EMPLOYMENT AGREEMENT
EXHIBIT
10.10
This
Employment Agreement (“Agreement”) is entered into as of this 16th day of
April,
2007, by and between COMMEMORATIVE BRANDS, INC. and any successors thereto
(collectively referred to as the “Company”) and Xxxx Xxxxxxxxxxxxx
(“Executive”).
The
parties hereby agree as follows:
1. Employment.
Executive will serve the Company in the position of Chief Financial Officer
of
American Achievement Corporation, its Parents and its Subsidiaries and will
perform such duties as from time to time shall be determined by the Board of
Directors of the Company, and will perform, faithfully and diligently, the
services and functions performed and will carry out the functions of his office
and furnish his best advice, information, judgment and knowledge with respect
to
the business of the Company. Executive agrees to perform such duties as
hereinabove described and to devote full-time attention and energy to the
business of the Company. Executive will not, during the term of employment
under
this Agreement, engage in any other business activity if such business activity
would impair Executive’s ability to carry out his duties under this
Agreement.
2. Term.
Contingent upon successful completion of a criminal background investigation,
reference check and pre-employment drug screen, this Agreement shall be
effective April 16, 2007 and end on April 15, 2008, and shall thereafter renew
for successive one-year terms, unless two months’ notice is given by either
party to the other party of non-renewal. However, this Agreement may be
terminated at any time by either party in accordance with Section 6
hereof.
3. Compensation
and Other Benefits.
3.1
Salary. The salary compensation to be paid by the Company to Executive
and which Executive agrees to accept from the Company for services performed
and
to be performed by Executive hereunder shall be an annual gross amount, before
applicable withholding and other payroll deductions, of $275,000, payable in
equal bi-weekly installments of $10,576.92, subject to such changes as the
Board
of Directors of the Company may, in its sole discretion, from time to time
determine.
3.2
Benefits. Executive shall be entitled to participate in such employee
benefit programs, plans and policies (including incentive bonus plans) as are
maintained by the Company and as may be established for the employees of the
Company from time to time on the same basis as other executive employees are
entitled thereto, except to the extent such plans are duplicative of benefits
otherwise provided to Executive under this Agreement (e.g. severance). It is
understood that the establishment, termination or change in any such Executive
employee benefit programs, plans or policies shall be at the option of the
Company in the exercise of its sole discretion, from time to time, and any
such
termination or change in such program, plan or policy will not affect this
Agreement so long as Executive is treated on the same basis as other executive
employees participating in such program, plan or policy, as the case may be.
Upon termination of employment under this Agreement, without regard to the
manner in which the termination was brought about, Executive’s rights in such
employee benefit programs, plans or policies shall be governed solely by the
terms of the program, plan or policy itself and not this Agreement. Executive
shall be entitled to an annual paid vacation in accordance with the Company’s
personnel policy for his years of service completed as an employee of the
Company (and, to the extent applicable, the Company’s predecessors) except that
Executive shall be entitled to four weeks of paid vacation effective with his
employment date.
4. Working
Facilities. During the term of his employment under this Agreement,
Executive shall be furnished with a private office, stenographic services and
such other facilities and services as are commensurate with his position with
the Company and adequate for the performance of his duties under this
Agreement.
5. Expenses.
During the term of his employment under this Agreement, Executive is authorized
to incur reasonable out-of-pocket expenses for the discharge of his duties
hereunder and the promotion of business of the Company, including expenses
for
entertainment, travel and related items that are incurred in accordance with
the
Company’s policies. The Company shall reimburse Executive for all such expenses
upon presentation by Executive from time to time of itemized accounts of
expenditures incurred in accordance with Company policies.
6. Termination.
The employment relationship between Executive and the Company is “at-will”,
which means that Executive’s employment under this Agreement may be terminated
with or without cause or reason by either the Company or Executive at any time.
Payment to Executive upon his termination is governed by the following terms
and
conditions.
6.1
Termination by Company for Cause. The following events or
circumstances
are deemed “Cause” for Executive’s termination.
