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Exhibit 10.32
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (this "Agreement") is made in Medina, Ohio and
is entered into on this 23rd day of July, 1996, and effective as of April 1,
1996 by and between Corrpro Companies Inc., an Ohio corporation (the "Company"),
and Xxxxxx X. Xxx ("Executive").
WITNESSETH:
WHEREAS, the Company and Executive are parties to an Employment
Agreement dated June 11, 1993 (the "Original Employment Agreement");
WHEREAS, the parties now desire to enter into this Agreement which shall
supersede the Original Employment Agreement in its entirety.
NOW, THEREFORE, in consideration of the recitals, the mutual covenants
and agreements contained in this Agreement, and other good and valuable
consideration, the parties agree as follows:
SECTION 1 - TERM AND DUTIES.
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(a) The Company employs Executive under this Agreement, commencing April
1, 1996 and ending on March 31, 1998 unless sooner terminated in
accordance with the provisions of this Agreement.
(b) During his employment pursuant to this Agreement, Executive shall
serve as Chairman of the Board, Chief Executive Officer and
President of the Company. The Company shall nominate Executive to
serve as a director on the Board of Directors of the Company and
shall use its best efforts to facilitate Executive's election.
Executive shall have the right to serve on the board of directors of
any newly formed holding company and subsidiary of the Company . In
these capacities, Executive will retain the right to approve, select
and/or hire employees of the Company plus have the authority to
determine and implement programs and establish direction for the
Company and shall serve at the direction of the Board of Directors
of the Company.
(c) The Company agrees that it will not, without Executive's consent,
(i) assign to Executive duties inconsistent with his current
positions, duties, responsibilities and status with the Company, or
(ii) change his titles as currently in effect, or (iii) remove him
from, or fail to re-elect him to, any of such positions, except in
connection with the termination of his employment for Good Cause (as
hereinafter defined), Disability (as hereinafter defined) or
retirement or as a result of his death or voluntary termination.
Except as so limited, the powers and duties of Executive are to be
more specifically determined and set by the Company from time to
time.
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SECTION 2 - COMPENSATION AND BENEFITS.
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(a) During his employment pursuant to this Agreement, Executive shall
receive an annual base salary of Two Hundred Thirty-five Thousand
Dollars ($235,000.00) as compensation for his services to the
Company (the "Base Compensation"), such compensation to be payable
in regular installments in accordance with standard Company policy.
On or about the first day of each fiscal year of the Company during
Executive's employment pursuant to this Agreement, the Base
Compensation shall be set by the Board of Directors (or a committee
thereof designated by the Board) and in the event the Base
Compensation is adjusted, such adjusted Base Compensation (adjusted
either upward or downward) shall be payable to Executive under this
Agreement for that fiscal year.
(b) During his employment pursuant to this Agreement, and except as
otherwise expressly provided in this Agreement, Executive shall be
entitled to participate on substantially the same terms as other
Senior Level Executives (all persons with the title Vice President
and above employed by the Company) in all employee benefit and
executive benefit plans, pension plans, medical benefit plans, group
life insurance plans, hospitalization plans, or other employee
welfare plans that the Company may adopt from time to time during
Executive's employment pursuant to this Agreement, and as such plans
may be modified, amended, terminated, or replaced from time to time.
In addition, Executive shall receive such other compensation as
the Board of Directors of the Company (or a committee thereof
designated by the Board) may from time to time determine to pay
Executive whether in the form of bonuses, stock options, incentive
compensation or otherwise. The bonuses, stock options, incentive
compensation or other compensation, if any, payable to Executive
pursuant to this Section 2(b) shall be set each year by the Board of
Directors (or a committee thereof designated by the Board) at the
time Executive's Base Compensation is set pursuant to Section 2(a)
above and at such other times as the Board (or a committee thereof
designated by the Board) may determine.
