EXHIBIT 10.1
AGREEMENT
AGREEMENT made and entered into in Canton, Massachusetts, by and between
Xxxxxxxxx & Xxxx, Inc. (the "Company") and Xxxxx Xxxxxx, of Dover, Massachusetts
(the "Executive"), effective as of the 7th day of April, 2000 (the "Effective
Date").
WHEREAS, the operations of the Company and its Affiliates are a complex
matter requiring direction and leadership in a variety of arenas, including
financial, strategic planning, regulatory and others;
WHEREAS, the Executive is possessed of certain experience and expertise
that qualify him to provide the direction and leadership required by the Company
and its Affiliates; and
WHEREAS, subject to the terms and conditions hereinafter set forth, the
Company therefore wishes to employ the Executive as its President and Chief
Executive Officer and the Executive wishes to accept such employment;
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
promises, terms, provisions and conditions set forth in this Agreement, the
parties hereby agree:
1. Employment. Subject to the terms and conditions set forth in this
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Agreement, the Company hereby offers and the Executive hereby accepts
employment.
2. Capacity and Performance.
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a. The Executive shall serve the Company as its President and Chief
Executive Officer, subject to his appointment by the Board of Directors of the
Company (the "Board") as a condition precedent to the effectiveness of this
Agreement, or in such other executive position as the Board may designate from
time to time. In addition, and without further compensation, the Executive
shall serve as a director and/or officer of one or more of the Company's
Affiliates if so elected or appointed from time to time.
b. During the term hereof, the Executive shall be employed by the
Company on a full-time basis and shall perform such duties and responsibilities
on behalf of the Company and its Affiliates as may be designated from time to
time by the Board or by its designees.
c. During the term hereof, the Executive shall devote his full
business time and his best efforts, business judgment, skill and knowledge
exclusively to the advancement of the business and interests of the Company and
its Affiliates and to the discharge of his duties and responsibilities
hereunder. The Executive shall not engage in any other business activity or
serve in any industry, trade, professional, governmental or academic position
during the
term of this Agreement, except as may be expressly approved in advance by the
Board in writing.
3. Compensation and Benefits. As compensation for all services performed
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by the Executive under and during the term hereof and subject to performance of
the Executive's duties and of the obligations of the Executive to the Company
and its Affiliates, pursuant to this Agreement or otherwise:
a. Base Salary. During the term hereof, the Company shall pay the
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Executive a base salary at the rate of Two Hundred Thousand Dollars ($200,000)
per annum, payable in accordance with the payroll practices of the Company and
subject to adjustment from time to time by the Board, in its sole discretion.
Such base salary, as from time to time adjusted, is hereafter referred to as the
"Base Salary".
b. Stock Options. The Company will grant the Executive 42,000 stock
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options for the Company's common stock, vesting in three equal increments of
14,000 on the first, second and third anniversary of the Effective Date. The
exercise price of the options will be the closing price of the Company's common
stock on the Effective Date. The terms and conditions of this stock option
grant are subject to, and more fully described in, the Company's stock option
plan and related plan documents.
c. Retention Bonus. If the Executive is continuously employed by
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the Company from the Effective Date through December 31, 2000, the Company shall
pay the Executive a one-time bonus of Fifty Thousand Dollars ($50,000).
d. Other Benefits. During the term hereof and subject to any
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contribution therefor generally required of employees of the Company, the
Executive shall be entitled to participate in any and all employee benefit plans
from time to time in effect for employees of the Company generally. Such
participation shall be subject to (i) the terms of the applicable plan
documents, (ii) generally applicable Company policies and (iii) the discretion
of the Board or any administrative or other committee provided for in or
contemplated by such plan. The Company may alter, modify, add to or delete its
employee benefit plans at any time as it, in its sole judgment, determines to be
appropriate, without recourse by the Executive.
4. Termination By the Company for Cause. The Company may terminate the
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Executive's employment hereunder for Cause at any time upon notice to the
Executive. The following, as determined by the Board in its judgment, shall
constitute Cause for termination:
i. The Executive's material failure to perform, or gross negligence
in the performance of, his duties and responsibilities to the
Company or any of its Affiliates;
ii. Material breach by the Executive of any provision of this
Agreement; or
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iii. Other conduct by the Executive that is materially harmful to the
business, interests or reputation of the Company or any of its
Affiliates.
