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EXHIBIT 10.13
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") by and between Bristol
Hotel Company, a Delaware corporation (the "Company"), and Xxxx X. Xxxxxxx (the
"Executive") is entered into on April ___, 1997 but effective as of the
effective time of the merger (the "Merger") contemplated under that certain
Agreement and Plan of Merger dated as of December 15, 1996 among Holiday
Corporation, Holiday Inns, Inc. and the Company (the "Commencement Date").
In consideration of the promises and mutual covenants herein contained,
the parties hereto agree as follows:
1. Employment. The Company will continue to employ the Executive,
and the Executive hereby accepts such continued employment, on the terms and
conditions set forth herein.
2. Term. The term of this Agreement (the "Term") will commence as
of the Commencement Date and, subject to Section 9, will expire on the day
before the fourth anniversary of the Commencement Date; provided, however, that
commencing on the fourth anniversary of the Commencement Date and each
anniversary thereafter the Term will automatically be extended for successive
one-year periods unless either party gives written notice to the other, not
less than 90 calendar days prior to the otherwise scheduled expiration of the
Term, that it or he does not want the Term to so extend.
3. Title, Duties, Responsibilities and Authority of the Executive.
During the Term, and in accordance with the Company's Bylaws, the Executive
will be the Chief Operating Officer and Executive Vice President of the Company
and will have such duties and responsibilities as may from time to time be
assigned to him by the Board of Directors of the Company (the "Board")
consistent with such position. In addition, during the Term, the Executive
will have the authority to recruit, hire or terminate any employee of the
Company, and no other employee of the Company shall have such authority other
than Xxxx X. Xxxxxxx while the Executive and Xx. Xxxxxxx are both employees of
the Company. Subject to Section 9, the Board may not reduce the Executive's
title or the scope of the Executive's duties, responsibilities or authority at
any time during the Term. The Executive also will serve, without additional
compensation, as an officer or director, or both, of any subsidiary or
affiliate of the Company or any other entity in which the Company has an equity
interest if elected to any such position in accordance with the constituent
documents of and laws applicable to such entity, provided, however, that the
Company will indemnify the Executive
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from liabilities in connection with serving in any such capacity to the same
extent as the Executive is indemnified in the performance of his duties with
the Company. The Executive will devote substantially all of his time during
normal business hours and his best efforts, full attention and energies to the
business and affairs of the Company (excluding reasonable amounts of time
devoted to charitable purposes, passive investments and directorships and
periods in which he is physically or mentally ill, injured or otherwise
disabled).
4. Cash Compensation. (a) Salary. The Executive's base salary will
be $450,000 per year during the Term, payable monthly or otherwise as in effect
for other executive officers of the Company from time to time. As of January 1
of each calendar year during the Term, such base salary will be reviewed and
may be increased (but not decreased), as determined by the Compensation
Committee of the Board (the "Compensation Committee") in its sole discretion.
(b) Bonus. For each fiscal year of the Company during the
Term, the Executive will be eligible to receive an annual performance bonus in
an amount not less than 50% of the Executive's base salary in effect on the
last day of such year. The actual amount of such bonus, if any, will be
determined based upon the Executive's achievement of performance objectives
established by the Compensation Committee pursuant to this Agreement or
pursuant to any bonus plan in effect for other executive officers of the
Company from time to time. Such bonus, if any, will be payable in cash at such
time as bonuses are payable to other executive officers of the Company.
(c) Special Merger Payment. As of the Commencement Date, the
Executive will receive a one-time special payment in connection with the
Merger. The amount of such payment will equal the amount of additional base
salary that the Executive would have received during the calendar year
including the Commencement Date if the base salary specified in Section 4(a)
had become effective on January 1 of such year. Such payment will be paid in
cash as soon as practicable following the Commencement Date.
5. Options. The Company has previously granted the Executive non-
qualified options to purchase shares of Common Stock of the Company pursuant to
the Company's 1995 Equity Incentive Plan (the "Equity Incentive Plan"). The
Executive will not be eligible to participate in any awards of options that are
made under the Equity Incentive Plan in connection with the Merger, but will be
eligible to participate in any subsequent awards of options or other equity
rights that are made under the Equity Incentive Plan during the Term, at such
levels and on such terms as may be determined by the Compensation Committee.