(c) During his employment pursuant to this Agreement, and except as
otherwise provided in this Agreement, Executive shall be entitled to
participate on substantially the same terms and conditions as other
Senior Level Executives in all fringe benefits provided such
personnel, including but not limited to, vacation, sick pay, and
company car.
SECTION 3- TIME COMMITMENT AND PERFORMANCE. Executive shall devote
his best efforts and all of his business time, attention, and skill to the
business and the operations of the Company and shall perform his duties and
conduct himself at all times in a manner consistent with his appointment as
Chairman of the Board, Chief Executive Officer and President of the Company;
except, however, Executive may serve on corporate, civic, or charitable boards
or committees provided that he advises the Board of Directors of the Company of
all such
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service, and provided, further, that if such service shall require a substantial
commitment (as such term may be defined by the Board from time to time) by
Executive, such service must be approved in advance, in writing, by the Board,
such approval not to be unreasonably withheld.
SECTION 4 - COMPETITIVE ACTIVITY. From the effective date of this
Agreement and until the later of (i) three (3) years following the termination
of Executive's employment with the Company, or (ii) as long as Executive is
receiving payments pursuant to Section 11 hereof, Executive will not, directly
or indirectly, either for himself or on behalf of any other corporation,
partnership, person, group, or entity:
(a) enter into any contract or agreement, or own, directly or
indirectly, any interest in, or engage in or conduct in any manner
or capacity (whether as shareholder, consultant, advisor, principal,
agent, partner, officer, director, employee, or otherwise), any
business competitive with any line of business then being conducted
or planned to be conducted by the Company;
(b) attempt to divert or take away, in any manner, the business or
patronage of any customer or potential customer of the Company or
otherwise take from or deprive the Company of any business
opportunity;
(c) attempt to hire or employ, whether as an employee, agent,
independent contractor or otherwise, any employees of the Company;
or
(d) materially interfere, in any manner, with the business, trade, good
will or customers of the Company.
For purposes of this Section 4, there shall be disregarded any interest of
Executive arising solely from the ownership of less than a five percent (5%)
equity interest in a corporation whose stock is regularly traded on any national
securities exchange or regularly traded in the over-the-counter market.
SECTION 5 - PROPRIETARY INFORMATION. During his employment pursuant to
this Agreement and at any time thereafter, Executive shall not disclose, or
cause to be disclosed in any manner, to any corporation, partnership, person,
group, or entity (other than Company or its authorized employees or
representatives) or otherwise use for any purpose other than the Company's
business, any trade secrets or confidential or proprietary information of the
Company, including, but not limited to, the following:
(a) the Company's customer or prospective customer lists;
(b) information concerning the Company's promotional, pricing, or
marketing practices;
(c) the Company's business records; and
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(d) the Company's trade secrets and other confidential and proprietary
information.
Upon termination of employment under any circumstances, Executive, or his estate
or representatives, shall promptly return to the Company all property of the
Company including any and all electronic devices and related data storage
devices and shall destroy or erase any data which cannot be returned.
SECTION 6 - COMPENSATION DURING DISABILITY. Executive shall receive his
Base Compensation during the first ninety (90) business days of absence due to
Disability (as hereinafter defined) in accordance with the Company's disability
benefits provided to Senior Level Executives. The amount of benefits to be paid
by the Company to Executive under this Section 6 shall be reduced by any amount
paid or to be paid to Executive for such period under any insurance policy the
premiums for which were paid by the Company. In the event of Executive's
Disability and a determination by the Board of Directors that no reasonable
accommodations can be made, the Company may terminate Executive's employment
under this Agreement. If the Company terminates Executive's employment under
this Agreement because of Executive's Disability, the Company shall pay to
Executive the amounts, and provide to Executive the benefits, specified in
Section 10 hereof. For purposes of this Agreement, "Disability" shall mean
Executive's inability, through physical or mental illness or accident or other
cause, to perform his major and substantial duties on a full time basis as
determined by a physician hired by the Board of Directors for this purpose (the
"Company Physician"). If the physician regularly attending Executive (the
"Executive Physician") disagrees with the opinion of the Company Physician, the
Company Physician and the Executive Physician shall choose a third consulting
physician (the expense of which shall be borne by the Company), and the written
opinion of the third consulting physician shall be conclusive as to such
disability. In conjunction with this Section 6, Executive consents to such
examination, to furnish any medical information requested by any examining
physician, and to waive any applicable physician-patient privilege that may
arise because of such examination. All physicians, except the Executive
Physician, selected hereunder must be board-certified in the specialty most
closely related to the nature of the disability alleged to exist.
