Exhibit 10
XXXX.XXX, INC.
EXECUTIVE SEVERANCE AGREEMENT
This Executive Severance Agreement ("Agreement") is being made in
Chicago, Illinois, on this 4th day of October 2000, by and between xxxx.xxx,
Inc. ("EBIX"), a Delaware corporation, formerly known as Delphi Information
Systems, Inc. and Xxxxxxx X. Xxxx ("Executive"), who presently serves as Senior
Vice President - Finance and Administration, Chief Financial Officer and
Secretary of EBIX.
RECITALS
WHEREAS EBIX provides services and products to the insurance industry
and to the general public, and is presently in a state of redefinition which
could include a possible sale of part or all of the company.
WHEREAS Executive is part of EBIX's executive workforce, is a critical
asset to EBIX, and is especially necessary at this time.
WHEREAS EBIX desires that Executive remain employed by EBIX, and
recognizes that Executive needs some special assurances at this time.
WHEREAS EBIX is a publicly-traded company that desires stability in its
executive workforce. Said stability is a benefit to EBIX's shareholders,
especially during this period of redefinition.
WHEREAS EBIX and Executive understand that to ensure stability in
EBIX's executive workforce, and to protect Executive in the event of a change of
control of the company, an Executive Severance Agreement is a valuable component
of a benefit package.
CONSIDERATION
NOW, THEREFORE, in consideration of the mutual promises and covenants
made herein, in consideration of Executive continuing his employment with EBIX,
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties do hereby agree as follows.
TERMS
1. ADOPTION OF RECITALS. The foregoing recitals are hereby
adopted and incorporated herein and made a part of this Agreement.
2. SEVERANCE AGREEMENT. This Severance Agreement provides for
Severance Pay and Severance Insurance payable or provided, as the case may be,
as follows:
X. Xxxxxxxxx Pay, Salary. Upon an Event Triggering Payment of
Severance as described in Section 3, EBIX shall pay Executive a Severance
salary, in an amount equal to the highest annual salary earned by Executive
during the twelve (12) month period ending with the last day of employment
(calculated as the product of 12 and the highest monthly base salary earned by
him during such period). EBIX shall pay Executive his Severance salary in twelve
(12) equal monthly installments commencing on the last day of the calendar month
immediately subsequent to his last day of his employment by EBIX. Payment of the
Severance salary is subject to normal withholding ("Normal Withholding"), i.e.,
withholding required for income taxes, FICA, premiums for benefit plan
coverages, and any other withholding to which Executive consents in writing or
which is required by applicable law.
X. Xxxxxxxxx Pay, Bonus. Upon an Event Triggering Payment of
Severance as described in Section 3, EBIX shall pay Executive a bonus for the
calendar year in which his employment terminates in an amount equal to the bonus
paid to Executive during the immediately preceding calendar year multiplied by a
fraction, the numerator of which is the number of whole months elapsed in the
calendar year of termination and the denominator of which is 12. EBIX shall pay
the Executive the Severance bonus portion in full within (30) thirty days of the
last day of employment, subject to Normal Withholding..
X. Xxxxxxxxx Insurance, Medical Coverage. Upon an Event
Triggering Payment of Severance as described in Section 3, if Executive has been
insured with this coverage throughout the six months ending with the last day of
employment (and is eligible for and elects COBRA coverage), EBIX shall subsidize
COBRA coverage so that, during the twelve month period commencing with the month
commencing after the last day of employment, the Executive is not required to
pay more toward the premiums than a similarly situated executive who remains
actively employed by EBIX. After the end of such twelve month period, the
Executive shall be solely responsible for COBRA premiums for the balance of the
COBRA period.
