EMPLOYMENT AGREEMENT
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EMPLOYMENT AGREEMENT (this "Agreement"), dated as of January 30, 1998
between VISTANA, INC., a Florida corporation ("Company" or "Vistana"), and XXXX
X. XXXXXX ("Employee") (capitalized terms used herein and not otherwise defined
shall have the meanings ascribed thereto in Section 13).
W I T N E S S E T H:
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WHEREAS, Vistana, directly or through its Affiliates, is engaged in the
business of timeshare or vacation ownership development, sales and resort
management, as well as the installation and management of voice, data and cable
television systems, and related operations; and
WHEREAS, the parties hereto desire to enter this Agreement upon the terms
and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing, of the mutual covenants
and agreements herein contained and for other good and valuable consideration,
the receipt, adequacy and sufficiency of which are hereby acknowledged, the
parties, intending legally to be bound, hereby agree as follows:
1. Employment. The Company hereby employs Employee, and Employee hereby
accepts such employment, upon the terms and conditions hereinafter set forth.
2. Position, Duties and Responsibilities.
(a) Position. Employee's corporate and functional titles and primary
responsibilities are set forth on Schedule A attached hereto and incorporated
herein by this reference. The Company shall have the right from time to time to
assign Employee an equal or higher corporate title and an alternative functional
title, consistent with Employee's responsibilities and the needs of the
Company's business.
(b) Place of Employment. During the term of this Agreement, Employee
shall perform the services required by this Agreement at the Company's location
set forth on Schedule A attached hereto; provided, however, that the Company may
at its reasonable discretion require Employee to travel to other locations on
the Company's business.
(c) Other Activities. During the term of this Agreement, Employee
shall be an employee of the Company, shall not be engaged in any other
employment or business activities, shall devote Employee's full business time
and effort to the Company and shall not serve as an officer or director of any
public company. Notwithstanding the foregoing, Employee shall not be prohibited
from investing or trading in stocks, bonds, commodities or other forms of
passive
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investment, including real property (provided that such investments do not
violate Section 10 hereof).
3. Term.
(a) Effective Date. This Agreement shall become effective on the
effective date (the "Effective Date") set forth on Schedule A attached hereto.
(b) Termination Date. The term of employment under this Agreement
shall terminate upon the earliest to occur of the following events (the
date specified in each such event is referred to as the "Termination
Date"):
(i) the expiration date (the "Expiration Date") set forth on
Schedule A attached hereto; provided, however, that such period of
employment may be extended by written agreement of the parties (it being
understood that if Employee remains employed by the Company after the
Expiration Date, such employment shall be "at-will" unless different terms
are established in writing);
(ii) the date upon which the Company terminates Employee's
employment by the Company for Cause or without Cause (it being understood
that the date of termination shall be the date upon which the Company
provides Employee written notice of either such event);
(iii) the date of Employee's death;
(iv) the date upon which the Company terminates Employee's
employment by the Company as a result of Employee's Permanent Disability
(it being understood that the date of termination shall be the date upon
which the Company provides Employee written notice of such event); or
(v) the date which occurs 30 days after Employee has tendered
written notice of resignation; provided, however, that the Company shall
have the right in its sole discretion to accelerate Employee's Termination
Date to a date selected by the Company if the Company determines not to
continue Employee's employment after Employee has tendered written notice
of resignation (in which event the accelerated date selected by the Company
shall be deemed to be the Termination Date).
(c) Performance of Duties During Notice Period. In the event that the
Company terminates Employee's employment by the Company pursuant to Section
3(b)(ii) hereof, Employee, if requested by the Company, shall continue to render
services hereunder to the Company for the 30-day period after receipt of the
Company's notice, and shall, in such event, be paid the compensation and
benefits hereunder for the remainder of such period (and any such compensation
shall offset and reduce any Severance Pay payable to Employee hereunder).
