EXHIBIT 10.11
EMPLOYMENT AGREEMENT, DATED AS OF DECEMBER 16, 1996 BY AND
BETWEEN COMMEMORATIVE BRANDS, INC. AND XXXXXX X. XXXXXXXX
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into as of this 16th
day of December, 1996, by and between COMMEMORATIVE BRANDS, INC. and any
successors thereto (collectively referred to as the "Company") and XXXXXX X.
XXXXXXXX ("Executive").
The parties hereby agree as follows:
1. EMPLOYMENT. Executive will serve the Company in an executive capacity as Vice
President - On-Campus Sales and Marketing. Executive will be responsible for all
sales and marketing of scholastic products through the on-campus distribution
channel including the Balfour high school "in-school" channel and the college
on-campus channel (both ArtCarved and Balfour). Executive will report directly
to the Company's Chief Executive Officer 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. This Agreement shall be effective upon the consummation of the
acquisition by the Company of substantially all of the assets and businesses of
X.X. Xxxxxxx Company, Inc. and CJC Holdings, Inc. on December 16, 1996, and
shall thereafter terminate on December 15, 1999; PROVIDED, that the term of this
Agreement may be automatically extended for an additional year on December 15,
-------- 1999, and each anniversary of December 15, 1999, unless at least 60
days prior to December 15, 1999, or such anniversary date, the Company shall
give notice to Executive that the termination date shall not be so extended.
3. COMPENSATION AND OTHER BENEFITS.
3.1. SALARY; BONUS. 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 $160,000,
payable in equal bi-weekly installments of $6,153.85, subject to such changes as
the Board of Directors of the Company may, in its sole discretion, from time to
time determine. In addition, the Company agrees to pay Executive a $50,000 bonus
if Executive remains employed by the Company during the period from December 16,
1996, through December 15, 1997, or if Executive's employment is earlier
terminated by the Company without Cause (as defined in paragraph 6.1 below) or
by Executive with Good Reason (as defined in paragraph 6.4 below), in each case,
subject to approval by the Board of Directors of the Company based on
Executive's performance during such period.
3.2. BENEFITS. Executive shall be entitled to participate in such
employee benefit programs, plans and policies (including incentive bonus plans
and incentive stock option 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.
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It is understood that the establishment, termination or change in any such
Executive employee benefit programs, plans or policies shall be at the instance
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, if applicable, the Company's predecessors).
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. 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
customary Company policies.
6. TERMINATION. Executive's employment under this Agreement may be terminated
with or without cause or reason by either Company or Executive upon the
following terms and conditions.
6.1. TERMINATION BY COMPANY FOR CAUSE. If any of the following events
or circumstances occur, the Company may terminate Executive's employment under
this Agreement at any time during or at the end of the initial or any extended
term of this Agreement for any of the following causes (each, a "Cause").
(i) Executive's conviction of a felony;
(ii) Executive's intentional failure to observe or perform material
provisions of this Agreement required to be observed or
performed by him; or
(iii) Executive's intentional substantial wrongful damage to
property of the Company.
Upon payment by the Company to Executive of all salary payable, accrued
and unused vacation, and any accrued 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 the
Termination Payment or Termination Benefits (as such terms are defined below)
except aforesaid vacation and any accrued bonus.