SECTION 7 - RESIGNATION DUE TO COMPANY FAILING TO HONOR ITS OBLIGATIONS
AND TERMINATION WITHOUT GOOD CAUSE. Anything to the contrary contained in this
Agreement notwithstanding, (i) if the Company fails to honor any of its
obligations under this Agreement, and if the Company does not cure the
determined failure within thirty (30) days after a determination of a failure in
accordance with the procedures set forth below, and if as a result Executive
resigns his employment with the Company, or (ii) the Company terminates
Executive's employment with the Company under this Agreement without Good Cause,
Executive shall be entitled to receive and the Company shall pay to Executive
the following:
(a) SALARY. Executive's Base Compensation earned through the date of
resignation or termination shall be paid within ten (10) days of the
effective date of the resignation or termination.
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(b) SEVERANCE PAYMENT. A severance payment for a period of one year
shall be paid in twelve (12) equal, consecutive monthly payments
commencing on the first day of the month following such resignation
or termination in the amount (net of any required withholdings)
equal to Executive's Base Compensation. In the event of Executive's
death prior to the receipt of all twelve (12) payments, the payments
shall continue to Executive's spouse. In the event of the spouse's
death, the payments shall continue in accordance with the terms of
Executive's Will, but in no event will more than a total of twelve
(12) payments be made.
(c) BENEFITS. Following any resignation or termination for which a
payment under Section 7(b) is owing, Executive, or his spouse and
eligible dependents in the event of Executive's death, shall
continue to participate at the expense of the Company in the same or
comparable hospital, medical, accident, disability and life
insurance benefits as he participated in immediately prior to
resignation or termination of his employment unless by law, the
terms of any insurance policy or the terms of the applicable benefit
plans, continued coverage is not permitted; provided, however, that
Executive, or his spouse and eligible dependents in the event of
Executive's death, shall pay any employee cost associated with such
benefits which would otherwise have been paid by Executive if he had
continued his employment. If because of the application of law, the
terms of any insurance policy or the terms of the applicable benefit
plans Executive cannot be covered under any benefit program referred
to above, then the Company shall pay to Executive, or his spouse and
eligible dependents in the event of Executive's death, on a regular
basis the amount which the Company would have paid for the benefit
had Executive continued to participate in the Company's group plan.
To the extent that during Executive's employment, any such benefits
were part of a program of benefits for Senior Level Executives of
the Company, generally, then any subsequent modification,
substitution, or termination of any such benefits, generally, shall
also apply to Executive and to the benefits available to Executive
pursuant to this Section 7(c). Any health insurance benefits which
are so continued will be continued to age 65.
(d) EARLY CESSATION OF BENEFITS. All benefits (other than those with
respect to which continuation is required by law) under Section 7(c)
above shall cease upon the death of Executive and his spouse.
(e) INCENTIVE PLANS. An amount equal to a full year's participation in
the short-term incentive bonus plan then in effect as provided for
in Section 2 hereof shall be paid to Executive within the time
period prescribed by such plan. In addition, any payments due
Executive under the incentive plans then in effect as provided for
in Section 2 hereof (other than any short-term incentive bonus
plans) in accordance with the terms of such plans shall be paid to
Executive within the time period prescribed by such plans.
