EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made as of the
16th day of May, 2002 by and between Kirshner International, Inc.
("Company") and Xxxxxx Xxxxxxxx ("Executive").
WHEREAS, Company and its subsidiaries wishes to, among other
things, (i) develop music performance talent; (ii) acquire master
rights in musical performances and other content, excluding the
library common known as "Xxx Xxxxxxxx'x Rock Concert", except to the
extent otherwise described herein; (iii) engage in the music
publishing and record label business; and (iv) engage in such other
activities as shall, from time to time, be determined by the
Company's board of directors (collectively, the "Business");
WHEREAS, Company wishes to employ Executive as Chairman of the
board of directors of the Company (the "Board"), Chief Executive
Officer and President of Company and its subsidiaries; and
WHEREAS, Executive wishes to accept such employment and to
render services to Company and its subsidiaries on the terms set
forth herein and in accordance with the provisions of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, the parties hereto agree as follows:
1. Employment. Subject to and upon the terms and provisions
of this Agreement, Company hereby employs Executive and Executive
hereby accepts employment by Company as its Chairman of the Board,
Chief Executive Officer and President of Company and, to the extent
at any time and from time to time requested by Executive, its
subsidiaries.
2. Duties.
(a) During the Employment Term (as defined in Paragraph 8
hereof), Executive shall serve as Chairman of the Board, Chief
Executive Officer and President of Company and in such other
position or positions for Company and its subsidiaries as may be
agreed upon by Company and Executive or, with respect to
subsidiaries of Company only, as may be requested by Executive as
provided under Paragraph 1 hereof; provided, however, that, on not
less than ten (10) days' prior written notice to Company, Executive
may, at any time and from time to time and without liability as a
result thereof, relinquish any or all positions he then holds with
any subsidiaries of Company, and any such relinquishment in and of
itself shall not constitute a breach of this Agreement or subject
Executive to any reduction in any compensation or benefits due
Executive hereunder.
(b) Consistent with applicable law and the authority
reposed in the Board, Executive shall have overall authority for and
be in sole charge of all of the operations and activities of Company
and its subsidiaries. Executive shall at all times during the
Employment Term be the senior most officer of Company, and to the
extent requested by Executive, shall report directly and solely to
the Board.
(c) Notwithstanding anything herein contained to the
contrary, Company hereby acknowledges that Executive shall be
entitled, without restriction, to engage in the following activities
(collectively, the "Other Activities"): (i) participate in a
Broadway production, stage, theatrical or television production
based upon Executive's life; (ii) serve as the executive producer
with respect to film and television scripts; (iii) make commercial
endorsements in connection with anything other than the Business;
(iv) engage in merchandising activities in connection with anything
other than the Business; (v) acquire interests in or receive revenue
from a library of television programs commonly known as Xxx
Xxxxxxxx'x Rock Concert ("Rock Concert"), provided that should
Executive acquire the right to license Rock Concert, Company and
Executive shall enter in to an industry standard license agreement
granting an exclusive license to the Company as to Rock Concert in
exchange for royalties to Executive in the amount of five percent
(5%) of gross revenues generated by Company under such license
agreement; (vi) license of Executive's name and likeness in
connection with anything other than the Business; (vii) write or
participate in the writing of books based upon Executive's life and
other related subjects; and (viii) make speaking engagements and
serve as on air host of television, broadcast or radio programming.
Company agrees that such Other Activities do not involve a material
conflict of interest with the interests of Company, agrees that
Executive shall not be accountable to Company in connection with
such Other Activities, agrees that no diminution in compensation
shall occur as a result the engagement by Executive in the Other
Activities and agrees that Company shall have no interest in any
revenues generated by Executive from such Other Activities. Subject
to the foregoing, Executive shall devote such remaining regular
working time as shall reasonably be necessary to the discharge of
the duties of Executive to Company.
3. Membership on the Board. During the Employment Term,
Company shall nominate Executive for election to the Board as a
member of the management slate at each meeting of the stockholders
of Company at which Executive shall come up for election, and
Company shall use its best efforts to cause Executive to be elected
as a member of the Board, and while Executive is a member of the
Board, Executive shall be Chairperson of the Board.
4. Location of Office. During the Employment Term, the
principal offices of Company shall be located at Boca Raton, Florida
(the "Initial Location"), and the services provided by Executive
pursuant hereto shall be performed primarily at principal offices of
Company.
5. Monetary Remuneration.
(a) Base Salary. During the Employment Term, Company
shall pay to Executive in consideration of the performance by
Executive of the obligations of Executive hereunder (including any
services as an officer, member of the Board, employee, member of any
committee of Company, or otherwise), a salary (the "Base Salary") at
an annual rate equal to Four Hundred Thousand and No/100 Dollars
($400,000.00) payable in advance in equal biweekly installments.
The Base Salary shall be increased (but not decreased) at least
annually during the Employment Term by an amount equal to the annual
increase in the consumer price index, as applicable each year for
the same month as the month in the which the Effective Date (as
defined below) shall have occurred and, upon each such increase the
term "Base Salary" shall mean such increased amount. If the
above-described index is discontinued, a comparable index shall be
used.
(b) Incentive Compensation.
(1) Annual Bonus. In addition to the Base Salary,
Company shall pay to Executive a bonus (each, an "Annual
Bonus") in respect of all or any portion of each fiscal year of
Company during the Employment Term, which shall be the greater
of the amount determined: (A) by the Board and (B) pursuant to
the Bonus Formula (as defined below); provided, however, that
in no case shall any Annual Bonus be less than five percent
(5%) of Executive's Base Salary paid in the applicable fiscal
year. The "Bonus Formula" shall mean a formula determined
jointly and in good faith by the Board and Executive designed
to provide Executive with incentive compensation each fiscal
year commensurate with Executive's status and position as
Chairman of the Board, Chief Executive Officer and founder of
Company and the contribution and expected contribution of
Executive to the success of Company; it being agreed that such
formula is to be determined prior to the end of the third
quarter of each of the Company's fiscal year during the
Employment Term. The Bonus Formula may provide for appropriate
adjustment in order to reflect special factors, including,
without limitation, material changes in accounting policies or
practices, material acquisitions or dispositions or other
unusual or unplanned items (an "Adjustment Event"), which in
the judgment of the Board, should be taken into account, in
whole or in part, in furtherance of equity; it being understood
that it is not intended that any such adjustment will either
increase or decrease any Annual Bonus for performance following
an Adjustment Event comparable to the performance contemplated
in setting the Bonus Formula.
(2) Transaction Bonus.
