity as
a director of the Company, including the option heretofore granted to the
Executive giving the Executive the option to purchase 50,000 shares of the
Company's common stock, and (iii) any stock option plans for employees and/or
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executives of the Company which may hereafter be adopted by the Board of
Directors of the Company or by the Board of Directors of any of the subsidiaries
of the Company (including, but not by way of limitation, the option plan(s)
providing for the purchase of 105,000 shares of the Company's common stock
pursuant to resolutions approved by the Board of Directors of the Company at its
meeting on December 27, 1996, as such resolutions have been amended to date by
the Board of Directors of the Company), (e) the right to all fringe benefits
generally made available to other executives and/or employees of the Company,
and (f) the right to participate in any and all retirement and/or incentive
plans now in effect or hereafter implemented by the Company or any of the
subsidiaries of the Company.
In addition to the foregoing, the Executive shall be entitled to (a)
such vacation leave as shall be permitted by the Company's standard policies, or
(b) if such standard policies provide for a lesser amount of vacation leave,
minimum annual vacation leave of three (3) weeks per year with full pay, and
thirty (30) days per year of sick leave with full pay (this number of days of
sick leave may be extended if the Board of Directors of the Company approves).
The Executive shall also be entitled to receive such fees and/or
compensation as shall be granted to the Executive by the Board of Directors of
the Company in connection with the Executive serving as a member of the Board of
Directors of the Company, and/or any and all of the subsidiaries of the Company.
4. Duties and Services. During the term of this Agreement, the
Executive agrees to (a) do his utmost to enhance and develop the best interests
and welfare of the Company, (b) give his best efforts and skill to advancing and
promoting the growth and success of the Company, and (c) perform such duties or
render such services as the Board of Directors of the Company may, from time to
time, reasonably confer upon or impose on the Executive. It is
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understood that the Executive shall report directly to the Chairman of the Board
and Chief Executive Officer of the Company.
5. Termination.
a. The Company may terminate the Executive's employment
pursuant to this Agreement at any time for "cause" as herein defined. The term
"cause" shall mean any of the following events: (i) the Executive's conviction
or plea of guilty to a crime involving moral turpitude, (ii) any acts of
dishonesty or theft on the part of the Executive which, in the opinion of the
Board of Directors of the Company, is detrimental to the best interests of the
Company, and (iii) intentional and material violation by the Executive of any
written policy of the Board of Directors of the Company which is not corrected
within ninety (90) days after receipt by the Executive of a detailed written
explanation from the Board of Directors of the Company. Any decision by the
Board of Directors of the Company to terminate the Executive for cause must be
approved by the favorable vote of seventy-five percent (75%) of all members of
the Board of Directors of the Company excluding the Executive.
b. The Company may terminate the Executive as an employee of
the Company at any time during the term of this Agreement if a majority of all
of the members of the Board of Directors of the Company approves a resolution
authorizing such action and reflecting that such action is in the best interests
of the Company. However, unless the Executive's employment is terminated for
"cause" (as herein defined), any termination of the Executive's employment shall
not terminate the Company's obligations to pay to the Executive the severance
benefits as hereinafter set forth, or to comply with the other requirements of
this Agreement.
c. The Executive may terminate his employment with the Company
at any time by giving ninety (90) days written notice to the Company.
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d. The Executive's employment by the Company shall
automatically terminate on the date of the Executive's death if the Executive
dies during the term of this Agreement.
e. If the Executive is incapacitated by an accident, sickness
or otherwise, so as to render him mentally or physically incapable of performing
the services required of him pursuant to this Agreement, Executive's employment
by the Company shall terminate at such time as the Board of Directors of the
Company determines (with at least seventy-five percent of the directors other
than the Executive voting in favor) that the Executive is so disabled and that
this Agreement should be terminated by reason of such disability.
Notwithstanding the foregoing, the Executive shall have the right to contest any
determination of disability by the Board of Directors of the Company. In the
event that the Executive does contest such determination, such matter shall be
resolved by arbitration pursuant to Section 12(c) of this Agreement.
6. Severance and Other Payments.
a. If the Executive's employment pursuant to this Agreement is
terminated for "cause" (as herein defined) or due to the death or disability (as
determined pursuant to paragraph 5(e) of this Agreement) of the Executive, the
Company shall not be obligated to pay or provide any severance compensation or
benefits to the Executive.
b. If the Executive's employment with the Company is
terminated under Paragraph 5(b) of this Agreement, the Company agrees to pay to
the Executive an amount equal to the base compensation which would have been
paid to the Executive during the period of time from the date of the termination
of the Executive's employment with the Company until the Termination Date and
for a period of twelve (12) months following the Termination Date. In addition
to the foregoing severance payment, the Executive and his family shall continue
to
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participate in the Company's group health plan, at no cost to the Executive,
until the Termination Date.
c. If the Executive's employment is terminated during the term
of this Agreement, for any reason other than cause, the Executive (i) shall be
entitled to receive a prorata share (based upon the number of months employed
during the calendar year in which employment with the Company is terminated) of
any bonus or incentive compensation which the Executive would otherwise have
been entitled to receive had he remained employed for the entirety of the
calendar year involved, and (ii) shall have twelve (12) months to exercise any
stock options heretofore or hereafter granted to the Executive by the Board of
Directors of the Company.
d. During the time of Executive's employment with the Company
and all of its subsidiaries, the Company shall fund a deferred compensation
program for the Executive in the amount of $1,500.00 per month. Such program
shall be pursuant to a written policy to be adopted by the Company on or before
July 1, 1997.