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(f) RETIREMENT INCOME. Executive shall be paid the retirement income
provided in Section 11 hereof, payable in accordance with the
provisions of Section 11.
For purposes of this Section 7, the following procedure shall be used to
determine whether the Company has failed to honor any of its obligations under
this Agreement: (i) Executive shall submit a claim to the Company's Board of
Directors specifically identifying the nature of the failure; (ii) within thirty
(30) days of receipt of such claim, the Board of Directors shall determine
whether they agree with Executive that a failure has occurred and shall
communicate, in writing, their determination to Executive; and (iii) if
Executive disagrees with the determination of the Board of Directors, Executive,
within ten (10) days of such determination, may submit the claim to arbitration
in accordance with the provisions of Section 20 of this Agreement, such
arbitration to be completed within thirty (30) days of submission, and such
determination shall be final and binding upon the Company and Executive.
SECTION 8- TERMINATION FOR GOOD CAUSE. The Company shall have the right
to terminate Executive's employment with the Company under this Agreement for
Good Cause. As used in this Agreement, the term "Good Cause" shall mean:
(a) any act or acts by Executive resulting in, or intended to result
directly or indirectly in, significant gain or personal enrichment
to Executive at the expense of the Company;
(b) a material failure by Executive to substantially perform his duties
with the Company (other than any such failure resulting from
incapacity due to mental or physical illness), and such failure
results in demonstrably material injury to the Company;
(c) the willful, wanton or reckless failure by Executive to properly
perform his duties with the Company (other than any such failure
resulting from incapacity due to mental or physical illness); or
(d) Executive's indictment for the commission of a felony.
Executive's employment shall in no event be considered to have been terminated
by the Company for Good Cause if such termination took place as the result of
(i) bad judgment or negligence, or (ii) any act or omission reasonably believed
in good faith to have been in or not opposed to the interest of the Company.
Executive shall not be deemed to have been terminated for Good Cause unless and
until there shall have been delivered to him a copy of a resolution duly adopted
by the affirmative vote of not less than sixty percent (60%) of the entire
membership of the Board of Directors excluding Executive, if he is a member of
the Board, at a meeting of the Board (after reasonable notice to Executive and
an opportunity for him, together with his counsel, to be heard before the
Board), finding that, in the good faith opinion of the Board, Executive was
guilty of conduct set forth above in clauses (a), (b) or (c) above. However,
pending a final determination of the Board, the Board shall have the authority
to place Executive on "leave of absence status", with or without pay in the sole
discretion of the Board as determined by a majority of the Board. In the event
that the Company shall terminate
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Executive's employment under this Agreement for Good Cause, the Company shall
have no further obligation to Executive under this Agreement except to pay his
Base Compensation earned through the date of termination within ten (10) days
after the date of termination.
SECTION 9- VOLUNTARY TERMINATION OTHER THAN SECTION 7. Executive may
voluntarily terminate his employment with the Company under this Agreement,
other than as provided in Section 7 hereof, upon not less than ninety (90) days
prior written notice to the Company. In the event that Executive voluntarily
terminates his employment pursuant to this Section 9, the Company shall have no
further obligation to Executive under this Agreement except to pay his Base
Compensation earned through the date of resignation within ten (10) days after
the date of resignation. Notwithstanding the preceding sentence, Executive shall
also be paid the retirement income provided for in Section 11 hereof provided
Executive satisfies the requirements contained in Section 11.
SECTION 10- TERMINATION UPON DEATH OR DISABILITY OF EXECUTIVE.
Executive's employment under this Agreement shall terminate upon the death of
Executive or may terminate upon his Disability as provided for in Section 6
hereof. Upon such termination, Executive, his designated beneficiary, or his
personal representative shall receive the payments/benefits described below from
the Company:
(a) SALARY. Executive's Base Compensation earned through the date of
termination and a lump sum payment for any unused vacation shall be
paid within ten (10) days after the date of termination.
