Exhibit 10
EMPLOYMENT AGREEMENT
AGREEMENT by and between Viad Corp, a Delaware corporation
(the "Company"), and Xxxxxx X. Xxxxxxxx (the "Executive"), dated
as of the 1st day of April, 1998.
WHEREAS, the Board of Directors of the Company (the "Board")
has determined that it is in the best interests of the Company
and its shareholders to employ the Executive as Chief Executive
Officer ("CEO"), and the Executive desires to serve in that
capacity;
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. EMPLOYMENT PERIOD. (a) The Company shall employ the
Executive, and the Executive shall serve the Company, on the
terms and conditions set forth in this Agreement, for the
Employment Period (as defined in the next sentence). The
"Employment Period" shall mean the period beginning on April 1,
1998, and ending on March 31, 2001; provided, however, that on
April 1, 1999, and on each subsequent anniversary of such date
(each such anniversary thereof being hereinafter referred to as a
"Renewal Date"), unless previously terminated, the Employment
Period shall be automatically extended by one year.
(b) This Employment Agreement shall terminate
automatically when the Executive reaches the age of 65 years old.
No notice shall be required.
2. POSITION AND DUTIES. (a) During the Employment
Period, the Executive shall serve as Chairman and CEO of the
Company and, subject to the direction of the Board, shall have
full authority for management of the Company and all its
operations, financial affairs, facilities and investments. The
Executive shall serve as a member of the Board, shall act as the
duly authorized representative of the Board and shall be an
ex-officio member of all committees of the Board to which he is
appointed.
(b) During the Employment Period, and excluding any
periods of vacation and sick leave to which the Executive is
entitled, the Executive shall devote reasonable attention and
time during normal business hours to the business and affairs of
the Company and, to the extent necessary to discharge the
responsibilities assigned to the Executive under this Agreement,
use the Executive's reasonable best efforts to carry out such
responsibilities faithfully and efficiently. It shall not be
considered a violation of the foregoing for the Executive to (A)
serve on corporate, civic or charitable boards or committees, (B)
deliver lectures, fulfill speaking engagements or teach at
educational institutions and (C) manage personal investments, so
long as such activities do not significantly interfere with the
performance of the Executive's responsibilities as an employee of
the Company in accordance with this Agreement.
(c) The Executive's services shall be performed
primarily at Viad Tower, Phoenix, Arizona, or such other location
designated by the Board.
3. COMPENSATION. (a) BASE SALARY. During the Employment
Period, the Executive shall receive an annual base salary
("Annual Base Salary") of $750,000.00, payable twice each month.
During the Employment Period, the Annual Base Salary shall be
reviewed for possible increase at least annually. Annual
increases shall be no less than the lesser of 5% or the increase
in the Consumer Price Index ("CPI") for prior annual period. Any
increase in the Annual Base Salary shall not limit or reduce any
other obligation of the Company under this Agreement.
(b) ANNUAL BONUS. In addition to the Annual Base
Salary, the Executive shall be awarded, for each calendar year or
portion thereof, ending during the Employment Period, an annual
bonus (the "Annual Bonus") as determined by the Board. Each
Annual Bonus or Management Incentive Plan ("MIP"), as it is
sometimes called, shall be paid in a single cash lump sum no
later than 90 days after the end of the calendar year for which
the Annual Bonus is awarded, unless the Executive elects in
writing, before the end of the year for which the Annual Bonus is
to be awarded, to defer receipt of the Annual Bonus.
(c) OTHER BENEFITS. During the Employment Period:
the Executive shall be entitled to participate in all incentive,
savings and retirement plans, practices, policies and programs of
the Company to the same extent as peer executives; and (ii) the
Executive and/or the Executive's family, as the case may be,
shall be eligible for participation in, and shall receive all
benefits under, all welfare benefit plans, practices, policies
and programs provided by the Company (including, without limita-
tion, medical, prescription, dental, disability, salary con-
tinuance, employee life insurance, group life insurance,
accidental death and travel accident insurance plans and
programs) to the same extent as peer executives. The term "peer
executives" means senior vice presidents of the Company.