(A) In addition to the Base Salary and Annual
Bonus, in the event that a Disposition Transaction (as defined
below) shall occur during the Employment Term or as a result of
discussions commenced, or an agreement reached, during the
Employment Term or the period ending on the second anniversary
of the date of termination of the Employment Term, then,
simultaneous with consummation of such Disposition Transaction
or, in the event that such Disposition Transaction is a
liquidation, simultaneous with completion of such liquidation,
Company shall pay to Executive a bonus (a "Transaction Bonus")
in an lump sum cash payment in an amount equal to one percent
(1%) of the aggregate fair market value (the "Fair Market
Value") of all consideration (the "Transaction Consideration")
paid or payable (whether in cash, property, securities or any
combination of two (2) or more of the foregoing) to Company
and/or the stockholders of Company and/or any subsidiary of
Company in connection with such Disposition Transaction (each,
a "Consideration Recipient" and, collectively, the
"Consideration Recipients"). The Fair Market Value of such
consideration (other than cash or marketable securities) shall
be determined by the Board in good faith.
(B) If a Disposition Transaction involves a
sale or other disposition of the entire Company or a sale or
other transfer of all or substantially all of Company's
properties and assets, the amount of the Transaction Bonus in
connection with such Disposition Transaction shall be reduced
by the amount of all prior Transaction Bonuses paid or payable
to Executive.
(C) In the event that the Transaction
Consideration in connection with a Disposition Transaction
shall be subject to future increase as a result of contingent
payments which shall not be determined until after consummation
of such Disposition Transaction, or in the event that such
Disposition Transaction is a liquidation then the amount of any
additional Transaction Bonus related to such additional
Transaction Consideration shall be paid to Executive
simultaneous with payment of such additional Transaction
Consideration to the applicable Consideration Recipients.
(D) For purposes of this Agreement, the term
"Disposition Transaction" shall mean a sale, transfer or other
disposition (whether in a single transaction or a series of
transactions) of Company or any of its subsidiaries or all or
any portion of its or their businesses or assets (whether
existing or owned on the Effective Date or thereafter
acquired), whether through merger, sale of assets, tender or
exchange offer, sales of a majority interest of Company's or
any of its subsidiaries' outstanding voting securities,
liquidation or otherwise, other than in connection with a
public offering of Company's securities or any sale of all or
any portion of the assets of Company or any of its subsidiaries
which shall occur in the ordinary course of business.
(3) Subsidiary Rights Bonus.
(A) In addition to the Base Salary, Annual
Bonus and Transaction Bonus, in the event that during the
Employment Term or within two (2) years after termination of
the Employment Term pursuant to a determination of the Board
made or an agreement entered into during the Employment Term
Company shall (i) issue to stockholders of Company rights to
purchase shares of stock of any subsidiary of Company or (ii)
distribute to stockholders of Company shares of stock in any
subsidiary of Company (a "Subsidiary Transaction"), then
simultaneous with any such issuance or distribution, Executive
shall be issued rights to purchase an amount of shares of stock
in such subsidiary equal to one percent (1%) of the aggregate
number of shares subject to all such rights in connection with
such issuance at the same price offered to the stockholders of
Company in connection such issuance or receive an amount of
shares of stock in such subsidiary equal to one percent (1%) of
the aggregate number of shares to be distributed in connection
with such distribution, as the case may be (each such issuance
or distribution referred to as a "Subsidiary Rights Bonus").
The Subsidiary Rights Bonus shall be in addition to, and not in
lieu of, any other rights Executive shall have as a stockholder
of Company with respect to any Subsidiary Transaction.
(4) Notwithstanding anything contained in paragraphs
5.(b)(2) or 5.(b)(3) to the contrary, the amount of any
Transaction Bonus or Subsidiary Rights Bonus shall be reduced
by the amount of any prior Transaction Bonus or Subsidiary
Rights Bonus paid or payable to Executive if and to the extent
necessary in order to avoid paying any such bonus to Executive
more than once with respect to the same business asset.
(5) Stock Options; Equity Awards. Executive shall
be awarded stock options and/or other equity based awards
pursuant to any Stock Incentive Plan implemented by the Company
(or any successor thereto) each fiscal year in respect of such
number of shares of Company's common stock and on such terms
and conditions as are commensurate with Executive's status and
position as Chairman of the Board, Chief Executive Officer and
founder of Company and the contribution and expected
contribution of Executive to the success of Company.
6. Employee Benefit Programs.
(a) Employee Benefits. Executive shall be entitled to
participate, in accordance with the terms and conditions of the
applicable plan, program or arrangement, fringe benefit or
perquisites, in all of the employee benefit plans, programs and
arrangements, fringe benefits and executive perquisites, which shall
hereafter be made available by Company to, or for the benefit of,
its senior executive officers or its employees in general. The
Employee's participation in any such plans, programs and
arrangements, fringe benefits and perquisites shall be on a basis
not less favorable than that of any other senior executive officers
of Company.
(b) Business Expenses. During the Employment Term,
Company shall reimburse Executive for all reasonable business
expenses incurred by Executive in carrying out Executive's duties,
services and responsibilities under this Agreement (including, but
not limited to, the cost of first class travel, lodging and other
related expenses), provided that Executive complies with the
generally applicable policies, practices and procedures of Company
for submission of expense reports, receipts or similar documentation
of such expenses.
(c) Insurance. During the Employment Term, Company shall
provide to Executive, at no cost or expense to Executive, life
insurance in an amount not less than One Million dollars
($1,000,000.00) covering Executive, the beneficiary of which life
insurance shall be the party or parties determined by Executive.
(d) Other Benefits. During the Employment Term, Company
shall:
(1) provide Executive, at no cost or expense to
Executive, with the use of an automobile (including without
limitation, the cost of gas, insurance, licensing, parking and
a cellular telephone), which automobile may be selected by
Executive not less frequently than every two (2) years and
shall be of a class of automobile not less than a Lexus LS470
or comparable class, plus an amount necessary to fully gross-up
Executive for all income and employment taxes incurred by
Executive in connection with the provision of such automobile
and related expenses as provided hereunder;
(2) purchase and maintain at all times, at no cost
or expense to Executive, an officers' and directors' insurance
policy in an amount which shall be agreed upon by Company and
Executive, but in no event shall be less than Two Million and
No/100 Dollars ($2,000,000.00), and which shall name Executive
as the insured thereunder;
(3) if requested by Executive, Company shall provide
Executive with a driver and appropriate personal security
arrangements.
7. Vacation and Sick Leave.
(a) During the Employment Term, Executive shall be
entitled to not less than Four (4) weeks paid vacation annually.
Executive shall be entitled to carry forward unused vacation time.
(b) During the Employment Term, Executive shall be
entitled to a number of sick days annually equal to the number of
days in the waiting period for the earliest period of eligibility
under any of Company's disability plans. Unused sick days may not
be carried forward.
