EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") between Xxxxxxx Enterprises,
Inc., a Louisiana corporation (the "Company"), and Xxxxxx X. Kitchen (the
"Employee") is effective as of December 2, 2004 (the "Agreement Date").
WITNESSETH:
WHEREAS, Employee currently is employed by the Company;
WHEREAS, the Company desires to retain the services of Employee
pursuant to the terms of this Agreement, subject to Employee's acceptance of the
conditions stated herein;
WHEREAS, Employee wishes to be employed by the Company in consideration
of the compensation and benefits set forth herein and pursuant to the terms
hereof;
WHEREAS, during the course of his employment with the Company, Employee
has or will have received extensive and unique knowledge, training and education
in, and access to resources involving, the Death Care Business (as defined
below) at a substantial cost to the Company, which Employee acknowledges has
enhanced or substantially will enhance Employee's skills and knowledge in such
business;
WHEREAS, during the course of his employment with the Company, Employee
has or will have received access to and information about the Company's
customers, suppliers, joint venture partners and others having important
commercial relationships with the Company, the preservation of which the
Employee acknowledges are vital to the continuing commercial success of the
Company;
WHEREAS, during the course of his employment with the Company, Employee
has had and will continue to have access to valuable oral and written
information, knowledge and data relating to the business and operations of the
Company and its subsidiaries that is non-public, confidential or proprietary in
nature and is particularly useful in the Death Care Business; and
WHEREAS, in view of the training provided by the Company to Employee,
its cost to the Company, the importance of maintaining continuing favorable
relationships with customers, suppliers, partners and others, and the need for
the Company to be protected against disclosures by Employee of the Company's and
its subsidiaries' trade secrets and other non-public, confidential or
proprietary information, the Company and Employee desire, among other things, to
prohibit Employee from disclosing or utilizing, outside the scope and term of
his employment with the Company, any non-public, confidential or proprietary
information, knowledge and data relating to the business and operations of the
Company or its subsidiaries received by Employee during the course of his
employment, and to restrict the ability of Employee to compete with the Company
or its subsidiaries for a limited period of time;
NOW, THEREFORE, for and in consideration of the continued employment of
Employee by the Company and the payment of salary, benefits and other
compensation to Employee by the Company, the parties hereto agree as follows:
ARTICLE I
EMPLOYMENT CAPACITY AND TERM
1. CAPACITY AND DUTIES OF EMPLOYEE. The Employee is employed by the
Company to render services on behalf of the Company in the capacity set forth in
Appendix A hereto, as such Appendix may be amended or supplemented from time to
time (as so amended or supplemented, "Appendix A"). The Employee shall perform
such duties, consistent with the Employee's job title, as are assigned to the
title or titles held by the Employee as set forth from time to time in the
Company's Bylaws and such other duties as may be prescribed from time to time by
the Company's Board of Directors (the "Board") or the executive of the Company
to whom the Employee directly reports.
2. EMPLOYMENT TERM. The term of this Agreement (the "Employment Term")
shall commence on the Agreement Date and shall continue through October 31,
2007, subject to any earlier termination of Employee's status as an employee
pursuant to this Agreement.
3. DEVOTION TO RESPONSIBILITIES. During the Employment Term, the
Employee shall devote all of his business time to the business of the Company,
shall use his best efforts to perform faithfully and efficiently his duties
under this Agreement, and shall not engage in or be employed by any other
business; provided, however, that nothing herein shall prohibit the Employee
from (a) serving as a member of the board of directors, board of trustees or the
like of any for-profit or non-profit entity that does not compete with the
Company, or performing services of any type for any civic or community entity,
whether or not the Employee receives compensation therefor, (b) investing his
assets in such form or manner as shall require no more than nominal services on
the part of the Employee in the operation of the business of the entity in which
such investment is made, or (c) serving in various capacities with, and
attending meetings of, industry or trade groups and associations, as long as the
Employee's activities permitted by clauses (a), (b) and (c) above do not
materially and unreasonably interfere with the ability of the Employee to
perform the services and discharge the responsibilities required of him under
this Agreement. Notwithstanding clause (b) above, during the Employment Term,
the Employee may not beneficially own more than 2% of the equity interests of a
business organization required to file periodic reports with the Securities and
Exchange Commission under the Securities Exchange Act of 1934 (the "Exchange
Act") and may not beneficially own more than 2% of the equity interests of a
business organization that competes with the Company. For purposes of this
paragraph, "beneficially own" has the meaning ascribed to that term in Rule
13d-3 under the Securities Exchange Act of 1934, as amended from time to time
(the "Exchange Act").
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ARTICLE II
COMPENSATION AND BENEFITS
During the Employment Term, the Company shall provide the Employee with
the compensation and benefits described below:
1. SALARY AND BONUS. (a) The Company shall pay the Employee a salary
("Base Salary") at an annual rate per fiscal year of the Company ("Fiscal Year")
as set forth in Appendix A, which shall be payable to the Employee at such
intervals as other salaried employees of the Company are paid.
(b) The Employee shall be eligible to receive an annual
incentive bonus (the "Bonus"), up to the maximum amount set forth in Appendix A.
The Bonus will be awarded based upon factors to be established or approved
annually by the Compensation Committee in its discretion and set forth in
Appendix A or a supplement thereto. Any Bonus awarded shall be paid in cash not
later than 30 days following the filing of the Company's annual report on Form
10-K for the Fiscal Year in which the Bonus has been earned.
(c) Any change in the Employee's title, Base Salary or Bonus
eligibility during the Employment Term shall be set forth in one or more
supplements to Appendix A to this Agreement, each of which shall be signed by
the Employee and a member of the Compensation Committee of the Board of
Directors of the Company.
2. BENEFITS. The Employee shall be eligible to participate in all
benefit programs provided to other employees of the Company, including without
limitation a fully-paid insurance benefit package similar to that provided other
employees of the Company.
3. EXPENSES. The Employee shall be reimbursed for reasonable
out-of-pocket expenses incurred from time to time on behalf of the Company or
any subsidiary in the performance of his duties under this Agreement, upon the
presentation of such supporting invoices, documents and forms as the Company
reasonably requests.
4. SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT. In lieu of
participating in the Company's Supplemental Executive Retirement Plan, the
executive shall be entitled to earn a supplemental retirement benefit on the
terms and subject to the conditions set forth in Appendix C hereto.
ARTICLE III
TERMINATION OF EMPLOYMENT
1. DEATH. The Employee's status as an employee shall terminate
immediately and automatically upon the Employee's death during the Employment
Term.
2. DISABILITY. The Employee's status as an employee may be terminated
for "Disability" as follows:
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(a) The Employee's status as an employee shall terminate if
the Employee has a disability that would entitle him to receive benefits under
the Company's long-term disability insurance policy in effect at the time either
because he is Totally Disabled or Partially Disabled, as such terms are defined
in such policy. Any such termination shall become effective on the first day on
which the Employee is eligible to receive payments under such policy (or on the
first day that he would be so eligible, if he had applied timely for such
payments).
(b) If the Company has no long-term disability plan in effect,
if (i) the Employee is rendered incapable because of physical or mental illness
of satisfactorily discharging his duties and responsibilities under this
Agreement for a period of 90 consecutive days and (ii) a duly qualified
physician chosen by the Company and reasonably acceptable to the Employee or his
legal representatives so certifies in writing, the Board shall have the power to
determine that the Employee has become disabled. If the Board makes such a
determination, the Company shall have the continuing right and option, during
the period that such disability continues, and by notice given in the manner
provided in this Agreement, to terminate the status of Employee as an employee.
Any such termination shall become effective 30 days after such notice of
termination is given, unless within such 30-day period, the Employee becomes
capable of rendering services of the character contemplated hereby (and a
physician chosen by the Company and reasonably acceptable to the Employee or his
legal representatives so certifies in writing) and the Employee in fact resumes
such services.
(c) The "Disability Effective Date" shall mean the date on
which termination of employment becomes effective due to Disability.
3. CAUSE. The Company may terminate the Employee's status as an
employee for Cause. As used herein, "Cause" shall mean the Employee's: (a)
breach of this Agreement; (b) intentional failure to perform his prescribed
duties; (c) unauthorized acts or omissions that could reasonably be expected to
cause material financial harm to the Company or materially disrupt Company
operations; (d) commission of a felony; (e) commission of an act of dishonesty
(even if not a crime) resulting in the enrichment of the Employee at the expense
of the Company; (f) knowing falsification or knowing attempted falsification of
financial records of the Company in violation of SEC Rule 13b2-1; or (g) willful
failure to follow established Company policies or procedures; provided, however,
that no such termination may take place in the case of (a) through (c) or (g)
above unless the Company has provided written notice to the Employee of such
conduct and the Employee has failed to remedy such conduct within 10 days
following receipt of such notice.
4. GOOD REASON. The Employee may terminate his status as an employee
for Good Reason. As used herein, the term "Good Reason" shall mean:
(a) The occurrence of any of the following during the
Employment Term:
(i) the assignment to the Employee of any duties or
responsibilities that are inconsistent with the Employee's status, title and
position as set forth in Appendix A;
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(ii) any removal of the Employee from, or any failure
to reappoint or reelect the Employee to, the position set forth in Appendix A,
except in connection with a termination of Employee's status as an employee as
permitted by this Agreement;
(iii) the Company's requiring the Employee to be
based anywhere other than in the metropolitan area set forth in Appendix A,
except for required travel in the ordinary course of the Company's business;
(b) any breach of this Agreement by the Company that continues
for a period of 10 days after written notice thereof is given by the Employee to
the Company;
(c) the failure by the Company to obtain the assumption of its
obligations under this Agreement by any successor or assign as contemplated in
this Agreement; or
(d) any purported termination by the Company of the Employee's
status as an employee for Cause that is not effected pursuant to a Notice of
Termination satisfying the requirements of this Agreement.