(b) BONUS. An amount equal to a full year's participation in the
short-term incentive bonus plans then in effect as provided for in
Section 2 hereof shall be paid within the time period prescribed by
such plan.
(c) BENEFITS . Benefits will continue for Executive's spouse and
eligible dependents in accordance with Company policy and as
required by law.
(d) INCENTIVE PLANS. Any payments due Executive under the incentive
plans then in effect as provided for in Section 2 hereof (other than
any short-term incentive bonus plan) in accordance with the terms of
such plans shall be paid within the time period prescribed by such
plan.
(e) RETIREMENT INCOME. The retirement income shall be paid as provided
in Section 11 hereof.
SECTION 11 - RETIREMENT INCOME. The Company shall provide Executive with
retirement income, with a lifetime survivor benefit to Executive's spouse, in an
amount equal to fifty percent (50%) of Executive's Base Compensation, payable on
a monthly basis, if: (a) Executive remains in the employment of the Company
through March 31, 1998; (b) Executive's employment is terminated due to
Executive's death or disability; (c) Executive's employment is terminated by the
Company without Good Cause; or (d) Executive resigns due to the Company failing
to honor its obligations as defined in Section 7 hereof. In the event of
Executive's retirement after March 31, 1998, monthly lifetime survivor
retirement payments will commence
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on the first day of the month following the earlier of (i) Executive's reaching
the age of 63-1/2, or (ii) Executive's death. In the event that Executive's
employment terminates due to death, monthly lifetime survivor retirement
payments to his spouse will commence on the first day of the month following
Executive's death. In the event that Executive's employment terminates due to
Disability, monthly lifetime survivor retirement payments will commence on the
first day of the month following the later of (i) the termination of disability
payments provided for in the first sentence of Section 6 hereof, or (ii) the
termination of benefits received by Executive from disability insurance the
premiums for which were paid by the Company . In the event that Executive's
employment terminates due to termination by the Company without Good Cause or if
Executive terminates employment due to the Company failing to honor its
obligations as defined in Section 7 hereof, monthly lifetime survivor retirement
payments will commence on the first day of the month following the termination
of the severance payments provided for in Section 7(b) hereof. As long as the
retirement payments provided for in this Section 11 are made, Executive agrees
not to compete with the Company as provided in Section 4 hereof. In the event
Executive violates any of the provisions of Section 4 hereof, the Company may
cease making the retirement payments which are provided for in this Section 11.
SECTION 12 - CHANGE IN CONTROL AND RABBI TRUST.
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(a) If Executive's employment with the Company under this Agreement is
terminated within twelve (12) months following a change in control
(as defined below), by the Company without Good Cause, then
Executive shall receive, and the Company shall pay or provide to
Executive or his spouse, eligible dependents, and designated
beneficiaries, the termination payments and benefits provided for in
Section 7 of this Agreement; provided, however, immediately
following a change in control (as defined below), the Company shall
establish a grantor trust conforming with Revenue Procedure 92-64
("Rabbi Trust"). A copy of such Trust to be executed by the Company
is attached hereto as Exhibit A. Within ten (10) days following a
change in control, the Company shall fund the entire obligation to
Executive under this Section 12.
(b) As used herein, a "change in control" shall have occurred at any
time during Executive's employment pursuant to this Agreement, and
if any of the following shall occur:
(i) The Company is merged, consolidated, or reorganized into or
with another corporation or other Legal Person, and immediately
after such merger, consolidation, or reorganization Voting
Securities entitled to exercise a majority of the Voting Power
of the surviving or resulting corporation or other Legal Person
are not (A) Voting Securities of the Company outstanding
immediately prior to such merger, consolidation or
reorganization, or (B) securities received in exchange for such
Voting Securities of the Company.
