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MAXXIM MEDICAL, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
THE FOLLOWING CONSTITUTES THE EXECUTIVE EMPLOYMENT AGREEMENT ("AGREEMENT")
BETWEEN MAXXIM MEDICAL, INC. ("MAXXIM") AND XXXXXXX X. XXXX ("CEO"):
POSITIONS & TITLES: Vice Chairman, Chief Executive Officer and Member of
the Board of Directors (the "Board") of Maxxim.
REPORTING: CEO will report to the Chairman of the Board and the
Board of Directors of Maxxim. Maxxim's President,
Chief Financial Officer and other senior executive
officers will report to CEO.
START DATE: June 18, 2001.
TERM: 5 years.
ANNUAL CASH
COMPENSATION: Base salary of $700,000, plus bonus
earned as follows: (i) $400,000 for the
Company's annual business plan proposed by CEO
and as approved by the Board (the "Plan"), plus
(ii) $150,000 for making material progress in
respect of the annual Corporate Goals
established by the Board. CEO must be employed
by the Company and in good standing on the
date the Company's auditors approve the prior
fiscal year's financial statements to be
eligible for a bonus in respect of such prior
fiscal year.
EQUITY PACKAGE: MAXXIM SHARES AND OPTIONS with purchase and
strike price of $5.00 per share (split adjusted)
all as set forth below.
STOCK: 200,000 SHARES - CEO will
pay cash of $500,000 for 100,000 shares and
Maxxim will loan CEO $500,000 for 100,000
shares. The loan will be evidenced by CEO's
non-cash pay note that will (i) be a 9-year
balloon; (ii) bear interest at the lowest rate
allowable by the Internal Revenue Service which
avoids the imputation of interest income to CEO,
compounding annually, but with no interest
payments required until maturity or an earlier
acceleration; (iii) be prepayable out of and
accelerate to
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the extent of after tax proceeds from the
disposition of Maxxim shares and options;
(iv) become due and payable (accelerate)
upon termination of employment for any
reason; and (v) be secured by a pledge of
CEO's Company stock and options.
STOCK OPTIONS: 2,000,000 OPTIONS,
with an exercise price of $5.00 per share,
having a term of 10 years, to vest 20% on each
of the first five anniversaries of employment,
with acceleration upon a change in control.
Vesting ceases and the term of unvested options
lapse upon termination of employment for any
reason. Vested options may be exercised for 90
days following a termination of employment,
except upon a termination for cause.
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SEVERANCE: In the event of the termination of CEO's employment
by the Board other than for cause of disability, CEO
shall receive the lesser of (i) $500,000 to be paid
over 12 months if such termination occurs during the
initial 4 years of the term of this Agreement or (ii)
$41,667 each month for the remaining term of this
Agreement if such termination occurs during the last
year of the term of this Agreement. As a condition to
the receipt of such payments, CEO shall execute a
general release in favor of the Company. For purposes
of this Agreement, "cause" shall mean (i) that CEO is
charged with a felony or other crime involving moral
turpitude, (ii) CEO commits fraud, embezzlement or
other conduct adverse to the interests of the Company
of its affiliates, or (iii) CEO substantially fails
to perform his duties or obligations to the Company
as a director or officer.
AUTOMOBILE ALLOWANCE: CEO will receive an annual automobile allowance of
$15,000.
COMMUTING EXPENSES: Maxxim will reimburse CEO for all reasonable and
documented business-related commuting expenses incurred
in connection with CEO's performance of his duties and
obligations under this Agreement, including reasonable
apartment/hotel expenses, auto rental expenses, and air
transportation.
ADDITIONAL BENEFITS: CEO will participate in Maxxim's health and other
benefit plans and programs for senior executives and
be covered under Maxxim's D&O insurance and corporate
indemnification policies.
MISCELLANEOUS: This Agreement is to be governed by and construed in
accordance with the laws of the State of New York,
without reference to principles of conflict of laws.
Any dispute between Maxxim and CEO arising out of,
related to, or in connection with any relationship
between them, contractual or otherwise (including
without limitation those created by or in connection
with this Agreement), shall be subject to binding
confidential arbitration in New York, New York in
accordance with the rules of the Commercial Panel of
the American Arbitration Association (the "AAA" and
not in accordance with the Employment Dispute
Resolution Rules of the AAA). This agreement (i)
supersedes all other offers, agreements, promises,
and representations between Maxxim and CEO, and shall
only be binding on Maxxim and CEO if and when Maxxim
and CEO execute the Agreement below and (ii) may only
be amended by a writing executed by Maxxim and CEO.
For purposes of the prior two sentences, "Maxxim"
includes
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Maxxim Medical, Inc., its subsidiaries and related
entities; Fox Xxxxx & Company, LLC, its subsidiaries
and related entities including without limitation Fox
Xxxxx Capital, LLC, Fox Xxxxx Capital Fund, L.P., Fox
Xxxxx Capital Fund II GP, LLC, Fox Xxxxx Capital Fund
II, L.P., and all persons and entities that are
partners or shareholders or members in any such
related entities) and all partners, members,
directors, employees, shareholders and agents of any
of the foregoing. Maxxim and CEO agree to further
document the provisions of this Agreement as need be
and to enter into other agreements regarding (i)
protection of Maxxim's corporate trade secrets and
the like and (ii) CEO's post-Maxxim employment
non-competition and non-solicitation of Maxxim
employees and customers for a period of twelve (12)
months.
IN WITNESS WHEREOF, the parties executed this agreement as of June 13, 2001.
MAXXIM MEDICAL, INC.
BY: /s/ Xxxx X. Xxx
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XXXX X. XXX
CHAIRMAN OF THE BOARD OF DIRECTORS
/s/ Xxxxxxx X. Xxxx
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XXXXXXX X. XXXX
Address: 0 Xxxxxxxxx Xxx
Xxxxxxx, XX 00000
