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[EXHIBIT 10.3]
FORM OF EMPLOYMENT AGREEMENT BETWEEN CCI AND XXXXXXX X. XXXXX
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered
into as of the ____ day of __________, 1998, by and between XXXXX COMPANIES,
INC. (the "Company"), a Utah corporation with an office at [1375 Xxxxx Xxxx
Xxxxxx, Xxxxxxxxxxx, Xxxx 00000], and XXXXXXX X. XXXXX (the "Executive"), an
individual having an address at 000 Xxxxx 000 Xxxx, Xxxx, Xxxx 00000.
WHEREAS, the Company desires to retain the services of the
Executive for the term and on the terms and conditions hereinafter set forth;
and
WHEREAS, the parties hereto deem it to be in their best interests to
enter into an employment agreement whereby the Company will employ or continue
to employ the Executive on the terms hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises hereinafter
made by the parties hereto, the Executive and the Company hereby covenant and
agree as follows:
SECTION 1: EMPLOYMENT OF EXECUTIVE; DUTIES AND RESPONSIBILITIES
1.1 Employment of the Executive. The Company shall employ the
Executive, and the Executive shall provide services to the Company, subject to
the terms and conditions hereof.
1.2 Term of Employment. The Executive's employment by the Company
shall be for a period commencing on ______________, 1998 (the "Effective Date")
and ending on the date of termination pursuant to the provisions of Section 3
hereof (the "Employment Period").
1.3 Office and Position of the Executive. During the Employment
Period and unless otherwise mutually agreed by the Company and the Executive,
the Executive shall be the President and Chief Executive Officer of the Company.
1.4 Duties and Responsibilities. During the Employment Period:
(a) subject to the ultimate control and responsibility of the
Board of Directors of the Company, as President and Chief Executive Officer, the
Executive shall have the responsibilities related to such position which may be
specified in the Articles of Incorporation or Bylaws of the Company and shall
have the powers and duties related thereto, and shall perform such other duties
and responsibilities as the Board of Directors of the Company shall reasonably
assign to the Executive which are consistent with the Executive's position
specified in Section 1.3; and
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(b) the Executive shall perform his duties and
responsibilities at or from the Company's offices in [Springville], Utah, or
from any other office or location in the State of Utah which the Company, with
the Executive's concurrence, deems appropriate or convenient.
SECTION 2: COMPENSATION; BENEFITS; REIMBURSEMENT
2.1 Base Salary. The Company shall pay to the Executive a base
salary at the rate of $____________ per annum, payable in substantial equal
monthly installments (such amount, as it may be increased from time to time, is
hereinafter referred to as the "Base Salary"). The Base Salary and any other
compensation that the Executive may be entitled to hereunder, shall be reviewed
by the Board of Directors at least annually and may be increased or decreased
(but in no event lower than as previously provided in this Section 2.1) as the
Board of Directors may determine.
2.2 Discretionary Annual Incentive Bonus. The Company may pay the
Executive with respect to each calendar year during his employment an annual
incentive bonus in such amount as the Board of Directors may determine. This
compensation is completely discretionary to the Board of Directors.
2.3 Other Benefits.
(a) Employee Benefit Plans or Arrangements. The Executive
shall be entitled to participate in all employee benefit plans of the Company,
as presently in effect or as they may be modified by the Company from time to
time, under such terms as may be applicable to officers of the Executive's rank
employed by the Company or its subsidiaries, including, without limitation,
plans providing retirement benefits, medical insurance, life insurance,
disability insurance and accidental death or dismemberment insurance.
(b) Vacation and Sick Leave. The Executive shall be entitled
to paid annual vacation periods and to sick leave in accordance with the
policies of the Company, as presently in effect or as they may be modified by
the Company from time to time, under such terms as may be applicable to officers
of the Executive's rank employed by the Company or its subsidiaries, but in no
event less than _________ of vacation per annum or ___________ of sick leave per
annum.