Upon the giving of notice of termination of the Executive's employment hereunder
for Cause, the Company shall have no further obligation or liability to the
Executive, other than for Base Salary earned and unpaid at the date of
termination.
5. Termination By the Company Other than for Cause. The Company may
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terminate the Executive's employment hereunder other than for Cause at any time
upon notice to the Executive. In the event of such termination, and provided
that no benefits are payable to the Executive under a separate severance
agreement or an executive severance plan as a result of such termination, then
the Executive shall receive a severance payment of Two Hundred Thousand Dollars
($200,000) for a period of twelve (12) months following the date of termination
(the "Severance Period") payable in equal monthly installments, provided,
however, that if the Executive obtains employment of any kind during the
Severance Period, the amount payable to the Executive under this Section 5 shall
be reduced by 50% of the total W-2 income received or deferred by the Executive
with respect to the Severance Period from such other employment, and provided,
further, that the amount payable to Executive under this Section 5 shall not be
reduced to less than One Hundred Thousand Dollars ($100,000). If Executive
obtains employment during the Severance Period, he shall immediately provide the
Company in writing the name and address of his new employer, as well as his
compensation.
6. Termination By the Executive. The Executive may terminate his
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employment hereunder at any time upon sixty (60) days' notice to the Company,
unless such termination would violate any obligation of the Executive to the
Company under a separate severance agreement. In the event of termination of
the Executive pursuant to this Section 6, the Board may elect to waive the
period of notice, or any portion thereof, and, if the Board so elects, the
Company will pay the Executive his Base Salary for the notice period (or for any
remaining portion of the period).
7. Confidential Information.
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a. The Executive acknowledges that the Company and its Affiliates
continually develop Confidential Information, that the Executive may develop
Confidential Information for the Company or its Affiliates and that the
Executive may learn of Confidential Information during the course of employment.
The Executive will comply with the policies and procedures of the Company and
its Affiliates for protecting Confidential Information and shall never disclose
to any Person (except as required by applicable law or for the proper
performance of his duties and responsibilities to the Company and its
Affiliates), or use for his own benefit or gain, any Confidential Information
obtained by the Executive incident to his employment or other association with
the Company or any of its Affiliates. The Executive
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understands that this restriction shall continue to apply after his employment
terminates, regardless of the reason for such termination.
b. All documents, records, tapes and other media of every kind and
description relating to the business, present or otherwise, of the Company or
its Affiliates and any copies, in whole or in part, thereof (the "Documents"),
whether or not prepared by the Executive, shall be the sole and exclusive
property of the Company and its Affiliates. The Executive shall safeguard all
Documents and shall surrender to the Company at the time his employment
terminates, or at such earlier time or times as the Board or its designee may
specify, all Documents then in the Executive's possession or control.
8. Restricted Activities. The Executive agrees that some restrictions on
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his activities during and after his employment are necessary to protect the
goodwill, Confidential Information and other legitimate interests of the Company
and its Affiliates. While the Executive is employed by the Company and for
twelve (12) months after his employment terminates, the Executive shall not,
directly or indirectly, whether as owner, partner, investor, consultant, agent,
employee, co-venturer or otherwise, compete with the Company or any of its
Affiliates or undertake any planning for any business competitive with the
Company or any of its Affiliates. Specifically, but without limiting the
foregoing, the Executive agrees not to engage in any manner in any activity that
is directly or indirectly competitive or potentially competitive with the
business of the Company or any of its Affiliates as conducted or under
consideration at any time during the Executive's employment, including, without
limitation, any activity that involves the retail sale of wine or wine
accessories via the mails or the Internet.
9. Enforcement of Covenants. The Executive acknowledges that he has
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carefully read and considered all the terms and conditions of this Agreement,
including the restraints imposed upon him pursuant to Sections 7 and 8 hereof.