3. Events Triggering Payment of Severance. EBIX shall be obligated to
comply with the Severance Plan Salary, Bonus and Medical Coverage provisions set
forth in Section 2 of this Agreement, if the events described in Paragraphs A
and B of this Section occur:
A. There is a change of control of EBIX. "Change of
Control" shall mean either of the following:
(i) the acquisition (other than from EBIX) by any
person, entity or "group" within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934
("Exchange Act") [excluding for this purpose EBIX or its
subsidiaries or any employee benefit plan of EBIX or its
subsidiaries which acquires beneficial ownership of voting
securities of EBIX) of beneficial ownership (within the
meaning of Rule 13(d)-3 promulgated under the Exchange Act) of
securities of EBIX, resulting in such person, entity or group
having greater than
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XXXX.XXX, INC.
EXECUTIVE SEVERANCE AGREEMENT
30% of either the then outstanding shares of common stock or
the combined voting power of EBIX's then outstanding voting
securities entitled to vote generally in the election of
directors, or
(ii) a change in composition of the Board of
Directors of EBIX ("Board") such that a majority of its
members at any time are not "Incumbent Members." For this
purpose, an "Incumbent Member" is any member of the Board on
the date hereof and any member of the Board nominated or
elected as such by the Board at a time when a majority of its
members are "Incumbent Members," and
B. Within twelve (12) months after a Change of Control
of EBIX,
(i) Executive is fired for any reason without
cause(as defined in Section 3.C. hereof); or
(ii) Executive resigns due to a demotion or other new
and onerous requirement placed on Executive, including but not
limited to, relocation of Executive's office greater than 50
miles from its current location. A demotion is defined as a
material reduction in salary and benefits, which includes
bonus opportunity, which reduction does not apply to the ten
most highly compensated employees of the Company generally, or
a material reduction in title or responsibilities. For
purposes of this clause (ii), a reduction is "material" if it
would be viewed as significant to a reasonable person in
Executive's position in determining whether to continue in
such position.
C. "Cause" means any of the following: (i) commission by
Executive of any felony which includes as an element of the crime a premeditated
intention to commit the act, (ii) Executive's inability to perform his duties
due to habitual alcohol use or drug addition, (iii) serious misconduct involving
dishonesty in the course of Executive's employment, or (iv) Executive's habitual
neglect of his duties (other than on account of disability) which habitual
neglect materially adversely affects Executive's performance of duties and
continues for thirty (30) days following Executive's receipt of notice from the
Board which specifically identifies the nature of the habitual neglect and the
duties that are materially adversely affected and states that, if not cured,
such habitual neglect constitutes grounds for termination.
4. COOPERATION. Executive agrees to cooperate with EBIX for a period of
twelve (12) months after the last day of employment in respect of corporate
administrative affairs arising during his employment, including but not limited
to answering questions posed by EBIX employees, counsel, or auditors; providing
a summary of matters pending as of the last day of employment, if requested and
within 21 days of the request; signing corporate minutes; or any other
reasonable requests made by EBIX.
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XXXX.XXX, INC.
EXECUTIVE SEVERANCE AGREEMENT
5. INDEMNIFICATION; HOLD HARMLESS. EBIX agrees to indemnify, defend,
and hold Executive, or his heirs, legatees or estate, forever harmless to the
fullest extent permitted by law from any and all damages, claims, demands,
judgments, losses, costs and expenses, including but not limited to reasonable
attorneys' fees and costs ("Losses") arising out of law suits or other legal
procedures which may hereinafter at any time be incurred, suffered, sustained by
or imposed upon Executive that may be due or required to be paid by virtue of,
or incident to, the performance of Executive's duties, including but not limited
to the authorization and execution of contracts on behalf of EBIX, other than
any such Losses arising by virtue of or incident to Executive's gross neglect or
willful misconduct. For purposes of this Section 5, "gross neglect" means
neglect or negligence that is substantially greater than ordinary neglect or
negligence.
6. CONFIDENTIALITY OF PROPRIETARY INFORMATION. Executive agrees to
keep confidential all proprietary information belonging to EBIX. Proprietary
information includes, but is not limited to, client lists, as well as technical,
marketing, business, financial, or other information that may reasonably be
considered confidential.
