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EMPLOYMENT AGREEMENT
By and Between
AUDIO VISUAL SERVICES CORPORATION
and
XXXX X. XXXXXX
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As of August 29, 2000
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement"), dated as of August 29, 2000, by
and between AUDIO VISUAL SERVICES CORPORATION, a Delaware corporation having an
office at 000 Xxxx Xxxxx Xxxxxxxxx, Xxxxx 0000, Xxxx Xxxxx, Xxxxxxxxxx 00000
("Employer"), and XXXX X. XXXXXX, an individual residing at 00 Xxxxxx Xxxx,
Xxxx, Xxxxxxxxxxx 00000 ("Employee").
W I T N E S S E T H:
WHEREAS, Employee is currently employed in the Presentation Services ("PS")
division of the Employer's wholly-owned subsidiary known as Audio Visual
Services Group, Inc. ("AVSG");
WHEREAS, Employer desires to continue to retain Employee as an employee and
Employee desires to continue to provide his services to Employer in connection
with Employer's business; and
WHEREAS, both parties desire to clarify and specify the rights and
obligations which each have with respect to the other in connection with
Employee's employment.
NOW, THEREFORE, in consideration of the agreements and covenants herein set
forth, the parties hereby agree as follows:
1. EMPLOYMENT
Employer hereby employs Employee as Chief Executive Officer of the PS
division of AVSG and as an Executive Vice President of Employer, and Employee
hereby accepts such employment and agrees to render his services as an employee
of Employer and AVSG, all subject to and on the terms and conditions herein set
forth.
2. DUTIES AND RESPONSIBILITIES OF EMPLOYEE
Employee shall be employed as and perform the duties of Chief Executive
Officer of the PS division of AVSG and as Executive Vice President of Employer,
subject to the other provisions of this Section 2. In the performance of his
duties, Employee shall report to Employer's Chief Executive Officer or such
other person as may be designated by the Board of Directors of Employer.
Employee shall use his best efforts to maintain and enhance the business and
reputation of Employer and PS. Employee's duties and responsibilities shall be
designated to Employee by the Chief Executive Officer of Employer and the Board
of Directors of Employer. Upon Employer's request, Employee shall also perform
similar services in an identical capacity for (and, if requested, shall hold
directorships with) any subsidiary or division of Employer designated by the
Board. Employee shall be available to travel as the reasonable needs of
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Employer shall require. Employee shall be based in Employer's offices located in
the Chicago, Illinois metropolitan area.
3. EXCLUSIVITY OF SERVICE
Employee agrees to devote all of his business time, efforts and attention
to the business and affairs of Employer on an exclusive basis, and not to engage
in any other business activities for any person or entity, other than personal
investment activities and, subject to Employer's prior written approval,
directorships, provided that such activities do not materially affect the
performance of Employee's duties hereunder.
4. COMPENSATION; BONUS
(a) In consideration for his services to be performed under this Agreement
and as compensation therefor, Employee shall receive, in addition to all other
benefits provided in this Agreement, a base salary (the "Base Salary") at the
annual rate of two hundred sixty-two thousand dollars ($262,000). All payments
of Base Salary shall be payable bi-weekly in arrears or otherwise in accordance
with Employer's policies.
(b) In addition to the Base Salary, Employee shall be eligible to receive a
bonus (the "Bonus") on an annual basis. The Bonus shall be determined pursuant
to an executive bonus plan to be formulated by Employer in consultation with
Employee. Employee's "target" level Bonus will be forty percent (40%) of his
then-current Base Salary; provided, however, that the Bonus paid to Employee may
be greater or less than the "target" based on Employee's and Employer's
performance during the fiscal year in respect of which the Bonus is being paid
and subject to the above-referenced executive bonus plan. Payment of the Bonus
shall be made in the discretion of the Board of Directors of Employer subject to
the above-referenced executive bonus plan and is not guaranteed. To the extent
payable, Employer shall pay the Bonus to Employee on or about 90 days following
the end of the fiscal year in respect of which the Bonus is being paid.
(c) Employee's Base Salary and Bonus shall be reviewed annually by the
Board and increased in the discretion of the Board of Directors of Employer.
5. BENEFITS
In addition to the Base Salary and Bonus provided for in Section 4 hereof,
Employee shall be entitled to the following benefits during and in respect of
his employment by Employer:
(a) Employee will be entitled to participate in Employer's hospitalization,
medical, dental and vision insurance plans, as well as long-term and short-term
disability and life insurance plans, on the same basis as other senior executive
employees of Employer in accordance with Employer's practices and subject, in
each case, to the terms and conditions of such plans, which shall govern
Employee's participation therein. Employee will be entitled to family medical
and dental insurance coverage at the rate charged therefor by Employer and
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subject to the terms and conditions set forth by Employer. Employee will also be
entitled to participate in any of Employer's plans relating to vacation, sick
leave, personal days, stock options, stock purchases, pension, thrift, profit
sharing, education or other retirement or benefit plan that Employer has adopted
or may adopt for the benefit of its executive officers, officers and/or
employees subject, in each case, to the terms and conditions of such plans,
which shall govern Employee's participation therein.
