EXHIBIT 10.1
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT, made this 29th day of
January, 2003, is between NCI BUILDING SYSTEMS, L.P., a Texas limited
partnership (the "Company"), and XXXXXX XXXXXXX (the "Employee").
1. Employment Term. The Company hereby employs the Employee for a term
commencing on April 10, 1989 and ending on December 31, 1995, subject to earlier
termination as provided in Section 6 hereof, ending December 31, 1995 (such
term, as from time to time extended or earlier terminated as hereafter provided,
being herein referred to as the "term of this Agreement"). The Employee agrees
to accept such employment and to perform the services specified therein, all
upon the terms and conditions hereinafter stated. The term of this Agreement
shall be automatically renewed after December 31, 1995 for successive one-month
periods unless and until either party provides the other party with at least
thirty (30) days prior written notice of such party's intention to terminate
this Agreement.
2. Duties. The Employee shall serve the Company in an executive
capacity and shall report to, and be subject to the general direction and
control of, the Board of Directors of the Company (the "Board"). The Employee
shall perform the executive, management and administrative duties of the
President and Chief Executive Officer of the Company and such other executive
duties as are from time to time assigned to him by the Board or such executive
officers and as are not inconsistent with the provisions hereof. The Company
agrees that it will assign the Employee those duties, and only those duties, of
the type, nature and dignity normally assigned to an officer of his position in
a corporation of the size, stature and nature of the Company.
3. Extent of Service. The Employee shall devote his full business time
and attention to the business of the Company, and, except as may be specifically
permitted by the Board, shall not be engaged in any other business activity
during the term of this Agreement. The foregoing shall not be construed as
preventing the Employee from making passive investments in other businesses or
enterprises, provided, however, that such investments will not require services
on the part of the Employee which would in any way impair the performance of his
duties under this Agreement.
4. Salary. The Company shall pay Employee a base salary of $125,000.00
per year. From time to time during the term of this Agreement, the Employee's
salary may be increased by, and at the sole discretion of, the Board, or any
committee thereof with responsibility for executive compensation matters, in
which case the amount of such increased salary shall thereafter be deemed to be
the amount of salary contracted for in this Agreement. The salary set forth
herein shall be payable in installments in accordance with the payroll policies
of the Company in effect from time to time during the term of this Agreement.
5. Benefits. The Employee shall be eligible to receive those benefits
during the term of this Agreement that are from time to time applicable to
executive employees of the Company, together with any additional benefits
determined in the sole discretion of the Board, or any committee thereof with
responsibility for executive compensation matters.
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6. Termination.
(a) Death. If during the term of this Agreement and while in
the employ of the Company, the Employee dies, this Agreement shall automatically
terminate and the Company shall have no further obligation to the Employee or
his Beneficiary (as hereinafter defined) except that the Company shall pay the
Employee's Beneficiary (i) that portion of the Employee's salary accrued through
the end of the month in which the Employee's death occurred and (ii) the
Payments (as hereinafter defined) in the same manner and at the same times as if
the Employee had not died. If Employee's Beneficiary dies prior to the payment
of all of the Payments, the then present value of the remaining Payments shall
be paid to Beneficiary's estate in a single sum distribution within 30 days
after the date of Beneficiary's death.
(b) Disability. If during the term of this Agreement and while
in the employ of the Company, the Employee is prevented for sixty (60)
consecutive days or ninety (90) days in the aggregate from performing his duties
hereunder due to disability, this Agreement shall automatically terminate and
the Company shall have no further obligation to the Employee or his Beneficiary
except that the Company shall pay the Employee (i) that portion of the
Employee's salary accrued through the end of the month in which the Board's
determination of disability occurred and (ii) the Payments in the same manner
and at the same times as if the Employee had not become disabled if, on each
payment date, Employee has not breached or violated any of his covenants set
forth in Section 8(a). For purposes of this Agreement, the Employee shall be
deemed to have become disabled when the Board, upon the advice of a qualified
physician, shall have determined that the Employee has become physically or
mentally incapable (excluding infrequent and temporary absences due to ordinary
illness) of performing his duties under this Agreement.
(c) Termination for Cause. Notwithstanding any other provision
of this Agreement to the contrary, if Employee's employment with the Company is
terminated for Cause, this Agreement shall automatically terminate, the Company
shall have no further obligation to the Employee other than to pay the Employee
his base salary accrued through the date of termination and Employee shall
forfeit his or her rights to any other benefits under this Agreement.
(d) Involuntary Discharge. At any time during the term of this
Agreement or prior to the end of the term of this Agreement, the Company may
discharge the Employee without Cause, in which case this Agreement shall
automatically terminate and the Company shall have no further obligation to the
Employee or his Beneficiary other than (i) to pay the Employee his base salary
accrued through the date of such termination and (ii) the Payments in the same
manner and at the same times as if the Employee's employment had not been
terminated if, on each payment date, Employee has not breached or violated any
of his covenants set forth in Section 8(a).