(d) Employment-At-Will/Employee Acknowledgment. Notwithstanding
Section 3 of this Agreement and Sections 4(a) and (b) hereof relating to the
annual salary and bonus to
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be paid to Employee during Employee's employment by the Company, nothing in this
Agreement should be construed as to confer any right of Employee to be employed
by the Company for a fixed or definite term. Subject to Section 8 hereof,
Employee agrees that the Company may dismiss Employee under Section 3(b)(ii)
without regard to (i) any general or specific policies (whether written or oral)
of the Company relating to the employment or termination of employment of the
Company employees; or (ii) any statements made to Employee, whether made orally
or contained in any document or instrument, pertaining to Employee's
relationship with the Company. Notwithstanding anything to the contrary
contained herein, Employee's employment by the Company is not for any specified
term, is at-will and may be terminated by the Company pursuant to Section
3(b)(ii) at any time by delivery of the notice referred to therein, for any
reason, for Cause or without Cause, without any liability whatsoever, except
with respect to the payments provided for in Section 8.
(e) Termination Obligations.
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(i) Employee hereby acknowledges and agrees that all personal
property and equipment, including, without limitation, all books, manuals,
records, reports, notes, contracts, lists, blueprints, and other documents,
or materials, or copies thereof (including computer files), and all other
proprietary information relating to the business of the Company, furnished
to or prepared by Employee in the course of or incident to Employee's
employment, belongs to the Company and shall be promptly returned to the
Company within 10 days after the termination of Employee's employment by
the Company (which for this purpose includes Vistana and all Affiliates of
Vistana). Following the termination of Employee's employment by the Company
(which for this purpose includes Vistana and all Affiliates of Vistana),
Employee will not retain any written or other tangible material containing
any proprietary or other non-public information of Vistana and its
Affiliates.
(ii) Effective as of the termination of Employee's employment
by the Company (which for this purpose includes Vistana and all Affiliates
of Vistana), Employee shall be deemed to have resigned from all offices and
directorships then held with Vistana and/or any of its Affiliates.
(iii) The covenants and agreements of Employee contained in
Sections 3(e), 9, 10, 11, 12 and 14(b) and (c) shall survive termination of
Employee's employment by the Company and the termination of this Agreement.
(f) Release. In exchange for the Company entering into the Agreement,
Employee agrees that, at the time of Employee's resignation or termination
from the Company, Employee will execute a release acceptable to the Company
of all liability of the Company and its officers, shareholders, employees,
directors and Affiliates to Employee in connection with or arising out of
Employee's employment by the Company, except with respect to (i) any then-
vested rights, if any, under the Vistana Stock Plan, (ii) any amounts which
may be payable to Employee pursuant to Section 8 and (iii) any claims
Employee may have pursuant to the Company's disability and workmen's
compensation insurance policies (it being understood that the foregoing is
not intended to provide Employee duplicative rights to those provided for
in Section 8(c)).
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4. Compensation.
(a) Salary. The Company shall pay to Employee the annual salary (the
"Base Salary") set forth on Schedule B attached hereto and incorporated herein
by this reference (prorated for partial calendar years). The Base Salary shall
be paid in equal installments, subject to all applicable withholding and
deductions, in accordance with the usual payroll practices of the Company, but
not less frequently than monthly.
(b) Bonus Amount. Employee shall be eligible to receive an annual
bonus amount (the "Bonus Amount") in respect of the term of this Agreement as
set forth on Schedule B attached hereto. The Bonus Amount shall be calculated
and determined on a January through December calendar-year basis and shall be
prorated if Employee was not an employee of the Company as of January 1 of the
applicable year. Any Bonus Amount due to Employee shall be paid within 60 days
after the close of the applicable calendar year, subject to all applicable
withholding and deductions, but only if Employee is an employee of the Company
or an Affiliate thereof as of the close of such year and as of the date of such
payout.
5. Fringe Benefits. During the term of this Agreement, Employee shall be
entitled to such group employment benefits as may, from time to time, be made
generally available to similar level employees of the Company; provided,
however, that such benefits and arrangements are made available at the
discretion of the Company and nothing in this Agreement establishes any right of
Employee to the availability or continuance of any such plan or arrangement.
6. Business Expenses. Except as otherwise provided herein, the Company
shall pay, either directly or by reimbursement to Employee, such reasonable and
necessary business expenses incurred by Employee, including travel and
entertainment expenses, in the course of employment by the Company as are
consistent with the Company's policies in existence from time to time.