5. VOLUNTARY TERMINATION BY THE COMPANY. The Company may terminate the
Employee's status as employee for other than death, Disability or Cause.
6. VOLUNTARY TERMINATION BY THE EMPLOYEE. The Employee may voluntarily
terminate the Employee's status as employee for other than Good Reason.
7. NOTICE OF TERMINATION. Any termination by the Company or by the
Employee, shall be communicated by Notice of Termination to the other party
hereto given in accordance with Article VII Section 2 of this Agreement. For
purposes of this Agreement, a "Notice of Termination" means a written notice
that (a) indicates the specific termination provision in this Agreement relied
upon (b) to the extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Employee's
employment under the provisions so indicated and (c) if the Date of Termination
(as defined below) is other than the date of receipt of such notice, specifies
the termination date (which date shall be not more than 30 days after the giving
of such notice). The failure by the Employee or the Company to set forth in the
Notice of Termination any fact or circumstance that contributes to a showing of
Good Reason, Disability or Cause shall not negate the effect of the notice nor
waive any right of the Employee or the Company, respectively, hereunder or
preclude the Employee or the Company, respectively, from asserting such fact or
circumstance in enforcing the Employee's or the Company's rights hereunder.
8. DATE OF TERMINATION. "Date of Termination" means (a) if Employee's
employment is terminated by reason of his death or Disability, the Date of
Termination shall be the date of death of Employee or the Disability Effective
Date, as the case may be, (b) if Employee's employment is terminated by the
Company for Cause, or by the Employee for Good Reason, the date of delivery of
the Notice of Termination or any later date specified therein (which date shall
not be more than 30 days after the giving of such notice) as the case may be,
(c) if the Employee's employment is terminated by the Company for reasons other
than death,
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Disability or Cause, the Date of Termination shall be the date on which the
Company notifies the Employee of such termination or any later date specified
therein, and (d) if the Employee's employment is terminated voluntarily by the
Employee for reasons other than Good Reason, the Date of Termination shall be
the date on which the Employee notifies the Company of such termination or any
later date specified therein (which date shall not be later than 30 days after
the giving of such notice) as the case may be.
ARTICLE IV
OBLIGATIONS UPON TERMINATION
1. DEATH. If the Employee's status as an employee is terminated by
reason of the Employee's death, this Agreement shall terminate without further
obligation to the Employee's legal representatives under this Agreement, other
than the obligation to pay accrued salary through the Date of Termination and to
make any payments due pursuant to employee benefit plans maintained by the
Company or its subsidiaries.
2. DISABILITY. If Employee's status as an employee is terminated by
reason of Employee's Disability, this Agreement shall terminate without further
obligation to the Employee, other than the obligation to pay accrued salary
through the Date of Termination and to make any payments due pursuant to
employee benefit plans maintained by the Company or its subsidiaries.
3. TERMINATION BY THE COMPANY FOR REASONS OTHER THAN DEATH, DISABILITY
OR CAUSE; TERMINATION BY THE EMPLOYEE FOR GOOD REASON. If the Company terminates
the Employee's status as an employee for reasons other than death, Disability or
Cause, or the Employee terminates his employment for Good Reason, then the
Company shall pay to the Employee an amount equal to a single year's Base Salary
in effect at the Date of Termination, payable in equal installments over a
two-year period beginning on the first regular payroll date that is at least six
months after the Date of Termination and thereafter (1) at such intervals as
other salaried employees of the Company are paid.
4. CAUSE. If the Employee's status as an employee is terminated by the
Company for Cause, this Agreement shall terminate without further obligation to
the Employee other than for accrued salary through the Date of Termination,
obligations imposed by law and obligations imposed pursuant to any employee
benefit plan maintained by the Company or its subsidiaries.
5. RESIGNATION FROM BOARD OF DIRECTORS. If Employee is a director of
the Company and his employment is terminated for any reason other than death,
the Employee shall, if requested by the Company, immediately resign as a
director of the Company. If such resignation is not received when so requested,
the Employee shall forfeit any right to receive any payments pursuant to this
Agreement.
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(1) This deferral is now required under the American Jobs Creation Act of 2004.
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ARTICLE V
NONDISCLOSURE, NONCOMPETITION AND PROPRIETARY RIGHTS
1. CERTAIN DEFINITIONS. For purposes of this Agreement, the following
terms shall have the following meanings:
(a) "Confidential Information" means any information,
knowledge or data of any nature and in any form (including information that is
electronically transmitted or stored on any form of magnetic or electronic
storage media) relating to the past, current or prospective business or
operations of the Company and its subsidiaries, that at the time or times
concerned is not generally known to persons engaged in businesses similar to
those conducted or contemplated by the Company and its subsidiaries (other than
information known by such persons through a violation of an obligation of
confidentiality to the Company), whether produced by the Company and its
subsidiaries or any of their consultants, agents or independent contractors or
by Employee, and whether or not marked confidential, including without
limitation information relating to the Company's or its subsidiaries' products
and services, business plans, business acquisitions, joint ventures, processes,
product or service research and development ideas, methods or techniques,
training methods and materials, and other operational methods or techniques,
quality assurance procedures or standards, operating procedures, files, plans,
specifications, proposals, drawings, charts, graphs, support data, trade
secrets, supplier lists, supplier information, purchasing methods or practices,
distribution and selling activities, consultants' reports, marketing and
engineering or other technical studies, maintenance records, employment or
personnel data, marketing data, strategies or techniques, financial reports,
budgets, projections, cost analyses, price lists, formulae and analyses,
employee lists, customer records, customer lists, customer source lists,
proprietary computer software, and internal notes and memoranda relating to any
of the foregoing.
(b) "Death Care Business" means (i) the owning and operating
of funeral homes and cemeteries, including combined funeral home and cemetery
facilities, (ii) the offering of services and products to meet families' funeral
needs, including prearrangement, family consultation, the sale of caskets and
related funeral and cemetery products and merchandise (whether at physical
locations or by means of the Internet), the removal, preparation and
transportation of remains, cremation, the use of funeral home facilities for
visitation and worship, and related transportation services, (iii) the marketing
and sale of funeral services and cemetery property or merchandise on an at-need
or prearranged basis, (iv) providing, managing and administering financing
arrangements (including trust funds, escrow accounts, insurance and installment
sales contracts) for prearranged funeral plans and cemetery property and
merchandise, (v) providing interment services, the sale (on an at-need or
prearranged basis) of cemetery property including lots, lawn crypts, family and
community mausoleums and related cemetery merchandise such as monuments,
memorials and burial vaults, (vi) the maintenance of cemetery grounds pursuant
to perpetual care contracts and laws or on a voluntary basis, and (vii) offering
mausoleum design, construction and sales services.
2. NONDISCLOSURE OF CONFIDENTIAL INFORMATION. During the Employment
Term, Employee shall hold in a fiduciary capacity for the benefit of the Company
all Confidential Information which shall have been obtained by Employee during
Employee's employment
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(whether prior to or after the Agreement Date) and shall use such Confidential
Information solely within the scope of his employment with and for the exclusive
benefit of the Company. For a period of five years after the Employment Term,
commencing with the Date of Termination, Employee agrees (a) not to communicate,
divulge or make available to any person or entity (other than the Company) any
such Confidential Information, except upon the prior written authorization of
the Company or as may be required by law or legal process, and (b) to deliver
promptly to the Company any Confidential Information in his possession,
including any duplicates thereof and any notes or other records Employee has
prepared with respect thereto. In the event that the provisions of any
applicable law or the order of any court would require Employee to disclose or
otherwise make available any Confidential Information, Employee shall give the
Company prompt prior written notice of such required disclosure and an
opportunity to contest the requirement of such disclosure or apply for a
protective order with respect to such Confidential Information by appropriate
proceedings.
3. LIMITED COVENANT NOT TO COMPETE. During the Employment Term and for
a period of two years thereafter, commencing with the Date of Termination,
Employee agrees that, with respect to each State of the United States or other
jurisdiction, or specified portions thereof, in which the Employee regularly (a)
makes contact with customers of the Company or any of its subsidiaries, (b)
conducts the business of the Company or any of its subsidiaries or (c)
supervises the activities of other employees of the Company or any of its
subsidiaries, as identified in Appendix B attached hereto and forming a part of
this Agreement, and in which the Company or any of its subsidiaries engages in
the Death Care Business on the Date of Termination (collectively, the "Subject
Areas"), Employee will restrict his activities within the Subject Areas as
follows:
(a) Employee will not, directly or indirectly, for himself or
others, own, manage, operate, control, be employed in an executive, managerial
or supervisory capacity by, consult with, or otherwise engage or participate in
or allow his skill, knowledge, experience or reputation to be used in connection
with, the ownership, management, operation or control of, any company or other
business enterprise engaged in the Death Care Business within any of the Subject
Areas; provided, however, that nothing contained herein shall prohibit Employee
from making passive investments as long as Employee does not beneficially own
more than 2% of the equity interests of a business enterprise engaged in the
Death Care Business within any of the Subject Areas. For purposes of this
paragraph, "beneficially own" shall have the same meaning ascribed to that term
in Rule 13d-3 under the Exchange Act.
(b) Employee will not call upon any customer of the Company or
its subsidiaries for the purpose of soliciting, diverting or enticing away the
business of such person or entity, or otherwise disrupting any previously
established relationship existing between such person or entity and the Company
or its subsidiaries;
(c) Employee will not solicit, induce, influence or attempt to
influence any supplier, lessor, lessee, licensor, partner, joint venturer,
potential acquiree or any other person who has a business relationship with the
Company or its subsidiaries, or who on the Date of Termination is engaged in
discussions or negotiations to enter into a business relationship with
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the Company or its subsidiaries, to discontinue or reduce or limit the extent of
such relationship with the Company or its subsidiaries; and
(d) Employee will not make contact with any of the employees
of the Company or its subsidiaries with whom he had contact during the course of
his employment with the Company for the purpose of soliciting such employee for
hire, whether as an employee or independent contractor, or otherwise disrupting
such employee's relationship with the Company or its subsidiaries.
