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EXHIBIT 10.10
LETTER AGREEMENT WITH XXXXXX X. XXXXXXX
January 29, 1996
Dear Xxx:
This letter will confirm our offer to you to join Xxxxx & Co., Inc. (The
"Company") as its President, Chief Executive Officer and Vice Chairman of the
Board of Directors and will set forth the terms and conditions of your
employment. As agreed, you have commenced employment on January 3, 1996.
1. Position and Duties. As President and Chief Executive Officer, you will
have the duties, authority and responsibilities normally associated with and
appropriate for such positions, and will report directly to the Board of
Directors of the Company. In addition, while you are employed hereunder, we will
make our best efforts to insure your retention as a member of the Board of
Directors of the Company, and you agree to serve as an officer and director of
such additional subsidiaries or affiliated companies of the Company as the
Company deems reasonably appropriate.
2. Base Salary. Your base salary ("Base Salary") will be payable at a rate of
$400,000 per year and will be subject to review and upward adjustment in the
Board of Directors' discretion during your employment hereunder. You Base Salary
will be paid in accordance with the Company's payroll policies applicable to its
senior executives.
3. Bonus Plan. You will be eligible to receive an annual incentive
compensation award (the "Bonus") pursuant to the Company incentive compensation
program (the "Bonus Plan") during the term of your employment hereunder. For
1996, you will receive a bonus of not less than $150,000, of which $75,000 shall
be payable upon your joining the Company with the remainder payable six months
thereafter. Future bonuses shall be subject to the discretion of the Board of
Directors of the Company.
4. Benefit Plans and Arrangements.
(a) While you are employed hereunder, you will be entitled to participate,
in a manner appropriate to your position with the Company, in all benefit plans,
programs and arrangements generally applicable to the Company's senior
executives and the Company will provide to you at the Company's expense a car
and driver and such other fringe benefits and perquisites (including vacation
entitlement) as are generally available to the Company's senior executives.
(b) Upon your retirement from the Company, you will be entitled to receive
a pension in accordance with the terms of the Company's pension, retirement and
similar plans, programs and arrangements then generally applicable to senior
executives of the Company.
5. Restricted Stock. The Company will grant to you a special one-time
award of 40,000 Common shares (the "Shares"). In connection with such award, you
agree that (i) you or your legal representatives will pay to the Company, or
make arrangements satisfactory to the Company regarding payment of any federal,
state or local taxes of any kind required by law to be withheld with respect to
the Shares, and (ii) the Company will, to the extent permitted by law, have the
right to deduct from any payment of any kind otherwise due to you any federal,
state or local taxes of any kind required by law to be withheld with respect to
such Shares. You shall have absolute ownership of the Shares including the right
to vote the same and receive dividends thereon, subject, however, to the terms,
conditions and restrictions set forth below:
(a) In the event your employment with the Company shall terminate for any
reason excluding your death, Permanent Disability, termination of employment by
the Company without Cause or termination of
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employment by you for good Reason prior to the dates listed below, all of your
rights to the specified number of shares shall terminate.
PERIOD ENDING SHARES TO BE RETURNED
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January 3, 1999 ........................................... 40,000
January 3, 2000 ........................................... 26,667
January 3, 2001 ........................................... 13,333
On the 3rd, 4th and 5th anniversaries of January 3, 1996, the restrictions set
forth in this section shall lapse as to one-third of the Shares, provided you
are employed by the Company under this Agreement on the day preceding each
respective anniversary.
(b) If you, while in the employ of the Company, shall die, shall suffer a
Permanent Disability, or if your employment is terminated by you for Good Reason
or by the Company without Cause, then the restrictions set forth above shall
lapse.
(c) Shares subject to restrictions imposed by clause (a) hereof shall not
be sold, assigned, transferred, pledged, hypothecated, or otherwise disposed of
prior to the lapse of restrictions applicable to such Shares.
(d) You hereby represent, warrant, and covenant that you are acquiring the
Shares for your own account and not with a view to the distribution thereof, and
(ii) the Shares you acquired under this Agreement will not be sold except
pursuant to an effective registration statement under the Securities Act of
1933, as amended, or pursuant to an exemption from registration under said Act.
(e) Certificates evidencing the Shares delivered to you pursuant to this
Agreement or shares of company Stock subject to Section 5(g) hereof shall be
registered in your name, shall be deposited by you with the Company accompanied
by appropriate executed stock powers to the Company, and shall bear the legend
indicated below:
"The transferability of this certificate and the shares of stock
represented hereby are subject to the terms and conditions (including
forfeiture) contained in section 5 of the Letter Agreement dated January
29, 1996 between Xxxxx & Co., Inc. and Xxxxxx X. Xxxxxxx. A copy of such
Agreement is on file in the office of the Secretary of Xxxxx & Co., 000
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx."
Any attempt to dispose of the Shares in contravention of the terms, conditions
and restrictions described in this Agreement shall be ineffective.
(f) At the time the restrictions contained in this section lapse with
respect to any of the Shares, the Company shall deliver new certificates to you
with respect to such Shares bearing the following legend:
"These securities have not been registered under the Securities Act of
1933, as amended, and may not be offered, sold or delivered in the absence
of registration or an applicable exemption therefrom."