7. Vacation and Sick Leave. Employee shall be entitled to the period of
paid vacation time, in the aggregate, per calendar year (pro-rated for partial
calendar years) set forth on Schedule B attached hereto, and such paid sick
leave as shall be authorized by the Company pursuant to the Company's written
policies, as determined from time to time. All vacations shall be taken by
Employee at such time or times as may be reasonably approved by the Company.
8. Compensation Upon Termination of Employment.
(a) Expiration of Term. If Employee's employment by the Company is
terminated as of the Expiration Date pursuant to Section 3(b)(i), Employee shall
receive the compensation and other benefits expressly provided under this
Agreement through the Termination Date.
(b) Death. If Employee's employment by the Company is terminated as a
result of the occurrence of Employee's death pursuant to Section 3(b)(iii), the
Company shall pay Employee's estate the compensation and other benefits
expressly provided under this Agreement through the Termination Date.
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(c) Permanent Disability. If Employee's employment by the Company is
terminated by the Company as a result of the occurrence of Employee's Permanent
Disability pursuant to Section 3(b)(iv), the Company shall pay Employee the
compensation and other benefits expressly provided under this Agreement through
the Termination Date.
(d) Termination by the Company for Cause. If Employee's employment by
the Company is terminated by the Company for Cause pursuant to Section 3(b)(ii),
Employee shall receive the compensation and other benefits expressly provided
under this Agreement through the Termination Date.
(e) Termination by the Company without Cause. If Employee's
employment by the Company is terminated by the Company without Cause pursuant to
Section 3(b)(ii), the Company shall pay Employee (i) the compensation and other
benefits expressly provided under this Agreement through the Termination Date
and (ii) the Severance Amount, if any, set forth on Schedule B, attached hereto,
payable as specified therein.
(f) Resignation. If the Employee resigns pursuant to Section 3(b)(v),
the Company shall pay Employee the compensation and other benefits expressly
provided under this Agreement through the applicable Termination Date.
(g) Continuation of Health Insurance Coverage. At Employee's own
expense, Employee and Employee's dependents shall also be entitled to any
continuation of health insurance coverage rights under any applicable law.
(h) Right of Offset; Compliance with Covenants.
(i) If the Employee's employment by the Company is terminated
for any reason, Employee shall be entitled to the compensation and other
benefits expressly provided under this Agreement, subject to the Company's
right of offset for any amounts owed by Employee to the Company (or to any
of its Affiliates).
(ii) The continuing obligation of the Company to make the
payments to Employee contemplated by Section 8(e) is expressly conditioned
upon the Employee complying in all respects and continuing to comply in all
respects with Employee's obligations under Sections 9, 10 (to the extent
applicable) and 11 hereof following the Termination Date.
9. Confidential Information and Ownership of Property.
(a) Confidential Information. Employee agrees to use all Confidential
Information solely in connection with the performance of services for or on
behalf of the Company and its Affiliates. Employee shall not, during the term of
this Agreement, or at any time after the termination of this Agreement, in any
manner, either directly or indirectly, (i) disseminate, disclose, use or
communicate any Confidential Information to any person or entity, regardless of
whether such Confidential Information is considered to be confidential by third
parties, or (ii) otherwise directly or indirectly misuse any Confidential
Information; provided, however, that none of the
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provisions of this Section 9 shall apply to disclosures made for valid business
purposes of the Company and its Affiliates and provided further that Employee
shall not be obligated to treat as confidential any Confidential Information
that (x) was publicly known at the time of disclosure to Employee; (y) becomes
publicly known or available thereafter other than by means in violation of this
Agreement or any other duty owned to Vistana or any of its Affiliates by any
person or entity; or (z) is lawfully disclosed to Employee by a third party.
Notwithstanding the foregoing, Employee shall be permitted to disclose
Confidential Information to the extent required to enforce Employee's rights
hereunder in any litigation arising under, or pertaining to, this Agreement
provided that Employee shall give prior written notice to the Company of any
such disclosure so that the Company may have an opportunity to protect the
confidentiality of such Confidential Information in such litigation.