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(i)
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Executive’s
indictment of, or plea of nolo contendere to, a felony or other crime
involving moral turpitude;
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(ii)
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Executive’s
material breach of a contractual obligation to the Company or any
of its
Affiliates (as defined below);
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(iii)
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Executive’s
failure to perform, or gross negligence in the performance of, Executive
material duties and responsibilities to the Company or any of its
Affiliates; or
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(iv)
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Executive’s
substantial, wrongful damage to property of the
Company.
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If
the
Executive is terminated for Cause, upon payment by the Company to Executive
of
all salary earned but unpaid through the termination date, accrued and unused
vacation, and any accrued and unpaid bonus to the date of such termination,
the
Company shall have no further liability to Executive for compensation in
accordance herewith, and Executive will not be entitled to receive any other
salary, the Termination Payments or Termination Benefits (as such terms are
defined below) except aforesaid vacation and any accrued bonus. For purposes
of
this Agreement, “Affiliates” means all persons and entities directly or
indirectly controlling, controlled by or under common control with the Company,
where control may be by management authority, equity interest or
otherwise.
6.2
Termination by Company Without Cause. In the event of the termination of
Executive’s employment under this Agreement by the Company without Cause the
Executive will be entitled to receive 26 bi-weekly payments equal to the average
of his bi-weekly base salary in effect within the two years preceding the
termination (including, for these purposes, average bi-weekly base salary of
Executive from the Company’s predecessors) (“Termination Payments”), less
legally required withholdings. In addition to the Termination Payments,
Executive will be entitled to elect the continuation of health benefits under
COBRA and the Company will pay the COBRA premiums for a maximum of 12-months,
beginning on the date that Executive’s health coverage ceases due to his
termination, accrued but unused vacation, and any accrued bonus (“Termination
Benefits”). If Executive obtains employment while he is entitled to receive the
Termination Payments and the Termination Benefits, the payment of the
Termination Benefits shall cease upon Executive becoming covered under the
new
employer’s health coverage plan at no cost to Executive. The combination of the
Termination Payments and the Termination Benefits constitute the sole amount
to
which Executive is entitled if termination is without Cause.
6.3
Termination by Executive Without Good Reason. Executive may terminate his
employment under this Agreement without Good Reason as defined in Paragraph
6.4
below upon the giving of 30 days written notice of termination. In the event
of
such termination, in lieu of the 30 day notice period, the Company may elect
to
pay Executive compensation for the notice period (or any remaining portion
thereof), plus unused accrued vacation and any accrued unpaid bonus, in which
event Executive’s services to the company will be terminated immediately. No
Termination Payments or Termination Benefits other than as set forth in Section
6.3 shall be payable upon Executive’s termination of this Agreement without Good
Reason.
6.4
Termination by Executive With Good Reason. Executive may terminate his
employment under this Agreement for Good Reason. For purposes of this Agreement,
“Good Reason” shall mean:
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(i)
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Without
Executive’s consent, the assignment to Executive of substantial duties
inconsistent with Executive’s then-current position, duties,
responsibilities, change in the reporting level and status with the
Company, or any removal of Executive from his titles and offices,
except
in connection with the termination of Executive’s employment under this
Agreement by Company or as a result of Executive’s death or permanent
disability (as defined in the Company’s or Executive’s disability
insurance policies);
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(ii)
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The
Company requiring Executive to relocate anywhere other than Austin,
or
Dallas, Texas without Executive’s consent;
or
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(iii)
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A
decrease in Executive’s salary from the salary in effect upon the date
hereof that is inconsistent with or not commensurate with Executive’s then
current position in the Company.
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(iv)
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In
the event of termination under this Section 6.4, the Company shall
pay to
Executive the same Termination Payments and Termination Benefits
to which
Executive would have been entitled had he been terminated by the
Company
without Cause.
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6.5
Death or Permanent Disability. Executive’s employment under this
Agreement shall terminate upon Executive’s death or permanent disability (as
defined in the Company’s or Executive’s disability insurance policies). Other
than accrued but unused vacation and any accrued but unpaid bonus, no
Termination Payments or Termination Benefits shall be payable upon Executive’s
death or permanent disability.