6. Benefits. (a) Participation in Plans. During the Term, the
Executive will be entitled to participate in all
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retirement and welfare plans and programs of the Company in which executive
officers of the Company participate. The Executive's rights under such plans
and programs will be governed by the terms thereof and will not be enlarged
hereunder or otherwise affected hereby.
(b) Amendment or Termination. The Executive acknowledges that
the Company, in its sole discretion, may amend or terminate any such plan at
any time.
7. Expenses. The Company will pay or reimburse the Executive for
reasonable and necessary expenses incurred by the Executive in connection with
his duties on behalf of the Company in accordance with the general policies of
the Company in effect from time to time for other executive officers of the
Company.
8. Place of Performance. During the Term, the principal executive
offices of the Company will be located in Dallas, Texas, and the Executive will
be based at such offices except for travel required for Company business.
9. Termination. (a) Termination of Employment. The Executive's
employment hereunder may be terminated by the Company for any reason, or
without reason, by written notice as provided in Section 14. Subject to the
following provisions of this Section 9 and any benefit continuation
requirements of applicable law, in the event that the Executive's employment
hereunder is terminated during the Term by the Company or the Executive, the
compensation and benefit obligations of the Company under this Agreement will
cease as of the effective date of such termination, except (i) for any
compensation and benefits earned or accrued but unpaid through such date and
(ii) as otherwise provided in this Section 9.
(b) Termination by the Company Without Cause. If the
Executive's employment hereunder is terminated during the Term by the Company
other than for Cause or as a result of the Executive's death or Disability, the
Company will pay the amount and make available the benefits specified below:
(i) Cash Payment. The Executive will receive two times
the average of his total cash compensation for the preceding two
calendar years. Such payment will be made in a single lump sum within
15 calendar days after the effective date of the Executive's termination
of employment with the Company (the "Termination Date").
(ii) Welfare Benefits. During the two-year period
beginning on the Termination Date (the "Two-Year Severance Period"), the
Company will continue to provide the Executive with any welfare benefits
that he was receiving from the Company immediately prior to the
Termination Date ("Welfare Benefits"). Such Welfare Benefits will be
provided to the Executive on the same terms and conditions
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(including employee contributions toward the cost of benefits or
coverage) under which the Executive was entitled to participate
immediately prior to the Termination Date. Such Welfare Benefits may be
modified or terminated at any time by the Company following the
Termination Date, provided that such change is applicable to senior
executives of the Company generally. Notwithstanding the foregoing, the
Company's obligation to provide Welfare Benefits pursuant to this
Section 9(b)(ii) will terminate when the Executive commences any other
employment with any third party during the Two-Year Severance Period.
(iii) Options and Other Equity Rights. On the
Termination Date, all options and other equity rights granted to the
Executive pursuant to Section 5 hereof which have not vested or become
exercisable, as applicable, will vest and become exercisable.
(c) Termination for Cause. If the Executive's employment
hereunder is terminated during the Term by the Company for Cause, the Executive
will be entitled to no salary or Welfare Benefits (other than as required by
law) which might otherwise accrue after the Termination Date.
(d) Release. Acceptance by the Executive of any amounts
pursuant to this Section 9 will constitute a full and complete release by the
Executive of any and all claims the Executive has or may have against the
Company, its officers, directors and affiliates, including without limitation
claims he might have relating to the Executive's cessation of employment with
the Company; provided, however, that there will be excluded from the scope of
such release claims that the Executive has or may have against the Company for
reimbursement of ordinary and necessary business expenses incurred by him
during his course of employment consistent with this Agreement.