(e) Employee further agrees that, for a period of one year
from and after the Date of Termination, Employee will not hire, on behalf of
himself or any person or entity engaged in the Death Care Business with which
Employee is associated, any employee of the Company or its subsidiaries as an
employee or independent contractor, whether or not such engagement is solicited
by Employee; provided, however, that the restriction contained in this
subsection (e) shall not apply to Company employees who reside in, or are hired
by Employee to perform work in, any of the Subject Areas located within the
States of Virginia, Arkansas or Georgia.
Employee agrees that he will from time to time upon the Company's
request promptly execute any supplement, amendment, restatement or other
modification of Appendix B as may be necessary or appropriate to correctly
reflect the jurisdictions which, at the time of such modification, should be
covered by Appendix B and this Article V Section 3. Furthermore, Employee agrees
that all references to Appendix B in this Agreement shall be deemed to refer to
Appendix B as so supplemented, amended, restated or otherwise modified from time
to time.
4. INJUNCTIVE RELIEF; OTHER REMEDIES. Employee acknowledges that a
breach by Employee of Section 2 or 3 of this Article V would cause immediate and
irreparable harm to the Company for which an adequate monetary remedy does not
exist; hence, Employee agrees that, in the event of a breach or threatened
breach by Employee of the provisions of Section 2 or 3 of this Article V during
or after the Employment Term, the Company shall be entitled to injunctive relief
restraining Employee from such violation without the necessity of proof of
actual damage or the posting of any bond, except as required by non-waivable,
applicable law. Nothing herein, however, shall be construed as prohibiting the
Company from pursuing any other remedy at law or in equity to which the Company
may be entitled under applicable law in the event of a breach or threatened
breach of this Agreement by Employee, including without limitation the recovery
of damages and/or costs and expenses, such as reasonable attorneys' fees,
incurred by the Company as a result of any such breach or threatened breach. In
addition to the exercise of the foregoing remedies, the Company shall have the
right upon the occurrence of any such breach or threatened breach to cancel any
unpaid salary, bonus, commissions or reimbursements otherwise outstanding at the
Date of Termination. In particular, Employee acknowledges that the payments
provided under Article IV Section 3 are conditioned upon Employee fulfilling any
noncompetition and nondisclosure agreements contained in this Article V. In the
event Employee shall at any time materially breach or threaten to breach any
noncompetition or nondisclosure agreements contained in this Article V, the
Company may suspend or eliminate payments under Article IV during the period of
such breach or threatened breach. Employee acknowledges that any such suspension
or elimination of payments would be an exercise of the
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Company's right to suspend or terminate its performance hereunder upon
Employee's breach of this Agreement; such suspension or elimination of payments
would not constitute, and should not be characterized as, the imposition of
liquidated damages.
5. REQUESTS FOR WAIVER IN CASES OF UNDUE HARDSHIP. In the event that
Employee should find any of the limitations of Article V Section 3 (including
without limitation the geographic restrictions of Appendix B) to impose a severe
hardship on Employee's ability to secure other employment, Employee may make a
request to the Company for a waiver of the designated limitations before
accepting employment that otherwise would be a breach of Employee's promises and
obligations under this Agreement. Such request must be in writing and clearly
set forth the name and address of the organization with which employment is
sought and the location, position and duties that Employee will be performing.
The Company will consider the request and, in its sole discretion, decide
whether and on what conditions to grant such waiver.
6. GOVERNING LAW OF THIS ARTICLE V; CONSENT TO JURISDICTION. Any
dispute regarding the reasonableness of the covenants and agreements set forth
in this Article V (including Appendix B hereto), or the territorial scope or
duration thereof, or the remedies available to the Company upon any breach of
such covenants and agreements, shall be governed by and interpreted in
accordance with the laws of the State of the United States or other jurisdiction
in which the alleged prohibited competing activity or disclosure occurs, and,
with respect to each such dispute, the Company and Employee each hereby
irrevocably consent to the exclusive jurisdiction of the state and federal
courts sitting in the relevant State (or, in the case of any jurisdiction
outside the United States, the relevant courts of such jurisdiction) for
resolution of such dispute, and agree to be irrevocably bound by any judgment
rendered thereby in connection with such dispute, and further agree that service
of process may be made upon him or it in any legal proceeding relating to this
Article V and/or Appendix B by any means allowed under the laws of such
jurisdiction. Each party irrevocably waives any objection he or it may have as
to the venue of any such suit, action or proceeding brought in such a court or
that such a court is an inconvenient forum.
7. EMPLOYEE'S UNDERSTANDING OF THIS ARTICLE. Employee hereby represents
to the Company that he has read and understands, and agrees to be bound by, the
terms of this Article V (including Appendix B hereto). Employee acknowledges
that the geographic scope and duration of the covenants contained in Article V
Section 3 are the result of arm's-length bargaining and are fair and reasonable
in light of (i) the importance of the functions performed by Employee and the
length of time it would take the Company to find and train a suitable
replacement, (ii) the nature and wide geographic scope of the operations of the
Company and its subsidiaries, (iii) Employee's level of control over and contact
with the business and operations of the Company and its subsidiaries in a
significant number of jurisdictions where same are conducted and (iv) the fact
that all facets of the Death Care Business are conducted by the Company and its
subsidiaries throughout the geographic area where competition is restricted by
this Agreement. It is the desire and intent of the parties that the provisions
of this Agreement be enforced to the fullest extent permitted under applicable
law, whether now or hereafter in effect and, therefore, to the extent permitted
by applicable law, the parties hereto waive any provision
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of applicable law that would render any provision of this Article V (including
Appendix B hereto) invalid or unenforceable.
ARTICLE VI
ARBITRATION
1. BINDING AGREEMENT TO ARBITRATE. Any claim or controversy arising out
of any provision of this Agreement (other than Article V hereof), or the breach
or alleged breach of any such provision, shall be settled by arbitration
administered by the American Arbitration Association (the "AAA") under its
National Rules for the Resolution of Employment Disputes (the "Rules"), and
judgment on the award rendered by the arbitrator(s) may be entered in any court
having jurisdiction thereof.
2. SELECTION AND QUALIFICATIONS OF ARBITRATORS. If no party to the
arbitration makes a claim in excess of $1.0 million, exclusive of interest and
attorneys' fees, the proceedings shall be conducted before a single neutral
arbitrator selected in accordance with the Rules. If any party makes a claim
that exceeds $1.0 million, the proceedings shall be conducted before a panel of
three neutral arbitrators, one of whom shall be selected by each party within 15
days after commencement of the proceeding and the third of whom shall be
selected by the first two arbitrators within 10 days after their appointment. If
the two arbitrators selected by the parties are unable or fail to agree on the
third arbitrator, the third arbitrator shall be selected by the AAA. Each
arbitrator shall be a member of the bar of the State of Louisiana and actively
engaged in the practice of employment law for at least 15 years.
3. LOCATION OF PROCEEDINGS. The place of arbitration shall be New
Orleans, Louisiana.
4. REMEDIES. Any award in an arbitration initiated under this Article
VI shall be limited to actual monetary damages, including if determined
appropriate by the arbitrator(s) an award of costs and fees to the prevailing
party. "Costs and fees" mean all reasonable pre-award expenses of the
arbitration, including arbitrator's fees, administrative fees, travel expenses,
out-of-pocket expenses such as copying, telephone, witness fees and attorneys'
fees. The arbitrator(s) will have no authority to award consequential, punitive
or other damages not measured by the prevailing party's actual damages, except
as may be required by statute.
5. OPINION. The award of the arbitrators shall be in writing, shall be
signed by a majority of the arbitrators, and shall include findings of fact and
a statement of the reasons for the disposition of any claim.
ARTICLE VII
MISCELLANEOUS
1. BINDING EFFECT.
(a) This Agreement shall be binding upon and inure to the
benefit of the Company and any of its successors or assigns.
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(b) This Agreement is personal to the Employee and shall not
be assignable by the Employee without the consent of the Company (there being no
obligation to give such consent) other than such rights or benefits as are
transferred by will or the laws of descent and distribution.
(c) The Company shall require any successor to or assignee of
(whether direct or indirect, by purchase, merger, consolidation or otherwise)
all or substantially all of the assets or businesses of the Company (i) to
assume unconditionally and expressly this Agreement and (ii) to agree to perform
all of the obligations under this Agreement in the same manner and to the same
extent as would have been required of the Company had no assignment or
succession occurred, such assumption to be set forth in a writing reasonably
satisfactory to the Employee. In the event of any such assignment or succession,
the term "Company" as used in this Agreement shall refer also to such successor
or assign.
2. NOTICES. All notices hereunder must be in writing and shall be
deemed to have been given upon receipt of delivery by: (a) hand (against a
receipt therefor), (b) certified or registered mail, postage prepaid, return
receipt requested, (c) a nationally recognized overnight courier service
(against a receipt therefor) or (d) telecopy transmission with confirmation of
receipt. All such notices must be addressed as follows:
If to the Company, to:
Xxxxxxx Enterprises, Inc.
0000 Xxxxx Xxxxxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Attn: Chief Executive Officer
If to the Employee, to:
Xxxxxx X. Kitchen
0000 Xxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxx 00000
or such other address as to which any party hereto may have notified the other
in writing.
3. GOVERNING LAW. This Agreement shall be construed and enforced in
accordance with and governed by the internal laws of the State of Louisiana
without regard to principles of conflict of laws, except as expressly provided
in Article V Section 6 above with respect to the resolution of disputes arising
under, or the Company's enforcement of, Article V of this Agreement.