8. Employment Term. The "Employment Term," as used in this
Agreement, shall mean the period which shall commence on the date
hereof (the "Effective Date") and, unless otherwise terminated
earlier in accordance with the provisions of Paragraph 9 hereof,
shall terminate on the fifth anniversary of the Effective Date;
provided, however, that on the fifth anniversary of the Effective
Date and on each anniversary of the Effective Date thereafter, the
Employment Term shall automatically be extended for an additional
one year unless prior thereto either party shall have given written
notice to the other that such party does not wish to extend the
Employment Term.
9. Termination. Notwithstanding Paragraph 8 hereof to the
contrary, the Employment Term shall automatically terminate upon the
earliest of any of the following to occur:
(a) the death of Executive;
(b) the termination of Executive's employment by mutual
agreement of Company and Executive;
(c) the termination of Executive's employment by Company
for Cause (as defined in Paragraph 10 hereof);
(d) the termination of Executive's employment by
Executive for Good Reason (as defined in Paragraph 11 hereof);
(e) the termination of Executive's employment by reason
of Disability (as determined in accordance with Paragraph 12
hereof); and
(f) the termination of Executive's employment by Company
other than for Cause or by Executive other than for Good Reason.
10. Cause.
(a) Company shall have the right to terminate Executive's
employment for "Cause." Cause shall arise in the event that
Executive shall have:
(1) been convicted of or pled nolo contendere to a
felony based upon moral turpitude; or
(2) willfully engaged in misconduct that is
materially injurious to Company.
(b) For purposes of this Agreement, no act on Executive's
part shall be considered "willful" unless Executive shall have acted
without good faith and without a reasonable belief that Executive's
action was in the best interests of Company. Any act that shall be
based upon authority given pursuant to a resolution adopted by the
Board or based upon the advice of counsel for Company shall be
conclusively presumed to have been done by Executive in good faith
and in the best interests of Company. No conduct that is based upon
a good faith and honest mistaken belief shall constitute Cause.
(c) No termination of Executive's employment shall be for
Cause unless effected in accordance with the following procedures.
Company shall give Executive written notice ("Notice of Termination
for Cause") of its intention to terminate Executive's employment for
Cause, setting forth in reasonable detail the specific conduct of
Executive that it considers to constitute Cause and the specific
provision(s) of this Agreement on which it relies, and stating the
date, time and place of the Special Board Meeting for Cause (as
defined below). The term "Special Board Meeting for Cause" shall
mean a meeting of the Board called and held specifically for the
purpose of considering termination of Executive's employment for
Cause, that takes place not less than ten (10) and not more than
twenty (20) business days after Executive receives the Notice of
Termination for Cause. Executive shall be given an opportunity,
together with counsel and such others as Executive so desires, to be
heard at the Special Meeting for Cause. Termination of Executive's
employment for Cause shall be effective when and if a resolution is
duly adopted at the Special Board Meeting for Cause by affirmative
vote of not less than three-quarters (3/4) of the entire membership
of the Board; provided, however, that if within ten (10) business
days after the Special Board Meeting for Cause, Executive in good
faith notifies Company that Executive disputes Executive's
termination for Cause, Executive's employment hereunder shall not be
terminated until the date on which the dispute is finally resolved,
either by mutual written agreement of the parties, by a final
judgment, order or decree of any state or federal court sitting in
Palm Beach County, Florida (the time for appeal therefrom having
expired and no appeal having been perfected).
11. Good Reason.
(a) Executive may terminate Executive's employment for
Good Reason provided that Executive does so within twelve (12)
months of Executive having actual knowledge of the occurrence of the
event or condition constituting the basis for such termination. For
purposes of this Agreement, "Good Reason" shall mean the occurrence
of any of the following events or conditions:
(1) any material breach of this Agreement by
Company, including, without limitation, the exercise by the
Board of any authority which is inconsistent with the authority
of Executive provided for herein;
(2) any change in Executive's status, title,
position or responsibilities (including reporting
responsibilities) which, in Executive's reasonable judgment,
represents an adverse or material change from the status of
Executive's, title, position or responsibilities as in effect
immediately prior thereto; the assignment to Executive of any
duties or responsibilities which, in Executive's reasonable
judgment, are inconsistent with Executive's status, title or
position; or any removal of Executive from or failure to
reappoint or reelect Executive to any of such offices or
positions, except in connection with the termination of
Executive's employment for Disability, Cause, as a result of
Executive's death or by Executive other than for Good Reason;
(3) a reduction in Executive's Base Salary or
incentive compensation below the applicable levels set forth in
Paragraph 5 hereof;
(4) the relocation of the principal offices of
Company to a location other than as acceptable to Executive or
the requirement that Executive primarily perform Executive's
services hereunder anywhere other than Company's principal
offices, except for required travel on the business of Company
to the extent consistent with Executive's business obligations;;
(5) the failure by Company to pay to Executive any
amounts due hereunder within seven (7) days of the date such
amounts shall have been due;
(6) the failure by Company to continue in effect
(without reduction in benefit levels and/or reward
opportunities) any of the benefits to be provided hereunder;
(7) the failure of Company to obtain from any of its
successors the express assumption and agreement required under
Paragraph 17.(a)(16)(C) hereof;
(8) any purported termination of Executive's
employment by Company for Cause other than pursuant to the
provisions of Paragraph 10 hereof;
(9) a material adverse change in the operations,
policies, funding, procedures, practices or professionalism
relating to the overall conduct of Company and/or its business
operations;
(10) a Change of Control (as defined below); or
(11) Executive, in good faith, determines that
Executive is unable to perform Executive's duties hereunder for
any successor to all or substantially all of the business
and/or assets of Company following a transaction described in
Paragraph 17.(a)(16)(C) hereof.
(b) Any termination of the Employment Term by Executive
for Good Reason shall be communicated to Company by a written notice
that:
(1) indicates the specific termination provision of
this Paragraph 11 relied upon;
(2) sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination under
the provision so indicated; and
(3) sets forth the proposed date of termination of
the Employment Term which in no event shall be less than five
(5) days nor more than sixty (60) days after the date of such
notice.
12. Disability. In the event of a physical or mental
infirmity which renders Executive unable to substantially perform
Executive's duties, services and responsibilities hereunder for a
period of one hundred and eighty (180) consecutive calendar days (a
"Disability"), the Employment Term shall automatically terminate on
such one hundred and eightieth calendar day, without any further or
additional action on the part of Company. The determination as to
whether a Disability shall exist shall be made by a physician
selected by Executive or Executive's legal representative, and
reasonably acceptable to Company. Such physician's determination as
to the existence of a Disability shall be final, binding and
conclusive on Company and Executive.