(b) Employee shall be entitled to twenty-five (25) working days paid
vacation to be taken by Employee at times mutually and reasonably agreed upon by
Employer and Employee in addition to all other holidays established as part of
Employer's standard practices. No payment shall be made to Employee for unused
vacation days nor may such days be carried over to future years without
Employer's consent.
(c) Employee shall be entitled to reimbursement for all reasonable
travel, entertainment and other reasonable expenses incurred in connection with
Employer's business, provided that such expenses are adequately documented and
vouchered in accordance with Employer's policies.
(d) Employee shall be provided with an automobile in accordance with
Employer's policies. Employer will pay all costs incurred by Employee in
connection with Employee's normal use of his automobile (except for those which
Employee is entitled to reimbursement pursuant to Section 5(c) hereof).
(e) Employee will be entitled to reimbursement for weekly roundtrip
airfare between Hartford, Connecticut and Chicago, Illinois in accordance with,
and subject to, Employer's policies.
6. AT-WILL STATUS
Notwithstanding anything to the contrary contained herein and, subject
to Employer's obligations contained herein, Employee shall be employed by the
Company as an "employee at-will" and that as such, Employee's employment with
Employer may be terminated at any time for any reason or no reason whatsoever.
7. CONFIDENTIALITY; INVENTIONS; PRODUCT DEVELOPMENT, ETC.
(a) Employee agrees and covenants that, at any time during employment
by Employer (which, for purposes of Sections 7 and 8 hereof shall include
Employer's subsidiaries and affiliates) or thereafter, he will not (without
first obtaining the written permission of Employer) (i) at any time during
employment by Employer and thereafter divulge to any person or entity, nor use
(either himself or in connection with any business) any "Confidential
Information" (as hereinafter defined in Section 7(c) hereof) and (ii) at any
time during employment by Employer and thereafter, divulge to any person or
entity, nor use (either himself or in connection with any
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business) any "Trade Secrets" (as hereinafter defined in Section 7(c) hereof) to
which he may have had access or which had been revealed to him during the course
of his employment unless such disclosure is pursuant to a court order,
disclosure in litigation involving the Employer or in any reports or
applications required by law to be filed with any governmental agency.
(b) Employee hereby grants to Employer or its nominee all rights of
every kind whatsoever, exclusively and perpetually, in and to all services
performed, products created and product ideas conceived by Employee for Employer
or its nominee, and hereby agrees, upon Employer's request therefor, to assign
and transfer to Employer or its nominee, any and all inventions, Trade Secrets,
product ideas, improvements, processes, Confidential Information and "know how"
relating to the business or products of Employer or any subsidiary or division
thereof, including any thereof which Employee may learn, possess or acquire
during Employee's employment by Employer, and agrees that all such things and
such knowledge are, and will be, the sole and exclusive property of Employer or
its nominee, and are known or held by Employee only for the benefit of Employer
or its nominee.
(c) As used in this Agreement, the term "Confidential Information"
shall mean and include all information and data in respect of Employer's
operations, financial condition, products, customers and business (including,
without limitation, artwork, photographs, specifications, facsimiles, samples,
business, marketing or promotional plans, creative written material and
information relating to characters, concepts, names, trademarks and copyrights)
which may be communicated to Employee or to which Employee may have access in
the course of Employee's employment by Employer. Notwithstanding the foregoing,
the term "Confidential Information" shall not include information which:
(i) is, at the time of the disclosure, a part of the public domain through
no act or omission by Employee;
(ii) was otherwise in Employee's lawful possession prior to the disclosure;
or
(iii) is hereafter lawfully disclosed to Employee by a third party who or
which did not acquire the information under an obligation of
confidentiality to or through Employer.
As used in this Agreement, the term "Trade Secrets" shall mean and include
information, without regard to form, including, but not limited to, technical or
non-technical data, a formula, a pattern, a compilation, a program, a device, a
method, a technique, a drawing, a process, financial data, financial plans,
product plans, or a list of actual or potential customers or suppliers which is
not commonly known by or available to the public and which information (i)
derives economic value, actual or potential, from not being known to, and not
being readily ascertainable by proper means by, other persons who can obtain
economic value from its disclosure or use; and (ii) is the subject of efforts
that are reasonable under the circumstances to maintain its secrecy.
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Any combination of known information shall be within any of the foregoing
exclusions only if the combination as such is within such exclusions.