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(ii) Any Person becomes the Beneficial Owner of Voting Securities
representing twenty percent (20%) or more of the combined
Voting Power of the Company. The change in control shall be
deemed to have occurred no later than the date on which a
report is filed on Schedule 13D or Schedule 14D-1 as
promulgated pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), disclosing that any Person has
become the Beneficial Owner of Voting Securities representing
twenty percent (20%) or more of the combined voting power of
the Company.
(iii) A "change in control" or possible "change in control" which
would be required to be disclosed in response to an item in
Form 8-K or Schedule 14A in connection with the filing of a
report or proxy statement with the Securities and Exchange
Commission pursuant to the Exchange Act, has or may have
occurred or will or may occur in the future pursuant to any
then existing contract or transaction. The change in control
will be deemed to have occurred no later than the date on which
the Company files such report or proxy statement with the
Securities and Exchange Commission disclosing the "change in
control" or possible "change in control."
(iv) During any consecutive six (6) month period commencing before
or after the date of this Agreement, individuals who at the
beginning of such six (6) month period constituted a majority
of the Board of Directors of the Company cease serving on the
Board; however, if a person ceases to serve as a director of
the Company for any reason not related to the Company (as, for
example, because of family reasons, or health reasons, or a
lack of time), then such cessation shall not be considered as a
"cessation" under this Section 12, and any replacement director
shall, for purposes of this Section 12, be treated as the same
person as the director who so ceased serving.
(c) Any reference in this Section 12 to a section of the Exchange Act, a
rule or regulation promulgated under the Exchange Act, or any
schedule, form or report promulgated under the Exchange Act or any
subdivision or item included in any of the foregoing, shall be
deemed to refer to any successor, replacement or amended section,
rule, regulation, schedule, form, report, subdivision, or item in
effect at the time a determination is made. The following words and
phrases when used in this Section 12, shall have the meanings
indicated:
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(i) PERSON shall have the meaning used in Section 1 3(d)(3) or
Section 14(d)(2) of the Exchange Act, and shall also include
all affiliates and associates of such Person as defined in Rule
12b-2 promulgated under the Exchange Act.
(ii) LEGAL PERSON means any Person other than a natural person,
including any entity which can acquire, hold and dispose of
property in its own name, a fictitious name, or in the name of
its owner or owners.
(iii) BENEFICIAL OWNER shall have the meaning defined under Rule
13d-3 promulgated under the Exchange Act, but without the sixty
(60) day limitation specified in paragraph (3)(1)(i) of said
Rule.
(iv) VOTING SECURITIES means any stock or securities entitling the
holder to exercise Voting Power.
(v) VOTING POWER means the right to vote in the election of
directors or persons serving in a similar capacity with a
corporation or other Legal Person, or if there is no board of
directors or similar body, the right to vote to retain or
dismiss the management of the Legal Person.
SECTION 13 - POST TERMINATION CONSULTING AND COOPERATION. For a period
of six (6) months following the termination of Executive's employment under this
Agreement, regardless of whether such termination is by Executive or by the
Company or whether it is with or without Good Cause, Executive, at the sole
discretion of the Company, shall provide the Company and its designated agents,
advisors, and executives with such consultation as the Company may reasonably
require up to a maximum of twenty (20) hours per week. However, Executive shall
have no consulting obligation under this Section 13 if he resigns under
circumstances which entitle him to payments under Section 7 hereof. Company
shall pay Executive an hourly rate of One Hundred Dollars ($100.00) per hour and
reimburse Executive for all reasonable expenses and out-of-pocket costs incurred
in connection with fulfilling his obligations under this Section 13. The Company
shall endeavor to schedule such consulting so that Executive's obligations under
this Section 13 to assist Company shall not unreasonably interfere with
Executive's business prospects or responsibilities to a new employer .