13. Effect of a Termination.
(a) Termination Payments.
(1) In the event that the Employment Term shall be
terminated for any reason Company shall pay to Executive the
following payments and benefits (all such payments and benefits
set forth in this Paragraph 13.(a)(1) are hereinafter referred
to as the "Accrued Compensation and Benefits"):
(A) Company shall pay to Executive, in a lump
sum cash payment not later than ten (10) days following the
date of termination of the Employment Term, any Base Salary
accrued hereunder on or prior to the date of termination but
not theretofore paid to Executive, plus an additional amount of
Base Salary in respect of Executive's accrued and unused
vacation (including any amounts carried forward from prior
years);
(B) Company shall pay to Executive, in a lump
sum cash payment not later than ten (10) days following the
date of termination of the Employment Term, an amount equal to
the Bonus Amount (as defined below) multiplied by a fraction,
the numerator of which shall be the number of days in the
fiscal year in which the date of termination of the Employment
Term shall have occurred, and the denominator of which shall be
the number three hundred and sixty-five (365);
(C) Company shall pay to the executive, not
later than ten (10) days following the date of termination of
the Employment Term (in cash where applicable), any incentive
compensation that has been earned pursuant to any of the
provisions of Paragraph 5.(b) hereof but not theretofore paid
to Executive;
(D) Executive shall be entitled to any
Transaction Bonus and Subsidiary Bonus which shall accrue
following termination of the Employment Term in accordance with
the provisions of Paragraph 5.(b)(2) hereof;
(E) Executive shall be entitled to
reimbursement for all of Executive's then unreimbursed business
expenses in accordance with Paragraph 6.(b) hereof; and
(F) Executive shall be entitled, in accordance
with the terms and conditions of the applicable plan, program
or arrangement, to all benefits accrued under any benefit
plans, programs or arrangements in which Executive shall be a
participant as of the date of termination.
(2) In the event that the Employment Term shall be
terminated for any reason other than by Company for Cause:
(A) to the extent applicable, Executive and the
surviving spouse of Executive shall, at the sole expense of
Company, be entitled to medical and dental insurance benefits
for the remainder of each of their respective lives, which
benefits shall in no case be less favorable (on an after-tax
basis) in terms of benefit levels applicable to each of
Executive and Executive's surviving spouse than that applicable
to Executive and Executive's surviving spouse on the date of
termination of the Employment Term; and
(B) during the period (the "Continuation
Period") which shall commence on the date of termination of the
Employment Term and shall terminate on the thirty-six (36)
month anniversary of such date, to the extent applicable,
Executive, the surviving spouse of Executive and/or Executive's
dependents, shall, at the sole expense of Company, continue to
be covered under any benefits provided by Company to Executive
as of the date of termination of the Employment Term, other
than any medical and dental insurance benefits for the benefit
of Executive and Executive's surviving spouse, which benefits
shall be provided in accordance with the provisions of
Paragraph 13.(a)(2)(A), as if Executive had continued to be an
employee of Company; provided, however, that in the event that
participation in any one or more of the Initial Benefits or any
successor thereto shall not be possible or the benefits
applicable to Executive, Executive's surviving spouse and/or
Executive's dependents shall be less favorable than that
available immediately prior to termination of the Employment
Term, then, during the Continuation Period, Company shall, at
its sole expense, provide not less favorable (on an after-tax
basis) benefits. The entitlement to all such benefits for the
Continuation Period as provided under this Paragraph 13.(a)(2)
shall hereinafter referred to as the "Continuation Benefits".
(3) In the event that the Employment Term shall be
terminated due to Executive's death, then, in addition to the
Accrued Compensation and Benefits and Continuation Benefits,
during the Continuation Period Company shall continue to pay to
Executive's spouse, or in the event that Executive shall not
have a spouse on the date of death, to Executive's heirs, the
Base Salary, plus an amount equal to two (2) times the Bonus
Amount (as defined below) which amount shall be paid ratably
over the Continuation Period.
(4) In the event the Employment Term shall be
terminated due to the Disability of Executive, then, in
addition to the Accrued Compensation and Benefits and
Continuation Benefits, during the Continuation Period, Company
shall continue to pay to Executive:
(A) an amount equal to:
1. one hundred percent (100%) of the Base
Salary, for the twelve (12) month period which shall
commence on the date of termination of the Employment
Term,
2. sixty-six percent (66%) of the Base
Salary for the twelve (12) month period which shall
commence on the twelve (12) month anniversary of the date
of termination of the Employment Term,
3. thirty-three percent (33%) of the Base
Salary for the twelve (12) month period which shall
commence on the twenty-four (24) month anniversary of the
date of termination of the Employment Term, plus
(B) an amount equal to the Bonus Amount (as
defined below) , which amount shall be paid ratably over the
thirty-six (36) month period during which the Base Salary is
continued pursuant to this Paragraph 13.(a)(4).
(5) In the event that the Employment Term shall be
terminated by Company without Cause or by Executive for Good
Reason, then, in addition to the Accrued Compensation and
Benefits and Continuation Benefits:
(A) not later than fifteen (15) days following
the date of termination of the Employment Term, Company shall
pay to Executive in a lump sum cash payment an amount equal to
three (3) times the sum of:
1. the Base Salary; and
2. an amount (the "Bonus Amount") equal
to the highest Annual Bonus paid or payable to Executive
in respect of any of the three (3) fiscal years prior to
the fiscal year in which the date of termination of the
Employment Term shall have occurred;
(B) notwithstanding the terms and conditions of
any plan, agreement or arrangement, all outstanding options to
acquire securities of Company, stock appreciation rights,
shares of restricted stock and other equity-based awards held
by Executive on the date of termination of the Employment Term
shall be fully vested and all restrictions thereon or on the
underlying securities shall lapse;
(C) not later than thirty (30) days following
the date of termination of the Employment Term, Company shall
pay to Executive in a lump sum cash payment an amount equal to
the Black-Scholes Value of the Foregone Options (each as
defined below). For purposes of this Section 13.(a)(5)(C), the
term "Black-Scholes Value" shall mean the value, using the
Black-Scholes method of valuation, of options to purchase
securities of Company, as calculated by a compensation
consultant that shall be mutually approved by Company and
Executive, in each case, which approval shall not unreasonably
be withheld. For purposes of this Section 13.(a)(5)(C), the
term "Foregone Options" shall mean a number of options to
acquire securities of Company equal to the number of such
options which shall have been granted to Executive during the
two (2) year period terminating on the date of termination of
the Employment Term or, in the event that termination shall
occur following a Change of Control, during the two (2) year
period terminating on the Change of Control if more favorable
to Executive; and
(D) not later than thirty (30) days following
the date of termination of the Employment Term, Company shall
pay to Executive in a lump sum cash payment an amount equal to
the excess of:
1. the Expected Retirement Benefit (as
defined below) had:
a. Executive remained employed by
Company for an additional three (3) complete years of
credited service;
b. Executive's annual compensation
during such period been equal to the sum of the Base
Salary and Bonus Amount;
c. Company made employer
contributions to each defined contribution plan in which
Executive was a participant as of the date of termination
of the Employment Term (in an amount equal to the amount
of such contribution for the plan year immediately
preceding such date or, in the event that termination
shall occur following a Change of Control, for the plan
year immediately preceding the plan year in which the
Change of Control shall have occurred if more favorable to
Executive); and
d. Executive been fully (100%)
vested in Executive's benefit under each retirement plan
in which Executive was a participant
over
2. the lump sum actuarial equivalent of
the aggregate retirement benefit Executive shall actually
be entitled to receive under such retirement plans.