6.6
Release Agreement. The payment of Termination Payments and Termination
Benefits pursuant to Section 6 are conditioned upon Executive signing an
effective release of claims in the form provided by the Company (the "Release
Agreement") within the time limits set forth by the Company.
6.7
Notwithstanding anything to the contrary in this Agreement, (i) except to the
extent required by law, no payment will be due and payable under this Section
6
until the later of the next regular Company payday following the effective
date
of the Release Agreement or that date which is in accordance with the
requirements of clause (ii) hereof and (ii) in the event that at the time that
Executive’s employment with the Company terminates the Company is publicly
traded (as defined in Section 409A of the Internal Revenue Code), any amounts
payable under this Section 6 that would otherwise be considered deferred
compensation subject to the additional twenty percent (20%) tax imposed by
Section 409A if paid within six (6) months following the date of termination
of
Company employment shall be paid at the later of the time otherwise provided
in
Section 6 or the time that will prevent such amounts from being considered
deferred compensation.
7. Confidentiality.
The Company and its Affiliates possess confidential information, proprietary
information goodwill and trade secrets, which is important to their business.
During the course of Executive’s employment with the Company, the Executive will
receive and have access to confidential information, proprietary information,
goodwill and trade secrets belonging to the Company and its Affiliates that
Executive did not have or have access to prior to Executive’s execution of this
Agreement to enable Executive to perform his duties and responsibilities
hereunder. During and after the term of employment under this Agreement,
Executive agrees that he shall not, without the express written consent of
Company, directly or indirectly communicate or divulge to, or use for his own
benefit or for the benefit of any other person, firm, association or
corporation, any of Company’s or its Affiliates’ trade secrets, confidential
information, proprietary information or goodwill, which trade secrets,
confidential information, proprietary data and goodwill were communicated to
or
otherwise learned or acquired by Executive during his employment relationship
with Company (“Confidential Information”), except that Executive may disclose
such matters to the extent that disclosure is required (a) at Company’s
direction or (b) by a court or other governmental agency of competent
jurisdiction. As long as such matters remain trade secrets, confidential
information, proprietary information or goodwill, Executive shall not use such
trade secrets, confidential information, proprietary information or goodwill
in
any way or in any capacity other than as expressly consented to by
Company.
8. Covenant
not to Compete or Solicit. Ancillary to the Company’s commitments as set
forth herein, including but not limited to, the obligation to provide Executive
with the Company’s and its Affiliates’ confidential information, proprietary
information, trade secrets and goodwill and Executive’s agreement not to
improperly use or disclose the Company’s and its Affiliates’ proprietary
information, trade secrets or goodwill, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
and
to avoid the actual or threatened misappropriation of the Company’s and its
Affiliates’ confidential information, proprietary information, trade secrets or
goodwill, Executive agrees to the following covenants:
8.1
Executive agrees to refrain during his employment under this Agreement and
for
one year after the termination of his employment under this agreement for any
reason, without written permission of the Company, from becoming involved in
any
way, within the boundaries of the United States, in the business of
manufacturing, designing, servicing or selling, the type of jewelry or fine
paper or other scholastic, licensed sports, insignia, recognition or affinity
products manufactured or sold (or then contemplated to be manufactured or sold)
by the Company, its divisions, subsidiaries and/or other affiliated entities,
including but not limited to, as an employee, consultant, independent
representative, partner representative, partner or proprietor. For the avoidance
of doubt, these restrictions shall apply, but shall not be limited to, Executive
becoming involved with Xxxxx-Xxxxx, Jostens, Visant, Intergold, Lifetouch and
Xxxxxxxxx.
8.2
Executive also agrees to refrain during his employment under this Agreement,
and
in the event of the termination of his employment under this Agreement for
any
reason, for one year thereafter, without written permission from the Company,
from diverting, taking, soliciting, licensed sports, jewelry or fine paper
products, insignia, recognition or affinity business of any customer of the
Company, its divisions, subsidiaries and/or affiliated entities, or any
potential customer of the Company, its divisions, subsidiaries and/or affiliated
entities whose identity became known to Executive through his employment by
the
Company and to which the Company has made a written business proposal or
provided written pricing information before the termination of Executive’s
employment under this Agreement.
