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EXHIBIT 10.22
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
as of this ___ day of May, 1998, by and between Geotrac, Inc., a Florida
corporation (the "Company")and Xxxxxx X. Xxxxx ("Executive").
RECITALS
A. The Company and Executive desire to enter into an employment
arrangement.
B. The Company has determined that it is in the best interests of the
Company to enter into this Agreement setting forth the rights, duties and
obligations of both the Company and Executive.
C. The Company's business requires secrecy in connection with the
methods and systems employed, and, for the proper protection of the Company, it
is absolutely necessary and essential (which necessity Executive expressly
recognizes) that all matters connected with, arising out of, or pertaining to
the business of the Company, its methods and systems and the names of its
customers be kept secret and confidential as goodwill belonging to the Company.
D. The Company will sustain great loss and damage, if during the term
of this Agreement, or for the period described in Section 10.2 below immediately
following its termination for any reason whatsoever, Executive should, for
himself or on behalf of any other person, persons, company, partnership or
corporation, call upon the trade, customers or clientele of the Company for the
purpose of soliciting, selling or servicing any programs of the type sold or
serviced by the Company, for which loss and damage, by reason of his financial
circumstances, Executive could not be compelled by law to respond to damages in
any action at law.
E. The Company wishes to assure itself of the services of Executive and
Executive is willing to be employed by the Company upon the terms and conditions
provided in this Agreement.
In consideration of the foregoing Recitals and the mutual covenants and
conditions contained herein, the parties agree as follows:
1. Employment. The Company hereby employs Executive, and Executive
hereby accepts employment with the Company, subject to the terms and conditions
of this Agreement.
2. Duties and Job Description. Executive shall serve as President and
Chief Executive Officer of the Company and shall do and perform all services,
acts and other things necessary to perform the tasks assigned to him by the
Board of Directors of the Company, which tasks shall be consistent with those
normally assigned to Presidents and Chief Executive Officers of similar
businesses. Executive shall devote his reasonable full-time efforts and
attention to the business of the Company during the Term (as defined in Section
3, below).
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3. Term. The term of employment under this Agreement shall become
effective and shall commence as of the date hereof and shall continue for a term
of four (4) years (the "Term"), unless earlier terminated in accordance with the
provisions of Sections 7 or 8 of this Agreement. If this Agreement has not been
previously terminated as provided herein, at the expiration of the Term, this
Agreement shall continue until terminated by either party on ninety (90) days'
prior written notice to the other.
4. Compensation. As compensation for the services to be performed under
this Agreement, Executive shall receive a base salary (the "Salary") at the rate
of $150,000.00 per year, payable in equal, biweekly installments or at such
other time or times as the Company and Executive shall agree. At the end of the
first year of this Agreement and each year thereafter, there shall be a review
of Executive's performance and compensation by the Board of Directors of the
Company. The annual review will include the possibility of a raise in salary.
The Executive shall be entitled to participate in any bonus program established
by the Company and shall be granted bonuses from time to time as determined by
the Board of Directors.
5. Duty of Loyalty. Executive shall discharge his duties in good faith
and shall not knowingly engage in any business or perform any services in any
capacity whatsoever that are in conflict with the best interests of the Company.
6. Benefits: Automobile Allowance.
6.1 Benefits. Executive shall be offered comparable benefits
to those offered to any other of the Company's executive officers, for
the purpose of Executive's entitlement to employee benefit programs,
including, without limitation, option plans, bonus programs, vacation,
sick pay, expense reimbursement, retirement plans, health, life and
disability insurance.
6.2 Automobile Allowance. The Company shall provide Executive
with a suitable automobile in connection with the performance of his
services under this Agreement in accordance with the Company's
policies.
6.3 Reimbursement of Expenses. The Company shall reimburse
Executive for any and all necessary, customary and usual expenses,
properly receipted in accordance with corporate policies, incurred by
Executive on behalf of the Company.
7. Death or Disability.
7.1 Termination of Employment. If during the term of this
Agreement Executive should die or become physically or mentally
disabled and as a result thereof becomes unable to continue the proper
performance of his duties under Section 2 of this Agreement,
Executive's employment under this Agreement shall thereupon
automatically cease and terminate. The Company's obligation to pay
Executive the Salary shall cease as of the date of such death or
disability, except that severance shall be paid equal to one times
Executive's
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then current annual salary and shall be paid first from any insurance
proceeds paid to the Company and the Company will pay the difference
between the severance amount and the amount provided by the insurance
proceeds in a lump sum within thirty (30) days of such termination.
7.2 Definition of Disabled. For purposes of this Section 7,
Executive shall be "disabled" if, due to illness or injury, either
physical or mental, Executive has been substantially unable to perform
his customary duties for the Company for a period of one hundred eighty
(180) consecutive days or an aggregate of one hundred eighty (180) days
within a period of 365 consecutive days, provided the Company has given
Executive thirty (30) days written notice of potential termination, and
within said thirty (30) day period after written notice of termination
had been given, Executive has not returned to the reasonable full-time
performance of his duties.