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6.2. TERMINATION BY COMPANY WITHOUT CAUSE. In the event of the
termination of Executive's employment under this Agreement by the Company at any
time during or at the end of the initial or any extended term of this Agreement
without Cause as defined in Paragraph 6.1 above, Executive will be entitled to
receive bi-weekly payments equal to the average of his bi-weekly compensation in
effect within the two years preceding the termination (including, for these
purposes, average bi-weekly compensation of Executive from the Company's
predecessors) ("Termination Payments"), less legally required withholdings, for
a period of the greater of 18 months or the remaining term of this Agreement,
PROVIDED however, that at the option of Executive, Executive may elect at any
time not to be bound by the provisions of Section 8.1 below, in which event
Executive shall not be entitled to any of the foregoing Termination Payments or
the Termination Benefits referred to below. 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 an 18-month
period, 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 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 90 days written notice of termination. In
the event of such termination, the Company may elect to pay Executive six months
of compensation including unused accrued vacation and any accrued bonus in lieu
of 90 days notice, 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:
(i) Without Executive's consent, the assignment to Executive of
substantial duties inconsistent with Executive's then-current
position, duties, responsibilities 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);
(ii) The Company requiring Executive to relocate anywhere other
than to Austin, Texas, except for required travel on the
Company's business to an extent substantially consistent with
Executive's business travel obligations, or, in the event
Executive consents to relocation from Attleboro, Massachusetts
other than to Austin, Texas, or any further relocation out of
Austin, Texas, the failure by the Company to pay or reimburse
Executive
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for all reasonable moving expenses incurred by Executive
relating to a change of Executive's principal residence in
connection with such relocation and to indemnify Executive
against any loss (defined as the difference between the actual
bona fide sale price of such residence and the fair market
value of such residence as determined by a member of the
Society of Real Estate Appraisers designated by Executive and
satisfactory to the Company) realized in the sale of
Executive's principal residence in connection with any such
change in residence; or
(iii) 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 with the Company.
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.
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 Termination Payments and Termination
Benefits pursuant to Section 6 are contingent upon Executive executing a Release
Agreement after termination, a copy of which is attached to this Agreement. It
is understood that Executive may preserve all rights and causes of action in the
event of termination by the Company and evidence of release of same will only be
by execution of said Release Agreement after termination.
7. CONFIDENTIALITY. 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 trade secrets, proprietary data or other
confidential information, which trade secrets, proprietary data or other
confidential information 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, proprietary data or other confidential information,
Executive shall not use such trade secrets, proprietary data or other
confidential information in any way or in any capacity other than as expressly
consented to by Company.
8. COVENANT NOT TO COMPETE OR SOLICIT.
8.1. Executive agrees to refrain 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
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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 or proprietor; PROVIDED however, that in the event of
the termination of Executive's employment by the Company without Cause (as
defined in paragraph 6.2), by Executive without Good Reason (as defined in
paragraph 6.3), or by Executive with Good Reason (as defined in paragraph 6.4),
if Executive elects to forego payment of all Termination Payments and
Termination Benefits and other payments that would otherwise be due to him
pursuant to Section 6 of this Agreement, then Executive shall not be bound by
the provisions of this paragraph 8.1.
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 and/or accepting on his own
behalf or on the behalf of another person, firm, or company, the scholastic,
licensed sports, 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 her employment or association with the Company or such other entity.
8.4. Executive further agrees that the covenants in Sections 8.1 and
8.2 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. Executive understands as a part of these covenants
that the Company intends to exercise whatever legal recourse against him for any
breach of this Agreement and in particular for breach of these covenants.
9. CONTROLLING LAW AND PERFORMABILITY. The execution, validity, interpretation
and performance of this Agreement will be governed by the law of the State of
Texas.
10. SEPARABILITY. 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:
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If to Executive: Xxxxxx X. Xxxxxxxx
000 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
If to the Company: Chief Executive Officer
Commemorative Brands, Inc.
0000 Xxxxxx X Xxxx
Xxxxxx, XX 00000
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 or 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, together with that certain
letter agreement, of even date herewith, between the Company and Executive
contain 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 herein. This Agreement may be changed only by an agreement
in writing by Executive and the Company.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the
date and year first above written.
COMMEMORATIVE BRANDS, INC.
By: /S/ XXXXXXX X. XXXXXXX
Name: Xxxxxxx X. Xxxxxxx
Title: Chief Executive Officer
EXECUTIVE
/S/ XXXXXX X. XXXXXXXX
Xxxxxx X. Xxxxxxxx
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