(e) Internal Revenue Code Limitations. Notwithstanding
anything contained in this Agreement to the contrary, if the "present value"
(as determined under Section 280G of the Internal Revenue Code of 1986, as
amended (the "Code"), or any successor provision thereto) of amounts and
benefits otherwise payable to the Executive pursuant to this Agreement, when
added to the "present value" (as determined under Section 280G of the Code or
any successor provision thereto) of any other "parachute payments" (as that
term is defined in section 280G of the Code or any successor provision thereto)
from the Company, would exceed an amount (the "299% Amount") equal to 299% of
the Executive's "base amount" (as that term is defined in Section 280G of the
Code (without regard to Section 280G(b)(2)(A)(ii) thereof) or any successor
provision thereto), the amounts and benefits payable under this Agreement will
be reduced to the minimum extent necessary so that the aggregate present value
determined in the previous clause does not exceed the 299% Amount; provided,
however, that the foregoing reduction
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will be made only if and to the extent that such reduction would result in an
increase in the aggregate amounts and benefits to be provided, determined on an
after-tax basis (taking into account the excise tax imposed pursuant to Section
4999 of the Code, or any successor provision thereto, any tax imposed by any
comparable provision of state law, and any applicable federal, state and local
income taxes). The determination of whether any reduction in the amounts or
benefits payable under this Agreement or otherwise is required pursuant to the
preceding sentence will be made, if requested by the Executive or the Company,
by such tax counsel as may be selected by the Company's independent accountants
and reasonably acceptable to the Executive. The fact that the Executive has
his right to payments under this Agreement reduced as a result of the existence
of the limitations contained in this Section 9(e) will not of itself limit or
otherwise affect any rights of the Executive arising other than pursuant to
this Agreement.
(f) Definition of "Cause". For purposes of this Agreement,
the term "Cause" means:
(i) the willful and continued failure by the Executive
substantially to perform his duties hereunder (other than any such
failure resulting from the Executive's incapacity due to physical or
mental illness), after written notice requesting substantial performance
is delivered to the Executive by the Board, which notice identifies in
reasonable detail the manner in which the Board believes the Executive
has not substantially performed his duties;
(ii) an act of fraud, embezzlement or theft in connection
with his duties or in the course of his employment with the Company; or
(iii) a material breach of Section 10.
(g) Definition of "Disability". For the purposes of this
Agreement, the term "Disability" means the Executive's incapacity due to
physical or mental illness substantially to perform his duties on a full-time
basis for six consecutive months and within 30 calendar days after a notice of
termination is thereafter given by the Company the Executive shall not have
returned to the full-time performance of the Executive's duties.
10. Confidentiality and No Hire Agreement. (a) Confidentiality. The
Executive acknowledges that, in the course of his employment by the Company, he
has access to and has become aware of and informed of, and will continue to
have access to and become aware of and informed of, confidential and/or
proprietary information which is a competitive asset of the Company, including
without limitation (i) the terms of any agreements between the Company and
third parties, (ii) marketing strategies and marketing methods, (iii)
development ideas and strategies, (iv) personnel training and development
programs, (v) financial
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results, (vi) strategic plans and demographic analyses, (vii) proprietary
computer and systems software, and (viii) any non-public information concerning
the Company, its employees, suppliers or customers (collectively, "Confidential
Information"). The Executive will keep all Confidential Information in strict
confidence during the Term and thereafter and will never directly or indirectly
make known, divulge, reveal, furnish, make available or use any Confidential
Information (except in the course of his regular authorized duties on behalf of
the Company). The Executive's obligations of confidentiality hereunder will
survive termination of his employment at the Company regardless of any actual
or alleged breach by the Company of this Agreement, until and unless any such
Confidential Information becomes, through no fault of the Executive, generally
known to the public or the Executive is required by law to make disclosure
(after giving the Company notice and an opportunity to contest such
requirement). The Executive's obligations under this Section 10 are in
addition to, and not in limitation or preemption of, all other obligations of
confidentiality which the Executive may have to the Company under general legal
or equitable principles.
(b) No Hire Agreement. For a period of two years from the
Termination Date, the Executive will not directly or indirectly induce or
attempt to induce any employee of the Company to leave the employment of the
Company or to accept any other employment or position unless (in each case
prior to such inducement or attempted inducement) such employee has been
terminated as an employee of the Company by the Company.
(c) Specific Performance. The Executive acknowledges that a
violation of any of the provisions of this Section 10 could cause irreparable
harm to the Company, and that the Company's remedy at law for any such
violation could be inadequate. Accordingly, in addition to any other relief
afforded by law or this Agreement, including damages sustained by a breach of
this Agreement, and without any necessity or proof of actual damages, the
Company will have the right to enforce this Agreement by specific remedies,
which will include, among other things, temporary and permanent injunctions, it
being the understanding of the parties hereto that damages, the forfeitures
described above and injunctions are proper modes of relief and are not to be
considered as alternative remedies.