(c) Expenses. Subject to the policy and limitations of the
Company, the Company shall reimburse the Executive for all reasonable expenses
incurred by him in the discharge of his duties, including but not limited to
expenses for entertainment and travel on behalf of the Company. The Executive
shall account to the Company for all such expenses.
SECTION 3: TERMINATION OF EMPLOYMENT
3.1 Termination of Employment Period. The Employment Period shall
terminate as follows:
(a) Mandatory Termination. The Employment Period shall
terminate on the date that is three (3) years from and after the Effective Date
(the "Mandatory Termination Date"). The Employment Period may be extended beyond
the Mandatory Termination Date only
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upon the affirmative vote of not less than eighty percent (80%) of the Board of
Directors of the Company.
(b) Termination for Cause. The Company may terminate the
Employment Period for "cause" at any time upon written notice to the Executive
stating the facts constituting such "cause". For purposes of this Section
3.1(b), the term "cause" shall mean:
(1) conviction for commission of a felony by the
Executive; or
(2) gross negligence or intentional or willful
misconduct by the Executive in the performance of his duties as determined in
good faith by the Board of Directors of the Company.
(c) Termination on Death. The Employment Period shall
terminate upon the death of the Executive.
(d) Termination for Disability. The Company may terminate the
Employment Period if the Executive shall become unable to fulfill his duties
under this Agreement for a period of time in excess of 180 days, as measured by
the Company's usual business activities, by reason of any medically determinable
physical and/or mental disability (including without limitation, alcohol, drug,
or other substance abuse) determined in accordance with the procedure set forth
below.
If in the opinion of the Company's Board of Directors or the
Executive, the Executive has been disabled for a period of 180 days, then the
Company shall promptly employ three physicians to examine the Executive and
determine if, in their opinion, the Executive is disabled. One of the three
physicians employed by the Company for this purpose shall be a physician
selected by the Executive. The opinion of the group of three physicians shall be
certified in writing to the Board of Directors and the Board of Directors shall
make such certificate available for inspection by the Executive or his
representative. If the three physicians, as a group, concludes that the
Executive is disabled and will remain disabled for at least 90 days, then the
Board of Directors, in its sole discretion, may terminate the Employment Period.
A termination of the Employment Period pursuant to this
Section 3.1(d) shall be effective 30 days after written notice of termination is
delivered to the Executive.
(e) Termination by the Executive. The Executive may, upon 60
days written notice to the Company, terminate the Employment Period (i) at any
time after the Mandatory Termination Date, if the Employment Period has been
extended beyond the Mandatory Termination Date in accordance with Section
3.1(a), or (ii) at any time after the occurrence of Constructive Termination, as
defined below. As used herein, "Constructive Termination" shall mean a material
reduction in the Executive's salary or benefits below those provided in Sections
2.1 and 2.3 hereof, a material change in the Executive's responsibilities, a
change of title, or a requirement that the Executive relocate, except for office
relocations that would not increase the Executive's one-way commute distance by
more than [20] miles.
3.2 Severance Payment. If, at any time prior to the Mandatory
Termination Date, the Executive's employment is involuntarily terminated for any
reason by the Company, other
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than for cause, death or disability, including a Constructive Termination, as
defined in Section 3.1(e), the Executive shall be entitled to receive a
severance payment from the Company in an amount determined under Section 3.3
below (the "Severance Payment"). The Severance Payment shall be made in one lump
sum not more than 60 days following the date of the employment termination. The
Severance Payment shall be in lieu of any further payment to the Executive under
Section 2 and any further accrual of benefits under Section 2 with respect to
periods subsequent to the date of the employment termination.
3.3 Severance Amount. The amount of the Severance Payment shall be
an amount equal to the sum of (i) the Executive's Base Salary (as of the date of
termination) multiplied by the number of years (including fractions thereof)
from the date of termination through and including the Mandatory Termination
Date plus (ii) the average annual bonus paid by the Company to the Executive, if
any, pursuant to Section 2.2 during the fiscal year(s) immediately preceding the
date of termination, multiplied by the number of years (including fractions
thereof) from the date of termination through and including the Mandatory
Termination Date.