(g) In the event that there is any change in the capital structure of the
Company through reorganization, recapitalization or otherwise, or if there shall
be any dividend on the Shares payable in the Company's common stock, or if there
shall be a stock split or combination of shares, then any shares of the
Company's common stock issued pursuant thereto with respect to the shares shall
be subject to the restrictions in this section of this Agreement to the same
extent as the Shares with respect to which they were issued.
(h) The value of restricted stock shall not be included in the calculation
of any retirement-type benefits.
6. Termination.
(a) In the event your employment with the Company is terminated by you
without Good Reason, by the Company for Cause, or for any reason after the fifth
anniversary of the date hereof, you will receive, as soon as practicable
thereafter, a lump sum payment equal to the sum of (I) all Base Salary accrued
but unpaid through your date of termination and (ii) any amounts payable to you
under the terms of the Bonus Plan and this Agreement with respect to any
completed fiscal Year preceding your date of termination.
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(b) In the event your employment with the Company is terminated prior to
the fifth anniversary of the date hereof by you with Good Reason or by the
Company without Cause other than for death or Permanent Disability, you will
receive: (i) a lump sum payment equal to the sum of all amounts specified in
paragraph 6(a); (ii) a lump sum equal to the Bonus you received for the fiscal
year prior to your year of termination multiplied by a fraction, the numerator
of which is the number of days you were employed in the fiscal year in which
your employment terminated, and the denominator of which is 365; and (iii) 18
monthly payments, which shall commence in the month after your date of
termination, with each payment equal to one twelfth of your Base Salary, at the
annual rate in effect on your date of termination.
(c) In the event your employment with the Company is terminated due to your
death or Permanent Disability, you will receive a lump sum payment equal to the
sum of all amounts specified in paragraph 6(a).
(d) For purposes of this Agreement, the following definitions will apply:
"Cause" will mean (I) your conviction of a felony; (ii) and willful
misconduct by you which is materially injurious to the Company or its
affiliates or; (iii) your willful and continuing refusal or failure to
perform your duties and obligations under this Agreement.
"Good Reason" will mean (I) the refusal or failure of the Company to
pay you the compensation and/or benefits due under the Agreement; (ii) any
material diminution (without your consent) in your duties, authority,
responsibilities or reporting requirements (whether or not accompanied by a
change in title) or; (iii) the failure to continue your membership on the
Board of directors of the Company.
"Permanent Disability" will mean a physical or mental disability,
bodily injury or disease (including a disability resulting from an
occupational disease) which, in the opinion of a licensed physician
designated by the mutual consent of the Company and you, would prevent you
from performing regular duties for the Company from the date of occurrence
of such disability for a period of more than one year, which disability
occurred at any time prior to your termination of employment with the
Company.
7. No Mitigation. You will not be required to mitigate any payments due to you
under this Agreement by seeking alternative employment, nor will any payments by
the Company be reduced by any amounts received in connection with such
alternative employment.
8. Legal Fees. The Company will reimburse you for all reasonable legal fees
and disbursements incurred by you in connection with the negotiation and
preparation of this Agreement.
9. Confidentiality and Non-Competition. You will not, without the prior
consent of the Company, divulge confidential information concerning the
operations of the Company during your employment hereunder or at any time
thereafter. During your employment hereunder and for [2] years thereafter, you
shall not:
(a) disclose to any person information which, whether or not derived from
the company, would be beneficial to a competitor of the Company;
(b) make investments in the aggregate of more than one percent (1%) of the
capital of a competing business either in the form of stock purchase,
contribution to capital, loan or any other form or any combination of the
foregoing;
(c) render or give advice or assistance to a competing business whether as
a consultant or otherwise; and
(d) become an officer or director of a corporation or member of a
partnership or trustee of a trust which conducts, by itself or through one or
more subsidiaries, a competing business or become an employee of such
corporation, partnership, trust or business.
If any of the above shall occur, this Agreement shall be considered null
and void and the Company shall have no further obligations hereunder. The
foregoing non-competition provision shall apply to lines of business in which
the Company, including any of its subsidiaries, is engaged during the term of
your employment or at the time of termination of your employment, and shall not
apply to new lines of business engaged in by the Company or any of its
subsidiaries subsequent to the termination of your employment. Nothing shall
prevent you from applying to the Company for a written waiver of the foregoing
non-competition provisions with
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respect to the particular application of such provisions subsequent to the
termination of your employment, the granting of which request for waiver shall
not be unreasonably withheld.
10. Withholding. The Company will be entitled to withhold from any payment
hereunder the amount of withholding required by law.
11. Governing Law. This Agreement will be construed, interpreted, and governed
in accordance with the laws of the State of New York, without reference to rules
relating to conflicts of law.
12. Counterparts. This Agreement may be signed in counterparts.
Xxxxx & Co., Inc.
By:
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Accepted and Agreed on this
26 day of March, 1996
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Xxxxxx X. Xxxxxxx