11. Entire Agreement. This Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto with respect
to the subject matter hereof and contains all of the covenants and agreements
between the parties with respect to such subject matter. Each party to this
Agreement acknowledges that, except as aforesaid, no representations,
inducements, promises or other agreements, orally or otherwise, have been made
by any party, or anyone acting on behalf of any party, pertaining to the
subject matter hereof, which are not embodied herein, and that no other
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agreement, statement, or promise pertaining to the subject matter hereof that
is not contained in this Agreement will be valid or binding on either party.
12. Withholding of Taxes. The Company may withhold from any amounts
payable under this Agreement all federal, state or other taxes as the Company
is required to withhold pursuant to any law or government regulation or ruling.
13. Successors and Binding Agreement. This Agreement will be binding
upon and inure to the benefit of and be enforceable by (i) the Company and any
successor to the Company, including without limitation any persons acquiring
directly or indirectly all or substantially all of the business or assets of
the Company whether by purchase, merger, consolidation, reorganization or
otherwise (and such successor will thereafter be deemed the "Company" for the
purposes of this Agreement), but will not otherwise be assignable, transferable
or delegable by the Company and (ii) the Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributees and
legatees. This Agreement is personal in nature and neither of the parties
hereto may, without the consent of the other, assign, transfer or delegate this
Agreement or any rights or obligations hereunder except as expressly provided
herein. Without limiting the generality or effect of the foregoing, the
Executive's right to receive payments hereunder will not be assignable,
transferable or delegable, whether by pledge, creation of a security interest,
or otherwise, other than by a transfer by Executive's will or by the laws of
descent and distribution and, in the event of any attempted assignment or
transfer contrary to this Section 13, the Company will have no liability to pay
any amount so attempted to be assigned, transferred or delegated.
14. Notices. For all purposes of this Agreement, all communications,
including without limitation notices, consents, requests or approvals, required
or permitted to be given hereunder will be in writing and will be deemed to
have been duly given when hand delivered or dispatched by electronic facsimile
transmission (with receipt thereof confirmed), or five business days after
having been mailed by United States registered or certified mail, return
receipt requested, postage prepaid, or three business days after having been
sent by a nationally recognized overnight courier service such as Federal
Express or UPS, addressed to the Company (to the attention of the Chairman of
the Board of the Company) at its principal executive office and to the
Executive at his principal residence, or to such other address as any party may
have furnished to the other in writing and in accordance herewith, except that
notices of changes of address shall be effective only upon receipt.
15. Governing Law. The validity, interpretation, construction and
performance of this Agreement will be governed by and construed in accordance
with the substantive laws of the
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State of Texas, without giving effect to the principles of conflict of laws of
such State.
16. Validity. If any provision of this Agreement or the application
of any provision hereof to any person or circumstances is held invalid,
unenforceable or otherwise illegal, the remainder of this Agreement and the
application of such provision to any other person or circumstances will not be
affected, and the provision so held to be invalid, unenforceable or otherwise
illegal will be reformed to the extent (and only to the extent) necessary to
make it enforceable, valid or legal.
17. Survival of Provisions. Notwithstanding any other provision of
this Agreement, the parties' respective rights and obligations under Sections 9
and 10 will survive any termination or expiration of this Agreement or the
termination of the Executive's employment for any reason whatsoever.
18. Miscellaneous. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto or compliance with
any condition or provision of this Agreement to be performed by such other
party will be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. Unless otherwise noted,
references to "Sections" are to sections of this Agreement. The captions used
in this Agreement are designed for convenient reference only and are not to be
used for the purpose of interpreting any provision of this Agreement.
19. Additional Considerations. In connection with the annual review of
the Executive's base salary, bonus and other compensation under this Agreement,
the Compensation Committee may consider without limitation the compensation of
executive officers at similarly situated companies performing comparable
functions as the Executive. In addition, so long as Xx. Xxxxx is Chief
Executive Officer of the Company, the Compensation Committee may consider
without limitation the aggregate compensation of executives at similarly
situated companies performing comparable functions as the Executive and Xx.
Xxxxx as compared to the aggregate compensation of the Executive and Xx. Xxxxx.
20. 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 will constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereof have executed this Agreement as
of the day and year first written above.
BRISTOL HOTEL COMPANY
By: /s/ Xxxxxx X.XxXxxxxx
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Xxxxxx X. XxXxxxxx,
Chairman of the Board
EXECUTIVE
/s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
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