8. Termination.
8.1 Termination by the Company for Cause. The Company may
terminate this Agreement at any time for "Cause". "Cause" as used
herein shall be defined as:
(a) Drunkenness by Executive or illegal use of
narcotics when, in the opinion of a physician selected by the
Company's Board of Directors (the "Board") and reasonably
acceptable to Executive, such drunkenness or use of narcotics
materially impairs the ability of Executive to perform his
duties under this Agreement. Prior to termination for
drunkenness or illegal use of narcotics, Executive must have
been offered treatment and (i) rejected the offer for
treatment or (ii) failed to complete the treatment;
(b) Conviction of a felony having a demonstrably
material adverse effect on the financial condition of the
Company;
(c) Fraudulent conduct of a material nature of
Executive in connection with the business affairs of the
Company;
(d) Any other conduct of Executive which is in
material violation of this Agreement for a period of thirty
(30) business days after written notice thereof is received by
Executive from the Company.
Executive's employment shall in no event be considered to have been
terminated by the Company for Cause if such termination took place as
the result of (i) any act or omission believed in good faith to have
been in or not opposed to the interest of the Company, or (ii) any act
or omission in respect of which a determination is made that Executive
met the applicable standard of conduct prescribed for indemnification
or reimbursement or payment of expenses under the by-laws of the
Company or the laws of the State of Ohio, in each case as in effect at
the time of such act or omission.
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The vote of four (4) out of the five (5) members of the Board shall be
required in order for Executive's employment to be terminated for cause
pursuant to this Section 8.1. However, with respect to drunkenness
under Section 8.1.a., and Section 8.1.d., such termination shall not
occur unless a member of the Board, in a counseling session with
Executive, has first described to Executive the reason for the
termination and Executive shall then have thirty (30) days to
discontinue the conduct so described or otherwise remedy the reason for
the cause of termination. A written record of such counseling session
shall be prepared and both the member of the Board and Executive shall
sign such written record to indicate that it accurately reflects the
matters discussed at the counseling session. If Executive's employment
is terminated for Cause pursuant to this Section 8.1 in accordance with
the provisions of this paragraph, Executive's employment may be
terminated immediately without any further advance written notice and
the Company shall have no obligation to make any payments to Executive
under this Agreement other than the Company's obligation to pay
Executive the Salary, any benefits and reimbursement of expenses
accrued through the date of such termination.
8.2 Termination by the Company Without Cause or for Good
Reason. In the event of termination by the Company without Cause or by
the Executive for Good Reason (as defined), the Company shall pay
Executive his base salary at the rate in effect as of such
determination date for the longer of (a) the remainder of the term of
this Agreement or (b) one year after such termination date. For
purposes of this Agreement, "Good Reason" shall mean (i) a reduction in
the Salary, (ii) a relocation of the Executive's headquarters outside
of the Norwalk, Ohio, area, (iii) a material demunition in the
Executive's duties or responsibilities, (iv) an adverse change in
Executive's title, (v) assignment to Executive of duties and
responsibilities inconsistent with his position in any material
respect, (vi) breach by the Company or Insurance Management Solutions
Group, Inc. ("IMSG") of their respective duties and obligations under
this Agreement and the Corporate Governance Agreement, dated the date
hereof between Executive, the Company and IMSG relating to certain
corporate governance issues, (vii) breach by the Company, IMSG or
Bankers Insurance Group, Inc. ("BIG") of their respective duties and
obligations under the Merger Agreement, dated May 12, 1998, by and
among Executive, his spouse, the Company, IMSG and BIG, (viii) breach
by the Company, IMSG or BIG of their respective duties and obligations
under the Option and Exchange Agreement dated of even date herewith
between Executive, the Company and IMSG or the Indemnity Agreement
between Executive, his spouse, the Company, IMSG and BIG, (ix) a
default under the terms of that certain Subordinated Promissory Note in
the principal amount of One Million Five Hundred Thousand Dollars
($1,500,000) issued by the Company to Executive, or (x) the sale,
directly or indirectly, of the capital stock or substantially all of
the assets of the Company to a competitor of the Company without the
consent of Executive.
8.3 Termination by Executive. Executive shall have the right
to terminate his employment with the Company under this Agreement at
any time. Executive agrees to provide the Company with ninety (90)
days' prior written notice of any such termination. The Company's
obligation to pay Executive the Salary pursuant to Section 4.1, above,
shall
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cease as of his last day of work if Executive terminates his employment
with the Company for any reason other than Good Reason.