The Executive agrees that said restraints are necessary for the reasonable and
proper protection of the Company and its Affiliates and that each and every one
of the restraints is reasonable in respect to subject matter, length of time and
geographic area. The Executive further acknowledges that, were he to breach any
of the covenants contained in Sections 7 and 8 hereof, the damage to the Company
would be irreparable. The Executive therefore agrees that the Company, in
addition to any other remedies available to it, shall be entitled to preliminary
and permanent injunctive relief against any breach or threatened breach by the
Executive of any of said covenants, without having to post bond. The parties
further agree that, in the event that any provision hereof shall be determined
by any court of competent jurisdiction to be unenforceable by reason of its
being extended over too great a time, too large a geographic area or too great a
range of activities, such provision shall be deemed to be modified to permit its
enforcement to the maximum extent permitted by law.
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10. Definitions. Words or phrases which are initially capitalized or are
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within quotation marks shall have the meanings provided in this Section 10 and
as provided elsewhere herein. For purposes of this Agreement, the following
definitions apply:
a. "Affiliates" means all persons and entities directly or
indirectly controlling, controlled by or under common control with the Company,
where control may be by either management authority or equity interest.
b. "Confidential Information" means any and all information of the
Company and its Affiliates that is not generally known by others with whom they
compete or do business, or with whom they plan to compete or do business and any
and all information, publicly known in whole or in part or not, which, if
disclosed by the Company or its Affiliates would assist in competition against
them. Confidential Information includes without limitation such information
relating to (i) the development, research, testing, manufacturing, marketing and
financial activities of the Company and its Affiliates, (ii) the Products, (iii)
the costs, sources of supply, financial performance and strategic plans of the
Company and its Affiliates, (iv) the identity and special needs of the customers
of the Company and its Affiliates and (v) the people and organizations with whom
the Company and its Affiliates have business relationships and those
relationships. Confidential Information also includes comparable information
that the Company or any of its Affiliates have received belonging to others or
which was received by the Company or any of its Affiliates with any
understanding that it would not be disclosed.
c. "Person" means an individual, a corporation, an association, a
partnership, an estate, a trust and any other entity or organization, other than
the Company or any of its Affiliates.
11. Withholding. All payments made by the Company under this Agreement
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shall be reduced by any tax or other amounts required to be withheld by the
Company under applicable law.
12. Assignment. Neither the Company nor the Executive may make any
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assignment of this Agreement or any interest herein, by operation of law or
otherwise, without the prior written consent of the other; provided, however,
that the Company may assign its rights and obligations under this Agreement
without the consent of the Executive in the event that the Company shall
hereafter affect a reorganization, consolidate with, or merge into, any other
Person or transfer all or substantially all of its properties or assets to any
other Person. This Agreement shall inure to the benefit of and be binding upon
the Company and the Executive, their respective successors, executors,
administrators, heirs and permitted assigns.
13. Severability. If any portion or provision of this Agreement shall to
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any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than
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those as to which it is so declared illegal or unenforceable, shall not be
affected thereby, and each portion and provision of this Agreement shall be
valid and enforceable to the fullest extent permitted by law.
14. Waiver. No waiver of any provision hereof shall be effective unless
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made in writing and signed by the waiving party. The failure of either party to
require the performance of any term or obligation of this Agreement, or the
waiver by either party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.
15. Entire Agreement. This Agreement constitutes the entire agreement
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between the parties and supersedes all prior communications, agreements and
understandings, written or oral, with respect to the terms and conditions of the
Executive's employment.
16. Amendment. This Agreement may be amended or modified only by a
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written instrument signed by the Executive and by a expressly authorized
representative of the Company.
17. Headings. The headings and captions in this Agreement are for
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convenience only and in no way define or describe the scope or content of any
provision of this Agreement.
18. Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be an original and all of which together shall
constitute one and the same instrument.
19. Governing Law. This is a Massachusetts contract and shall be
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construed and enforced under and be governed in all respects by the laws of the
Commonwealth of Massachusetts, without regard to the conflict of laws principles
thereof.
IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument
by the Company, by its duly authorized representative, and by the Executive, as
of the date first above written.
THE EXECUTIVE: XXXXXXXXX & XXXX, INC.
/s/ Xxxxx X. Xxxxxx By: /s/ Xxxx Xxxxxxxxx
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Title: Chairman of the Board
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