(E) during the Continuation Period, Company
shall provide to Executive an office (at a location of
Executive's choice in the continental United States),
furnishings and secretarial and administrative support
comparable to what Executive was provided immediately prior to
the termination of the Employment Term; and
(F) For purposes of Paragraph 13.(a)(5)(D), the
term "Expected Retirement Benefit" shall mean the lump sum
actuarial equivalent of the aggregate retirement benefit
Executive would have been entitled to receive under Company's
supplemental and other retirement plans and savings plans,
based on the plan provisions as in effect immediately prior to
termination of the Employment Term or, in the event that
termination shall occur following a Change of Control,
immediately prior to the Change of Control if more favorable to
Executive, and the "actuarial equivalent" shall be determined
in accordance with actuarial assumptions used by the Pension
Benefit Guaranty Corporation for single-employer pension plans
terminating on the date of termination of the Employment Term.
(b) Payments in Lieu of Severance. The severance
payments provided under this Agreement shall be in lieu of any other
severance or termination payment that Executive may be entitled to
under any other plan, policy or agreement of or with Company.
Executive shall not be required to mitigate the amount of any
payments or benefits provided under this Agreement by seeking other
employment or otherwise and no such payment or benefit shall be
offset or reduced by the amount of any compensation or benefits
provided to Executive in any subsequent endeavor of employment or
for any other reason whatsoever.
(c) Excise Tax.
(1) In the event it shall be determined that any
payment (other than the payment provided for in this Paragraph
13.(c)) or distribution of any type to or for the benefit of
Executive, by Company, any affiliate of Company, any person who
acquires ownership or effective control of Company or ownership
of a substantial portion of Company's assets (within the
meaning of Section 280G of the Internal Revenue Code of 1986,
as amended (the "Code"), and the regulations thereunder) or any
affiliate of such person, whether paid or payable or
distributed or distributable pursuant to the terms of this
Agreement or otherwise (the "Total Payments"), is or will be
subject to the excise tax imposed by Section 4999 of the Code
or any interest or penalties with respect to such excise tax
(such excise tax, together with any such interest and
penalties, are collectively referred to as the "Excise Tax"),
then Executive shall be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after
payment by Executive of all taxes (including any interest or
penalties imposed with respect to such taxes), including any
income tax, employment tax or Excise Tax, imposed upon the
Gross-Up Payment, Executive retains an amount of the Gross-Up
Payment equal to the Excise Tax imposed upon the Total Payments.
(2) All determinations that are required to be made
under this Paragraph 13.(c), including, but not limited to,
determinations as to whether any of the Total Payments are
"parachute payments" (within the meaning of Section 280G of the
Code), whether a Gross-Up Payment is required, the amount of
such Gross-Up Payment and amounts relevant to the last sentence
of this Paragraph 13.(c)(2), shall be made by an independent
accounting firm selected by Executive from among the four (4)
largest accounting firms in the United States (the "Accounting
Firm") (including, but not limited to, and without objection by
Company and notwithstanding any potential or actual conflict of
interest between Company and Executive, any such accounting
firm which is then providing or has at any time in the past
provided services to Company and/or any subsidiaries or
affiliates of Company), which shall provide its determination
(the "Determination"), together with detailed supporting
calculations, regarding the amount of any Gross-Up Payment and
any other relevant matter, both to Company and Executive by no
later than ten (10) days after the date Executive's employment
is terminated, if applicable, or such other time as requested
by Company or by Executive if Executive reasonably believes
that there is a possibility that an Excise Tax may be payable
in respect of all or any portion of the Total Payments. If the
Accounting Firm determines that no Excise Tax is payable by
Executive, it shall furnish Executive and Company with an
opinion reasonably acceptable to Executive and Company that no
Excise Tax is payable (including the reasons therefor) and that
Executive has substantial authority not to report any Excise
Tax on Executive's federal income tax return. If a Gross-Up
Payment is determined to be payable, it shall be paid to
Executive within twenty (20) days after the Determination (and
all accompanying calculations and other material supporting the
Determination) is delivered to Company by the Accounting Firm.
Any determination by the Accounting Firm shall be binding upon
Company and Executive, absent manifest error. As a result of
uncertainty in the application of Section 4999 of the Code at
the time of the initial determination by the Accounting Firm
hereunder, it is possible that Gross-Up Payments not made by
Company should have been made ("Underpayment"), or that
Gross-Up Payments will have been made by Company which should
not have been made ("Overpayments"). In either such event, the
Accounting Firm shall determine the amount of the Underpayment
or Overpayment that has occurred. In the case of an
Underpayment, the amount of such Underpayment (together with
any interest and penalties payable by Executive as a result of
such Underpayment) shall be promptly paid by Company to or for
the benefit of Executive. In the case of an Overpayment,
Executive shall, at the direction and expense of Company, take
such steps as are reasonably necessary (including the filing of
returns and claims for refund), follow reasonable instructions
from, and procedures established by, Company, and otherwise
reasonably cooperate with Company to correct such Overpayment.
The fees and expenses of the Accounting Firm shall be paid by
Company.
(d) Personal Property. In the event the Employment Term
shall be terminated for any reason, Executive or such individual or
individuals (each, an "Agent") as shall be designated by Executive,
or, in the event of Executive's death or Disability, Executive's
counsel, shall have the right, at such reasonable time or times as
shall be determined in the sole discretion of Executive or
Executive's counsel, as the case may be, to retrieve from any
premises of Company all personal property belonging to Executive
(collectively, the "Personal Property"), including, but not limited
to, furniture, machines, notes, writings, memoranda, lists, logs,
correspondence, documents, files, reports, technical data,
recordings, disks, tapes and any other tangible product or document
belonging to Executive.