SECTION 14 - EXCESS PARACHUTE PAYMENT REDUCTION. Anything in this
Agreement to the contrary notwithstanding, in the event it shall be determined
that any payment or distribution by the Company to or for the benefit of
Executive (whether paid or payable or distributed or distributable pursuant to
the terms of this Agreement or otherwise) (a "Payment") would be nondeductible
by the Company for Federal income tax purposes because of Section 280G of the
Internal Revenue Code and applicable regulations promulgated thereunder, then
the aggregate present value of amounts payable or distributable to or for the
benefit of Executive pursuant to this Agreement (such payments or distributions
pursuant to this Agreement
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are hereinafter referred to as "Agreement Payments") shall be reduced (but not
below zero) to the Reduced Amount. The "Reduced Amount" shall be an amount
expressed in present value which maximizes the aggregate present value of
Agreement Payments without causing any Payment to be nondeductible by the
Company because of Section 280G of the Internal Revenue Code and applicable
regulations promulgated thereunder. For purposes of this Section 14, present
value shall be determined in accordance with Section 280G(d)(4) of the Internal
Revenue Code and applicable regulations promulgated thereunder. All
determinations required to be made under this Section 14 shall be made by the
independent certified public accounting firm performing the year-end audit on
the Company (the "Accounting Firm") which shall provide detailed supporting
calculations both to the Company and Executive within thirty (30) days after the
termination date or such earlier time as is requested by the Company. The
Company and Executive shall cooperate with each other and the Accounting Firm
and will provide necessary information so that the Accounting Firm may make all
such determinations. All such determinations by the Accounting Firm shall be
final and binding upon the Company and Executive. Executive shall determine
which of the Agreement Payments (or, at the election of Executive, other
payments) shall be eliminated or reduced consistent with the requirements of
this Section 14, provided that, if Executive does not make such determination
within twenty (20) days of the receipt of the calculations made by the
Accounting Firm, the Company shall elect which of the Agreement Payments shall
be eliminated or reduced consistent with the requirements of this Section 14 and
shall notify Executive promptly of such election. As a result of the uncertainty
in the application of Section 280G of the Internal Revenue Code and applicable
regulations promulgated thereunder at the time of the initial determination by
the Accounting Firm hereunder, it is possible that Agreement Payments will be
made by the Company which should not have been made ("Overpayment") or that
additional Agreement Payments will not be made by the Company which could have
been made ("Underpayment"), in each case, consistent with the calculations
required to be made hereunder. In the event that the Accounting Firm or a court
of competent jurisdiction (in a final judgment as to which the time for appeal
has lapsed or no appeal is available) determines at any time that an Overpayment
has been made, any such Overpayment shall be treated for all purposes as a loan
to Executive which Executive shall repay to the Company together with interest
at the applicable short-term Federal rate provided for in Section 1274(d)(1) of
the Internal Revenue Code, compounded semi-annually; provided, however, that no
amount shall be payable by Executive to the Company (or if paid by Executive to
the Company, such payment shall be returned to Executive) if and to the extent
such payment would not reduce the amount which is subject to taxation under
Section 4999 of the Internal Revenue Code. In the event that the Accounting Firm
or a court of competent jurisdiction (in a final judgment as to which the time
for appeal has lapsed or no appeal is available) determines at any time that an
Underpayment has occurred, any such Underpayment shall be promptly paid by the
Company to or for the benefit of Executive together with interest at the
applicable short-term Federal rate provided for in Section 1274(d)(1) of the
Internal Revenue Code, compounded semi-annually.
SECTION 15 - BREACHES AND REMEDIES. Executive acknowledges and agrees
that in the event that Executive violates the undertakings set forth in Section
4 or 5 hereof, other than in an immaterial fashion, the Company, in addition to
any other rights or remedies to which it may be entitled under law or this
Agreement, shall be entitled to enforce the provisions of Section 4 or 5 by
injunction or other equitable relief.
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SECTION 16 - SEVERABILITY. The provisions contained in this Agreement
are severable and in the event any provision shall be held to be invalid,
unenforceable or overbroad, in whole or in part, by a court of competent
jurisdiction, the remainder of such provision and of this Agreement shall not be
affected thereby and shall be given full force and effect.