(d) EXPENSES. During the Employment Period, the
Executive shall be entitled to receive prompt reimbursement for
all reasonable expenses incurred by the Executive in carrying out
the Executive's duties under this Agreement, provided that the
Executive complies with the policies, practices and procedures of
the Company for submission of expense reports, receipts, or
similar documentation of such expenses.
(e) FRINGE BENEFITS. During the Employment Period,
the Executive shall be entitled to fringe benefits, such as tax
and financial planning services, payment of lunch and country
club dues, use of an automobile and payment of related expenses,
use of company aircraft, and an annual physical.
(f) VACATION. During the Employment Period, the
Executive shall be entitled to paid vacation of five weeks per
year.
4. EARLY TERMINATION OF EMPLOYMENT. (a) DEATH OR
DISABILITY. The Executive's employment shall terminate
automatically upon the Executive's death during the Employment
Period. The Company shall be entitled to terminate the
Executive's employment because of the Executive's Disability
during the Employment Period. "Disability" means that the
Executive has been unable, for a period of 180 consecutive
business days, to perform the Executive's duties under this
Agreement, as a result of physical or mental illness or injury,
and a physician selected by the Company or its insurers, and
acceptable to the Executive or the Executive's legal
representative, has determined that the Executive's incapacity is
total and permanent. A termination of the Executive's employment
by the Company for Disability shall be communicated to the
Executive by written notice, and shall be effective on the 30th
day after receipt of such notice by the Executive (the
"Disability Effective Date"), unless the Executive returns to
full-time performance of the Executive's duties before the
Disability Effective Date.
(b) EARLY TERMINATION BY THE COMPANY. The Company may
terminate the Executive's employment during the Employment Period
at any time, without a stated reason, by a vote of a majority of
the Board, excluding Executive. The Board shall also determine
the date of Early Termination.
(c) EARLY TERMINATION FOR CAUSE. The Company may
terminate the Executive's employment for cause as defined below
in accordance with the following procedure:
Cause defined: For purposes of the Agreement, the Company
shall have "Cause" to terminate the Executive's employment
upon (A) the willful and continued failure by the Executive
to substantially perform his duties (other than any such
failure resulting from the Executive's incapacity due to
physical or mental illness) after demand for substantial
performance is delivered by the Company specifically
identifying the manner in which the Company believes the
Executive has not substantially performed his duties, or (B)
the willful engaging by the Executive in misconduct which is
materially injurious to the Company, monetarily or
otherwise. No act, or failure to act, on the Executive's
part shall be considered "willful" unless done, or omitted
to be done, by him not in good faith and without reasonable
belief that his action or omission was in the best interest
of the Company. Notwithstanding the foregoing, the
Executive shall not be deemed to have been terminated for
Cause unless and until there shall have been delivered to
the Executive a copy of a resolution, duly adopted by the
affirmation vote of not less than three-quarters (3/4) of
the entire membership of the Board, excluding Executive, at
a meeting of the Board called and held for such purposes
(after reasonable notice to the Executive and an opportunity
for him, together with his counsel, to be heard before the
Board), finding that in the good faith opinion of the Board,
the Executive was guilty of conduct set forth above in
clause (A) or (B).
(d) EARLY TERMINATION BY EXECUTIVE. The Executive may
terminate employment voluntarily at any time after giving the
Company at least 180 day's advance written notice.
5. OBLIGATIONS OF THE COMPANY. (a) DEATH OR DISABILITY.
If the Executive's employment is terminated by reason of the
Executive's death or Disability during the Employment Period, the
Company shall pay the Pro Rata Benefits or Obligations to the
Executive or the Executive's estate or legal representative, as
applicable, in a lump sum in cash within 90 days after the Date
of Death or Disability Termination, and the Company shall have no
further obligations under this Agreement.