4. WITHHOLDING. The Employee agrees that the Company has the right to
withhold, from the amounts payable pursuant to this Agreement, all amounts
required to be withheld under applicable income and/or employment tax laws, or
as otherwise stated in documents granting rights that are affected by this
Agreement.
-12-
5. SEVERABILITY. If any term or provision of this Agreement (including
without limitation those contained in Appendix B), or the application thereof to
any person or circumstance, shall at any time or to any extent be invalid,
illegal or unenforceable in any respect as written, Employee and the Company
intend for any court construing this Agreement to modify or limit such provision
temporally, spatially or otherwise so as to render it valid and enforceable to
the fullest extent allowed by law. Any such provision that is not susceptible of
such reformation shall be ignored so as to not affect any other term or
provision hereof, and the remainder of this Agreement, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid, illegal or unenforceable, shall not be affected thereby and
each term and provision of this Agreement shall be valid and enforced to the
fullest extent permitted by law.
6. WAIVER OF BREACH. The waiver by either party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach thereof.
7. REMEDIES NOT EXCLUSIVE. Except as provided in Article VI hereof, no
remedy specified herein shall be deemed to be such party's exclusive remedy, and
accordingly, in addition to all of the rights and remedies provided for in this
Agreement, the parties shall have all other rights and remedies provided to them
by applicable law, rule or regulation.
8. COMPANY'S RESERVATION OF RIGHTS. Employee acknowledges and
understands that the Employee serves at the pleasure of the Board and that the
Company has the right at any time to terminate Employee's status as an employee
of the Company, or to change or diminish his status during the Employment Term,
subject to the rights of the Employee to claim the benefits conferred by this
Agreement.
9. JURY TRIAL WAIVER. THE PARTIES HEREBY WAIVE TRIAL BY JURY IN ANY
JUDICIAL PROCEEDING TO WHICH THEY ARE PARTIES INVOLVING, DIRECTLY OR INDIRECTLY,
ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS
AGREEMENT.
10. SURVIVAL. The rights and obligations of the Company and Employee
contained in Article V of this Agreement shall survive the termination of the
Agreement. Following the Date of Termination, each party shall have the right to
enforce all rights, and shall be bound by all obligations, of such party that
are continuing rights and obligations under this Agreement.
11. PRIOR EMPLOYMENT AGREEMENT. Effective as of the Agreement Date,
this Agreement supersedes any prior employment agreement between the Employee
and the Company.
12. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
-13-
13. AMERICAN JOBS CREATION ACT OF 2004. In the event that any of the
compensation or benefits payable to the Employee hereunder are considered to be
non-qualified deferred compensation subject to the American Jobs Creation Act of
2004 (the "Jobs Act") and any regulations issued or to be issued by the
Department of the Treasury thereunder, the Company and the Employee shall
negotiate in good faith and agree to such amendments to this Agreement as they
and their respective tax counsel deem necessary to avoid the imposition of
additional taxes and penalties under the Jobs Act or such regulations, while
preserving the economic benefits intended to be conferred on the Employee by
this Agreement.
IN WITNESS WHEREOF, the Company and the Employee have caused this
Agreement to be executed on the dates set forth below and effective as of the
Agreement Date.
XXXXXXX ENTERPRISES, INC.
Dated: January 7, 2005 By: /s/ XXXXX X.XXXXXXXXX
---------------------------------
Xxxxx X. XxXxxxxxx
Compensation Committee Chairman
EMPLOYEE:
Dated: January 7, 2005 /s/ XXXXXX X. KITCHEN
-------------------------------------
Xxxxxx X. Kitchen
-14-
APPENDIX A TO EMPLOYMENT AGREEMENT
BETWEEN XXXXXXX ENTERPRISES, INC.
AND
XXXXXX X. KITCHEN
BASE SALARY, BONUS COMPENSATION AND BENEFITS
1. Effective December 2, 2004, Employee's titles shall be Executive Vice
President and Chief Financial Officer, and Employee's Base Salary shall
be $300,000. Employee's principal work location shall be the New
Orleans, Louisiana metropolitan area.
2. For Fiscal Year 2005 ("FY 2005"), the Employee shall be eligible to
receive a maximum Bonus of up to 100% of Base Salary.
(a) The Bonus available for award will be determined as follows:
FY 2005 Reported EPS Bonus Available
----------------------- ---------------
Less than $.46 $ 0
Equals or exceeds .46 300,000
(b) The portion of the Bonus available that will be awarded will
depend on the performance measures set forth below:
(1) 75% of the Bonus available ($225,000) for FY 2005 will be
determined based on the achievement of the following reported
EPS levels (i.e., that EPS level, rounded to the nearest
whole cent, reported in the Company's year-end earnings
release, adjusted as appropriate pursuant to 2(c) hereof):
% of 75% of Bonus Award
FY 2005 Diluted Reported EPS Bonus Potential Based on EPS
---------------------------- --------------- ------------
Equals or exceeds $.46 20.00% $ 45,000
Equals or exceeds $.47 35.00% $ 78,750
Equals or exceeds $.48 50.00% $ 112,500
Equals or exceeds $.49 66.67% $ 150,000
Equals or exceeds $.50 83.33% $ 187,500
Equals or exceeds $.51 100.00% $ 225,000
(2) 25% of the Bonus available ($75,000) will be discretionary,
based on Qualitative Factors established by the Compensation
Committee.
A-1
(c) Non-recurring items approved for exclusion by the Compensation
Committee in its sole discretion shall be excluded from diluted
earnings per share for purposes of this calculation. Diluted
earnings per share shall be calculated by the Company's Chief
Financial Officer taking into account any such exclusions and
shall be binding on all Employees absent manifest error.
Agreed to and accepted:
XXXXXXX ENTERPRISES, INC.
Effective date: December 2, 2004 By: /s/ XXXXX X. XXXXXXXXX
-------------------------------
Xxxxx X. XxXxxxxxx
Compensation Committee Chairman
EMPLOYEE
Effective date: December 2, 2004 /s/ XXXXXX X. KITCHEN
------------------------------------
Xxxxxx X. Kitchen
X-0
XXXXXXXX X TO
EMPLOYMENT AGREEMENT
BETWEEN XXXXXXX ENTERPRISES, INC.
AND
XXXXXX X. KITCHEN
Jurisdiction In Which Competition
Is Restricted As Provided
In Article V Section 0
X. Xxxxxx xxx Xxxxxxxxxxx xx xxx Xxxxxx Xxxxxx:
1. Louisiana-- The following parishes in the State of Louisiana:
Orleans, St. Xxxxxxx, St. Tammany, Plaquemines, Jefferson, Lafourche,
St. Xxxxxxx, St. Xxxx the Baptist, Tangipahoa
as well as any other parishes in the State of Louisiana in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
2. Florida-- The following counties in the State of Florida:
Seminole, Dade, Hillsborough, Xxxxx, Orange, Pinellas, Indian River,
Palm Beach, Volusia, Lake, Brevard, Broward, Monroe, Collier, Pasco,
Manatee, Polk, Hardee, Nassau, Baker, Clay, St. Xxxxx, St. Lucie,
Osceola, Ockeechobee, Xxxxxx, Xxxxxx, Xxxxxx, Alachua, Putnam, Levy,
Hernando, Citrus, Sumter, Sarasota, DeSoto, Highlands, Charlotte,
Glades
as well as any other counties in the State of Florida in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
3. Texas-- The following counties in the State of Texas:
Xxxxxxx, Xxxxxx, Collin, Tarrant, Lamar, Harris, Denton, Johnson,
Rockwall, Brazoria, Xxxxxxxxx, Van Zandt, Hunt, Ellis, Fannin, Wise,
Parker, Red River, Delta, Galveston, Ft. Bend, Waller, Montgomery,
Liberty, Chambers, Cooke, Hood, Bosque, Hill, Matagorda, Franklin,
Wharton, Somervell
AGREED TO AND ACCEPTED:
XXXXXXX ENTERPRISES, INC. EMPLOYEE
BY:
-------------------------------- --------------------------------
XXXXX X. XXXXXXXXX EFFECTIVE DATE: DECEMBER 2, 2004
COMPENSATION COMMITTEE CHAIRMAN
EFFECTIVE DATE: DECEMBER 2, 2004
B-1
as well as any other counties in the State of Texas in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
4. Maryland-- The following counties in the State of Maryland:
Baltimore, Baltimore City, Xxxxxx, Prince Xxxxxx'x, Xxxx Arundel,
Montgomery, Xxxxxxx, Xxxxxxxxx, Harford, Calvert, Charles, Kent, Queen
Anne's, Talbot, Wicomico, Worcester, Somerset, Dorchester
as well as any other counties in the State of Maryland in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
5. Virginia-- The following counties in the State of Virginia:
Chesterfield, Roanoke, Rockingham, Fairfax, Tazewell, Goochland,
Pulaski, Albemarle, Hanover, Henrico, Xxxxxxxxx, Xxxxxx, Powhatan,
Xxxxxxx City, Prince George, Bedford, Montgomery, Franklin, Botetourt,
Craig, Floyd, Augusta, Shenandoah, Page, Xxxxxx, Prince Xxxxxxx, Xxxxx,
Xxxxxxx, Fluvanna, Louisa, Wythe, Giles, Carroll, Orange, Buckingham,
Nelson, King Xxxxxxx, New Xxxx, Spotsylvania, Xxxxxxxx, Xxxxxxxx,
Loudoun, Arlington, Xxxxx
as well as any other counties in the State of Virginia in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
6. West Virginia-- The following counties in the State of West
Virginia:
Raleigh, Kanawha, Fayette, Berkeley, Boone, Summers, Wyoming, Clay,
Lincoln, Jackson, Putnam, Roane, Greenbrier, Nicholas, Logan, Xxxxx,
McDowell, Morgan, Jefferson, Mercer, Mingo, Cabell, Xxxxx
as well as any other counties in the State of West Virginia in which
the Employee regularly (a) makes contact with customers of the Company
or any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
EMPLOYEE
/s/ XXXXXX X. KITCHEN
--------------------------------
EFFECTIVE DATE: DECEMBER 2, 2004
B-2
7. Puerto Rico-- The following towns in the Commonwealth of Puerto
Rico:
Bayamon, San Xxxx, Cayey, Canovanas, Ponce, Caguas, Carolina, Humacao,
Toa Baja, Toa Alta, Naranjito, Aguas Buenas, Guaynabo, Comereo, Catano,
Xxxx Xxxx, Patilla, San Xxxxxxx, Guayama, Xxxxxxx, Aibonito, Loita, Rio
Grande, Las Marias, Xxxxxx, Xxxxx Xxxx, Jajuja, Utuado, Adjuntas,
Puenulas, Xxxxxxxx, Alto, Gurabo, Cidra, Yagucoa, Naguabo, Mayaguez,