8.3
Executive agrees to refrain during his employment under this Agreement, and
in
the event of the termination of his employment under this Agreement for any
reason for a period of one year thereafter, from inducing or attempting to
influence any employee or independent representative of the Company, its
divisions, subsidiaries, and/or affiliated entities to terminate his or his
employment or association with the Company or such other entity.
8.4
Executive further agrees that the covenants in Sections 8.1, 8.2 and 8.3 are
made to protect the legitimate business interests of the Company, including
interests in the Company’s “Confidential Information,” as defined in Section 7
of this Agreement, and not to restrict his mobility or to prevent him from
utilizing his skills. In signing this Agreement, Executive gives the Company
assurance that he has carefully read and considered all the terms and conditions
of this Agreement, including the restraints imposed on him under Section 7
and
8. Executive agrees without reservation that these 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. Executive further agrees that, were he
to
breach any of the covenants contained in Sections 7 and 8, he damage to the
Company and its Affiliates would be irreparable. 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 him of any of those covenants, without having to post
bond.
Executive and the Company further agree that, in the event that any provision
of
Sections 7 and 8 is 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, that provision shall be
deemed to be modified to permit its enforcement to the maximum extent permitted
by law. It is also agreed that each of the Company's Affiliates shall have
the
right to enforce all of Executive’s obligations to that Affiliate under this
Agreement, including without limitation pursuant to Sections 7 and
8.
9. Controlling
Law and Performability. The execution, validity, interpretation and
performance of this Agreement will be governed by the laws of the state of
Texas.
10. Reparability.
If any provision of this Agreement is rendered or declared illegal or
unenforceable, all other provisions of this Agreement will remain in full force
and effect.
11. Notices.
Any notice required or permitted to be given under this Agreement shall be
sufficient if in writing and if sent by certified mail (return receipt
requested) addressed as follows:
| If to Executive: | Xxxx X. Xxxxxxxxxxxxx | |
| 00 Xxxx Xxxxxxxxx Xxxxxx | ||
| Xxx Xxxxxxxxx, XX 00000 | ||
| If to the Company: | Commemorative Brands, Inc. | |
| 0000 Xxxxxx X Xxxx | ||
| Xxxxxx, Xxxxx 00000 | ||
| Attention: Xxx Xxxxxxxx, President & CEO |
Any
address or other change to the above shall be in writing to the other party
to
become effective.
12. Assignment.
The rights and obligations of the Company under this Agreement shall inure
to
the benefit of and be binding upon its successors and assigns. The rights and
obligations of Executive under this Agreement are of a personal nature and
shall
neither be transferred nor assigned in whole or in part by
Executive.
13. Non-Waiver.
No waiver of or failure to assert any claim, right, benefit or remedy hereunder
shall operate as a waiver of any other claim, right, benefit or remedy of the
company or Executive.
14. Review
and Consultation. Executive acknowledges that he has had a reasonable time
to review and consider this Agreement and has been given the opportunity to
consult with an attorney.
15.
Entire Agreement and Amendments. This Agreement contains the entire
agreement of Executive and the Company relating to the matters contained in
this
Agreement and supersedes all prior agreements and understandings, oral or
written, between Executive and the Company with respect to the subject matter
in
this Agreement. This Agreement may be changed only by an agreement in writing
by
Executive and the Company.
IN
WITNESS WHEREOF, the parties have executed this Agreement on the date and year
first above written.
| COMMEMORATIVE BRANDS, INC. | |||
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Date
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By:
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/s/ XXX XXXXXXXX | |
| Xxx Xxxxxxxx | |||
| President & CEO | |||
| EXECUTIVE | |||
| /s/ XXXX X. XXXXXXXXXXXXX | |||
| Xxxx X. Xxxxxxxxxxxxx | |||