(b) EARLY TERMINATION BY THE BOARD. If, during the
Employment Period, the Company terminates the Executive's
employment, other than for Death or Disability, the Company shall
pay the amounts and provide the benefits described below to the
Executive and shall, at its sole expense as incurred, provide the
Executive with outplacement services, the scope and provider of
which shall be selected by the Executive in the Executive's sole
discretion. The payments and benefits provided pursuant to this
paragraph (b) of Section 5 are intended as liquidated damages for
a termination of the Executive's employment by the Company and
shall be the sole and exclusive remedy therefor. The amounts to
be paid and the benefits to be provided as described above are:
(i) Severance pay equal to three times the sum of
(1) the Annual Current Salary and (2) the average
of the last three annual Bonuses or MIP awards
paid to Executive, such payment to be made in a
lump sum;
(ii) Performance Based Stock ("PBS") and
Performance Unit Incentive Plans ("PUP") awards to
Executive as of the date of Early Termination
shall be prorated to the date of Early Termination
and the Executive shall be paid in accordance with
the respective PBS or PUP plans but no new PBS or
PUP awards shall be granted after the date of
Early Termination;
(iii) All stock options awarded to Executive
shall vest as of the day of Early Termination;
(iv) Executive shall be provided with Executive
Medical Coverage for a period of three years from
the date of Early Termination; and
(v) Executive shall be entitled to pension
credits for the period of three years from the
date of Early Termination in accordance with the
Company's pension plans.
(c) UPON EARLY TERMINATION FOR CAUSE. The Executive
shall be paid:
(i) 1 year's salary.
(ii) Accrued MIP prorated to date of early
termination.
(iii) PUP and PBS shall terminate without any
further payments.
(d) UPON EARLY TERMINATION BY EXECUTIVE. The
Executive shall be paid:
(i) One year's salary and shall be credited with
one additional year's pension credit.
(ii) Prorated MIP to date of Early Termination.
(iii) PBS and PUP awards, outstanding as of the
date of Early Termination, shall lapse and no
vesting of PBS awards shall occur and no payments
for PUP shall be paid to the Executive.
(iv) Executive shall be entitled to exercise only
stock options which have vested prior to Early
Termination by Executive.
(e) UPON ORDINARY RETIREMENT. The Executive shall be
paid:
(i) Salary and accrued MIP, PUP, and PBS
prorated to the date of Ordinary Retirement.
(ii) All accrued other benefits as of the date of
Ordinary Retirement shall be paid to the Executive
in accordance with their respective plans.
(iii) Life-time executive medical benefits for the
Executive.
(iv) Other benefits as may be determined by the
Board.
6. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement
shall prevent or limit the Executive's continuing or future
participation in any plan, program, policy or practice provided
by the Company or any of its affiliated companies for which the
Executive may qualify, nor, subject to paragraph (f) of Section
10, shall anything in this Agreement limit or otherwise affect
such rights as the Executive may have under any contract or
agreement with the Company or any of its affiliated companies.
Vested benefits and other amounts that the Executive is otherwise
entitled to receive under any plan, policy, practice or program
of, or any contract or agreement with, the Company or any of its
affiliated companies on or after the Date of Termination shall be
payable in accordance with such plan, policy, practice, program,
contract or agreement. Specifically, in the event of a "Change
of Control," as defined in the Executive Severance Agreement
applicable to the Executive, the terms of the Executive Severance
Agreement shall control to the extent they provide an additional
or enhanced benefit.
7. FULL SETTLEMENT. The Company's obligation to make the
payments provided for in, and otherwise to perform its
obligations under, this Agreement shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right
or action that the Company may have against the Executive or
others. In no event shall the Executive be obligated to seek
other employment or take any other action by way of mitigation of
the amounts payable to the Executive under any of the provisions
of this Agreement.
8. CONFIDENTIAL INFORMATION; NONCOMPETITION. (a) The
Executive shall hold in a fiduciary capacity for the benefit of
the Company all secret or confidential information, knowledge or
data relating to the Company or any of its affiliated companies
and their respective businesses that the Executive obtains during
the Executive's employment by the Company or any of its
affiliated companies and that is not public knowledge (other than
as a result of the Executive's violation of this paragraph (a) of
Section 8) ("Confidential Information"). The Executive shall not
communicate, divulge or disseminate Confidential Information at
any time during or after the Executive's employment with the
Company, except with the prior written consent of the Company or
as otherwise required by law or legal process.