For a period of one (1) year after Executive's employment by
EBIX is terminated, but only if such termination results in payment of the
severance benefits provided for in Section 2, Executive shall not, without the
prior written consent of EBIX, directly or indirectly, as an individual or
otherwise, own, manage, operate, control, be or remain employed or retained by,
render any services for, or be financially interested in any manner (other than
as a shareholder of five percent 5% or less of the capital stock of a
corporation whose publicly traded securities are listed on a national or
regional securities exchange or the NASDAQ Stock Market) in any corporation,
firm, partnership, sole proprietorship or other entity which at any time during
such period of one (1) year after the date of termination of employment, is
engaged in offering insurance on the internet or offering transaction processing
of insurance, or was so engaged at any time within one year prior to such
termination date. EBIX does business and renders services throughout the U. S.
and the rest of the world and it is therefore agreed that the foregoing
restriction shall be operative throughout the U.S. and the rest of the world.
7. NON-DISPARAGEMENT. Executive agrees that he will not at any time, or
in any way, either verbally or in writing, or by gesture or innuendo, disparage,
place in false light, or demean EBIX, its directors, officers, employees, or any
activities in which EBIX is involved. EBIX agrees that it, through its officer
and directors, will not, at any time, or in any way, either verbally or in
writing, or by gesture or innuendo, disparage, place in false light, or demean
the Executive.
8. CONFIDENTIALITY OF THIS AGREEMENT. Executive agrees that all the
terms and conditions of this agreement are confidential and that said terms and
conditions shall not be disclosed, discussed, or in any way revealed by
Executive to any persons or entities, whether inside or outside of EBIX, other
than Executive's attorney, or personal tax advisor, as may be necessary, or in
any action to enforce the terms of this Agreement. Confidentiality extends to
the mere fact that this agreement has been offered to Executive by EBIX.
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XXXX.XXX, INC.
EXECUTIVE SEVERANCE AGREEMENT
EBIX and Executive recognize and acknowledge that notwithstanding the
foregoing, this Agreement will pursuant to law be filed as an exhibit to the
next Form 10-K or Form 10-Q to be filed by EBIX and described in EBIX's Form
10-K and proxy statement.
In the event that Executive is requested or required (by oral
questions, interrogatories, requests for information or documents, subpoena,
civil investigative demand or similar process) to disclose any information
supplied to Executive in the course of his dealings with EBIX or its
representatives, it is agreed that Executive will provide EBIX with prompt
notice of such request(s) and the documents requested thereby so that EBIX may
seek an appropriate protective order and/or waive Executive's compliance with
the provisions of this Agreement. It is further agreed that, if in the absence
of a protective order or the receipt of a waiver hereunder Executive is
nonetheless, in the written opinion of Executive's counsel, compelled to
disclose information concerning EBIX to any tribunal or else stand liable for
contempt or suffer other censure or penalty, Executive may disclose such
information to such tribunal without liability hereunder; provided, however,
that Executive shall give EBIX written notice of the information to be so
disclosed as far in advance of its disclosure as is practicable and shall use
his best efforts to obtain an order or other reliable assurance that
confidential treatment will be accorded to such portion of the information
required to be disclosed as EBIX designates.
9. RETURN OF EBIX PROPERTY. Executive agrees to return to EBIX, by the
close of business on his last day of employment, all property belonging to EBIX
which was or may be in the Executive's possession, including, without
limitation, books, records, documents, files, memoranda, credit cards, passes,
keys, computer access codes, computer disks, instructional manuals, tools,
computers and any other physical property of any kind.
10. JUDICIAL REVISION. In the event that any of the provisions,
covenants, warranties or agreements in this Agreement are held by any Court to
be in any respect an unreasonable restriction or are otherwise invalid, for any
reason or cause, then the parties expressly authorize the Court to modify the
period of time in which it operates, the scope of activity to which it pertains,
or to make any other changes to the extent necessary to render any of the
restrictions of this Agreement enforceable.