Anasco, Maricao, Hormiguero, San German, Cabo Rojo, Loiza, Las Piedras,
Ceiba, Naguabo, Luquillo, San Xxxx
as well as any other towns in the Commonwealth of Puerto Rico in which
the Employee regularly (a) makes contact with customers of the Company
or any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
8. North Carolina-- The following counties in the State of North
Carolina:
Catawba, Wilson, Guilford, Haywood, Johnston, Wake, Wilkes, Craven,
Nash, Iredell, Burke, Caldwell, Lincoln, Alexander, Cleveland, Xxxxxx,
Xxxxx, Edgecombe, Pitt, Davidson, Randolph, Forsyth, Stokes,
Rockingham, Xxxxxxx, Alamance, Xxxxxxx, Buncombe, Xxxxxxxxx,
Transylvania, Swain, Madison, Sampson, Franklin, Durham, Harnett,
Granville, Chatham, Alleghany, Surry, Ashe, Watauga, Yadkin, Pamilco,
Halifax, Warren, Carteret, Jones, Lenoir, Beaufort, Vance, Lee, Moore,
Cumberland, Davie
as well as any other counties in the State of North Carolina in which
the Employee regularly (a) makes contact with customers of the Company
or any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
9. South Carolina-- The following counties in the State of South
Carolina:
Greenville, Charleston, Aiken, Pickens, Laurens, Spartanburg, Xxxxxxxx,
Abbeville, Berkeley, Dorchester, Colleton, Edgefield, Saluda,
Lexington, Orangeburg, Barnwell, Richland, Fairfield, Kershaw, Sumter,
Calhoun, Newberry, Oconee, Georgetown
as well as any other counties in the State of South Carolina in which
the Employee regularly (a) makes contact with customers of the Company
or any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
EMPLOYEE
/s/ XXXXXX X. KITCHEN
--------------------------------
EFFECTIVE DATE: DECEMBER 2, 2004
B-3
10. Tennessee-- The following counties in the State of Tennessee:
Davidson, Sumner, Robertson, Knox, Sullivan, Sevier, Wilson,
Rutherford, Williamson, Cheatham, Trousdale, Macon, Montgomery,
Jefferson, Grainger, Union, Anderson, Loudon, Blount, Roane, Greene,
Washington, Carter, Johnson, Hawkins, Cocke, Xxxxxx, Dekalb, Smith,
Hamblen, Unicoi
as well as any other counties in the State of Tennessee in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
11. Arkansas-- The following counties in the State of Arkansas:
Saline, Pulaski, Hot Spring, Garland, Perry, Grant, Lonoke, White,
Jefferson, Faulkner, Dallas, Clark, Montgomery, Van Buren, Cleburne,
Conway
as well as any other counties in the State of Arkansas in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
12. Georgia-- The following counties in the State of Georgia:
Xxxx, Cherokee, Xxxxx, Dekalb, Xxxxxx, Xxxxxxx, Paulding, Bartow,
Pickens, Forsyth, Dawson, Xxxxxx, Xxxxxxx, Rockdale, Newton, Butts,
Spalding, Gwinnett, Fayette, Coweta, Xxxxxxx
as well as any other counties in the State of Georgia in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
13. Alabama-- The following counties in the State of Alabama:
Mobile, Madison, Baldwin, Monroe, Washington, Jackson, Marshall,
Xxxxxx, Limestone, Clarke, Elmore, Montgomery, Macon, Coosa,
Tallapoosa, Autauga, Chilton, Walker, Jefferson, Blount, Cullman,
Winston, Tuscaloosa, Xxxxxxx, Xxxxxx, Wilcox, Marengo, Choctaw, Xxxx,
Talladega, St. Clair, Shelby, Perry, Xxxx
EMPLOYEE
/s/ XXXXXX X. KITCHEN
--------------------------------
EFFECTIVE DATE: DECEMBER 2, 2004
B-4
as well as any other counties in the State of Alabama in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
14. Mississippi-- The following counties in the State of Mississippi:
Hinds, Madison, Rankin, Simpson, Copiah, Xxxxxxxxx, Xxxxxx, Yazoo
as well as any other counties in the State of Mississippi in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
15. Pennsylvania-- The following counties in the State of
Pennsylvania:
Montgomery, Philadelphia, Bucks, Delaware, Xxxxxxx, Berks, Lehigh,
Northampton
as well as any other counties in the State of Pennsylvania in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
16. Kentucky-- The following counties in the State of Kentucky:
Pike, Martin, Floyd, Knott, Letcher
as well as any other counties in the State of Kentucky in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
17. The District of Columbia
18. Kansas-- The following counties in the State of Kansas:
Xxxxxxx, Leavenworth, Johnson, Miami, Franklin, Wyandotte, Sedgwick,
Cowley, Sumner, Butler, Harvey, Reno, Kingman
as well as any other counties in the State of Kansas in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the
EMPLOYEE
/s/ XXXXXX X. KITCHEN
--------------------------------
EFFECTIVE DATE: DECEMBER 2, 2004
B-5
business of the Company or any of its subsidiaries or (c) supervises
the activities of other employees of the Company or any of its
subsidiaries as of the Date of Termination.
19. Missouri-- The following counties in the State of Missouri:
Boone, Audrain, Callaway, Cole, Cooper, Howard, Moniteau, Randolph,
Jackson, Lafayette, Johnson, Cass, Xxxx, Xxx, Platte, Clinton, Morgan,
Pettis, Saline
as well as any other counties in the State of Missouri in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
20. Nebraska-- The following counties in the State of Nebraska:
Lancaster, Otoe, Sarpy, Gage, Saline, Seward, Saunders, Cass, Xxxxxx,
Xxxxxxx, Washington, Dodge, Xxxxxxx
as well as any other counties in the State of Nebraska in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
Employee and the Company agree that, throughout the Employment Term,
Employee shall comply with all of the requirements and restrictions set
forth in Article V of the Agreement of which this Appendix A forms a
part; however, Employee and the Company agree that, notwithstanding
anything to the contrary contained in Article V, Section 3 of the
Agreement, Employee shall be required to restrict his post-employment
activities in the State of Nebraska only to: (i) complying with the
restrictions set forth in Article V, Section 2 of the Agreement and
(ii) refraining from calling upon any customer of the Company or its
subsidiaries with whom Employee has done business and/or had personal
contact for the purpose of soliciting, diverting or enticing away the
business of such person or entity, or otherwise disrupting any
previously established relationship existing between such person or
entity and the Company or its subsidiaries. The parties hereby
acknowledge and agree that this modification to the restrictions of
Article V, Section 3 as they relate to post-employment competition in
the State of Nebraska is being entered into solely to comply with the
limitations provided in Nebraska law on the extent to which
noncompetition agreements may be enforced. This modification does not
reflect the parties' agreement as to the extent of the limitations upon
competition necessary to protect the legitimate interests of the
Company; rather, the provisions of Article V of the Agreement reflect
such agreement.
EMPLOYEE
/s/ XXXXXX X. KITCHEN
--------------------------------
EFFECTIVE DATE: DECEMBER 2, 2004
B-6
21. Iowa-- The following county in the State of Iowa:
Xxxx, Xxxxxx, Marion, Warren, Madison, Dallas, Story, Xxxxx
as well as any other counties in the State of Iowa in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
22. Nevada-- The following counties in the State of Nevada:
Clark, Lincoln, Xxx
as well as any other counties in the State of Nevada in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
23. New Mexico-- The following counties in the State of New Mexico:
Bernalillo, Xxxxxxxx, Xxxxx Fe, Torrance, Los Alamos, Rio Arriba, Xxxx,
San Xxxxxx
as well as any other counties in the State of New Mexico in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
24. Oregon-- The following counties in the State of Oregon:
Xxxxxxxxx, Xxxxxxxxxx, Xxxxxxx, Curry, Jackson, Klamath, Clatsop,
Columbia, Multnomah, Clackamas, Yamhill, Tillamook
as well as any other counties in the State of Oregon in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
25. California-- The following counties in the State of California:
Xxxxx, Plumas, Xxxxxx, Yuba, Colusa, Tehama, Fresno, San Mateo, Contra
Costa, San Joaquin, Stanislaus, Santa Xxxxx, Mariposa, Orange, San
Bernardino, Kern, Ventura,
EMPLOYEE
/s/ XXXXXX X. KITCHEN
--------------------------------
EFFECTIVE DATE: DECEMBER 2, 2004
B-7
Inyo, Riverside, Los Angeles, Monterey, Kings, Santa Xxxxxxx, Madera,
Tulare, San Benito, Merced, San Xxxx Obispo, Nevada, Alameda,
Sacramento, El Dorado, Amador, Yolo, Xxxxxx, San Diego, Imperial,
Sonoma, Napa, Lake, Marin, Santa Xxxx, Calaveras, Placer, Butte,
Mendocino, San Francisco
as well as any other counties in the State of California in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
Employee and the Company agree that, throughout the Employment Term,
Employee shall comply with all of the requirements and restrictions set
forth in Article V of the Agreement of which this Appendix A forms a
part; however, Employee and the Company agree that, notwithstanding
anything to the contrary contained in Article V, Section 2 or 3 of the
Agreement, Employee shall be required to restrict his post-employment
activities in the State of California only to: (i) complying with the
restrictions set forth in Article V, Section 2 of the Agreement to the
extent that Confidential Information constitutes a trade secret under
California law and (ii) complying with the restrictions set forth in
Article V, Sections 3(c) and 3(d) of the Agreement. The parties hereby
acknowledge and agree that these modifications to the restrictions of
Article V, Sections 2 and 3 as they relate to post-employment
disclosure and competition in the State of California are being entered
into solely to comply with the limitations provided in California law
on the extent to which nondisclosure and noncompetition agreements may
be enforced. These modifications do not reflect the parties' agreement
as to the extent of the limitations upon disclosure and competition
necessary to protect the legitimate interests of the Company; rather,
the provisions of Article V of the Agreement reflect such agreement.