(b) During the Noncompetition Period (as defined
below), the Executive shall not, without the prior written
consent of the Board, engage in or become associated with a
Competitive Activity. For purposes of this paragraph (b) of
Section 8: (i) the "Noncompetition Period" means three (3) years
from the date of Early Termination or Ordinary Retirement; (ii) a
"Competitive Activity" means any business or other endeavor that
engages in businesses similar to those conducted by the Company;
and (iii) the Executive shall be considered to have become
"associated with a Competitive Activity" if he becomes directly
or indirectly involved as an owner, employee, officer, director,
independent contractor, agent, partner, advisor, or in any other
capacity calling for the rendition of the Executive's personal
services, with any individual, partnership, corporation or other
organization that is engaged in a Competitive Activity. Not-
withstanding the foregoing, the Executive may make and retain
investments during the Employment Period in not more than five
percent of the equity of any entity engaged in a Competitive
Activity, if such equity is listed on a national securities ex-
change or regularly traded in an over-the-counter market.
9. SUCCESSORS. (a) This Agreement is personal to the
Executive and, without the prior written consent of the Company,
shall not be assignable by the Executive otherwise than by will
or the laws of descent and distribution. This Agreement shall
inure to the benefit of and be enforceable by the Executive's
legal representatives.
(b) This Agreement shall inure to the benefit of and
be binding upon the Company and its successors and assigns.
(c) The Company shall require any successor (whether
direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or
assets of the Company expressly to assume and agree to perform
this Agreement in the same manner and to the same extent that the
Company would have been required to perform it if no such
succession had taken place. As used in this Agreement, "Company"
shall mean both the Company as defined above and any such
successor that assumes and agrees to perform this Agreement, by
operation of law or otherwise.
10. MISCELLANEOUS. (a) This Agreement shall be governed
by, and construed in accordance with, the laws of the State of
Arizona, without reference to principles of conflict of laws.
The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not
be amended or modified except by a written agreement executed by
the parties hereto or their respective successors and legal
representatives.
(b) All notices and other communications under this
Agreement shall be in writing and shall be given by hand delivery
to the other party or by registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
IF TO THE EXECUTIVE:
Xxxxxx X. Xxxxxxxx
2410 Viad Tower
0000 X. Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
IF TO THE COMPANY:
Viad Corp
2212 Viad Tower
0000 X. Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: General Counsel
or to such other address as either party furnishes to the other
in writing in accordance with this paragraph (b) of Section 11.
Notices and communications shall be effective when actually
received by the addressee.
(c) The invalidity or unenforceability of any pro-
vision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement. If any
provision of this Agreement shall be held invalid or un-
enforceable in part, the remaining portion of such provision,
together with all other provisions of this Agreement, shall
remain valid and enforceable and continue in full force and
effect to the fullest extent consistent with law.
(d) Notwithstanding any other provision of this
Agreement, the Company may withhold from amounts payable under
this Agreement all federal, state, local and foreign taxes that
are required to be withheld by applicable laws or regulations.
(e) The Executive's or the Company's failure to insist
upon strict compliance with any provision of, or to assert any
right under, this Agreement (including, without limitation, the
right of the Executive to terminate employment for Good Reason
pursuant to paragraph (c) of Section 4 of this Agreement) shall
not be deemed to be a waiver of such provision or right or of any
other provision of or right under this Agreement.
(f) The Executive and the Company acknowledge that
this Agreement supersedes any other agreement between them
concerning the subject matter hereof.
(g) This Agreement may be executed in several
counterparts, each of which shall be deemed an original, and
said counterparts shall constitute but one and the same
instrument.
IN WITNESS WHEREOF, the Executive has hereunto set the
Executive's hand and, pursuant to the authorization of its Board
of Directors, the Company has caused this Agreement to be
executed in its name on its behalf, all as of the day and year
first above written
/s/ Xxxxxx X. Xxxxxxxx
VIAD CORP
By: /s/ Xxxxx X. Xxxxx
Vice President &
General Counsel