14. Indemnification. During the Employment Term and
thereafter, to the fullest extent permitted by law, Company shall
indemnify Executive and Executive's spouse, and save and hold each
of them harmless from and against any damages, liabilities, losses,
judgments, fines, amounts paid in settlement, costs and reasonable
expenses (including, but not limited to, attorneys' fees and
expenses), resulting from, arising out of or in connection with any
pending or threatened claim, action, proceeding or investigation
(whether civil or criminal) against or affecting Executive or
Executive's spouse as a result of Executive or Executive's spouse
serving as an officer, director or employee of Company or in any
capacity with the consent of or at the request of Company, in or
with regard to any other entity, employee benefit plan or enterprise
(other than arising out of Executive's or Executive's spouse's acts
of material and willful misconduct or intentional (e.g., not
negligent representation, etc.) fraud. In the event Company does
not compromise or assume the defense of any indemnifiable claim or
action against Executive or Executive's spouse, Company shall
promptly pay to Executive or Executive's spouse all costs and
expenses incurred or to be incurred by Executive or Executive's
spouse in defending or responding to any claim or investigation in
advance of the final disposition thereof. Company may not agree to
any settlement or compromise of any claim against Executive or
Executive's spouse, other than a settlement or compromise solely for
monetary damages for which Company shall be solely responsible,
without the prior written consent of Executive or Executive's
spouse, which consent may be withheld. This indemnification shall
be in addition to, and not in lieu of, any other indemnification
Executive or Executive's spouse shall be entitled to pursuant to
Company's Articles of Incorporation, Bylaws or otherwise. Following
termination of the Employment Term, Company shall continue to cover
Executive and Executive's spouse under Company's directors and
officers insurance for the period during which Executive and
Executive's spouse may be subject to potential liability for any
claim, action or proceeding (whether civil or criminal) as a result
of Executive or Executive's spouse serving as an officer, director
or employee of, or consultant to, Company or in any capacity at the
request of Company, in or with regard to any other entity, employee
benefit plan or enterprise (other than arising out of Executive's or
his spouse's acts of material and willful misconduct or intentional
fraud).
15. Certain Definitions. For purposes of this Agreement:
(a) the term "Change of Control" shall mean the
occurrence of any of the following:
(1) An acquisition (other than directly from
Company) of any voting securities of Company (the "Voting
Securities") by any "Person" (as the term person is used for
purposes of Section 13(d) or 14(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") immediately after
which such Person has "Beneficial Ownership" (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of
fifty percent (50%) or more of the combined voting power of
Company's then outstanding Voting Securities; provided,
however, in determining whether a Change of Control has
occurred, Voting Securities which are acquired in a
"Non-Control Acquisition" (as hereinafter defined) shall not
constitute an acquisition which would cause a Change of
Control. A "Non-Control Acquisition" shall mean an acquisition
by:
(A) an employee benefit plan (or a trust
forming a part thereof) maintained by:
1. Company; or
2. any corporation or other Person of
which a majority of its voting power or its voting equity
securities or equity interest is owned, directly or
indirectly, by Company (for purposes of this definition, a
"Subsidiary");
(B) Company or its Subsidiaries;
(C) any Person in connection with a
"Non-Control Transaction" (as hereinafter defined);
(D) any Person who, immediately prior to such
acquisition, owned fifty percent (50%) or more of the combined
voting power of Company's then outstanding Voting Securities; or
(E) Executive or Executive's Permitted
Transferees (as hereinafter defined) (each, a "Grandfathered
Stockholder" and, collectively, the "Grandfathered
Stockholders") or a Permitted Transferee of any Grandfathered
Stockholder.
(2) The individuals who, as of the date hereof are
members of the Board (the "Incumbent Board"), cease for any
reason to constitute at least two-thirds (2/3) of the members
of the Board; provided, however, that if the election, or
nomination for election by the shareholders of Company, of any
new director was approved by a vote of at least two-thirds of
the Incumbent Board, such new director shall, for purposes of
this Agreement, be considered as a member of the Incumbent
Board; provided further, however, that no individual shall be
considered a member of the Incumbent Board if such individual
initially assumed office as a result of either an actual or
threatened "Election Contest" (as described in Rule 14a-11
promulgated under the Exchange Act or other actual or
threatened solicitation of proxies or consents by or on behalf
of any "Person" (as the term "person" is used for purposes of
Section 13(d) or 14(d) of the Exchange Act) other than the
Board (a "Proxy Contest") including by reason of any agreement
intended to avoid or settle any Election Contest or Proxy Contest.
(3) The consummation of:
(A) A merger, consolidation or reorganization
with or into Company or in which securities of Company are
issued, unless such merger, consolidation or reorganization is
a Non-Control Transaction (as hereinafter defined). A
"Non-Control Transaction" shall mean a merger, consolidation or
reorganization with or into Company or in which securities of
Company are issued where:
1. the shareholders of Company,
immediately before such merger, consolidation or
reorganization, own directly or indirectly immediately
following such merger, consolidation or reorganization, at
least fifty percent (50%) of the combined voting power of
the outstanding voting securities of the corporation
resulting from such merger or consolidation or
reorganization (the "Surviving Corporation") in
substantially the same proportion as their ownership of
the Voting Securities immediately before such merger,
consolidation or reorganization;
2. the individuals who were members of
the Board immediately prior to the execution of the
agreement providing for such merger, consolidation or
reorganization constitute at least two-thirds (2/3) of the
members of the board of directors of the Surviving
Corporation, or a corporation beneficially owning directly
or indirectly a majority of the Voting Securities of the
Surviving Corporation; and
3. No Person other than:
a. Company,
b. any Subsidiary,
c. any employee benefit plan (or any
trust forming a part thereof) that, immediately prior
to such merger, consolidation or reorganization was
maintained by Company or any Subsidiary,
d. any Person who, immediately prior
to such merger, consolidation or reorganization had
Beneficial Ownership of fifty percent (50%) or more
of the then outstanding Voting Securities, or
e. the Grandfathered Stockholder,
has Beneficial Ownership of fifty percent (50%) or
more of the combined voting power of the Surviving
Corporation's then outstanding voting securities or
its common stock;
(B) A complete liquidation or dissolution of
Company; or
(C) The sale or other disposition of all or
substantially all of the assets of Company to any Person (other
than a transfer to a Subsidiary or the distribution to
Company's shareholders of the stock of a Subsidiary or any
other assets).