7. Working Conditions. The Company will provide the Executive with a
private office and secretarial services.
8. Relocation. In the event that the Board of Directors of the Company
relocates the primary office of the Executive outside of the Dallas, Texas
metropolitan area, the Company shall pay all moving expenses of the Executive to
the place of the new office. Absent the written consent of the Executive, the
Company shall not relocate the primary office of the Executive to an
office/location which is not the general corporate office of the Company.
9. Travel and Entertainment. The Executive is authorized to incur
reasonable business expenses on behalf of the Company, including, but not by way
of limitation, expenditures of entertainment, gifts and travel; if any expenses
are of a kind or a cost in excess
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of the written policies established by the Board of Directors of the Company,
such expenses must be expressly authorized by the Board of Directors of the
Company. The Company agrees to reimburse the Executive for all such expenses
upon the Executive's presentation of an itemized account of such expenditures.
In addition to the foregoing, the Executive is entitled to incur, and to be
reimbursed by the Company, various and sundry fees, costs and expenses
(including, but not by way of limitation, fees and costs involved in attending
continuing education sessions) in connection with the Executive continuing to be
licensed in Texas as a certified public accountant, certified management
accountant and a certified financial planner.
10. Non-Competition Agreement. In the event that the termination of
employment of the Executive pursuant to this Agreement is effectuated by the
Executive electing to terminate his employment pursuant to this Agreement, the
Executive agrees that the Executive shall not, for a one year period of time
following the date of termination of this Agreement, within Dallas, Dallas
County, Texas or within a radius of fifty (50) miles from any business location
of the Company and its subsidiaries in the continental United States on the
Termination Date, enter into or engage generally in direct competition with the
Company either as an individual on his own or as a partner or joint venturer, or
as an employee or agent for any person, or as an officer, director, shareholder
or otherwise of any entity other than the Company or an affiliate of the
Company.
11. Notices. All notices or other instruments or communications
provided for in this Agreement shall be in writing and signed by the party
giving same and shall be deemed properly given if delivered in person, including
delivery by overnight courier, or if sent by registered or certified United
States mail, postage pre-paid, addressed to such party at the address listed
below. Each party may, by notice to the other party, specify any other address
for the receipt of such notices, instruments or communications. Any notice,
instrument or communication sent
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by telegram shall be deemed properly given only when received by the person to
whom it is sent.
12. Miscellaneous.
a. Subject to the condition that this Agreement is not
assignable by either party without the prior written consent of the other party,
the terms and provisions of this Agreement shall inure to the benefit of, and
shall be binding on, the parties hereto and their respective heirs,
representatives, successors and assigns.
b. This Agreement supersedes all other agreements, either oral
or in writing, between the parties to this Agreement, with respect to the
employment of the Executive by the Company. This Agreement contains the entire
understanding of the parties and all of the covenants and agreement between the
parties with respect to such employment. Any such prior agreements are hereby
terminated without obligation for any payments otherwise due thereunder.
c. Any controversy between the parties to this Agreement
involving the construction or application of any of the terms, covenants, or
conditions of this Agreement shall be submitted to arbitration if either party
to this Agreement shall request arbitration by notice in writing to the other
party. In such event, the parties to this Agreement shall, within thirty (30)
days after this Paragraph 12(c) is invoked, both appoint one person as an
arbitrator to hear and determine the dispute, and if such arbitrators shall be
unable to agree within fifteen (15) days after selection of the second of the
two, then the two arbitrators so chosen shall, within fifteen (15) days, select
a third impartial arbitrator whose decision shall be final and conclusive upon
the parties to this Agreement. The decision of the third arbitrator shall be
rendered within fifteen (15) days after selection. The expenses of arbitration
proceedings conducted pursuant to this Agreement shall be borne by the party
incurring the cost; the expenses of a third arbitrator shall be borne equally by
the Company and the Executive.
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d. In the event of any litigation between the parties related
to the compliance with the terms and conditions of this Agreement, the parties
hereto acknowledge and agree that (i) such litigation proceedings must be held
in Dallas County, Texas, and (ii) the prevailing party in such litigation
proceedings shall be entitled to recover, from the nonprevailing party,
reasonable attorneys' fees and expenses incurred in connection with the dispute
involved.
e. This Agreement has been made under and shall be governed by
the laws of the State of Texas.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the 1st day of January, 1997, but actually executed this 10th
day of April, 1997.
COMPANY:
DIVERSIFIED CORPORATE RESOURCES, INC.
By:/s/ J. Xxxxxxx Xxxxx
----------------------------
J. Xxxxxxx Xxxxx, Chairman of the Board
and Chief Executive Officer
Address: 00000 Xxxxx Xxxxxxx Xxxxxxxxxx
Xxxxx 000
Xxxxxx, XX 00000
/s/ M. Xxx Xxxxxxx
----------------------------
M. Xxx Xxxxxxx
Address: 0000 Xx. Xxxxxxx
Xxxxxxxxxx, Xxxxx 00000
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