(b) Ownership of Property. Employee agrees that all works of
authorship developed, authored, written, created or contributed to during
Employee's employment by the Company (which for this purpose includes Vistana
and all Affiliates of Vistana) for the benefit of the Company (which for this
purpose includes Vistana and all affiliates of Vistana), whether solely or
jointly with others, shall be considered works-made-for-hire. Employee agrees
that such works shall be the sole and exclusive property of the Company (or an
appropriate Affiliate of Vistana) and that all right, title and interest therein
or thereto, including all intellectual property rights existing or obtained in
connection therewith, shall likewise be the sole and exclusive property of the
Company (or such other appropriate Affiliate of Vistana). Employee agrees
further that, in the event that any such work is not considered to be work-made-
for-hire by operation of law, Employee will immediately, and without further
compensation, assign all of Employee's right, title and interest therein to the
Company (or any Affiliate of Vistana which it may designate), its successors and
assigns. At the request and expense of the Company, Employee agrees to perform
in a timely manner such further acts as may be necessary or desirable to
transfer, defend or perfect the ownership of such work and all rights incident
thereto by Vistana or such Affiliate.
10. Covenant Not to Compete. During Employee's employment by the Company
and during the Non-Compete Period, Employee shall not:
(a) directly or indirectly for himself/herself or for any other
person or entity engage, whether as owner, investor, creditor, consultant,
partner, shareholder, director, financial backer, agent, employee or
otherwise, in the business, enterprise or employment of owning, operating,
marketing or selling a time-share, vacation plan, vacation ownership or
interval ownership project within the Territory; or
(b) directly or indirectly for himself/herself or for any other
person or entity sell, or otherwise procure purchasers for, any time-share,
vacation plan, vacation ownership or interval ownership project within the
Territory; or
(c) have any business (as owner, investor, creditor, consultant,
partner, debtor or otherwise) or be employed in any capacity by a person or
entity that is engaged, directly or indirectly, in (i) operating, or
providing sales, marketing or development services to, a time-share,
vacation plan, vacation ownership or interval ownership project within the
Territory, or (ii) in an activity formed or entered into for the primary
purpose of engaging in a time-
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share, vacation plan, vacation ownership or interval ownership business
within the Territory; or
(d) directly or indirectly for himself/herself or for any other person
or entity become employed in any capacity by or otherwise render services
in any capacity to any national enterprise having time-share, vacation
plan, vacation ownership or interval ownership activities, including,
without limitation, Xxxx Disney Company, Hilton Hotels Corporation, Hyatt
Corporation, Four Seasons Hotels and Resorts, Inc., Marriott International,
Inc., Inter-Continental Hotels and Resorts, Inc., Promus Hotels, Inc.,
Fairfield Communities, Inc., Signature Resorts, Inc., Vacation Break
U.S.A., Inc., Trendwest Resorts, Inc. or Silverleaf Resorts, Inc. or any of
their respective Affiliates; provided, however, that the provisions of this
Section 10(d) shall not be applicable if and to the extent that Employee
does not directly or indirectly participate in or provide services or
advice to, and Employee is not directly or indirectly employed in, involved
with, or responsible for, any of the time-share, vacation plan, vacation
ownership or interval ownership activities of such national enterprise in
any capacity; or
(e) directly or indirectly for himself, herself or for any other
person or entity pursue or consummate or otherwise interfere with any
Existing Project; or
(f) (i) directly or indirectly, for himself, herself, or any other
person or entity, pursue, consummate or otherwise interfere with any
Prospective Project or (ii) directly or indirectly for himself/herself or
for any other person or entity become employed in any capacity by or
otherwise render services in any capacity to any other person or entity
(other than the Company and its Affiliates) described in clause (ii) of the
definition of Prospective Project.
Notwithstanding the foregoing, Employee may purchase stock as a stockholder
in any publicly traded company, including any company engaged in the timeshare
or vacation ownership business; provided, however, that Employee may not own
(individually or collectively with Employee's family members, trusts for the
benefit of Employee's family members and affiliates of Employee) more than 5% of
any publicly traded company (other than Vistana) engaged in the timeshare or
vacation ownership business.
In light of the substantial remuneration provided to Employee hereunder and
Employee's management position with the Company, Employee hereby specifically
acknowledges and agrees that the provisions of this Section 10 (including,
without limitation, its time and geographic limits), as well as the provisions
of Sections 9 and 11, are reasonable and appropriate, and that Employee will not
claim to the contrary in any action brought by the Company to enforce such any
of such provisions.
11. Covenant Against Solicitation of Employees. During Employee's
employment by the Company and during the Non-Compete Period, Employee shall not
employ employees or agents or former employees or agents of Vistana or any of
its Affiliates or, directly or indirectly, solicit or otherwise encourage the
employment of employees or agents or former employees or agents of Vistana or
any of its Affiliates; provided, however, that this restriction shall not apply
to
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former employees or agents who, as of the date of the employment or solicitation
by Employee, have not worked for Vistana or any of its Affiliates during the
immediately preceding twelve months.
12. Remedies For Breach. It is understood and agreed by the parties that
no amount of money would adequately compensate the Company for damages which the
parties acknowledge would be suffered as a result of a violation by the Employee
of the covenants contained in Sections 9, 10 and 11 above, and that, therefore,
the Company shall be entitled, upon application to a court of competent
jurisdiction, to obtain injunctive relief (without the need to post bond) to
enforce the provisions of Sections 9, 10 or 11, which injunctive relief shall be
in addition to any other rights or remedies available to the Company. The
provisions of this Section 12 shall survive the termination of this Agreement.
13. Certain Defined Terms. For purposes of this Agreement the following
terms and phrases shall have the following meanings:
"Affiliate" means any person or entity who or which, directly or
indirectly, through one or more intermediaries, controls or is controlled by, or
is under common control with, a specified person or entity (the term "control"
for these purposes meaning the ability, whether by ownership of shares or other
equity interests, by contract or otherwise, to elect a majority of the directors
of a corporation, to act as or select the managing or general partner of a
partnership, or otherwise to select, or have the power to remove and then
select, a majority of those persons exercising governing authority over an
entity).
"Cause," with respect to the termination of Employee's employment by
the Company, shall mean (a) Employee's failure to properly perform Employee's
duties and responsibilities as described on Exhibit A, Employee's failure to
adhere to the policies of the Company, or Employee's neglect of duty, which
failure or neglect (as the case may be) persists or recurs after written notice
of such failure or neglect is given by the Company to Employee; (b) the
commission by Employee of an act of fraud, embezzlement or willful breach of a
fiduciary duty to the Company or any of its Affiliates (including the
unauthorized disclosure of confidential or proprietary material information of
the Company); (c) the commission by Employee of a breach of any material
covenant, provision, term, condition, understanding or undertaking set forth in
this Agreement; (d) the conviction or indictment of Employee for a crime
constituting a felony or a crime involving moral turpitude under applicable law
(or a plea of nolo contendere in lieu thereof); (e) the exposure of the Company
to any criminal liability substantially caused by the conduct of Employee or the
exposure of the Company to any civil liability caused by Employee's unlawful
discrimination or harassment in employment; (f) any habitual absenteeism, gross
negligence, bad faith, or willful misconduct by Employee in the performance of
Employee's duties to the Company or any willful conduct by Employee which
results in damage to the property, business, reputation or goodwill of the
Company or any of its Affiliates; or (g) Employee's habitual abuse of alcohol or
any controlled substance or Employee's reporting to work under the influence of
alcohol or a controlled substance (other than those controlled substances for
which Employee is taking under a then current prescription).
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"Confidential Information" means all software, trade secrets, work
products created by Employee for the Company, Vistana or any of their respective
Affiliates, know-how, ideas, techniques, theories, discoveries, formulas, plans,
charts, designs, drawings, lists of current or prospective clients, business
plans and proposals, current or prospective business opportunities, financial
records, research and development, marketing strategies and programs (including
present and prospective OPC locations and the terms of leases of similar
arrangements) and reports and other proprietary information created or obtained
by Employee for the benefit of the Company, Vistana or any of their respective
Affiliates during the course of employment by the Company.
"Consumer Price Index" means the United States Department of Labor's
Bureau of Labor Statistics' Consumer Price Index, All Urban Consumers, All Items
(1982-84 = 100) covering Employee's place of employment (as specified in
Schedule A), or the successor of such index (or if the index is not published
for such area, a comparable index applicable to such area as may be reasonably
determined by the Company).
"Existing Project" means a time-share, vacation plan, vacation
ownership or interval ownership resort or project which Vistana or any of its
Affiliates owns, operates or has commenced to develop, acquire or otherwise
undertake as of the termination of Employee's employment by the Company (which
for this purpose includes Vistana and all Affiliates of Vistana).
"Non-Compete Period" shall mean the period commencing on the Effective
Date and ending on the following date (as applicable):
(i) the later to occur of (A) the first day following the
termination of Employee's employment by the Company (which for this purpose
includes Vistana and all Affiliates of Vistana) and (B) the Termination
Date, in case of the termination of Employee's employment pursuant to
Section 3(b)(i) or (iv); provided, however, that, in either event, the
Company may extend the Non-Compete Period for a period not to exceed the
first anniversary of the date provided in the foregoing clauses (A) or (B),
by notifying Employee in writing that it will continue to pay Employee the
Base Salary or the Adjusted Base Salary (as defined in Schedule B) then in
effect (in accordance with the Company's payroll policies) through the end
of such extended period;
(ii) the Termination Date, in case of the termination of Employee's
employment pursuant to Section 3(b)(iii);
(iii) the first day following the severance period (the "Severance
Period") set forth on Schedule B attached hereto, in case of the
termination of Employee's employment pursuant to Section 3(b)(ii)(whether
or not the Severance Amount is payable); or
(iv) the first day following the Severance Period, in case of
Employee's resignation pursuant to Section 3(b)(v)(whether or not the
Severance Amount is payable).
"Permanent Disability" shall mean the inability of the Employee to
perform substantially all Employee's duties and responsibilities to the Company
by reason of a physical or mental disability or infirmity for either (i) a
continuous period of six months or (ii) 180 days during
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any consecutive twelve-month period. The date of such Permanent Disability shall
be (y), in the case of clause (i) above, the last day of such six-month period
or, if later, the day on which satisfactory medical evidence of such Permanent
Disability is obtained by the Company, or (z) in the case of clause (ii) above,
such date as is determined in good faith by the Company. In the event that any
disagreement or dispute arises between the Company and Employee as to whether
the Employee has incurred a Permanent Disability, then, in any such event,
Employee shall submit to a physical and/or mental examination by a competent and
qualified physician licensed under the laws of the State of Florida who shall be
mutually selected by the Company and Employee, and such physician shall make the
determination of whether Employee suffers from any disability. In the absence of
fraud or bad faith, the determination of such physician as to Employee's
condition at such time shall be final and binding upon both the Company and the
Employee. The entire cost of any such examination shall be borne solely by the
Company.
"Prospective Project" means (i) a prospective time-share, vacation
plan, vacation ownership or interval ownership resort or project with respect to
which Employee has been made aware or has been advised prior to the termination
of Employee's employment by the Company (which, for this purpose, includes
Vistana and all Affiliates of Vistana) that Vistana or any of its Affiliates is
considering developing or undertaking and (ii) any person or entity, including
its respective Affiliates, with respect to which Employee has been made aware or
has been advised prior to the termination of Employee's employment by the
Company (which, for this purpose, includes Vistana and all Affiliates of
Vistana) that Vistana or any of its Affiliates has commenced to evaluate or
negotiate with in respect of any transaction involving (y) the acquisition by
Vistana or any of its Affiliates of all or a portion of such person or entity or
its consolidated assets or (z) the acquisition by such person or entity (or its
Affiliates) of all or a portion of Vistana or its consolidated assets.
"Territory" means the total geographic area located within a 150-mile
radius of each Existing Project and each Prospective Project.
14. Miscellaneous.
(a) Severability. If any provision of this Agreement shall be
declared invalid or unenforceable by a court of competent jurisdiction, the
invalidity or unenforceability of such provision shall not affect the other
provisions hereof, and this Agreement shall be construed and enforced in
all respects as if such invalid or unenforceable provision was omitted.
(b) Attorneys' Fees and Costs. In the event a dispute arises between
the parties hereto and suit is instituted, the prevailing party or parties
in such litigation shall be entitled to recover reasonable attorneys' fees
and other costs and expenses from the non-prevailing party or parties,
whether incurred at the trial level or in any appellate proceeding.
(c) Governing Law and Venue. This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida. In the event
of any legal or equitable action arising under this Agreement, the venue of
such action shall be exclusively within either the state courts of Florida
located in Orange County, Florida, or the United States District Court for
the
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Xxxxxx Xxxxxxxx of Florida, Orlando Division, and the parties waive any
other jurisdiction and venue.
(d) Completeness of Agreement. All understandings and agreements heretofore
made between the parties hereto with respect to the subject matter of this
Agreement are merged into this document which alone fully and completely
expresses their agreement. No change or modification may be made to this
Agreement except by instrument in writing duly executed by the parties
hereto with the same formalities as this document.
(e) Notices. Any and all notices or other communications provided for herein
shall be given in writing and shall be hand delivered or sent by United
States mail, postage prepaid, registered or certified, return receipt
requested, addressed as follows:
If to the Company: Vistana, Inc.
0000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: President
If to Employee: at the address specified in
Schedule A attached hereto.
provided, however, that any of the parties may, from time to time, give notice
to the other parties of some other address to which notices or other
communications to such party shall be sent, in which event, notices or other
communications to such party shall be sent to such address. Any notice or other
communication shall be deemed to have been given and received hereunder as of
the date the same is actually hand delivered or, if mailed, when deposited in
the United States mail, postage prepaid, registered or certified, return receipt
requested.
(f) Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the respective parties hereto, their heirs, legal
representatives, successors and permitted assigns (it being understood that
Employee may not assign this Agreement, or any rights hereunder, without
the prior written consent of the Company and that the Company may assign
this Agreement, or any rights hereunder, to any Affiliate of the Company
without the consent of Employee).
(g) Counterparts. This Agreement may be executed in several counterparts, each
of which shall be deemed an original, and all of which shall constitute but
one and the same instrument.
(h) Captions. The captions appearing in this Agreement are inserted only as a
matter of convenience and in no way define, limit, construe or describe the
scope or intent of any provisions of this Agreement or in any way affect
this Agreement.
(i) Employee Representation. Employee represents that the execution of this
Agreement by Employee does not, and the performance of this Agreement by
Employee will not,
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violate or conflict with any other agreement to which Employee is a party
or otherwise subject. Employee also represents and agrees that in
performing Employee's obligations pursuant to this Agreement, Employee will
not breach the confidentiality, non-solicitation, non-competition or other
provisions of any other agreement to which Employee is a party or is
otherwise subject. Employee agrees to hold harmless and indemnify each of
the Company and its Affiliates from any and all claims, losses,
liabilities, actions, costs or expenses, which any of them may incur or
suffer as a result of a breach of the foregoing representation.
(j) Additional Understandings. Any additional understandings between the
Company and Employee are set forth on Schedule C attached hereto and
incorporated herein by this reference.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the date and
year set forth above.
THE COMPANY:
VISTANA, INC.,
a Florida corporation
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman and Chief
Financial Officer
EMPLOYEE:
/s/ Xxxx X. Xxxxxx
-------------------------------------------
Name: Xxxx X. Xxxxxx
-12-
SCHEDULE A
to
EMPLOYMENT AGREEMENT with XXXX X. XXXXXX
1. Employee Name and Address: Xxxx X. Xxxxxx
0000 Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
2. Employee Title: Vice President and Chief Accounting Officer
Corporate Title: Vice President and Chief Accounting
Officer
Functional Title: Not applicable
3. Primary Employment Responsibilities: Employee shall be responsible for
performing the duties and responsibilities of the chief accounting officer
of a public company. Employee shall also perform such additional duties and
responsibilities, consistent with Employee's title and position, as may be
specified from time to time by the Company's Board of Directors, Chief
Executive Officer(s), and Employee's supervising officer(s). Employee's
supervising officer(s) shall be designated by the Company's Chief Executive
Officer(s).
4. Place of Employment: The Company office(s) located in the Orlando, Florida
Metropolitan Statistical Area, as designated from time to time by the
Company.
5. Effective Date: January 30, 1998
6. Expiration Date: January 30, 2002
Initials: CEH A-1 Initials: MEP
--- ---
SCHEDULE B
to
EMPLOYMENT AGREEMENT with XXXX X. XXXXXX
1. Base Salary: For the 1998 calendar year, the Company shall pay to Employee
an annual salary equal to $160,000 (the "Base Salary"). For each calendar
year during the term of this Agreement commencing with the next ensuing
calendar year, the Company shall pay Employee an annual salary (the
"Adjusted Base Salary") determined by the Company's Chief Executive Officer
or its Board of Directors (or the Compensation Committee thereof);
provided, however, that the Adjusted Base Salary shall be no less than the
Base Salary.