26. Illinois-- The following counties in the State of Illinois:
Cook, Lake, McHenry, Kane, DuPage, Will
as well as any other counties in the State of Illinois in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
27. Washington-- The following counties in the State of Washington:
King, Snohomish, Kittitas, Xxxxxx, Kitsap, Skagit, Chelan, Island
EMPLOYEE
/s/ XXXXXX X. KITCHEN
--------------------------------
EFFECTIVE DATE: DECEMBER 2, 2004
B-8
as well as any other counties in the State of Washington in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
28. Wisconsin-- The following counties in the State of Wisconsin:
Waukesha, Dodge, Ozaukee, Jefferson, Washington, Racine, Walworth,
Milwaukee, Winnebago, Fond du Lac, Green Lake, Calumet, Waushara,
Outagamie, Waupaca, Kenosha
as well as any other counties in the State of Wisconsin in which the
Employee regularly (a) makes contact with customers of the Company or
any of its subsidiaries, (b) conducts the business of the Company or
any of its subsidiaries or (c) supervises the activities of other
employees of the Company or any of its subsidiaries as of the Date of
Termination.
B. Acknowledgment
The Company and Employee acknowledge that Employee's voluntary
compliance with Article V, Sections 2 and 3 constitutes a significant
part of the consideration for the Company's agreement to make the
payments specified in Article IV. Therefore, the Company and Employee
acknowledge that it is the intent of this Agreement that if Employee
engages in conduct described as prohibited conduct in Article V Section
2 or 3, the Company may suspend or eliminate payments under Article IV,
including Section 3 of Article IV, during the period of such conduct,
even if the parties' contractual prohibitions on such conduct are
determined to be invalid, illegal or unenforceable under applicable
law.
Furthermore, the parties acknowledge that any provision in this
Appendix B that permits Employee to engage, after the Date of
Termination, in a particular jurisdiction, in conduct otherwise
prohibited by Article V Section 2 or 3 (for example, as in California
and Nebraska) has been agreed to solely in order to comply with the
limitations provided in the law of that jurisdiction on the extent to
which nondisclosure and noncompetition agreements may be enforced.
Therefore, the parties acknowledge that, although Employee may be
permitted pursuant to this Appendix B to engage, after the Date of
Termination, in certain jurisdictions (such as California and
Nebraska), in conduct otherwise prohibited by Article V Section 2 or 3,
if Employee does engage in conduct prohibited by the provisions of
Article V Section 2 or 3 (as such provisions appear in the Agreement
without giving effect to any modifications to such provisions made by
this Appendix B), Employee will forfeit his or her right to payments
under Article IV, including Section 3 of Article IV, during the period
of such conduct.
EMPLOYEE
/s/ XXXXXX X. KITCHEN
--------------------------------
EFFECTIVE DATE: DECEMBER 2, 2004
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APPENDIX C TO
EMPLOYMENT AGREEMENT
BETWEEN XXXXXXX ENTERPRISES, INC.
AND
XXXXXX X. KITCHEN
Supplemental Executive Retirement Agreement
as provided in Article II, Section 4
SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT
THIS AGREEMENT (the "Agreement") is effective as of December 2, 2004 by
and between Xxxxxxx Enterprises, Inc., a Louisiana corporation (the "Employer"),
and Xxxxxx X. Kitchen ("Employee").
WHEREAS, in connection with Employer's entering into an
Employment
Agreement with the Employee pursuant to which Employee will serve as Executive
Vice President and Chief Financial Officer of the Employer, Employer wishes to
provide Employee with certain unfunded retirement benefits
NOW, THEREFORE, in consideration of the premises, it is agreed by and
between the parties as follows:
ARTICLE 1
DEFINITIONS
1.1 An ACTUARIALLY EQUIVALENT benefit means a benefit having the same
value as the benefit to which it is compared. Actuarial equivalence shall be
determined using a mortality table and an interest rate that are selected from
time to time by the Compensation Committee and that meet the requirements for
valuing a lump sum distribution under Internal Revenue Code Section 417(e), as
elaborated by IRS regulations and other applicable rules. Pursuant to current
Treasury Regulation Section 1.417(e)-1(d), the interest rate shall be the annual
interest rate on 30-year Treasury securities (or a replacement basket of
securities identified by the IRS for use under Code Section 417(e)) for the
month prior to the calendar year for which the determination is to be made.
1.2 ANNUITY STARTING DATE means the first day of the second month
immediately following the month in which occurs the Employee's Termination of
Employment. The Compensation Committee has the discretion to defer the Annuity
Starting Date for up to two months, if it determines that extra time is needed
to determine the benefit or the form of the benefit.
1.3 BENEFICIARY means any of the following;
(a) In the case of a 10-Years-Certain-and-Life Annuity
(including a pre-retirement death benefit under Paragraph 4.1(b) of
Article 4), the person or persons designated by the Employee (on his or
her Benefit Election Form) to receive the
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remainder of the 120 guaranteed monthly payments if the Employee dies
before the 120th month. If no person is effectively named by the
Employee as the Beneficiary, the Beneficiary shall be the Employee's
surviving spouse, if any, and otherwise the Employee's heirs or
legatees. If a Beneficiary dies after the Employee but before full
payment has been made, the share of the remaining payments that would
have been paid to the Beneficiary if he had survived shall be paid to
the person or persons who would have received that share of the benefit
if the Beneficiary had predeceased the Employee.
(b) In the case of a Joint-and-Survivor Annuity, the person
named by the Employee (on his Benefit Election Form) as his joint
annuitant, if that person survives the Employee.
1.4 BENEFIT ELECTION FORM means the form set forth as Exhibit A, or any
successor form provided by the Compensation Committee, on which the Employee
elects the manner in which his benefit under this Agreement will be paid.
1.5 FINAL AVERAGE PAY means the Employee's average monthly base salary
for the 36 full months immediately preceding the Employee's Termination of
Employment.
1.6 NORMAL FORM of benefit means a monthly pension commencing on the
Employee's Annuity Starting Date, and paid on the first day of each following
month, terminating with the payment made in the month of the Employee's death.
No death benefit is payable under the Normal Form.
1.7 OPTIONAL FORM of benefit means either the 10-Years-Certain-and-Life
Annuity or the Joint-and-Survivor Annuity, described in Paragraph 2.3 of Article
2, below.
1.8 TERMINATION OF EMPLOYMENT means the termination of the employment
of the Employee with the Employer, unless the Employee is transferred to an
affiliate of the Employer and the Compensation Committee determines that
employment by the affiliate is to be treated the same as employment by the
Employer.
ARTICLE 2
RETIREMENT BENEFIT
2.1 Upon the Termination of Employment of the Employee, the Employee
shall be entitled to the vested portion of his retirement benefit commencing on
his Annuity Starting Date.
2.2 The Employee's fully vested retirement benefit paid in the Normal
Form shall be 40% of Final Average Pay.
2.3 Instead of payment in the Normal Form, if the Employee's
Termination of Employment occurs on or after his 65th birthday, the Employee may
elect to receive the benefit in either of the following two Optional Forms:
(a) As a Joint-and-Survivor Annuity, as follows: a monthly
pension is paid to the Employee, commencing on his or her Annuity
Starting Date, continuing on the first day of each following month, and
terminating with the payment for the month of the
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Employee's death; and if the joint annuitant named by the Employee as
of the Annuity Starting Date survives the Employee, the amount paid
monthly to the Employee will be continued and paid to the joint
annuitant on the first day of each following month, terminating with
the payment for the month of the joint annuitant's death.
(b) As a 10-Years-Certain-and-Life Annuity, as follows: a
monthly benefit is paid to the Employee, commencing on his or her
Annuity Starting Date, continuing on the first day of each following
month, and terminating with the later of the payment for the month of
the Employee's death or the month for which the 120th monthly payment
has been made. If the Employee dies prior to receiving 120 monthly
payments, the remainder of the 120 payments are made to the Employee's
Beneficiary, determined under Paragraph 1.3(a) of Article 1, above.
2.4 In every case the form of pension must be elected by the Employee
prior to his or her Annuity Starting Date and may not be changed thereafter. If
the Employee makes no election prior to the Annuity Starting Date, the benefit
shall be paid in the Normal Form.
2.5 The Employee's pension paid in an Optional Form shall be
Actuarially Equivalent to the pension paid in the Normal Form.
ARTICLE 3
VESTING OF RETIREMENT BENEFIT
3.1 The Employee's retirement benefit, commencing at the Annuity
Starting Date, shall be a percentage of his Final Average Pay, which shall be
calculated according to the following schedule:
Years of Service % of Final Average Pay
---------------- ----------------------
0 - 5 0
5 20%
6 24%
7 28%
8 32%
9 36%
10 or more 40%
3.2 If the Employee terminates employment prior to the five-year
anniversary of the date of this Agreement, he is not eligible to receive a
benefit under this Agreement, except as otherwise provided in Article 9 hereof.
ARTICLE 4
DEATH
4.1 Upon the death of the Employee prior to his Termination of
Employment for any other reason, if the Employee had a vested retirement benefit
on such date of death, the Employee's Beneficiary shall receive a death benefit
that shall commence as of the month following the month of death, and shall be
determined as follows:
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(a) If the Employee is survived by his spouse, and the
surviving spouse is the only Beneficiary, the surviving spouse shall be
entitled to a monthly benefit for her life, equal to the pension the
surviving spouse would have received if the Employee had retired on the
date of his death and had elected a Joint-and-Survivor Annuity with the
surviving spouse as the Beneficiary, and had died before his Annuity
Starting Date.
(b) If Paragraph 4.1(a) of this Article 4 does not apply, the
death benefit shall be paid to the Employee's Beneficiary for 120
months, determined as if the Employee had retired on the date of his
death and had elected to receive his or her benefit in the form of a
10-Years-Certain-and-Life Annuity but died before his or her Annuity
Starting Date.
4.2 Upon the death of the Employee after his Annuity Starting Date, a
benefit will be paid only if the Employee elected an Optional Form of benefit
under which a benefit is due to a Beneficiary.
ARTICLE 5
AMENDMENT AND DISCONTINUANCE
5.1 The Employer expects to continue this Agreement indefinitely but
reserves the right, acting through the Compensation Committee, to amend or
discontinue it, except as provided in Section 9.3 hereof and provided, however,
that a vested benefit can be affected without the Employee's consent only as set
forth below, and subject to Article 8 hereof.
5.2 If the Compensation Committee should discontinue this Agreement,
the Employer shall be obligated to pay all benefits that have already commenced.
5.3 The Compensation Committee can terminate this Agreement at any time
in its discretion without the Employee's consent, if the Employee has not had a
Termination of Employment. In that event a benefit shall be paid, as set forth
in Paragraph 5.4 below, to the Employee only if he is vested with respect to all
or a portion of his benefits hereunder as of the date such action is taken.
5.4 In the event of the termination of this Agreement, the benefit
under Paragraph 5.3 of this Article 5 shall be based on the Employee's Final
Average Pay determined as of the date of termination of this Agreement.
Nevertheless, the Annuity Starting Date, the retirement benefit, the discount
(if any), and the form of the benefit, shall be determined in the normal way
upon the Employee's Termination of Employment.
5.5 Except as otherwise provided in Article 9 in the event of a Change
of Control, if as of the date the Agreement is terminated, the Employee's
benefits hereunder have not vested, the Employee shall receive no benefit under
this Agreement.
ARTICLE 6
RESTRICTIONS ON ASSIGNMENT
The interest of the Employee or a Beneficiary hereunder may not be
sold, transferred, assigned, or encumbered in any manner, either voluntarily or
involuntarily. Neither shall the
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benefits hereunder be liable for or subject to the claims of the creditors of
any person to whom such benefits or funds are payable, except that (i) no amount
shall be payable hereunder until and unless any and all amounts representing
debts or other obligations owed to the Employer or any affiliate of the Employer
by the Employee with respect to whom such amounts would otherwise be payable
shall have been fully paid and satisfied, and (ii) no amounts shall be payable
hereunder to any Employee (or the Employee's Beneficiary) if the Employee
engages in any of the activities described in Article 7 hereof.
ARTICLE 7
CONDITION OF NON-COMPETITION
7.1 The Employee (and the Employee's Beneficiary) will lose the right
to any unpaid benefits under the Agreement if the Employee engages in any
Restricted Activities following his Termination of Employment.
7.2 The term "Restricted Activities" means any one or more of the
following activities:
(a) Employee, directly or indirectly, for himself or others,
owns, manages, operates, controls, is employed in an executive,
managerial or supervisory capacity by, consults with, or otherwise
engages or participates in or allows his skill, knowledge, experience
or reputation to be used in connection with, the ownership, management,
operation or control of, any company or other business enterprise
engaged in the Death Care Business within any of the Subject Areas;
provided, however, a passive investment by the Employee is not a
Restricted Activity s as long as Employee does not beneficially own
more than 2% of the equity interests of a business enterprise engaged
in the Death Care Business within any of the Subject Areas. For
purposes of this paragraph, "beneficially own" shall have the same
meaning ascribed to that term in Rule 13d-3 under the Securities
Exchange Act of 1934.
(b) Employee calls upon any customer of the Company or its
subsidiaries for the purpose of soliciting, diverting or enticing away
the business of such person or entity, or otherwise disrupting any
previously established relationship existing between such person or
entity and the Company or its subsidiaries.
(c) Employee solicits, induces, influences or attempts to
influence any supplier, lessor, lessee, licensor, partner, joint
venturer, potential acquiree or any other person who has a business
relationship with the Company or its subsidiaries, or who on the date
of Termination of Employment is engaged in discussions or negotiations
to enter into a business relationship with the Company or its
subsidiaries, to discontinue or reduce or limit the extent of such
relationship with the Company or its subsidiaries.
(d) Employee makes contact with any of the employees of the
Company or its subsidiaries with whom he had contact during the course
of his employment with the Company for the purpose of soliciting such
employee for hire, whether as an employee or independent contractor, or
otherwise disrupting such employee's relationship with the Company or
its subsidiaries.
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7.3 The following terms used in this Article 7 are defined as follows:
(a) "Subject Areas" means each State of the United States or
other jurisdiction in which Employee regularly (a) makes contact with
customers of the Company or any of its subsidiaries, (b) conducts the
business of the Company or any of its subsidiaries or (c) supervises
the activities of other employees of the Company or any of its
subsidiaries, and in which the Company or any of its subsidiaries
engages in the Death Care Business (as hereinafter defined) on the date
of Termination of Employment.
(b) "Death Care Business" means (i) the owning and operating
of funeral homes and cemeteries, including combined funeral home and
cemetery facilities, (ii) the offering of services and products to meet
families' funeral needs, including prearrangement, family consultation,
the sale of caskets and related funeral and cemetery products and
merchandise (whether at physical locations or by means of the
Internet), the removal, preparation and transportation of remains,
cremation, the use of funeral home facilities for visitation and
worship, and related transportation services, (iii) the marketing and
sale of funeral services and cemetery property or merchandise on an
at-need or prearranged basis, (iv) providing, managing and
administering financing arrangements (including trust funds, escrow
accounts, insurance and installment sales contracts) for prearranged
funeral plans and cemetery property and merchandise, (v) providing
interment services, the sale (on an at-need or prearranged basis) of
cemetery property including lots, lawn crypts, family and community
mausoleums and related cemetery merchandise such as monuments,
memorials and burial vaults, (vi) the maintenance of cemetery grounds
pursuant to perpetual care contracts and laws or on a voluntary basis,
and (vii) offering mausoleum design, construction and sales services.
ARTICLE 8
NATURE OF AGREEMENT
The Employee and Beneficiaries under this Agreement have only an
unsecured right to receive benefits from the Employer as general creditors of
the Employer. The Agreement constitutes a mere promise to make payments in the
future. The Employer may set aside funds, in a trust or otherwise, for the
purpose of satisfying its obligations under this Agreement. The setting aside of
amounts by the Employer with which to discharge its obligations hereunder shall
not create any security for the payment of benefits, however. Any and all funds
so set aside shall remain subject to the claims of the general creditors of the
Employer, present and future. This provision shall not require the Employer to
set aside any funds, but the Employer may set aside such funds if it chooses to
do so.
ARTICLE 9
CHANGE OF CONTROL
9.1 Notwithstanding the provisions of Article 5, Article 8 or any other
provisions of this Agreement to the contrary, if the Employee has a Termination
of Employment within five years of the date hereof and following a Change of
Control (as such term is defined in the Change of Control Agreement between the
Employee and the Employer), the Employee shall
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receive the same benefits hereunder that the Employee would have received if the
Employee had completed five years of service to the Employer hereunder.
9.2 If the Employee's Termination of Employment occurs during the
two-year period beginning with the Change of Control, the Employee shall receive
as his only benefit under the Plan a lump sum that is Actuarially Equivalent to
the Normal Form of benefit that the Employee otherwise would have been entitled
to under the Plan (including, if applicable, Paragraph 9.1 of this Article 9).
In computing the Normal Form for the purpose of this benefit, however, Final
Average Pay shall be determined immediately before the Change of Control or
immediately before the Termination of Employment, whichever produces the larger
amount.
9.3 During the two-year period following a Change of Control, the
Employer shall have no right to terminate this Agreement.
ARTICLE 10
ADMINISTRATION
The Compensation Committee of the Board of Directors of the Employer
shall have full power and authority to interpret, construe and administer this
Agreement, and its interpretations and constructions hereof and actions
hereunder, including the timing, form, amount or receipt of any payment to be
made hereunder, within the scope of its authority, shall be binding and
conclusive for all purposes. The Compensation Committee may delegate its
responsibilities hereunder to one or more employees of the Employer.
ARTICLE 11
MISCELLANEOUS
11.1 If the Employee anticipates a Termination of Employment, the
Employee should apply for a benefit using the Benefit Election Form provided by
the Compensation Committee. Upon the death of the Employee when a benefit is
payable to a Beneficiary, the Beneficiary should notify the Compensation
Committee of the death. All claims for benefit shall be addressed to the
Chairman of the Compensation Committee, Xxxxxxx Enterprises, Inc., 0000 Xxxxx
Xxxxxxxxx Xxxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000. The procedures of making a claim,
and for appealing from a partial or complete denial, are attached hereto as
Exhibit B. The remedy of an employee who is unsatisfied after completing the
appeal process is to enter binding arbitration with the Employer.
11.2 If the Employer, through a mistake of law or fact, pays to the
Employee or other person a benefit hereunder that the recipient is not entitled
to, the recipient shall repay the mistaken amount to the Employer. The Employer
may offset the future benefits of any recipient who refuses to return an
erroneous payment, in addition to pursuing other remedies provided by law.
11.3 Nothing contained herein shall be construed as conferring upon the
Employee the right to continue in the employ of the Employer in any capacity.
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11.4 This Agreement shall be binding upon and inure to the benefit of
the Employer, its successors and assigns and the Employee and his or her heirs,
executors, administrators and legal representatives.
11.5 The Employee is being offered the benefits of this Agreement in
consideration of agreeing to become an employee of the Employer and the
non-competition covenant contained in Article 7 hereto, to which such Employee
explicitly agrees by executing this Agreement.
11.6 This Agreement shall be construed in accordance with and governed
by the laws of the State of Louisiana, except to the extent that the Agreement
is governed by the Employee Retirement Income Security Act of 1974 ("ERISA"). It
is the Employer's intent that the Agreement shall be exempt from ERISA's
provisions to the maximum extent permitted by law. The Agreement is intended to
be unfunded for federal income tax purposes and for the purposes of Title I of
ERISA, and is intended to provide a pension benefit only for a select group of
management or highly compensated employees, so as to be exempt from Parts 2, 3
and 4 of Title I of ERISA, pursuant to Sections 201(2), 301(a)(3), and 401(a)(1)
of ERISA.
11.7 This Agreement, and any amendment hereto, shall also serve as the
Agreement's Summary Plan Description. A copy of this Agreement and each
amendment hereto shall be provided to the Employee.
11.8 In the event that any of the compensation payable to the Employee
hereunder is considered to be non-qualified deferred compensation subject to the
American Jobs Creation Act of 2004 (the "Jobs Act") and any regulations issued
or to be issued by the Department of the Treasury thereunder, the Employer and
the Employee shall negotiate in good faith and agree to such amendments to this
Agreement as they and their respective tax counsel deem necessary to avoid the
imposition of additional taxes and penalties under the Jobs Act or such
regulations, while preserving the economic benefits intended to be conferred on
the Employee by this Agreement.
Executed in duplicate originals in__________________, Louisiana, this
_____ day of _____________, 200__.
WITNESSES: XXXXXXX ENTERPRISES, INC.
By: The Compensation Committee
of the Board of Directors
-----------------------------
By: /s/ XXXXX X. XXXXXXXXX
----------------------------------
Xxxxx X. XxXxxxxxx,
Chairman
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WITNESSES:
/s/ XXXXXX X. KITCHEN
---------------------------- ------------------------
Xxxxxx X. Kitchen
----------------------------
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XXXXXXX ENTERPRISES, INC.
EXECUTIVE RETIREMENT AGREEMENT
EXHIBIT A - BENEFIT ELECTION FORM
Name: SSN:
------------------------------------ -------------------------
Address:
-----------------------------------------------------------------------
Date of Termination of Employment:
------------------------------
Form of Benefit (Elect One):
[ ] For my life only
[ ] For my life, but no less than 120 months
In the event of my death before 120 payments have been made, the
beneficiary or beneficiaries of the remaining payments shall be:
-----------------------------------------------------------------------
[ ] For my life, and at my death to the following individual for his or her
life, if he or she survives me:
-----------------------------------------------------------------------
------------------------------
Xxxxxx X. Kitchen
------------------------------
Date
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XXXXXXX ENTERPRISES, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT
EXHIBIT B - CLAIMS PROCEDURES
(a) FILING OF A CLAIM FOR BENEFITS
Claims for benefits under the Agreement are to be presented in
writing by the claimant or an authorized representative to the Chairman
of the Compensation Committee of the Board of Directors of Xxxxxxx
Enterprises, Inc.
(b) NOTIFICATION TO CLAIMANT OF DECISION
If a claim is wholly or partially denied, a notice of the
decision rendered in accordance with the rules set forth below will be
furnished to the claimant not later than 90 days after receipt of the
claim by the Chairman of the Compensation Committee.
If special circumstances require an extension of time for
processing the claim, the Chairman of the Compensation Committee will
give the claimant a written notice of the extension prior to the end of
the initial 90 day period. In no event will the extension exceed an
additional 90 days. The extension notice will indicate the special
circumstances requiring an extension of time and the date by which the
Chairman of the Compensation Committee expects to render its final
decision.
If the notice of the denial of claim is not furnished in
accordance with the procedure set out herein, the claim will be deemed
denied and the claimant will be permitted to proceed to the review
stage.
(c) CONTENT OF NOTICE
The Chairman of the Compensation Committee will provide to a
claimant who is denied a claim for benefits written or electronic
notice setting forth in a clear and simple manner:
(1) The specific reason or reasons for denial;
(2) Specific reference to pertinent plan provisions on which
denial is based;
(3) A description of any additional material or information
necessary for the claimant to perfect the claim and an
explanation of why such materials or information are
necessary; and
(4) Appropriate information as to the steps to be taken if the
claimant wishes to submit his or her claim for review,
including the right to bring a civil action under ERISA
Section 502(a) following an adverse determination on review.
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d) REVIEW PROCEDURE
After the claimant has received written notification of the
denial of the claim, the claimant or a duly authorized representative
will have 60 days within which to appeal, in writing, a denied claim to
the full Compensation Committee. The Compensation Committee will afford
the claimant a full and fair review of the denial of the claim. The
claimant should include in his written appeal the following information
to support his claim for benefits:
(1) A list of the issues in the claim denial that he chooses
to contest, if any, and that he wishes the Compensation
Committee to review on appeal;
(2) His position on each issue;
(3) Any additional facts that he believes support his position
on each issue; and
(4) Any legal or other arguments he believes support his
position on each issue.
The claimant or a duly authorized representative will be
permitted to submit issues and comments relevant to the claim.
Upon request, the claimant will be given reasonable access to,
and copies of, all documents and information relevant to the
claim for benefits, at no charge.
The review will consider all items submitted by the claimant,
regardless of whether such information was submitted or
considered in the initial benefit determination.
(e) DECISION ON REVIEW
The decision on review by the Compensation Committee will be
rendered as promptly as is feasible, but not later than 60 days after
the receipt of a request for review unless the Compensation Committee
in its sole discretion, determines that special circumstances require
an extension of time for processing, in which case a decision will be
rendered as promptly as is feasible, but not later than 120 days after
receipt of a request for review.
If an extension of time for review is required because of
special circumstances, written notice of the extension will be
furnished to the claimant before termination of the initial 60-day
review period.
The decision on review will be in written or electronic form.
In the event of a claim denial, the decision shall contain: (1)
specific reasons for the decision, written in a clear and simple
manner; (2) specific references to the pertinent plan provisions on
which the decision is based; (3) a statement that the claimant may
request, at no charge,
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reasonable access to and copies of all documents, records and other
information relevant to the claim for benefits; and (4) a description
of the Agreement's appeal and arbitration procedures (if any), and the
claimant's right to bring an action under ERISA Section 502(a).
If the decision on review is not furnished within the time
period(s) set out in this section, the claim will be deemed denied on
review.
If the claimant wishes to contest the Compensation Committee's decision on
review, the claimant's claim shall be submitted to binding arbitration in
accordance with the following procedures:
(f) ARBITRATION
(1) BINDING AGREEMENT TO ARBITRATE. Any claim or controversy
arising out of any provision of this Agreement that cannot be
resolved through the claims procedures provided above, shall be
settled by arbitration administered by the American Arbitration
Association (the "AAA") under its National Rules for the
Resolution of Employment Disputes (the "Rules"), and judgment on
the award rendered by the arbitrator(s) may be entered in any
court having jurisdiction thereof.
(2) SELECTION AND QUALIFICATIONS OF ARBITRATORS. If no party to
the arbitration makes a claim in excess of $1.0 million, exclusive
of interest and attorneys' fees, the proceedings shall be
conducted before a single neutral arbitrator selected in
accordance with the Rules. If any party makes a claim that exceeds
$1.0 million, the proceedings shall be conducted before a panel of
three neutral arbitrators, one of whom shall be selected by each
party within 15 days after commencement of the proceeding and the
third of whom shall be selected by the first two arbitrators
within 10 days after their appointment. If the two arbitrators
selected by the parties are unable or fail to agree on the third
arbitrator, the third arbitrator shall be selected by the AAA.
Each arbitrator shall be a member of the bar of the State of
Louisiana and actively engaged in the practice of employment law
for at least 15 years.
(3) LOCATION OF PROCEEDINGS. The place of arbitration shall be New
Orleans, Louisiana.
(4) REMEDIES. Any award in an arbitration initiated here shall be
limited to actual monetary damages, including if determined
appropriate by the arbitrator(s) an award of costs and fees to the
prevailing party. "Costs and fees" mean all reasonable pre-award
expenses of the arbitration, including arbitrator's fees,
administrative fees, travel expenses, out-of-pocket expenses such
as copying, telephone, witness fees and attorneys' fees. The
arbitrator(s) will have no authority to award consequential,
punitive or other damages not measured by the prevailing party's
actual damages, except as may be required by statute.
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(5) OPINION. The award of the arbitrators shall be in writing,
shall be signed by a majority of the arbitrators, and shall
include findings of fact and a statement of the reasons for the
disposition of any claim.
AGREED TO AND ACCEPTED:
XXXXXXX ENTERPRISES, INC. EMPLOYEE
BY:
----------------------------- ---------------------------------
DATE: , 200
---------------- --
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