(b) Notwithstanding the foregoing, a Change of Control
shall not be deemed to occur solely because any Person (the "Subject
Person") acquired Beneficial Ownership of more than the permitted
amount of the then outstanding Voting Securities as a result of the
acquisition of Voting Securities by Company which, by reducing the
number of Voting Securities then outstanding, increases the
proportional number of shares Beneficially Owned by the Subject
Persons, provided that if a Change of Control would occur (but for
the operation of this sentence) as a result of the acquisition of
Voting Securities by Company, and after such share acquisition by
Company, the Subject Person becomes the Beneficial Owner of any
additional Voting Securities which increases the percentage of the
then outstanding Voting Securities Beneficially Owned by the Subject
Person, then a Change of Control shall occur.
(c) The term "Permitted Transferee" shall mean with
respect to Executive, Executive's immediate family, trusts solely
for the benefit of such family members and partnerships in which
such family members and/or trusts are the only partners. For this
purpose, Executive's "immediate family" means Executive's spouse,
parents, children, stepchildren and grandchildren and the spouses of
such parents, children, stepchildren and grandchildren.
16. Covenants of Executive. In order to induce Company to
enter into this Agreement, Executive hereby covenants as follows:
(a) Assignment.
(1) Executive hereby irrevocably assigns to Company,
or to any party designated by the Company, Executive's entire
right, title and interest in all Developments (as hereinafter
defined) that are made, conceived, or developed by Executive,
in whole or in part, alone or jointly with others, within the
scope of Executive's employment with Company. Such assignment
shall include, without limitation, all Intellectual Property
Rights (as hereinafter defined) in such Developments.
(2) "Developments" shall mean all discoveries,
inventions, designs, improvements, enhancements, ideas,
concepts, techniques, know-how, software, documentation or
other works of authorship, whether or not copyrightable or
patentable, related to any business or technology that has been
developed or is under development by Company.
(3) "Intellectual Property Rights" shall mean all
forms of intellectual property rights and protections that may
be obtained for, or may pertain to, the Confidential
Information (as hereinafter defined) and Developments and may
include without limitation all right, title and interest in and
to:
(A) all Letters Patent and all filed, pending
or potential applications for Letters Patent, including any
reissue, reexamination, division, continuation or
continuation-in-part applications throughout the world now or
hereafter filed;
(B) all trade secrets, and all trade secret
rights and equivalent rights arising under the common law,
state law, Federal law and laws of foreign countries;
(C) all mask works, copyrights other literary
property or author's rights, whether or not protected by
copyright or as a mask work, under common law, state law,
Federal law and laws of foreign countries; and
(D) all proprietary indicia, trademarks,
tradenames, symbols, logos and/or brand names under common law,
state law, Federal law and laws of foreign countries.
(b) Confidentiality.
(1) During the Restriction Period (as hereafter
defined) and thereafter, Executive shall not, directly or
indirectly, without the prior written consent of Company,
except to the extent required by an order of a court having
competent jurisdiction or under subpoena from an appropriate
governmental agency, disclose to anyone, or use in competition
with Company, any Confidential Information (as hereinafter
defined) of or pertaining to Company.
(2) "Confidential Information" shall mean
confidential or other proprietary information that is owned by
the Company, financial, commercial, business or technical
information relating to Company or other information designated
as confidential or proprietary by Company, whether generated by
Company or received by Company and belonging to suppliers,
customers or others who do business with Company, including
without limitation trade secrets, advertising arrangements,
costs, financial data, employee information or information as
to organization structure of Company, hardware and software
designs, product specifications and documentation, business and
product plans, customer lists, and other confidential business
information.
(3) Confidential Information shall not include
information which:
(A) is or becomes public knowledge without any
action by, or involvement of, Executive;
(B) is disclosed by Executive with the prior
written approval of Company; or
(C) is disclosed pursuant to any judicial or
governmental order, provided that Executive gives Company
sufficient prior notice to contest such order.
(4) Executive shall not disclose to Company, use in
Company's business, or cause Company to use, any confidential
or proprietary information or materials of any third party.
(c) Records. All papers, books and records of every kind
and description relating to the business and affairs of Company, or
any of its affiliates, whether or not prepared by Executive, other
than Executive's Personal Property, shall be the sole and exclusive
property of Company, and Executive shall surrender same to Company
immediately upon expiration of the Employment Term.
(d) Competition.
(1) Executive shall not, during the Restriction
Period (as defined below), anywhere in the Restricted Area (as
defined below), directly or indirectly engage in or become
associated as an employee, consultant, partner, owner, agent,
stockholder, officer or director of, or otherwise have a
business relationship with, any person or organization engaged
in, or about to become engaged in, a business that competes,
directly or indirectly, with the business of Company.
(2) "Restriction Period" shall mean the period
commencing on the date hereof and continuing until the date
thirty six (36) months after the expiration of the Employment
Term.
(3) "Restricted Area" shall mean the United States
of America and any of its possessions.
(4) Notwithstanding anything herein contained to the
contrary, this paragraph shall not prohibit Executive from
owning up to ten percent (10%) of the outstanding shares of any
class of securities that are registered under the Securities
Act of 1933, as amended (the "Securities Act") or the Exchange
Act.
(e) Solicitation. During the Restriction Period, the
Executive shall not directly or indirectly solicit for employment on
the Executive's own behalf, or on behalf of any other enterprise,
any individual who is or has been an employee, agent or independent
contractor of the Company at any time during the Employment Term or
the Restriction Period.
(f) Reformation. The provisions contained in this
paragraph 16 as to the time periods, geographic area and scope of
activities restricted shall be deemed divisible, so that if any
provision contained in this paragraph 16 is determined to be invalid
or unenforceable, that provision shall be deemed modified so as to
be valid and enforceable to the full extent lawfully permitted.
(g) Enforcement. Executive acknowledges, agrees and
warrants that the covenants contained in this paragraph 16 are
reasonable, that valid consideration has been and will be received
by Executive in exchange therefor and that the agreements set forth
herein are the result of arms-length negotiations between Company
and Executive. Executive recognizes that the provisions of this
paragraph 16 are of vital importance to the continuing welfare of
Company, and its affiliates, and that money damages would constitute
a totally inadequate remedy for any violation thereof. Accordingly,
in the event of any such violation by Executive, Company, and its
affiliates, in addition to any other remedies available thereto,
shall have the right to institute and maintain a proceeding to
compel specific performance thereof or to issue an injunction
restraining any action by the Executive (without the necessity of
posting a bond in connection therewith) for any violation of this
paragraph 16.
17. Miscellaneous
(1) Construction. Whenever any words are used
herein in the masculine gender, they shall be construed as
though they were also used in the feminine gender in all cases
where they would so apply. Whenever any words used herein are
in the singular form, they shall be construed as though they
were also used in the plural form in all cases where they would
so apply.
(2) Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed to be
an original but all of which together shall constitute one and
the same instrument.