SECTION 17 - NOTICES. Any notices, requests, demands, or other
communications provided for by this Agreement shall be sufficient if made in
writing delivered personally or if sent by registered or certified mail, return
receipt requested, or by overnight express courier service, to Executive at the
last address he has filed in writing with the Company or, in the case of the
Company, at its principal executive offices. Any such notice shall be deemed
delivered and effective when received in the case of personal delivery, five
days after deposit, postage prepaid, in the U.S. postal service in the case of
registered or certified mail, and on the next business day following the date of
transmittal in the case of overnight express courier service.
SECTION 18 - ENFORCEMENT COSTS ON CHANGE OF CONTROL. If Executive's
employment is terminated following a "change in control" as defined in Section
12 hereof and Executive institutes any litigation or other action in order to
secure the benefits intended to be provided Executive under this Agreement, or
if Executive is required to defend litigation or other action instituted by the
Company or any other person to declare this Agreement void or unenforceable or
to deny, diminish, or recover from Executive the benefits intended to be
provided to Executive under this Agreement, then, regardless of whether
Executive prevails, in whole or part, in the prosecution or defense of such
litigation or action, the fees and expenses of Executive's counsel shall be paid
or reimbursed to Executive by the Company upon presentation to the Company by
Executive of statements prepared by such counsel in accordance with counsel's
customary practices. As security for the payment of such enforcement expenses,
the Company agrees that upon the initiation of the litigation described in this
Section 18, the Company shall deposit into an escrow account with Bank One,
Cleveland, NA an amount equal to twenty percent (20%) of the payment claimed by
Executive pursuant to any other section, which funds shall be payable to
Executive pursuant to the terms of this Section 18. Such payment shall be in
addition to the payments due Executive pursuant to Section 12 hereof. If
Executive's legal fees and expenses actually incurred in connection with the
litigation or legal action described in this Section 18 exceed the amount
deposited in escrow, the Company shall be obligated to pay the legal fees and
expenses actually incurred by Executive.
SECTION 19 - SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the Company, its successors and assigns, and to
the benefit of Executive, his heirs and legal representatives, except that
Executive's duties to perform future services are expressly agreed to be
personal and not to be assignable or transferable .
SECTION 20 - APPLICABLE LAW, ARBITRATION AND JURISDICTION. This
Agreement shall be governed by and construed under the laws of the State of
Ohio. The parties agree that any dispute arising out of this employment
relationship except for disputes arising under Sections 4 and 5 of this
Agreement shall be determined by binding arbitration under the rules of the
American Arbitration Association, such arbitration to be conducted in Cleveland,
Ohio, or at such other location as the parties may agree. All costs of such
arbitration shall be borne equally by Executive and the Company. With respect to
disputes arising under Sections
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4 and 5 of this Agreement, Executive and the Company consent and submit
themselves to the jurisdiction of the courts of the State of Ohio.
SECTION 21 - AMENDMENT. This Agreement may be amended only in a writing
signed by both parties.
SECTION 22 - NO WAIVER. No waiver by either party at any time of any
breach by the other party of, or compliance with, any condition or provision of
this Agreement to be performed by the other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same time or any prior or
subsequent time.
SECTION 23 - HEADINGS. The headings contained in this Agreement are for
reference only and shall not affect the meaning or interpretation of any
provision of this Agreement.
SECTION 24 - PRIOR AGREEMENTS. This Agreement supersedes in all
respects all prior agreements between the parties, whether written or oral,
regarding the subject matter hereof, including, but not limited to, the Original
Employment Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
CORRPRO COMPANIES INC.
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Xxxxxx X. Xxxxx,
Chairman of the Compensation Committee
of the Board of Directors
"COMPANY"
/s/ Xxxxxx X. Xxx
-----------------------------------------
Xxxxxx X. Xxx
"EXECUTIVE"
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