11. SEVERABILITY. Each of the terms and provisions of this Agreement is
to be deemed severable in whole or in part and, if any term or provision or the
application thereof in any circumstances should be invalid, illegal or
unenforceable, the remaining terms and provisions or the application thereof to
circumstances other than those as to which it is held invalid, illegal or
unenforceable, shall not be affected thereby and shall remain in full force and
effect.
12. BINDING AGREEMENT. This Agreement shall be binding upon the
parties and their successors. EBIX may assign this Agreement to any successor
in interest, or to a successor to any part thereof, provided that such successor
is capable of meeting its obligations hereunder. This Agreement is not
assignable by Executive.
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XXXX.XXX, INC.
EXECUTIVE SEVERANCE AGREEMENT
13. CONTROLLING LAW AND JURISDICTION. This Agreement shall be
governed by, and interpreted and construed in accordance with, the internal laws
of the State of Illinois without giving effect to the principles of conflict of
laws thereof.
14. LEGAL FEES. In any litigation, arbitration, or other legal
proceeding which may arise between the parties hereto, the prevailing party
shall be entitled to recover all his or its costs and all reasonable attorneys'
fees in addition to any other relief to which the prevailing party may be
entitled.
15. PARACHUTE CAP. If it is determined (by the reasonable
computation of EBIX's independent auditors, which determinations shall be
certified by such auditors and set forth in a written certificate
("Certificate") delivered to Executive) that any amount paid or deemed paid to
Executive pursuant to this Agreement or otherwise (collectively, the "Payments")
is or will become subject to any excise tax under Section 4999 of the Code or
any similar tax payable under any United States federal, state, local or other
law (such excise tax and all such similar taxes collectively, "Excise Taxes"),
then the aggregate present value of such amount shall be reduced to an amount
(expressed in present value) which maximizes the aggregate present value thereof
without causing any portion thereof to be subject to Excise Taxes.
16. LEGAL REPRESENTATION, REIMBURSEMENT. Executive agrees to
assist EBIX, in any reasonable way, during EBIX's prosecution or defense of a
lawsuit, or its representation at an administrative hearing or any other
proceeding. EBIX agrees to be responsible for expenses and reasonable attorney's
fees, in addition to lost wages and a reasonable hourly per diem. This provision
shall survive any termination of Executive's employment hereunder for a period
of three (3) years.
17. ENTIRE AGREEMENT. This instrument contains the entire
agreement of the parties with respect to the subject matter hereof, and may not
be changed orally but only by an agreement in writing signed by the parties
hereto and specifically referenced to this agreement.
19. NON-WAIVER. The failure to enforce any of the provisions of
this Agreement shall not be construed as a waiver of such provisions. Further,
any express waiver by any party with respect to any breach of any provision
hereunder by any other party shall not constitute a waiver of such party's right
to thereafter fully enforce every other provision of the Agreement.
20. HEADINGS. All numbers and heading of paragraphs are for
reference only and are not intended to qualify, limit or otherwise affect the
meaning or interpretation of any paragraph.
21. COUNTERPARTS. This Agreement may be executed in one or more
counterparts which together shall constitute a single Agreement.
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XXXX.XXX, INC.
EXECUTIVE SEVERANCE AGREEMENT
WHEREFORE, the parties have executed this Agreement in Illinois on the
date and year first above-written, said Agreement consisting of seven (7) pages.
XXXX.XXX, INC.
By: /s/ Xxxxx Xxxxx Title: President and Chief
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By (Printed Name): XXXXX XXXXX Executive Officer
By: /s/ Xxxxxxx X. Xxxxxx
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By (Printed Name): XXXXXXX X. XXXXXX, not individually, but solely as
authorized agent of xxxx.xxx, Inc.
EXECUTIVE
Signature: /s/ Xxxxxxx X. Xxxx
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Printed Name: XXXXXXX X. XXXX
Executive authorizes that payments, correspondences, and notices should be sent
to the following address:
Address:
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City, State, Zip Code:
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