Form 10-K
Year Ended
12/31/00
Exhibit 10(r)
NON-COMPETE, NON-SOLICITATION AND
NON-DISPARAGEMENT AGREEMENT
This Agreement dated as of February 1, 2001, is made by and between Xxxxxxxx
X. Xxxx ("Xxxx") and X. X. Xxxxxxxxx & Sons Company, a Delaware corporation
(the "Company").
WITNESSETH:
Whereas, Xxxx resigned from his position as President and Chief Operating
Officer of the Company as of January 9, 2001 (the "Resignation Date"); and
Whereas, the Company desires to enter into this Agreement to clarify certain
of its obligations to Xxxx and to receive from Xxxx certain agreements as to
his future activities;
Now, Therefore, Xxxx and the Company, in consideration of the agreements,
covenants and conditions contained herein, hereby agree as follows:
1. Effects of Resignation.
(1) Xxxx has received salary for the period ending on the Resignation
Date and the Company has paid to Xxxx a cash lump sum for all days of
vacation accrued but unused by him as of the Resignation Date. These
payments fully satisfy all obligations of the Company to Xxxx for
salary, bonus, vacation and other benefit-related amounts.
(2) As soon as practical after the Resignation Date, Xxxx shall
submit all expense account records and vouchers relating to his
employment with the Company, and the Company shall reimburse Xxxx in
accordance with its standard practices and procedures for such
expenses.
(3) The rights with respect to Xxxx'x outstanding option awards shall
be as provided by the respective plans and agreements under which they
were granted. All outstanding restricted stock awards shall be canceled
as of the Resignation Date.
(4) Xxxx shall have the option, as (sic) his personal expense, to
continue in effect policies providing disability and life insurance
previously paid for on his behalf by the Company. The Company shall
forward to Xxxx statements for premiums due on such policies in a
manner which provides Xxxx sufficient time to make such premium
payments, should he so elect.
2. Confidentiality, Non-Solicitation, Non-Disparagement and Non-
Competition.
(1) Xxxx reaffirms and agrees to comply with the terms of the
Agreement Regarding Confidential Information, Intellectual Property and
Non-Solicitation of Employees signed by Xxxx on November 14, 1988, a
copy of which is attached as Exhibit A hereto and is incorporated
herein by reference. Xxxx acknowledges that he has returned to the
Company all Company papers, books, records, computer programs, or like
materials which were in his possession or control at the Resignation
Date, except for such copies of documents describing the terms and
conditions of arrangements between Xxxx and the Company which survive
termination of employment.
(2) In consideration of the payments to be made by the Company
pursuant to Section 3 of this Agreement, the positions of trust and
confidence Xxxx has occupied and the information of a highly sensitive
and confidential nature he has received as a result of his previous
position with the Company, Xxxx agrees that he will not, during the
period commencing on the Resignation Date and ending on December 31,
2003, without the prior written consent of the Company, either directly
or indirectly own, manage, operate, control or participate in any
manner in the ownership, management, operation
or control of, or be connected as an officer, employee, partner,
director, principal, consultant, agent or otherwise with, or have any
financial interest in, or aid or assist any entity whose primary
business is in competition with any of the Company's businesses in
either the Long Run Print or High Value sectors of the Company as of
the Resignation Date, including but not limited to the following
entities: QuebWorld (Quebecor Printing Inc.), Quad-Graphics, Xxxxx &
Co., Inc., Xxxxxxx Corporation, Big Flower Holdings, Xxxxx Corp., Xxxxx
Corporation, United Parcel Service or Applied Graphics Technologies. It
is understood and agreed that, for the purposes of the foregoing
provisions of this Section 2 ownership of not more than five percent
(5%) of the voting stock of any of the above entities that are publicly
held shall not, of itself, constitute a violation of this Section 2.
(3) In consideration of the covenants and agreements of the parties
herein contained and the payments to be made by the Company pursuant to
Section 3 of this Agreement, each party agrees not to disparage the
other, including in the case of the Company, its officers, employees
and directors. If any prospective employer of Xxxx requests a
reference, the Company shall report only the fact that Xxxx worked for
the Company, the positions held and salary earned.
(4) The following additional provisions shall apply to the covenants
of Xxxx contained in this Section 2:
(1.) It is the intent and understanding of each party hereto that
if, in an action before any court or agency legally empowered to
enforce the covenants contained in this Section 2, any terms,
restriction, covenant or promise contained herein is found to be
unreasonable and for that reason unenforceable, then such term,
restriction, covenant or promise shall be deemed modified to the
extent necessary to make it enforceable by such court or agency.
(2.) A breach by either party of the agreements contained in this
Section 2 would cause irreparable harm to the other party which is
not adequately measurable by money damages and that, accordingly, in
the event of such breach, in addition to any and all other rights
the non-breaching party may have, including without limitation,
rights at law and in equity, and in the case of the Company any
right to terminate and/or recover payments previously made to Xxxx,
the non-breaching party shall be entitled to equitable remedies in
the nature of injunctive relief to stop any existing breaches and to
prohibit any future breaches.
(3.) In the event of any material breach by Xxxx of any provision
of this Section 2, the Company may, by written notice, elect to
terminate its obligations under this Agreement; provided, however,
that Xxxx shall have the opportunity to cure, within fifteen (15)
business days after such notice, any inadvertent or unwillful breach
by Xxxx, and in the event of such a cure by Xxxx, the termination by
the Company pursuant to this paragraph (iii) shall not take effect.
In the event of termination by the Company, all payments to Xxxx
otherwise required to be provided by the Company under the
provisions of Section 3 shall cease, and Xxxx shall be required to
return any payments previously received but relating to periods
after the date of such breach; provided that Xxxx shall be entitled
to receive or retain any payment of a benefit which had fully
accrued as of the date of such breach.
3. Consideration. As consideration for the agreements of Xxxx set forth
in Section 2 above, the Company agrees to pay Xxxx the sum of $300,000.00
on March 2, 2001, $216,468.00 on April 6, 2001, and the further sum of
$214,594.00 on June 1, 2002. Xxxx shall be responsible for payment of all
taxes due on the payments made by the Company hereunder, and shall furnish
the Company with a copy of IRS Form 4669 filed by him in 2002 evidencing
payment of taxes by him.
4. Notices. All notices or other communications required or permitted
hereunder shall be sufficient if in writing and delivered personally, by
reputable commercial delivery service, by registered mail, return receipt
requested, or by facsimile to the address designated by the relevant party.
Such notice shall be deemed to have been given upon such delivery or three
(3) days after deposit in the U.S. mail, as the case may be.
5. Assignment and Succession. The rights and obligations of the Company
under this Agreement shall inure to the benefit of and be binding upon its
successors and assigns, and Xxxx'x rights and obligations hereunder shall
inure to the benefit of and be binding upon Xxxx'x legal representatives or
designated beneficiaries.
6. Entire Agreement. This Agreement contains the entire agreement between
the parties with respect to the subject matter contained herein and
supersedes all prior oral or written communications relating thereto. This
Agreement may not be changed or amended orally.
7. Applicable Law. This Agreement shall at all times be construed,
interpreted and enforced in accordance with the laws of the State of
Illinois as applicable to agreements entered into in, and to be performed
entirely within, the State of Illinois.
In Witness Whereof, the Company has caused this Agreement to be signed by
its duly authorized officer and Xxxx has signed this Agreement as of the day
and year first above written.
/s/ Xxxxxxxx X. Xxxx
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Xxxxxxxx X. Xxxx
X. X. XXXXXXXXX & SONS COMPANY
/s/ Xxxxxx X. Xxxxxxx
By: _________________________________