(e) Voluntary Termination. The Employee may voluntarily
terminate his employment with the Company at any time during the term of this
Agreement, in which case this Agreement shall automatically terminate and the
Company shall have no further obligation to the Employee or his Beneficiary
other than (i) to pay the Employee his base salary accrued through the date of
such termination and (ii) the Vested Payments (as hereinafter defined) in the
amount and manner described in subsection (g) below.
(f) Payments. If Employee dies, becomes disabled or Employee's
employment is terminated by the Company for any reason other than Cause, then
for the
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following three-year period, the Company shall pay to the Employee an annual
amount equal to 75% of the Employee's base salary in effect as of the date of
termination of Employee's employment with the Company and the Company shall
continue the Employee's participation in the Company's group health insurance
program (if so requested by the Employee) on the same terms applicable to his on
the date of discharge. Such amounts shall be paid to the Employee in the same
manner and at the same times (in accordance with the Company's then existing
payroll practices) as if the Employee had not died, became disabled or
Employee's employment had not terminated (collectively, the "Payments"). If
Employee dies prior to receiving all of the Payments and prior to his death had
not breached or violated any of his covenants set forth in Section 8(a),
Employee's Beneficiary shall receive the unpaid portion of Employee's Payments
during the remainder of the three-year period. Notwithstanding any other
provision of this Agreement to the contrary, if Employee breaches or violates
any of his covenants set forth in Section 8(a), Employee immediately shall
forfeit his or her rights to any remaining Payments.
(g) Vested Payments. If the Employee voluntarily terminates
his employment with the Company, then for the following three-year period, the
Company shall pay to the Employee an annual amount equal to 25%, 50% or 75% of
the Employee's base salary in effect as of the date of termination of Employee's
employment with the Company, dependent upon the amount vested as provided in
this subsection. Such amounts shall be paid to the Employee in the same manner
and at the same times (in accordance with the Company's then existing payroll
practices) as if the Employee had not voluntarily terminated his employment with
the Company (collectively, the "Vested Payments"). Employee's right to receive
amounts under this subsection shall vest over a period of three (3) years, at
the rate of 33-1/3% for each year of employment by Employee after the date
hereof. If Employee dies prior to receiving all of the Vested Payments and prior
to his death had not breached or violated any of his covenants set forth in
Section 8(a), Employee's Beneficiary shall receive the unpaid portion of
Employee's Vested Payments during the remainder of the three-year period.
Notwithstanding any other provision of this Agreement to the contrary, if
Employee breaches or violates any of his covenants set forth in Section 8(a),
Employee immediately shall forfeit his or her rights to any remaining Vested
Payments.
(h) Cause. For purposes of this Agreement, "Cause" shall be
determined by the Board of Directors, in its sole and absolute discretion, and
means the occurrence of any or all of the following:
(i) Employee's conviction for committing an act of
fraud, embezzlement, theft, or other act constituting a
felony; or
(ii) The willful engaging by Employee in gross
misconduct materially and demonstrably injurious to the
Company, as determined by the Company. However, no act or
failure to act, on Employee's part shall be considered
"willful" unless done, or omitted to be done, by Employee not
in good faith and without reasonable belief that his action or
omission was in the best interest of the Company; or
(iii) The failure or inability for any reason of
Employee to devote his full business time to the Company's
business.
(i) Present Value. For purposes of this Agreement, whenever
the Company is required to calculate the present value of any benefit to be paid
to Employee or Beneficiary hereunder, the Company shall calculate the present
value of such benefit using a discount rate equal to the prime rate reported by
the Company's principal bank lender on the date on which
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such payment became payable (i.e., the date of termination of Employee's
employment with the Company), but in no event shall such discount rate exceed
8%.
7. Confidential Information. The Employee acknowledges that in the
course of his employment by the Company he has received and will receive certain
trade secrets, programs, lists of customers and other confidential information
and knowledge concerning the business of the Company (hereinafter collectively
referred to as "Information") which the Company desires to protect. The Employee
understands that the Information is confidential and he agrees not to reveal the
Information to anyone outside the Company so long as the confidential or secret
nature of the Information shall continue. The Employee further agrees that he
will at no time use the Information in competing with the Company or any
affiliate of the Company. Upon termination of this Agreement, the Employee shall
surrender to the Company all papers, documents, writings and other property
produced by him or coming into his possession by or through his employment or
relating to the Information and the Employee agrees that all such materials will
at all times remain the property of the Company.
8. Restrictive Covenant.
(a) In the event of any termination of the Employee's
employment with the Company for any reason at any time during the term of this
Agreement, then for a period beginning on the date of such termination and
ending three (3) years following the date of such termination, the Employee
shall not engage, anywhere within a radius of 500 miles of any plant, mini-plant
or any other manufacturing facility owned or operated by the Company as of the
time of such termination (the "Territory"), as principal, agent, trustee or
through the agency of any corporation, partnership, association or agent or
agency, in the business of manufacturing or selling engineered building systems,
metal building components or any other business ancillary thereto (the
"Industry"), and the Employee shall not be the owner of more than 5% of the
outstanding capital stock of any corporation, or a member or employee of any
partnership or an owner or employee of any business that conducts a business in
the Territory within the Industry. During such period, the Employee further
agrees that he shall not, either directly or indirectly, through any person,
firm, association or corporation with which the Employee is now or may hereafter
become associated, cause or induce any present or future employee of the Company
(or its successors and assigns) or any of their affiliates to leave the employ
of the Company (or its successors and assigns) or any such affiliate to accept
employment with the Employee or with such person, firm, association or
corporation.
(b) The foregoing covenants in Section 8(a) shall not be held
invalid or unenforceable because of the scope of the territory or actions
subject thereto or restricted thereby, or the period of time within which such
agreement is operative; but any judgment of a court of competent jurisdiction
may define the maximum territory and actions subject to and restricted by
covenants Section 8(a) and the period of time during which such covenants are
enforceable; provided, however, that in the event that as a result of an action
being instituted against the Company by or on behalf of the Employee, a judgment
of a court of competent jurisdiction is entered against the Company decreasing
the period of time during which this Agreement is enforceable, the term of this
Agreement shall be similarly decreased.
(c) The Employee represents and warrants to the Company that
(i) the Employee has the full right, power and authority to enter into and
perform this Agreement, including (without limitation) the giving of the
covenants in Section 8(a), (ii) the Employee acknowledges the giving of fair and
adequate consideration for his covenants in Section 8(a), and that such
covenants are necessary to protect the business, operations and goodwill of the
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Company and to attract investment in the Company, (iii) such covenants are not
oppressive to the Employee in any respect, and (iv) on the date hereof, the
Employee is not engaged in a common calling.
9. Notices. All notices, requests, consents and other communications
under this Agreement shall be in writing and shall be deemed to have been
delivered on the date personally delivered or three (3) business days following
the date mailed, postage prepaid, by certified mail, return receipt requested,
or when sent by telex or telecopy and confirmed, if addressed to the respective
parties as follows:
If to the Employee: Xxxxxx Xxxxxxx
00000 Xxxx Xx.
Xxxxxxx, Xxxxx 00000
Facsimile:
If to the Company: NCI Building Systems, L.P.
00000 Xxxxx Xxx Xxxxxxx Xxxxxxx Xxxx
Xxxxxxx, Xxxxx 00000
Attention: Chairman of the Board
Facsimile: (000) 000-0000
Either party hereto may designate a different address by providing written
notice of such new address to the other party hereto.
10. Specific Performance. The Employee acknowledges that a remedy at
law for any breach or attempted breach of Section 7 or 8 of this Agreement will
be inadequate, agrees that the Company shall be entitled to specific performance
and injunctive and other equitable relief in case of any such breach or
attempted breach, and further agrees to waive any requirement for the securing
or posting of any bond in connection with the obtaining of an such injunctive or
any other equitable relief.
11. Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such provision or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
12. Beneficiary. The Employee shall designate in writing on Exhibit "A"
hereto the person or entity to receive benefits due under this Agreement after
his death (a "Beneficiary"). If Employee fails to designate a Beneficiary or if
the designated Beneficiary predeceases Employee, Employee's Beneficiary shall be
his or her spouse, if living, and if no such spouse is living, Employee's
estate.
13. Assignment. This Agreement may not be assigned by the Employee.
Neither the Employee nor his Beneficiary shall have any right to commute,
encumber or dispose of any right to receive payments hereunder, it being agreed
that such payments and the right thereto are nonassignable and nontransferable.
14. Binding Effect. Subject to the provisions of Section 13 of this
Agreement, this Agreement shall be binding upon and inure to the benefit of the
parties hereto, the Employee's heirs and personal representatives, and the
successors and assigns of the Company.
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15. Captions. The section and subsection headings in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
16. Complete Agreement. This Agreement represents the entire agreement
between the parties concerning the subject hereof and supersedes all prior
agreements between the parties concerning the subject thereof.
17. Amendment; Waiver. This Agreement may not be amended or modified in
any respect except by a written instrument signed by the Company and the
Employee. No waiver, express or implied, by either party of a breach or
violation of any provision of this Agreement by the other party shall be
construed as a continuing waiver of such breach or violation or as a waiver of
any future breach or violation of the same or any other provision of this
Agreement. All amendments, modifications, consents, determinations and other
actions made or taken by or on behalf of the Company under this Agreement shall
require the approval of 75% of the Board, with the Employee abstaining.
18. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS.
19. Counterparts. This Agreement may be executed in multiple original
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
20. Prior Employment Agreements. The Employee represents and warrants
to the Company that he has fulfilled all of the terms and conditions of all
prior employment, consulting, non-competition or confidentiality agreements. The
Employee shall indemnify and hold the Company harmless from any and all losses,
costs, damages and expenses arising out of or resulting from any breach of or
inaccuracy with respect to the representations and warranties of the Employee
contained in this Section 20.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement in
Houston, Texas as of the date and year first above written.
NCI BUILDING SYSTEMS, L.P.
By: NCI Operating Corp., general partner
By: /s/ A.R. Xxxx
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A.R. Xxxx, Chairman of the Board
/s/ Xxxxxx Xxxxxxx
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XXXXXX XXXXXXX
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