(3) Dispute Resolution. All actions and proceedings
arising out of or relating to this Agreement shall be heard and
determined in any Florida state or federal court sitting in
Palm Beach County, Florida, and the parties hereto hereby
consent to the jurisdiction of such courts in any such action
or proceeding; provided, however, that neither party shall
commence any such action or proceeding unless prior thereto the
parties have in good faith attempted to resolve the claim,
dispute or cause of action which is the subject of such action
or proceeding through mediation by an independent third party.
(4) Entire Agreement. This Agreement sets forth the
entire understanding of the parties hereto with respect to the
subject matter hereof, and supersedes all prior agreements,
written or oral, between them as to such subject matter.
(5) Facsimile Execution. Facsimile signatures on
counterparts of this Agreement are hereby authorized and shall
be acknowledged as if such facsimile signatures were an
original execution.
(6) Full Settlement. Company's obligation to make
the payments provided for in, and otherwise to perform its
obligations under, this Agreement shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim,
right or action that Company may have against Executive or
others. Company hereby acknowledges that it will be difficult
and may be impossible to measure the amount of damages which
Executive may suffer as a result of a termination of the
Employment Term. Accordingly, the foregoing payments are
hereby acknowledged by Company to be reasonable and will be
liquidated damages, and Executive will not be required to
mitigate the amount of any such payments by seeking other
employment or otherwise, nor will any profits, income, earnings
or other benefits from any source whatsoever create any
mitigation, offset, reduction or any other obligation on the
part of Executive hereunder or otherwise.
(7) Governing Law. This Agreement shall be governed
by and construed in accordance with the internal laws of the
State of Florida, without reference to the principles of
conflict of laws.
(8) Headings and Numbers. The headings contained
herein are solely for the purposes of reference, are not part
of this Agreement and shall not in any way affect the meaning
or interpretation of this Agreement.
(9) Legal Fees. In addition to any obligation
Company may have under Paragraph 14 hereof, Company shall
promptly pay, upon demand by Executive, all legal fees, court
costs, fees of experts and other costs and expenses when
incurred by Executive in connection with any actual, threatened
or contemplated litigation or legal, administrative or other
proceeding brought under or involving this Agreement to which
Executive is or expects to become a party, whether or not
initiated by Executive. Subject to any rights of Executive
under Paragraph 14 hereof, if Company or, if Company shall not
be a party to such litigation or proceeding, the party opposing
Executive, shall prevail against Executive alone in Executive's
individual and not fiduciary capacity on the material issues
involved in any such litigation or proceeding (other than a
litigation or proceeding involving Paragraph 13.(c) hereof),
then, after all rights of appeal shall have been exercised or
shall have lapsed, Executive shall promptly repay to Company
all amounts previously paid to the Employee under this
Paragraph 17.(a)(9) in respect of such claim, but without
interest thereon.
(10) Modifications. Neither this Agreement nor any
provision hereof may be modified, altered, amended or waived
except by an instrument in writing duly signed by the party to
be charged.
(11) Non-Exclusivity of Rights. Nothing contained in
this Agreement shall prevent or limit Executive's continuing or
future participation in any plan, program, policy or practice
provided by Company for which Executive may qualify (including,
but not limited to, the Initial Benefits), except with respect
to any plan, program, policy or practice which shall provide
severance or termination payments, nor shall anything contained
in this Agreement limit or otherwise affect such rights as
Executive may have under any contract or agreement with
Company, except with respect to any contract or agreement which
shall provide severance or termination payments. Vested
benefits and other amounts that Executive shall otherwise be
entitled to receive under any plan, program, policy or practice
of, or any contract or agreement with, Company (including, but
not limited to, the Initial Benefits) on or after the date of
termination of the Employment Term shall be payable in
accordance with the terms of each such plan, program, policy,
practice, contract or agreement, as the case may be, except as
explicitly modified by this Agreement.
(12) Non-Waiver of Rights. The failure to enforce at
any time the provisions of this Agreement or to require at any
time performance by the other party of any of the provisions
hereof shall in no way be construed to be a waiver of such
provisions or to affect either the validity of this Agreement
or any part hereof, or the right of either party to enforce
each and every provision in accordance with its terms. No
waiver by either party hereto of any breach by the other party
hereto of any provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or
dissimilar provisions at that time or at any prior or
subsequent time.
(13) Notices. Every notice relating to this
Agreement shall be in writing and shall be given by personal
delivery or by registered or certified mail, postage prepaid,
return receipt requested as set forth below. Either of the
parties hereto may change their address for purposes of notice
hereunder by giving notice in writing to such other party
pursuant to this Paragraph 17.(a)(13).
If to Company:
_______________________________________
_______________________________________
_______________________________________
_______________________________________
If to Executive:
_______________________________________
_______________________________________
_______________________________________
_______________________________________
(14) Rabbi Trust. Upon the occurrence of a Change of
Control, Company shall deposit into a "rabbi trust,"
established solely for the benefit of Executive and meeting the
requirements of Rev. Proc. 92-64, 1992-2 C.B. 422, and the
terms of which are reasonably acceptable to Executive, an
amount of cash sufficient (as determined by Company in good
faith, subject to the approval of Executive, which approval
shall not unreasonably be withheld) to fund the anticipated
payments and benefits under this Agreement.
(15) Severability. The invalidity or enforceability
of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this
Agreement. If any provision of this Agreement shall be held
invalid or unenforceable in part, the remaining portion of such
provision, together with all other provisions of this
Agreement, shall remain valid and enforceable and continue in
full force and effect to the fullest extent consistent with law.
(16) Successors.
(A) This Agreement is personal to Executive
and, without the prior written consent of Company, shall not be
assignable by Executive otherwise than by will or the laws of
descent and distribution. This Agreement shall inure to the
benefit of and be enforceable by Executive's legal
representatives.
(B) This Agreement shall inure to the benefit
of and be binding upon Company and its successors and assignees.
(C) Company shall require any successor
(whether direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the business
and/or assets of Company expressly to assume and agree to
perform this Agreement in the same manner and to the same
extent that Company would have been required to perform it if
no such succession had taken place. As used in this Agreement,
"Company" shall mean both Company as defined above and any such
successor that assumes and agrees to perform this Agreement, by
operation of law or otherwise.
(17) Transferability of Rights and Benefits. The
rights and benefits of Executive under this Agreement may not
be anticipated, assigned, alienated or subject to attachment,
garnishment, levy, execution or other legal or equitable
process except as required by law. Payments under this
Agreement shall not be considered assets of Executive in the
event of insolvency or bankruptcy.
(Signatures Appear Next Page)
IN WITNESS WHEREOF, Company has caused this Agreement to be
executed by authority of the Board and Executive has executed this
Agreement, each on the day and year first above written.
Kirshner International, Inc.
By:/s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx, President
/s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx
