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EXHIBIT 10.1
EMPLOYMENT AGREEMENT
AGREEMENT, effective this 1st day of October, 1996 by and between
Xxxxxx Industries, Inc., a Delaware Company (together with its successors and
assigns permitted under this Agreement, the "Company"), and Xxxxxx X. Xxxxxxxx
(the "Executive").
W I T N E S S E T H
WHEREAS, Company and Executive entered into a certain employment
agreement, last amended October 1, 1994 (the "Amended Employment Agreement");
and
WHEREAS, Company and Executive desire to amend and restate the Amended
Employment Agreement to extend the term of employment so as to make available
to the Company the Executive's unique and special skills, and to reward the
Executive for his leadership of the Company as demonstrated by the Company's
growth and success.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the receipt of
which is mutually acknowledged, the Company and the Executive (individually a
"Party" and together the "Parties") agree as follows:
1. Definitions.
(a) "Affiliate" of a person or other entity shall mean a person
or other entity that directly or indirectly controls, is controlled by, or is
under common control, with the person or other entity specified. Fifty percent
of the Voting Stock or fifty percent of the equity ownership shall conclusively
establish control.
(b) "Annual Cash Bonus" shall mean the amount calculated as set
forth in Section 5(a).
(c) "Auditors" shall mean an independent nationally recognized
accounting firm jointly selected by Executive and the Company. The Auditors
shall not, during the two years preceding the date of its selection, have acted
in any way on behalf of the Company or any Affiliate thereof. If the Executive
and the Company cannot agree on the firm to serve as the Auditors, then the
Executive and the Company shall each select one accounting firm and those two
firms shall jointly select a single accounting firm to serve as the Auditors.
(d) "Average Stockholder's Equity" for any fiscal year shall be
defined as the average of the stockholders' equity on a consolidated basis of
the Company and its Affiliates (including all Affiliates of any
successor-in-interest to the Company in the event of a merger or consolidation
of the Company with another entity or a Change in Control) for each of the
thirteen (13) month ends, commencing with the month ending on the September
30th of the fiscal year prior to the fiscal year in question and ending with
the month ending on the
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September 30th of the fiscal year in question, as determined in accordance with
generally accepted accounting principles.
(e) "Base Salary" shall mean the salary provided for in Section
4 below or any increased salary granted to the Executive pursuant to Section 4.
(f) "Board" shall mean the Board of Directors of the Company.
(g) "Cash Flow" shall mean income or loss of the Company and its
Affiliates (including all Affiliates of any successor-in-interest to Company in
the event of a merger or consolidation of Company with another entity or a
Change in Control) on a consolidated basis determined in accordance with
generally accepted accounting principles before income taxes, plus each of the
following: depreciation, any non-cash amortization, deferred interest, any
asset write- downs and shall be adjusted for any non-cash charges or credits
which have been used in the calculation of net income. Equitable adjustments
shall be made to reflect properly the timing of transactions that take place at
or near the end of any fiscal year to assure that the cash flow resulting
therefrom is properly reflected in that appropriate fiscal year.
(h) "Cause" shall mean the Executive is convicted of a felony
involving moral turpitude, which conviction has become final and
non-appealable.
(i) A "Change in Control" shall mean the occurrence of any one
of the following events:
(i) any "person," as such term is used in Sections 3(a)(9),
13(d) and 14d(3) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), becomes a "beneficial owner," as such term is
used in Rule 13d-3 promulgated under the Exchange Act, of 20% or more
of the Voting Stock of the Company;
(ii) the Board of Directors or the shareholders of Company
adopt any plan or proposal which would result directly or indirectly
in the liquidation, transfer, sale or other disposal of all or
substantially all of the assets of the Company;;
(iii) all or substantially all of the assets or business of
the Company are disposed of pursuant to a merger, consolidation or
other transaction (unless the shareholders of the Company immediately
prior to such merger, consolidation or other transaction beneficially
own, directly or indirectly, in substantially the same proportion as
they owned the Voting Stock of the Company, all of the Voting Stock or
other ownership interests of the entity or entities, if any, that
succeed to the business of the Company);
(iv) the Company or a direct or indirect subsidiary of the
Company combines with another company (regardless of which entity is
the surviving one) or the Company or a direct or indirect subsidiary
of the Company acquires stock or assets in a corporate transaction,
but, in any of the preceding circumstances, immediately after the
transaction, the shareholders of the Company immediately
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prior to the combination hold, directly or indirectly, 66-2/3% or less
of the Voting Stock of the resulting company;
(v) a recapitalization of the Company occurs which results
in either a decrease by 33% or more in the aggregate percentage
ownership of Voting Securities held by Independent Shareholders (on a
primary basis or on a fully diluted basis after giving effect to the
exercise of stock options and warrants) or an increase in the
aggregate percentage ownership of Voting Securities held by
non-Independent Shareholders (on a primary basis or on a fully diluted
basis after giving effect to the exercise of stock options and
warrants) to greater than 50%. For purposes of this subsection, the
term "Independent Shareholder" shall mean any shareholder of the
Company except any executive officers or directors(s) of the Company
or any employee benefit plan(s) sponsored or maintained by the Company
or any subsidiary thereof;
(vi) a change in the composition of the Board such that the
"Continuing Directors" cease for any reason to constitute at least a
seventy percent (70%) majority of the Board. The "Continuing
Directors" shall mean those members of the Board who either: (x) were
directors at the Effective Date of this Agreement; or (y) were elected
by, or on the nomination or recommendation of, at least a
three-quarters (3/4) majority (consisting of at least four directors)
of the then existing Board; or
(vii) at any time an individual is elected to the Board who
was not nominated by the Board to stand for election;
(viii) an event that would be required to be reported in
response to Item 1 of Form 8-K, Current Report pursuant to Section 13
or 15(d) of the Exchange Act whether or not (i) such event is so
reported on such Form or (ii) the Company is then subject to such
reporting requirement.
(j) "Change in Control Price" shall mean the higher of (x) the
highest reported sales price of a share of Common Stock in any transaction
reported on the principal exchange on which such shares are listed during the
60 business day period prior to the Change in Control, or (y) the highest price
to be paid per share of common stock in any transaction or series of
transactions pursuant to which a Change in Control is effectuated. To the
extent that the consideration paid in any transaction described in (y) consists
of all or in part of securities or other non-cash consideration, the value of
such securities or non-cash consideration shall be determined by a mutually
agreed upon investment bank, or if no such investment bank can be agreed upon,
each party will choose an investment bank and the two investment banks chosen
shall select the investment bank.
(k) "Code" or "Internal Revenue Code" shall mean the Internal
Revenue Code of 1986, as amended, final regulations thereunder and any
subsequent Internal Revenue Code.
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(l) "Constructive Termination Without Cause" shall mean
termination of the Executive's employment at his election as provided in
Section 12 below following the occurrence, without the Executive's written
consent, of one or more of the following events:
(i) a reduction in the Executive's then current Base Salary
or the termination or material reduction of any Executive benefit or
perquisite enjoyed by him;
(ii) the failure to elect or reelect the Executive to any of
the positions described in Section 3 below or the removal of him from
any such position;
(iii) a diminution in the Executive's duties or the
assignment to the Executive of duties which are materially
inconsistent with his duties or which impair the Executive's ability
to function as the Chairman and Chief Executive Officer of the
Company;
(iv) the failure to continue the Executive's participation
in any incentive compensation plan unless a plan providing a
substantially similar compensation is substituted;
(v) the relocation of the Company's principal office to a
location more than 50 miles from Houston, Texas, or the relocation of
the Executive's own office location to a location other than as
determined by the Executive;
(vi) the failure of the Company to obtain the assumption in
writing of its obligation to perform this Agreement by any successor
(or, the ultimate parent of any successor where applicable) to all or
substantially all of the assets of the Company within 15 days after a
merger, consolidation, sale or similar transaction;
(vii) any act or failure to act by the Board of Directors of
the Company which would cause Executive (A) not to be reelected or to
be removed from the position of Chief Executive Officer or position of
the Chairman of the Board of Directors or (B) not to be elected or
reelected as a director by the shareholders of the Company at any
meeting held for that purpose or by written ballot of shareholders of
the Company;
(viii) upon written election by Executive, the failure of
the Company (or by any successor-in- interest) to perform or otherwise
breach any of its obligations under this Agreement. Such election may
be made by Executive at any time within six (6) months after the last
occurrence of the act or commission which Executive deems to be a
breach of this Agreement; or
(ix) upon written election by Executive within one year
after the date an event constituting a Change in Control shall have
occurred.
(m) "Disability" shall mean the Executive's physical or mental
inability to perform substantially his duties and responsibilities under this
Agreement for a period of 180
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consecutive days as determined by an approved medical doctor. For this purpose
an approved medical doctor shall mean a medical doctor selected by the Company
and the Executive. If the Parties cannot agree on a medical doctor, each Party
shall select a medical doctor and the two doctors shall select another medical
doctor who shall be the sole medical doctor for this purpose.
(n) "Stock" shall mean the Common Stock of the Company
(o) "Subsidiary" of the Company shall mean any corporation or
other entity of which the Company owns, directly or indirectly, 50% or more of
the Voting Stock.
(p) "Tax Counsel" for purposes of this subsection 12(d) shall
refer to an independent law firm that is nationally recognized and that is
selected by the Auditors.
(q) "Term of Employment" shall mean the period specified in
Section 2 below.
(r) "Trading Day" is a day on which the Stock is traded on the
American Stock Exchange or any successor principal national securities exchange
or the over the counter market on which the Company's shares are traded.
(s) "Voting Stock" shall mean capital stock of any class or
classes having the power to vote under ordinary circumstances, in the absence
of contingencies, in the election of directors.
2. Term of Employment.
The Company hereby employs the Executive, and the Executive hereby
accepts such employment, for the period commencing October 1, 1996 and ending
at the close of business on September 30, 2001 (the "Expiration Date"),
provided that on each October 1st of every succeeding year after October 1,
1996, the then Expiration Date shall be extended automatically for an
additional one year term unless ten (10) days prior to such October 1st, a
notarized written notice of expiration is given by Company in writing to
Executive and delivered personally to him and by certified mail to his place of
notice set forth in Article 31 hereof. The term specified in the first
sentence of this Section 2 is subject to earlier termination in accordance with
Section 12 of this Agreement.
3. Position, Duties and Responsibilities.
(a) During the Term of Employment, the Executive shall be
employed as the Chairman of the Board of Directors and Chief Executive Officer
of the Company and be responsible for the general management of the affairs of
the Company. The Executive shall also be a member of the Executive Committee of
the Board of Directors. The Executive, in carrying out his duties under this
Agreement, shall report to the Board.
(b) The Executive shall devote such time as is, in his opinion,
reasonably necessary for the performance of his responsibilities and duties
hereunder. Anything herein to the contrary notwithstanding, nothing shall
preclude the Executive from (i) serving on the
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boards of directors of a reasonable number of other corporations or the boards
of a reasonable number of trade associations and/or charitable organizations,
(ii) engaging in charitable activities and community affairs, and (iii)
managing his personal investments and affairs.
(c) The Company acknowledges that, from the commencement of his
employment, Executive has maintained his principal residence in Palm Beach,
Florida, and maintains residences elsewhere. Executive, as a condition to his
employment, is entitled to perform his responsibilities and duties hereunder
from offices in or near his places of residence.
4. Base Salary.
The Executive shall be paid an annualized Base Salary, payable in
accordance with the regular payroll practices of the Company, of $325,000.00.
Effective October 1, 1997, the Base Salary shall be increased to $575,000.00.
The Base Salary shall be reviewed no less frequently than annually for increase
in the discretion of the Board and its Compensation Committee.
5. Annual Incentive Awards.
The Executive shall participate in all annual incentive award
programs, including, without limitation, the following:
(a) Annual Cash Bonus. The Company shall pay to Executive an
Annual Cash Bonus each fiscal year equal to the following: seven (7) percent
of the quantity which is the excess of the Cash Flow of the Company and its
Affiliates in that fiscal year above fifteen (15) percent of the Average
Stockholder's Equity in that fiscal year. For fiscal years commencing on and
after October 1, 1999, the term "seven (7) percent" in the preceding sentence
shall be replaced with "six (6) percent.". The Annual Cash Bonus shall be paid
no later than 135 calendar days following the end of the respective fiscal
year.
(b) Stock Options and Stock Grant Awards. The Company may award
stock options and stock grants from time to time as it deems appropriate.
(c) General. The Executive shall be eligible to participate in
other annual or long-term incentive programs of the Company on the same basis
as other senior-level executives of the Company.
(d) Special Bonus. The Company may from time to time provide a
special non-recurring cash or stock-based bonus for certain extraordinary
specific developments that materially enhance the value of the Company.
(e) Confirmation. The Company acknowledges that Executive has
previously been awarded stock options and stock grants that are fully vested as
identified in Schedule 5.1 and Company reaffirms herein its contractual
commitments in those agreements. The terms of the stock option agreements in
Schedule 5.1 shall continue to apply and be
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construed so as not to change or modify any rights of Executive set forth
therein. The Company acknowledges that Executive also has previously been
awarded stock options that are not fully vested as identified in Schedule 5.1
and Company reaffirms herein its contractual commitments in those agreements.
Notwithstanding any provision in any stock option agreement or plan to the
contrary, Company agrees that all outstanding stock options granted or to be
granted Executive may be assigned by Executive to any third party, subject only
to whatever requirements or restrictions that may be relevant under the
applicable securities laws. Company agrees to undertake all steps (including
registration with the SEC), if necessary to permit Executive to make such
assignments if so desired.
6. Executive Benefit Programs.
Executive shall be entitled to participate in all Executive pension
and welfare benefit plans and programs made available to the Company's senior
level executives or to its executives generally, as such plans or programs may
be in effect from time to time, including, without limitation, pension, profit
sharing, savings and other retirement plans or programs, medical, dental,
hospitalization, short-term and long-term disability and life insurance plans,
accidental death and dismemberment protection, travel accident insurance, and
any other pension or retirement plans or programs and any other Executive
welfare benefit plans or programs that may be sponsored by the Company from
time to time, including any plans that supplement the above-listed types of
plans or programs, whether funded or unfunded. The Executive shall be entitled
to participate in all such programs and plans on a basis that is no less
favorable than any other person. With respect to any post-retirement welfare
benefits, Executive shall be entitled to participate on a basis no less
favorable than that of any other person provided that for this purpose the
Executive's period of employment shall be deemed to be the period necessary to
obtain the maximum level of such benefits.
7. Life Insurance and Benefits.
The Company shall provide life insurance coverage for the benefit of
Executive as set forth in Schedule 7.1 hereto.
8. Disability Benefits
The Company shall provide disability insurance coverage for the
benefit of Executive as set forth in Schedule 8 hereto.
9. Reimbursement of Business and Other Expenses; Perquisites.
(a) The Executive is authorized to incur reasonable expenses as
determined in his judgment in carrying out his duties and responsibilities
under this Agreement and the Company shall promptly reimburse him for all
business expenses incurred in connection with carrying out the business of the
Company. All expenses reimbursed shall be subject to documentation and review
in accordance with the Company's policy; the Company shall have one (1) year
from the close of the fiscal year in which the expenses were reimbursed to
review such expenses and, thereafter, expenses reimbursed will be presumed
conclusively to
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be reimbursable. In no event will the review of expenses result in an
adjustment unless the aggregate amount of adjustment in a fiscal year exceeds
$15,000. Company's sole and exclusive remedy with respect to any act or
omission relating to the reimbursement of expenses shall be an accounting under
the provisions of this paragraph and in no way may Company seek any other
remedy (including, but not limited to, termination).
(b) Executive shall be entitled to participate in any of the
Company's executive fringe benefits in accordance with the terms and conditions
of such arrangements as are made available from time to time for the Company's
executives on a basis no less favorable than any other executive.
(c) Executive shall be entitled to establish Company paid
office(s) for his use at or near his principal residence, and/or at any other
residence maintained by him. Executive shall be entitled to employ at the
Company's expense such number of administrative assistants at appropriate
compensation levels as considered necessary by him.
(d) In all events, the Company shall:
(i) pay for any club membership fees (including any bond
requirement) and luncheon clubs as the Executive determines are
appropriate to his carrying out his duties hereunder;
(ii) provide the Executive with a car (including insurance,
repair and maintenance) and driver trained in security techniques if
needed for his use;
(iii) provide the Executive with personal financial
(including tax) counseling by a firm to be chosen by the Executive;
and
(iv) provide the Executive with a security system or
security coverage at the job location, at his residence or otherwise
if reasonably requested by Executive.
(v) The Company shall, at Company expense, make available to
the Executive Company aircraft for business and personal use at his
discretion, such use to be subject to income imputation rules pursuant
to applicable Internal Revenue Service regulations. To the extent
applicable and not otherwise a qualified business expense, the Company
shall provide Executive with tax gross-up payments with respect to any
taxes incurred on any commutation between a business location and his
residences be so that all such taxes shall not be borne by Executive.
It is recognized that some of the Executive's travel by Company
aircraft may be required for security purposes and, as such, will
constitute business use of the aircraft.
(vi) The Company shall provide the Executive with a personal
Umbrella policy in the amount of $5,000,000.
(vii) Items (i) thru (vi) shall be reviewed annually with
the Chairman of the Compensation Committee
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(e) It is the intention of the Company that the Executive shall,
after taking into account any taxes on reimbursements or other benefits under
this Section 9, be kept whole with respect to such reimbursement or other
benefit. Accordingly, to the extent the Executive is taxable on any such
reimbursements or benefits, the Company shall pay the Executive in connection
therewith an amount which after all taxes incurred by the Executive on such
amount shall equal the amount of the reimbursement or benefit being provided
10. Vacation.
The Executive shall be entitled to six weeks paid vacation per year.
Vacation shall be taken each fiscal year and, if not taken within six (6)
months after the end of the fiscal year, shall not be carried forward
thereafter without Board approval.
11. Life Insurance for Company's Benefit.
The Company in its discretion may apply for and procure as owner and
for its own benefit, insurance on the life of the Executive, in such amount and
in such forms as the Company may choose. The Executive shall have no interest
whatsoever in any such policy or policies, but, at the request of the Company,
shall submit to medical examinations and supply such information and execute
such documents as may reasonably be required by the insurance company or
companies to which the Company has applied for insurance.
12. Termination of Employment.
(a) This Agreement may be terminated prior to the Expiration
Date provided that the amounts and obligations set forth in this Section are
paid and performed by Company and only in the following events:
(i) Executive's death;
(ii) Executive's Disability;
(iii) By Company, for "Cause" as defined in Section 1 of
this Agreement;
(iv) By Executive, for Constructive Termination Without
Cause as defined in Section 1, or by Company for any reason other than
that specified in (iii) above; and
(v) By Executive, upon written voluntary resignation by a
notarized instrument signed personally by Executive to be delivered to
the President of the Company or the Chairman of the Compensation
Committee (or, his designate), provided thirty (30) day written notice
is given;
provided, however, that any termination shall not be effective unless the
amounts and obligations of Company are paid and performed as required by the
provisions of this Section 12.
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(b) In the event that Executive's employment is terminated on
the basis of events in Section 12(a)(i), (ii) or (iv), Executive (or his estate
or his beneficiaries as the case may be) shall be entitled to receive within
thirty (30) days, upon occurrence of such event, the following:
(i) The greater of (x) all Base Salary which would have been
payable through the Expiration Date as if such date were the
termination date, or (y) three (3) times the then current Base Salary.
(ii) The greater of (w) all Annual Cash Bonus calculated
under Section 5(a) which would have been payable through the
Expiration Date as if such date were the termination date, or (x)
three (3) times the highest "bonus" paid during the last three fiscal
years prior to termination (for this purpose, "bonus" shall include
any Annual Cash Bonus and other cash bonus, and shall also include the
fair market value of any grants of stock awards or stock options
valued on a Black-Scholes basis at a 40% volatility without regard to
any vesting or other restrictions) or (y) three (3) times the highest
Annual Cash Bonus calculated under Section 5(a) for each of the three
previous fiscal years prior to termination, regardless of whether that
amount was in fact paid. For purposes of making the lump sum
calculation required in the preceding sentence, the future amounts of
the Annual Cash Bonus shall be based on the Annual Cash Bonus which
would have been payable based on the last fiscal year's results and
the amount due in the case of (w) under the preceding sentence shall
be adjusted each year to reflect the Annual Cash Bonus based on actual
results that would have been payable, all such calculations to be made
by the Auditors. Any additional amounts due in future years shall be
paid in cash within ninety (90) days of the respective fiscal
year-end.
(iii) Any restricted stock outstanding, whether or not
vested, shall become immediately and fully vested and transferable to
the full extent possible at the time of termination.
(iv) Any outstanding stock option (including any reload
rights contained therein) of any kind whatsoever shall become
immediately and fully vested and transferable to the full extent
possible at the time of termination without regard to any
contingencies or conditions specified therein, for the remainder of
the original term of the option.
(v) Any amounts earned, accrued or owing to Executive but
not yet paid, including any and all obligations to be performed
following termination under Sections 6-9. Executive, or his designee,
shall be entitled to continue to receive all the benefits set forth in
Section 6-9 through the later of: (1) Expiration Date as if no
termination occurred, or (2) three-years from the date of termination
(vi) Continued participation in medical, dental and life
insurance coverage until Executive receives equivalent coverage and
benefits under the plans and programs of a subsequent employer (such
coverage and benefits to be determined on a coverage-by-coverage or
benefit-by-benefit basis) or death of the later of Executive
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or his spouse; provided that (x) if the Executive is precluded from
continuing his participation in any Executive benefit plan or program
as provided in this clause (vi) of this Section 12(b), he shall be
provided with the after-tax economic equivalent of the benefits
provided under the plan or program in which he is unable to
participate for the period specified in this clause, (y) the economic
equivalent of any benefit foregone shall be deemed to be the lowest
cost that would be incurred by the Executive in obtaining such benefit
himself on an individual basis, and (z) payment of such after-tax
economic equivalent shall be made quarterly in advance;
(vii) Other or additional benefits in accordance with
applicable plans or programs of the Company.
(viii) In the event that the termination is related to a
Change in Control (or there is some other basis for termination as
well as a basis related to a Change in Control), then, in addition to
the items listed in (i) through (vii) above, Executive shall be
entitled, upon his election to terminate because of a Change in
Control, to receive in lieu of the exercise of any such number of
outstanding options as selected by Executive an amount of cash in
exchange therefor in an amount equal to (x) the excess of the Change
in Control Price over the exercise price of the options per share of
common stock, multiplied by (y) the number of options selected by
Executive. If Executive is entitled to reload options, his right to
reload options shall be preserved and the number of such reload
options in the continuing entity shall be adjusted to represent in the
continuing entity the same percentage of the total shares and options
of the Company outstanding immediately prior to the Change of Control.
In lieu of retaining all or a portion of any reload options, Executive
shall, upon his election to terminate because of a Change in Control,
be entitled to monetize such reload options as he selects and receive
in lieu thereof an amount of cash equal to the value of the selected
reload options computed on a Black Scholes basis using the following
assumptions: (i) a 40% volatility, (ii) a 10 year option term, (iii) a
stock price equal to the greater of the Change in Control Price or
the closing stock price on the date the election is made to terminate
because of a Change in Control and (iv) and no other restrictions on
exercise. Notwithstanding anything to the contrary, in addition,
Executive shall be entitled to an amount of cash equal to one dollar
less than the amount that would constitute an "excess parachute
payment" as defined in Section 280G of the Internal Revenue Code of
1986, as amended (the "Section 280 Amount") in lieu of the amounts
that would be payable to Executive under 12(b)(i) and 12(b)(ii) of
this Section 12 if such Section 280 Amount is greater than the sum of
the amounts under 12(b)(i) and 12(b)(ii). In addition, Executive
shall be entitled to be granted additional options immediately
exercisable for five years to acquire a number of shares of common
stock equal to the highest number of options granted during any fiscal
year during the period comprising the then current fiscal year, and
the three fiscal years preceding such termination at an exercise price
per share equal to the average closing price per share of Stock during
the twenty trading days prior to the event which resulted in the
triggering of the Change in Control.
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(c) In the event Executive's employment is terminated on the
basis of events in Sections 12(a)(iii) or (v), Executive shall be entitled to
receive within (60) days, upon occurrence of such event, the following:
(i) Base Salary through the date of the termination.
(ii) All Annual Cash Bonus calculated under Section 5(a)
(and pro-rated for the relevant part of the fiscal year) which would
have been payable through the date of termination; such amount shall
be estimated based on the last fiscal year's results and adjusted
later based on actual results, all such calculations to be performed
by the Auditors. Any additional amounts to be paid shall be paid
within ninety (90) days of the end of the respective fiscal year-end.
(iii) All restricted stock that has vested on or prior to
the date of termination.
(iv) Any outstanding stock option (including any reload
rights contained therein) of any kind whatsoever vested on or prior to
the date of termination, for the remainder of the original term of the
option.
(v) Any amounts earned, accrued or owing to the Executive
but not yet paid, including any and all obligations to be performed
following termination under Sections 6-9.
(vi) Other or additional benefits in accordance with
applicable plans of programs of the Company.
(d) In the event that Executive becomes entitled to any payments
provided under Section 12 (the "Agreement Payments") and in the event that any
of the Agreement Payments are subject to the tax (the "Excise Tax") imposed by
Section 4999 of the Code (or any similar tax that may hereafter be imposed),
the Company shall pay or cause to be paid to Executive at the time specified in
this subsection an additional amount ( the "Gross-up Payment") such that the
net amount retained by Executive, after deduction of any Excise Tax on the
Total Payments (as hereinafter defined) and any federal, state and local income
tax and Excise Tax upon the Gross-up Payment provided for this subsection, but
before deduction for any federal, state or local income tax on the Agreement
Payments, shall be equal to the Total Payments. To the extent that the Excise
Tax is amended or modified, or any similar tax is hereinafter imposed, the
provisions of this subsection shall be applied mutatis mutandis to effect the
same desired result of providing Executive net of such additional taxes the
benefits of the payments in Section 12.
For purposes of determining whether any of the Agreement Payments will
be subject to the Excise Tax and the amount of such Excise Tax, (i) any other
payments or benefits received or to be received by Executive in connection with
a Change in Control of the Company or the Executive's termination of employment
(whether pursuant to the terms of this Agreement or any other plan, arrangement
or agreement with the Company, or with any person whose actions result in a
Change in Control of the Company or any person affiliated
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with the Company or such person) (which, together with the Agreement Payments,
shall constitute the "Total Payments") shall be treated as "parachute payments"
within the meaning of Section 280G(b)(2) of the Code, and all "excess parachute
payments" within the meaning of Section 280G(b)(1) of the Code shall be treated
as subject to the Excise Tax, unless in the opinion of Tax Counsel selected by
the Auditors such other payments or benefits (in whole or in part) do not
constitute parachute payments, or such excess parachute payments (in whole or
in part) represent reasonable compensation for services actually rendered
within the meaning of Section 280G(b)(4) of the Code in excess of the base
amount within the meaning of Section 280G(b)(3) of the Code or are otherwise
not subject to the Excise Tax, (ii) the amount of the Total Payments which
shall be treated as subject to the Excise Tax shall be equal to the lesser of
(1) the total amount of the Total Payments or (2) the amount of excess
parachute payments within the meaning of Section 280G(b)(1) of the Code (after
applying clause (i), above), and (ii) the value of any non-cash benefits or any
deferred payment or benefit shall be determined by the Auditors in accordance
with the principles of Sections 280G(d)(3) and (4) of the Code.
For purposes of determining the amount of the Gross-up payment,
Executive shall be deemed to pay federal income taxes at the highest marginal
rate of federal income taxation for the calendar year in which the Gross-up
Payment is to be made and the applicable state and local income taxes at the
highest marginal rate of taxation for the calendar year in which the Gross-up
Payment is to be made, net of the maximum reduction in federal income taxes
which could be obtained from deduction of such state and local taxes. . In
the event that the Excise Tax is determined to exceed the amount taken into
account hereunder at the time the Gross-up Payment is made (including by reason
of any payment the existence or amount of which cannot be determined at the
time of the Gross-up Payment), the Company shall make or cause to be made an
additional Gross-up Payment in respect of such excess (plus any interest
payable with respect to such excess) at the time that the amount of such excess
is finally determined.
The Gross-up Payment or portion thereof provided for above shall be
paid not later than the thirtieth (30) day following payment of any amounts
under Section 12; provided, however, that if the amount of such Gross-up
payment or portion thereof cannot be finally determined on or before such day,
the Company shall pay or cause to be paid to Executive on such day an estimate,
as determined by the Auditors, of the minimum amount of such payments and shall
pay or cause to be paid the remainder of such payments (together with interest
at the rate provided in Section 1274(b)(2)(B) of the Code) as soon as the
amount thereof can be determined, but in no event later than the forty-fifth
day after payment of any amounts under Section 12. In the event that the
amount of the estimated payments exceeds the amount subsequently determined to
have been due, such excess shall constitute a loan to Executive, repayable on
the fifth day after demand by the Company (together with interest at the rate
provided in Section 1274(b)(2)(B) of the Code).
(e) No Mitigation: No Offset. In the event of any termination
of employment under this Section 12, the Executive shall be under no obligation
to seek other employment and there shall be no offset against amounts due the
Executive under this Agreement on account of any remuneration attributable to
any subsequent employment that he may obtain except as specifically provided in
this Section 12.
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(f) Nature of Payments. Any amounts due under this Section 12
are in the nature of severance payments considered to be reasonable by the
Company and are not in the nature of a penalty.
13. Confidentiality.
(a) During the Term of Employment and thereafter, the Executive
shall not disclose to anyone or make use of any trade secret or proprietary or
confidential information of the Company, including such trade secret or
proprietary or confidential information of any customer or other entity to
which the Company owes an obligation not to disclose such information, which he
acquires during the Term of Employment, including but not limited to records
kept in the ordinary course of business, except (i) as such disclosure or use
may be required or appropriate in connection with his work as an Executive of
the Company or (ii) when required to do so by a court of law, by any
governmental agency having supervisory authority over the business of the
Company or by any administrative or legislative body (including a committee
thereof) with apparent jurisdiction to order him to divulge, disclose or make
accessible such information; provided, however, that no trade secret or
proprietary or confidential information shall be required to be treated as such
to the extent such portions of such information are or become generally
available to the public other than as a result of a disclosure by Executive or
other Company representative bound by an agreement or duty of confidentiality.
14. Indemnification.
(a) Defined Terms. For purposes of Sections 14 through 19
inclusive, the following terms shall have the meaning given here:
(i) "Corporate Status" shall mean the status of a person who
is or was a director, officer or fiduciary of the Company or of any
other corporation, partnership, joint venture, trust, executive
benefit plan or other enterprise which such person is or was serving
at the express written request of the Company.
(ii) "Disinterested Director" shall mean a director of the
Company who is not and was not a party to the Proceeding in respect of
which indemnification is sought by the Executive.
(iii) "Enterprise" shall mean the Company and any other
corporation, partnership, joint venture, trust, executive benefit plan
or other enterprise which the Executive is or was serving as a
director, officer or fiduciary at the express written request of the
Corporation.
(iv) "Expenses" shall include all reasonable attorneys' fees
and costs, retainers, court costs, transcript costs, fees of experts,
witness fees, travel expenses, duplicating costs, printing and binding
costs, telephone charges, postage, delivery service fees, and all
other disbursements or expenses of the types customarily incurred in
connection with prosecuting, defending, preparing to prosecute or
defend,
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appealing, settling, investigating or being or preparing to be a
witness in a Proceeding.
(v) "Good Faith" shall mean the Executive's having acted in
good faith and in a manner the Executive reasonably believed to be in,
or not opposed to, the best interests of the Corporation, and, with
respect to any criminal Proceeding, having had no reasonable cause to
believe his conduct was unlawful.
(vi) "Independent Counsel" means a law firm, or a member of
a law firm, that is experienced in matters of corporate law and
neither presently is, and has not in the past five (5) years has been,
retained to represent: (i) the Company or Executive in any matter
material to either party, or (ii) any other party to the Proceeding
giving rise to a claim for indemnification hereunder. Notwithstanding
the foregoing, the term "Independent Counsel" shall not include any
person who, under the applicable standards of professional conduct
then prevailing, would have a conflict of interest in representing
either the Company or the Executive in an action to determine the
Executive's rights under this Agreement.
(vii) "Proceeding" includes any action, suit arbitration,
alternate dispute resolution mechanism, investigation, administrative
hearing or any other actual, threatened or completed proceeding,
whether civil, criminal, administrative or investigative, other than
one initiated by the Executive.
(b) In General. In connection with any Proceeding involving acts
or omissions occurring on or subsequent to January 6, 1987, the Company shall
indemnify and advance Expenses to the Executive as provided in this Agreement
to the fullest extent permitted by applicable law in effect on the Effective
Date and to such greater extent as applicable law may thereafter from time to
time permit.
(c) Proceedings Other Than Proceedings by or in the Right of
Company. If, by reason of the Executive's Corporate Status, the Executive is or
is threatened to be made a party to any Proceeding other than a Proceeding by
or in the right of the Company, the Company shall indemnify the Executive
against Expenses, judgments, penalties, fines and amounts paid in settlement or
actually and reasonably incurred by the Executive or on the Executive's behalf
in connection with such Proceeding or any claim, issue or matter therein if the
Executive acted in Good Faith.
(d) Proceedings by or in the Right of Company. If, by reason of
the Executive's Corporate Status, the Executive is, or is threatened to be made
a party to any Proceeding brought by or in the right of the Company to procure
a judgment in its favor, the Executive shall be indemnified against Expenses,
judgments, penalties, fines and amounts paid in settlement, or actually and
reasonably incurred by the Executive or on the Executive's behalf in connection
with such Proceeding or any claim, issue or matter therein if the Executive
acted in Good Faith. Notwithstanding the foregoing, no such indemnification
shall be made in respect of any claim, issue or matter in such Proceeding as to
which the Executive shall have been adjudged to be liable to the Company if
applicable law prohibits such indemnification; provided, however, that if
applicable law so permits, indemnification shall
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nevertheless be made by the Company in such event if and only to the extent
that the Court of Chancery of the State of Delaware or the court in which such
Proceeding shall have been brought or is pending shall determine.
(e) Indemnification of a Party who is Wholly or Partly
Successful. Notwithstanding any other provision of this Agreement, to the
extent that the Executive is, by reason of the Executive's Corporate Status, a
party to and is successful on the merits or otherwise, as to one or more but
less than all claims, issues or matters in such Proceeding the Company shall
indemnify the Executive against all Expenses, judgments, penalties, fines and
amounts paid in settlement, or actually and reasonably incurred by the
Executive or on the Executive's behalf in connection with each successfully
resolved claim, issue or matter, except as permitted by law. For purposes of
this paragraph (e) and without limitation, the termination of any claim, issue
or matter, in such a Proceeding by dismissal, with or without prejudice, shall
be deemed to be a successful result as to such claim, issue or matter, so long
as there has been no finding (either adjudicated or pursuant to this Section
14) that the Executive did not act in Good Faith.
(f) Indemnification for Expenses of a Witness. Notwithstanding
any other provision of this Agreement, to the extent that the Executive is, by
reason of the Executive's Corporate Status, a witness in any Proceeding, the
Executive shall be indemnified against all Expenses actually and reasonably
incurred by the Executive or on the Executive's behalf in connection therewith.
(g) Successors. The indemnification and advancement of expenses
provided by, or granted pursuant to, this Agreement shall continue as to the
Executive and shall inure to the benefit of the heirs, executors and
administrators of the Executive.
15. Advancement of Expenses.
Notwithstanding any provision to the contrary in this Agreement, the
Company shall advance all reasonable Expenses, which, by reason of the
Executive's Corporate Status, were incurred by or on behalf of the Executive in
connection with any Proceeding, within twenty (20) days after the receipt by
the Company of a statement or statements from the Executive requesting such
advance or advances, whether prior to or after final disposition of such
Proceeding. Such statement or statements shall reasonably evidence the
Expenses incurred by the Executive and shall include or be preceded or
accompanied by an undertaking by or on behalf of the Executive to repay any
Expenses if it shall ultimately be determined that the Executive is not
entitled to be indemnified against such Expenses. Any advance and undertakings
to repay pursuant to this Section 15 shall be unsecured and interest-free.
16. Procedures for Determination of Entitlement to Indemnification.
(a) Initial Request. To obtain indemnification under this
Agreement, the Executive shall submit to the Company a written request,
including therein or therewith such documentation and information as is
reasonably available to the Executive and which is reasonably necessary to
determine whether and to what extent the Executive is entitled to
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indemnification. The Secretary of the Company shall promptly advise the Board
in writing that the Executive has requested indemnification .
(b) Method of Determination. If required by applicable law, a
determination with respect to the Executive's entitlement to indemnification
shall be made as follows;
(i) if a Change in Control has occurred, unless the
Executive shall request in writing that such determination be made in
accordance with paragraph (b) (ii) of this Section 16, the
determination shall be made by Independent Counsel in a written
opinion to the Board, a copy of which shall be delivered to the
Executive;
(ii) if a Change in Control has not occurred the
determination shall be made by the Board by a majority vote of a
quorum consisting of Disinterested Directors. In the event that a
quorum of the Board consisting of Disinterested Directors is not
obtainable or, even if obtainable, such quorum of Disinterested
Directors so directs, the determination shall be made by Independent
Counsel in a written opinion to the Board, a copy of which shall be
delivered to the Executive.
(c) Selection. Payment and Discharge of Independent Counsel. In
the event the determination of entitlement to indemnification is to be made by
Independent Counsel pursuant to Section 16(b) of this Agreement, the
Independent Counsel shall be selected, paid and discharged in the following
manner:
(i) If a Change in Control has not occurred the Independent
Counsel shall be selected by the Board and the Company shall give
written notice to the Executive advising the Executive of the identity
of the Independent Counsel so selected.
(ii) If a Change in Control has occurred, the Independent
Counsel shall be selected by the Executive (unless the Executive shall
request that such selection be made by the Board, in which event
clause (i) of this Section shall apply), and the Executive shall give
written notice to the Company advising it of the identity of the
Independent Counsel so selected.
(iii) Following the initial selection described in clauses
(i) and (ii) of this Section 16(c), the Executive or the Corporation,
as the case may be, may, within seven (7) days after such written
notice of selection has been given, deliver to the other party a
written objection to such selection. Such objection may be asserted
only on the ground that the Independent Counsel so selected does not
meet the requirements of "Independent Counsel" and the objection shall
set forth with particularity the factual basis of such assertion.
Absent a proper and timely objection, the person so selected shall act
as Independent Counsel. If such written objection is made, the
Independent Counsel so selected may not serve as Independent Counsel
unless and until a court has determined that such objection is without
merit.
(iv) Either the Company or the Executive may petition the
Court of Chancery of the State of Delaware or other court of competent
jurisdiction if the parties have been unable to agree on the selection
of Independent Counsel within
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twenty (20) days after submission by the Executive of a written
request for indemnification pursuant to Section 16(a) of this
Agreement. Such petition may request a determination whether an
objection to the party's selection is without merit and/or seek the
appointment as Independent Counsel of a person selected by the Court
shall designate. A person so appointed shall act as Independent
Counsel under Section 16(b) of this Agreement.
(v) The Company shall pay any and all reasonable fees and
expenses of Independent Counsel incurred by such Independent Counsel
in connection with acting pursuant to this Agreement, and the Company
shall pay all reasonable fees and expenses incident to the procedures
of this Section 16(c), regardless of the manner in which such
Independent Counsel was selected or appointed.
(vi) Upon the due commencement of any judicial proceeding or
arbitration pursuant to Section 18(b) of this Agreement, Independent
Counsel shall be discharged and relieved of any further responsibility
in such capacity (subject to the applicable standards of professional
conduct then prevailing).
(d) Cooperation. The Executive shall cooperate with the person,
persons or entity making the determination with respect to the Executive's
entitlement to indemnification under this Agreement, including providing to
such person, persons or entity upon reasonable advance request any
documentation or information which is not privileged or otherwise protected
from disclosure and which is reasonably available to the Executive and
reasonably necessary to, such determination. Any costs or expenses (including
attorneys' fees and disbursements) incurred by the Executive in so cooperating
with the person, persons or entity making such determination shall be borne by
the Company(irrespective of the determination as to the Executive's entitlement
to indemnification) and the Company hereby indemnifies and agrees to hold the
Executive harmless therefrom.
(e) Payment. If it is determined that the Executive is entitled
to indemnification, payment to the Executive shall be made within ten (10) days
after such determination.
17. Presumption and Effect of Certain Proceedings.
(a) Burden of Proof. In making a determination with respect to
entitlement of indemnification hereunder, the person or persons or entity
making such determination shall presume that the Executive is entitled to
indemnification under this Agreement if the Executive has submitted a request
for indemnification in accordance with Section 16(a) of this Agreement, and the
Company shall have the burden of proof to overcome that presumption in
connection with the making of any person, persons or entity of any
determination contrary to that presumption.
(b) Effect of Other Proceedings. The termination of any
Proceeding or of any claim, issue or matter therein, by judgment, order,
settlement or conviction, or upon a plea of nolo contendere or its equivalent,
shall not (except as otherwise expressly provided in this
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Agreement) of itself adversely affect the right of the Executive to
indemnification or create a presumption that the Executive did not act in Good
Faith.
(c) Reliance as Safe Harbor. For purposes of any determination
of Good Faith, the Executive shall be deemed to have acted in Good Faith if the
Executive's action is based on the records or books of account of the
Enterprise, including financial statements, or on information supplied to the
Executive by the officers of the Enterprise in the course of their duties, or
on information or records given or reports made to the Enterprise by an
independent certified public accountant or by an appraiser or other expert
selected with reasonable care by the Enterprise. The provisions of this Section
17(c) shall not be deemed to be exclusive or to limit in any way the other
circumstances in which the Executive may be deemed to have met the applicable
standard of conduct set forth in this Agreement.
(d) Actions of Others. The knowledge and/or actions, or failure
to act, of any director, officer, agent or Executive of the Enterprise shall
not be imputed to the Executive for purposes of determining the right to
indemnification under this Agreement.
18. Remedies of the Executive.
(a) Application. This Section 18 shall apply in the event of a
dispute. For purposes of this Section, "Dispute" shall mean any of the
following events:
(i) a determination is made pursuant to Section 16 of this
Agreement that the Executive is not entitled to indemnification under
this Agreement;
(ii) advancement of Expenses is not timely made pursuant to
Section 15 of this Agreement;
(iii) the determination of entitlement to be made pursuant
to Section 16(b) of this Agreement has not been made within ninety
(90) days after receipt by the Company of the request for
indemnification;
(iv) payment of indemnification is not made pursuant to
Section 14(f) of this Agreement within ten (10) days after receipt by
the Company of a written request therefor; or
(v) payment of indemnification is not made within ten (10)
days after a determination has been made that the Executive is
entitled to indemnification or such determination is deemed to have
been made pursuant to Section 16 of this Agreement.
(b) Adjudication. In the event of a Dispute, the Executive shall
be entitled to an adjudication in an appropriate court of the State of
Delaware, or in any other court of competent jurisdiction, of the Executive's
entitlement to such indemnification or advancement of Expenses. Alternatively,
the Executive at the Executive's option, may seek an award in arbitration to be
conducted by a three person arbitration panel pursuant to the rules then
obtaining of the American Arbitration Association. The Executive shall commence
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such proceeding seeking an adjudication or an award in arbitration within one
hundred eighty (180) days following the date on which the Executive first has
the right to commence such proceeding pursuant to this Section 18(b). The
Company shall not oppose the Executive's right to seek any such adjudication or
award in arbitration.
(c) De Novo Review. In the event that a determination shall have
been made pursuant to Section 16 of this Agreement that the Executive is not
entitled to indemnification, any judicial proceeding or arbitration commenced
pursuant to this Section 18 shall be conducted in all respects as a de novo
trial, or arbitration, on the merits and the Executive shall not be prejudiced
by reason of that adverse determination. In any such proceeding or arbitration,
the Company shall have the burden of proving that the Executive is not entitled
to indemnification or advancement of Expenses, as the case may be.
(d) Company Bound. If a determination shall have been made or
deemed to have been made pursuant to Section 16 of this Agreement that the
Executive is entitled to indemnification, the Company shall be bound by such
determination in any judicial proceeding or arbitration absent (i) a
misstatement by the Executive of a material fact, or a failure to disclose
facts which would make Executive's statement not materially misleading, in
connection with the request for indemnification or (ii) a prohibition of such
indemnification under applicable law.
(e) Procedures Valid. The Company shall be precluded from
asserting in any judicial proceeding or arbitration commenced pursuant to this
Section 18 that the procedures and presumptions of Sections 16 and 17 are not
valid, binding and enforceable and shall stipulate in any such court or before
any such arbitrators that the Company is bound by all the provisions of this
Agreement.
(f) Expenses of Adjudication. In the event that the Executive,
pursuant to this Section 18, seeks a judicial adjudication of or an award in
arbitration to enforce the Executive's rights under, or to recover damages for
breach of, this Agreement, the Executive shall be entitled to recover from the
Corporation, and shall be indemnified by the Company against, any and all
Expenses actually and reasonably incurred by the Executive in such adjudication
or arbitration, but only if and to the extent that the Executive prevails
therein.
19. Non-Exclusivity, Subrogation.
(a) Non-Exclusivity. The rights of Executive to be indemnified
and to receive advancement of Expenses as provided by this Agreement shall not
be deemed exclusive of any other rights to which the Executive may at any time
be entitled under applicable law, the Certificate of Incorporation, the
By-Laws, any agreement, a vote of stockholders, a resolution of directors or
otherwise. No amendment, alteration, rescission or replacement of this
Agreement or any provision hereof shall be effective as to the Executive with
respect to any action taken or omitted by such the Executive in the Executive's
Corporate Status prior to such amendment, alteration, rescission or
replacement.
(b) Subrogation. In the event of any payment under this
Agreement, the Company shall be subrogated to the extent of such payment to all
of the rights of recovery of
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the Executive, who shall execute all papers required and take all action
necessary to secure such rights, including execution of such documents as are
necessary to enable the Company to bring suit to enforce such rights.
(c) No Duplicative Payment. The Company shall not be liable
under this Agreement to make any payment of amounts otherwise actually received
such payment under any insurance policy, contract, agreement or otherwise.
20. Director and Officer Insurance.
The Company agrees to continue and maintain a directors and officers'
liability insurance policy covering the Executive to the extent the Company
provides such coverage for its other executive officers.
21. Effect of Agreement on Other Benefits.
Except as specifically provided in this Agreement, the existence of
this Agreement shall not prohibit or restrict the Executive's entitlement to
full participation in the executive benefit and other plans or programs in
which senior executives of the Company are eligible to participate, or restrict
Executive from the benefits of any other agreements.
22. Assignability: Binding Nature.
This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors, heirs (in the case of the Executive)
and assigns. No rights or obligations of the Company under this Agreement may
be assigned or transferred by the Company except that such rights or
obligations may be assigned or transferred pursuant to a merger or
consolidation in which the Company is not the continuing entity, or the sale or
liquidation of all or substantially all of the assets of the Company, provided
that the assignee or transferee is the successor to all or substantially all of
the assets of the Company and such assignee or transferee assumes the
liabilities, obligations and duties of the Company, as contained in this
Agreement, by written contract. The Company further agrees that, in the event
of a sale of assets or liquidation as described in the preceding sentence, it
shall take whatever action it legally can in order to cause such assignee or
transferee to expressly assume the liabilities, obligations and duties of the
Company hereunder. No rights or obligations of the Executive under this
Agreement may be assigned or transferred by the Executive other than his rights
to compensation and benefits.
23. Representation.
The Company represents and warrants that it is fully authorized and
empowered to enter into this Agreement and that the performance of its
obligations under this Agreement will not violate any agreement between it or
and any other person, firm or organization. The Executive represents that he
knows of no agreement between him and any other person, firm or organization
that would be violated by the performance of his obligations under this
Agreement.
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24 Entire Agreement.
This Agreement contains the entire understanding and agreement between
the Parties concerning the subject matter hereof and supersedes all prior
agreements, understandings, discussions, negotiations and undertakings, whether
written or oral, between the Parties with respect thereto. This Agreement
hereby amends and replaces the Amended Employment Agreement effective October
1, 1996.
25. Amendment or Waiver.
No provision in this Agreement may be amended unless such amendment is
agreed to in writing and signed by the Executive and an authorized officer of
the Company. No waiver by either Party of any breach by the other Party of any
condition or provision contained in this Agreement to be performed by such
other Party shall be deemed a waiver of a similar or dissimilar condition or
provision at the same or any prior or subsequent time. Any waiver must be in
writing and signed by the Executive or an authorized officer of the Company, as
the case may be.
26. Severability.
In the event that any provision or portion of this Agreement shall be
determined to be invalid or unenforceable for any reason, in whole or in part,
the remaining provisions of this Agreement shall be unaffected thereby and
shall remain in full force and effect to the fullest extent permitted by law.
27. Survivorship.
The respective rights and obligations of the Parties hereunder shall
survive any termination of this Agreement.
28. Beneficiaries/References.
The Executive shall be entitled, to the extent permitted under any
applicable law, to select and change a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive's death
by giving the Company written notice thereof. In the event of the Executive's
death or a judicial determination of his incompetence, reference in this
Agreement to the Executive shall be deemed, where appropriate, to refer to his
beneficiary, estate or other legal representative.
29. Governing Law/Jurisdiction.
This Agreement shall be governed by and construed and interpreted in
accordance with the laws of Delaware without reference to principles of
conflict of laws.
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30. Resolution of Disputes.
Any disputes arising under or in connection with this Agreement
(including any action by Executive to enforce compliance or specific
performance with respect to this Agreement), shall at the election of the
Executive or the Company, be resolved by binding arbitration, to be held in New
York, New York in accordance with the rules and procedures of the American
Arbitration Association before three arbitrators. Judgment upon the award
rendered by the arbitrators may be entered in any court having jurisdiction
thereof. Nothing herein shall preclude either party from seeking provisional
remedies in aid of arbitration, such as a preliminary injunction, from a court
of competent jurisdiction. Costs of the arbitration or litigation, including,
without limitation, reasonable attorneys' fees of both Parties, shall be borne
by the Company. Pending the resolution of any arbitration or court proceeding,
the Company shall continue payment of all amounts due the Executive under this
Agreement consistent with past practice and all benefits to which the Executive
is entitled at the time the dispute arises.
31. Notices.
Any notice given to a Party shall be in writing and shall be deemed to
have been given when delivered personally or sent by certified or registered
mail, postage prepaid, return receipt requested, duly addressed to the Party
concerned at the address indicated below or to such changed address as such
Party may subsequently give such notice of:
If to the Company:
Xxxxxx Industries, Inc.
000 Xxxx Xxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: President
If to the Executive:
Xx. Xxxxxx X. Xxxxxxxx
Two North Breakers Row, Apt. 25-S
Xxxx Xxxxx, Xxxxxxx 00000
32. Headings.
The headings of the sections contained in this Agreement are for
convenience only and shall not be deemed to control or affect the meaning or
construction of any provision of this Agreement.
33. Counterparts.
This Agreement may be executed in two or more counterparts.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
Xxxxxx Industries, Inc.
By: /s/ XXXX XXXXXX
---------------------------------
Xxxx Xxxxxx
/s/ XXXXXX X. XXXXXXXX
---------------------------------
Xxxxxx X. Xxxxxxxx
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