2. Bonus Amount: From and after January 1, 1998, Employee shall be entitled to
annual bonuses, if any, as shall be specified in written performance plans
which are agreed to by the Company and Employee on a year-to-year basis.
The Company and Employee acknowledge that (i) such performance plans shall
be similar in form to that currently in effect for similar level employees
of the Company having responsibilities similar to the responsibilities of
Employee hereunder and (ii) such performance plans shall provide
eligibility for annual bonuses approximating 20% to 30% of Employee's Base
Salary or Adjusted Base Salary (as applicable).
3. Paid Vacation Time: Four weeks per calendar year. (Unused vacation time may
not be carried over from year to year unless approved by the Company in
writing or permitted by Company policy.)
4. Severance Amount: Employee's monthly Base Salary (or, if applicable,
Adjusted Base Salary) payable (in accordance with the Company's normal
payroll policies) during the Severance Period.
5. Severance Period: The period from the Termination Date until the earlier to
occur of (i) the twelve months' anniversary of the Termination Date and
(ii) the Expiration Date.
Initials: CEH B-1 Initials: MEP
--- ---
SCHEDULE C
to
EMPLOYMENT AGREEMENT with XXXX X. XXXXXX
1. Stock Options: Subject to the approval of the Compensation
Committee of Vistana's Board of Directors, Vistana
will grant Employee a compensatory (nonqualified)
option to purchase 25,000 shares of Vistana common
stock pursuant to the Vistana Stock Plan at an
exercise price per share equal to the closing
price per share of Vistana common stock on the
NASDAQ National Market System on the date of grant
(it being understood by Employee that (i) 25% of
such options shall vest and become exercisable on
the first year anniversary of the Effective Date
and the remaining 75% of such options shall vest
and become exercisable in equal amounts on each
ensuing annual anniversary of the Effective Date
until all such options have become fully vested
and exercisable and (ii) in the event that, at
Vistana's next ensuing Annual Meeting of
Shareholders, Vistana's shareholders do not
approve of an increase in the number of options
available for grant under the Vistana Stock Plan,
such grant of options shall be null and void for
all purposes and in all respects, in which event
Vistana shall grant such options as soon as a
sufficient number of options become available
under the Vistana Stock Plan). Such grant of
options will be made pursuant to an Option
Agreement between Vistana and Employee
substantially similar in form to the Option
Agreements currently in effect for similar level
executives.
2. Relocation: The Company will pay or reimburse Employee for the
reasonable cost of: (i) moving Employee's
household goods (including packing, unpacking,
insurance, and billing) from Employee's Miami,
Florida residence to Employee's new residence in
the Orlando, Florida area; and (ii) house hunting
trips for Employee's spouse, with round trip
airfare (Miami-Orlando) once a month, up to six
months. At Employee's option, the Company will:
(a) for a maximum of six months, provide Employee
with rent-free use of a Vistana Resort unit, or
reimburse Employee for the reasonable cost of
renting an apartment in the Orlando area, until
Employee acquires a home in, and Employee's family
relocates to, the Orlando area; or (b) provide
Employee with such rent-free
Initials: CEH C-1 Initials: MEP
--- ---
use of a Vistana Resort unit for up to three
months and reimburse Employee for up to three
months of the mortgage payments on Employee's
Miami residence, subject to a maximum of $1,300
per month, if and to the extent Employee is
required to pay mortgage payments on residences in
both Miami and Orlando.
The Company will reimburse Employee for up to
$2,500 of miscellaneous relocation expenses
incurred at time of actual relocation to the
Orlando, Florida area, upon presentation of
receipts or other documentation acceptable to the
Company.
3. Non-Compete: Following the termination of Employee's employment
by the Company (which for this purpose includes
Vistana and all Affiliates of Vistana), the
provisions of Section 10 of this Agreement shall
not be deemed to prevent Employee from working as
a partner, shareholder, or professional employee
of a public accounting or similar professional
services firm that has one or more clients in the
timeshare or vacation ownership business, provided
that such firm is not an Affiliate of any of the
organizations described in Section 10 and such
clients do not account for more than fifty percent
(50%) of Employee's xxxxxxxx for the firm.
C-2