Nothing in this Section 7 shall limit any protection, definition or remedy
provided to Employer under any law, statute or legal principle relating to
Confidential Information or Trade Secrets.
(d) Employee agrees that at the time of leaving the employ of Employer he
will deliver to Employer and not keep or deliver to anyone else any and all
notes, notebooks, drawings, memoranda, documents, and in general, any and all
material relating to the business of Employer (except Employee's personal files
and records) or relating to any employee, officer, director, agent or
representative of Employer.
8. NON-COMPETITION; NON-SOLICITATION
(a) Employee hereby agrees and covenants that commencing as of the date
hereof and for a period of one (1) year following the termination of his
employment with Employer (the "Limited Period") he will not directly or
indirectly engage in or become interested (whether as an owner, principal,
agent, stockholder, member, partner, trustee, venturer, lender or other
investor, director, officer, employee, consultant or through the agency of any
corporation, limited liability company, partnership, association or agent or
otherwise) in any business or enterprise that shall, at the time, be in whole or
in substantial part competitive with any material part of the business conducted
by Employer during the period of Employee's employment with Employer (except
that ownership of not more than 1% of the outstanding securities of any class of
any entity that are listed on a national securities exchange or traded in the
over-the-counter market shall not be considered a breach of this Section 8(a)).
(b) Employee agrees and covenants that for the Limited Period he will not
(without first obtaining the written permission of Employer) directly or
indirectly participate in the solicitation of any business of any type conducted
by Employer during the period of Employee's employment with Employer from any
person or entity which was a client or customer of Employer during the period of
Employee's employment with Employer, or was a prospective customer of Employer
from which Employee (or employees under Employee's supervision) solicited
business or for which a proposal for submission was prepared during the period
of Employee's employment with Employer.
(c) Employee agrees and covenants that for the Limited Period he will not
(without first obtaining the written permission of Employer) directly or
indirectly, recruit for employment, or induce or seek to cause such person to
terminate his or his employment with Employer, any person who then is an
employee of Employer.
9. TERMINATION
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(a) CAUSE. In the event that Employer discharges Employee and terminates
this Agreement because (i) Employee shall continually fail substantially to
perform his duties hereunder with reasonable diligence, other than by reason of
incapacity, or shall violate any material covenant of his herein contained, (ii)
Employee shall engage in an act of fraud, theft or embezzlement in connection
with his employment hereunder, (iii) Employee shall engage in a material act or
omission involving wilful misconduct or gross negligence in the performance of
Employee's duties, (iv) Employee shall engage in a material act of dishonesty,
(v) Employee shall unreasonably refuse to carry out the lawful order of Employer
commensurate with Employee's duties to be performed hereunder or (vi) Employee
shall be convicted of a felony involving moral turpitude, (which shall include
any felony relating to drugs) or shall plead nolo contendere (or make an
equivalent plea) in respect of, any governmental indictment, complaint or other
formal allegation, Employee's Base Salary and Bonus under Section 4 hereof and
all benefits under Section 5 hereof shall terminate immediately upon such
discharge (subject to applicable law such as COBRA), and Employer shall have no
further obligation to Employee except the payment to and reimbursement to
Employee for any monies due to Employee which right to payment or reimbursement
accrued prior to such discharge.
(b) DEATH. This Agreement shall terminate immediately upon the death of
Employee, in which case Employee's legal representatives shall be entitled to
receive promptly a payment equal to four (4) months Base Salary.
(c) Termination Without Cause; Good Reason. Notwithstanding Section 6 of
this Agreement, if Employee is discharged and this Agreement is terminated
without Cause (Cause being defined as a reason for termination as set forth in
Section 9(a) above) or by reason other than as set forth in Section 9(b) hereof,
or if Employee resigns for Good Reason (as hereinafter defined), Employer shall
pay to Employee (i) for a period of 12 months, the Base Salary (as determined by
the Base Salary being paid to Employee at the time of such termination or
resignation, as the case may be) as such sums become due (or, at Employer's
election, in a lump sum giving effect to the present value of such payments);
and (ii) the Bonus to which Employee may be entitled in respect only of the
fiscal year of Employer in which such termination or resignation (as the case
may be) occurs (prorated by reference to the number of days actually worked by
Employee in such fiscal year). For purposes of this Agreement, "Good Reason"
shall mean (i) a relocation of Employee, without his prior written consent, more
than fifty (50) miles outside of Employer's offices in Arlington Heights,
Illinois, or (ii) a failure to maintain Employee as an Executive Vice President
of Employer and Chief Executive Officer of PS, or (iii) a material diminution by
Employer of Employee's responsibilities, which change would cause Employee's
position with Employer to become one of significantly less responsibility or
scope from that contemplated by Section 2 hereof, or (iv) a wilful failure in
bad faith to pay the Base Salary or Bonus to Employee when due or another
material breach of this Agreement by Employer that has a material adverse effect
on Employee.
10. VIOLATION OF OTHER AGREEMENTS
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Employee represents and warrants to Employer that he is legally able to
enter into this Agreement and accept employment with Employer; that Employee is
not prohibited by the terms of any agreement, understanding or policy from
entering into this Agreement; and the terms hereof will not and do not violate
or contravene the terms of any agreement, understanding or policy to which
Employee is or may be a party, or by which Employee may be bound. Employee
agrees that, as it is a material inducement to Employer that Employee make the
foregoing representations and warranties and that they be true in all respects,
Employee shall forever indemnify and hold Employer harmless from and against all
liability, costs or expenses (including attorney's fees and disbursements) on
account of the foregoing representations being untrue.
11. SPECIFIC PERFORMANCE; DAMAGES
In the event of a breach or threatened breach of the provisions of Sections
7 or 8 hereof, Employee agrees that the injury which would be suffered by
Employer would be of a character which could not be fully compensated for solely
by a recovery of monetary damages. Accordingly, Employee agrees that in the
event of a breach or threatened breach of Section 7 or 8 hereof, in addition to
and not in lieu of any damages sustained by Employer and any other remedies
which Employer may pursue hereunder or under any applicable law, Employer shall
have the right to equitable relief, including issuance of a temporary or
permanent injunction, by any court of competent jurisdiction against the
commission or continuance of any such breach or threatened breach, without the
necessity of proving any actual damages or posting of any bond or other surety
therefor. In addition to, and not in limitation of the foregoing, Employee
understands and confirms that, in the event of a breach or threatened breach of
Section 7 or 8 hereof, Employee may be held financially liable to Employer for
any loss suffered by Employer as a result.
12. NOTICES
Any and all notices, demands or requests required or permitted to be given
under this Agreement shall be given in writing and sent, by registered or
certified U.S. mail, return receipt requested, by hand, or by overnight courier,
addressed to the parties hereto at their addresses set forth above or such other
addresses as they may from time-to-time designate by written notice or, in the
case of Employee, which Employer maintains as Employee's address, given in
accordance with the terms of this Section. Notice given as provided in this
Section shall be deemed effective: (i) on the date hand delivered, (ii) on the
first business day following the sending thereof by overnight courier, and (iii)
on the seventh calendar day (or, if it is not a business day, then the next
succeeding business day thereafter) after the depositing thereof into the
exclusive custody of the U.S. Postal Service.
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13. WAIVERS
No waiver by any party of any default with respect to any provision,
condition or requirement hereof shall be deemed to be a waiver of any other
provision, condition or requirement hereof; nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.
14. PRESERVATION OF INTENT
Should any provision of this Agreement be determined by a court having
jurisdiction in the premises to be illegal or in conflict with any laws of any
state or jurisdiction or otherwise unenforceable, Employer and Employee agree
that such provision shall be modified to the extent legally possible so that the
intent of this Agreement may be legally carried out.
15. ENTIRE AGREEMENT
This Agreement sets forth the entire and only agreement or understanding
between the parties relating to the subject matter hereof and supersedes and
cancels all previous agreements, negotiations, letters of intent,
correspondence, commitments and representations in respect thereof among them
(including, without limitation, (i) the letter, dated April 29, 1999, from
Xxxxxxxxxxx X. Xxxxxxxx to Employee regarding the terms and conditions of your
employment and (ii) the letter, dated August 19, 1999, from Xxxxxxx X. Xxxx of
Employer to Employee regarding certain payments to be made to Employee in the
event of a change of control of Employer or PS), and no party shall be bound by
any conditions, definitions, warranties or representations with respect to the
subject matter of this Agreement except as provided in this Agreement.
16. INUREMENT; ASSIGNMENT
The rights and obligations of Employer under this Agreement shall inure to
the benefit of and shall be binding upon any successor of Employer or to the
business of Employer, subject to the provisions hereof. Employer may assign this
Agreement to any person, firm or corporation controlling, controlled by, or
under common control with Employer. Neither this Agreement nor any rights or
obligations of Employee hereunder shall be transferable or assignable by
Employee.
17. AMENDMENT
This Agreement may not be amended in any respect except by an instrument in
writing signed by the parties hereto.
18. HEADINGS
The headings in this Agreement are solely for convenience of reference and
shall be given no effect in the construction or interpretation of this
Agreement.
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19. COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original, but all of which when taken together shall
constitute one and the same instrument.
20. GOVERNING LAW
This Agreement shall be governed by, construed and enforced in accordance
with the internal laws of the State of California, without giving reference to
principles of conflict of laws.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
EMPLOYEE:
By: /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
Employer:
AUDIO VISUAL SERVICES
CORPORATION
By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
Chief Executive Officer
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