3.4 Employee Benefit Plan Coverage. If, at any time prior to the
Mandatory Termination Date, the Executive's employment is involuntarily
terminated for any reason by the Company, other than for cause, death or
disability, including a Constructive Termination, in addition to the Severance
Payment, the Executive (and, where applicable, the Executive's dependents) shall
be entitled to continue participation until the Mandatory Termination Date, or
until the Executive's normal retirement date, if earlier, in the employee
benefit plans referred to in Section 2.3(a).
3.5 No Mitigation. The Executive shall not be required to mitigate
the amount of any payment contemplated by this Section 3 (whether by seeking new
employment or in any other manner), nor shall any such payment be reduced by any
earnings that the Executive may receive from any other source.
3.6 Successors of Company. The Company shall require any successor
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company's business and/or assets, by an agreement in substance and form
satisfactory to the Executive, to assume this Agreement and to agree expressly
to perform this Agreement in the same manner and to the same extent as the
Company would be required to perform it in the absence of a succession. The
Company's failure to obtain such agreement prior to the effectiveness of a
succession shall be a breach of this Agreement and shall entitle the Executive
to all of the compensation and benefits to which the Executive would have been
entitled hereunder if the Company had involuntarily terminated the Executive's
employment without cause or disability, on the date when such succession became
effective. For all purposes under this Agreement, the term "Company" shall
include any successor to the Company's business and/or assets which executes and
delivers the assumption agreement described in this Section 3.6 or which becomes
bound by this Agreement or by operation of law.
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SECTION 4: GENERAL PROVISIONS
4.1 Assignment. Neither this Agreement nor any of the rights,
obligations or interests hereunder may be assigned by the Executive without the
prior written consent of the Company; provided, however, that nothing in this
Section 4.1 shall preclude the Executive from designating in writing a
beneficiary or beneficiaries to receive any compensation payable to him or any
other benefit receivable by him under this Agreement upon the death or
disability of the Executive, nor shall it preclude the executors, administrators
or any other legal representatives of the Executive or his estate from assigning
any rights hereunder to the person or persons entitled thereto. Neither this
Agreement nor any of the rights, obligations or interests arising hereunder may
be assigned by the Company without the prior written consent of the Executive to
any person, except that the Company may assign this Agreement without the
Executive's consent to any party with which the Company merges or consolidates,
or to whom the Company sells all or substantially all of its assets; provided,
however, that any such affiliate or successor shall expressly assume all of the
Company's obligations and liabilities to the Executive under this Agreement.
4.2 Severability. This Agreement shall be deemed severable, and any
part hereof which may be held invalid by a court or other entity of competent
jurisdiction shall be deemed automatically excluded from this Agreement and the
remaining parts shall remain in full force and effect.
4.3 Entire Agreement. This Agreement contains the entire
understanding of the parties hereto and constitutes the only agreement between
the Company and the Executive regarding the employment of the Executive by the
Company. This Agreement supersedes all prior agreements, either express or
implied, between the parties hereto regarding the employment of the Executive by
the Company.
4.4 Amendment. No term or condition of this Agreement shall be
amended or modified unless expressly consented to in writing and signed by each
of the parties hereto.
4.5 Binding Agreement. This Agreement shall be binding upon and
inure to the benefit of the parties hereto, and their respective heirs, other
legal representatives and permitted successors and assigns, as the case may be.
4.6 Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the state of Utah.
4.7 Notices. All notices or other communications to be given by the
parties among themselves pursuant to this Agreement shall be in writing, shall
be deemed to have been duly made mailed by certified mail or hand delivered to
either of the parties at their respective addresses as they first appear above.
Any of the parties hereto may change their respective addresses upon written
notice to the other given in the manner provided in this Section.
4.8 Waiver. No waiver by any of the parties to this Agreement of any
condition, term or provision of this Agreement shall be deemed to be a waiver of
any preceding or subsequent breach of the same or any other condition, term or
provision hereof.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date and year first above written.
XXXXX COMPANIES, INC.:
By:
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Name:
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Title:
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EXECUTIVE:
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Xxxxxxx X. Xxxxx
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