8.4 Effect of Termination. Upon termination of this Agreement
by the Company for any reason whatsoever, or upon the termination of
this Agreement by Executive, this Agreement shall thereupon be and
become void and of no further force or effect, except that the
confidentiality and noncompetition provisions of Section 10, below,
shall survive any such termination and shall continue to bind
Executive. Any payments due pursuant to the provisions of this
Agreement for services rendered prior to termination shall be made as
provided in this Agreement. Notwithstanding the foregoing, if Executive
is terminated other than for Cause, if Executive terminates his
employment with the Company for Good Reason or this Agreement is not
renewed for any reason other than death, disability or for Cause,
Sections 10.2 and 10.4 below shall not apply and Executive shall be
entitled to severance pay equal to Executive's then current salary
payable in accordance with the Company's usual payroll practices for a
period equal to the greater of (i) the unexpired term of this Agreement
or (ii) one year (the "Severance Payment"). In the event that Executive
is entitled to a Severance Payment pursuant to this Section 8.4 and
Executive secures employment at any time during the greater of (i) the
unexpired term of this Agreement or (ii) one year (the "Severance
Period"), then the Company shall be entitled to a credit against its
obligations to make the Severance Payment in an amount up to
seventy-five percent (75%) of Executive's base salary during the
Severance Period paid to him by his new employer.
9. Company's Performance. Executive shall prepare and deliver to the
Board at least ninety (90) days prior to fiscal year-end a calendarized budget
which includes a sales plan on a monthly basis for the next fiscal year
indicating how the Company expects to reach the target for that fiscal year (the
"Budget"). Executive shall use his best efforts to cause the Company to operate
within, in all material respects, the Budget and failure to exercise his best
efforts and to not achieve such goals, in all material respects, shall be reason
for termination. Failure of the Company to achieve the results reflected in the
Budget will not, in and of itself, be deemed a violation by Executive of this
Agreement and not constitute an event giving rise to a "for cause" termination.
10. Confidentiality and Noncompetition.
10.1 Disclosure of Information. Executive acknowledges that in
connection and as a result of his engagement hereunder, he will be
making use of, acquiring, and/or adding to confidential information of
a special and unique nature and value relating to such matters as the
Company's trade secrets, systems, procedures, manuals, confidential
reports, marketing or promotional methods, lists of customers, business
plans and referral sources. As a material inducement to the Company's
entering into this Agreement, and to pay the Salary, as well as any
other additional benefits provided for herein, Executive covenants and
agrees that he shall not, at any time during the duration of this
Agreement, including any renewals hereof, and continuing thereafter,
directly or indirectly, divulge or disclose, for any purpose whatsoever
(other than the performance of his obligations hereunder), any
confidential information that has been obtained by, or disclosed to,
him as a result of his
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duties hereunder and his prior employment with SMS Geotrac, Inc., a
Delaware corporation, except to the extent that such confidential
information is (a) in the public domain, (b) generally known in the
flood zone mapping service industry, or (c) rightfully disclosed to
Executive by a third party.
10.2 Covenant Not to Compete. In consideration of the Salary
and other benefits provided herein, Executive agrees that for a period
of two (2) years following Executive's termination of employment with
the Company as provided for herein other than Executive's termination
of employment for Good Reason and the Company's termination of
Executive's employment for any reason other than for Cause, Executive
shall not, directly or indirectly, engage in the flood zone compliance
business nor in any other business engaged in or planned to be engaged
in by the Company within any state of the United States of America or
any other country in which the Company are doing or plan to do
business, nor shall Executive have any interest, directly or
indirectly, whether as proprietor, partner, employee, shareholder,
principal, agent, creditor, consultant, director, officer or in any
other capacity or manner whatsoever, in any such enterprise. For
purposes of this Section 10.2, the phrase "planned to be engaged in"
or "plans to do business" shall mean that as of the date Executive's
employment terminates, the Company has determined, and is pursuing
active steps, as evidenced by written documentation, to become involved
in a new product, service or geographic area and such determination has
been communicated to Executive.
It is the intention of the parties that if any court shall
determine that the scope, duration or geographical limit of any
restriction contained in this Section 10.2 is unenforceable, the
restrictive covenant set forth herein shall not thereby be terminated
but shall be deemed amended to the extent required to render it valid
and enforceable. Executive acknowledges that the scope, duration and
geographical limitation of the restrictions contained in this Section
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interests of the Company and that any violation of these restrictions
would cause substantial injury to the Company, who would not have
entered into this Agreement without receiving the additional
consideration offered by Executive in binding himself to these
restrictions.
10.3 Books and Records. Executive acknowledges that all files,
books, records and other materials owned by the Company and their
subsidiaries, as the case may be, shall at all times remain the
property of the Company or their subsidiaries, as the case may be, and
that upon termination of this Agreement, irrespective of the time,
manner or cause of such termination, Executive shall surrender to the
Company all such files, books, records and other materials.
10.4 Other Employees. Executive will not, during the term of
this Agreement and for two (2) years thereafter, directly or
indirectly, employ or attempt to employ or solicit for any employment
any of the Company's employees.
10.5 Survival of Obligations Beyond Termination. The
obligations of Executive under this Section 10 shall not terminate upon
the termination of this Agreement, but, rather,
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shall continue in effect thereafter. With respect to improvements,
discoveries and inventions for which Executive has had any involvement,
directly or indirectly, Executive shall provide the assistance deemed
necessary by the Company with respect to acquiring and protecting the
rights of the Company thereto, and, with respect to confidential
information or other business information, until such time as the
information shall be in the public domain.
10.6 Injunctive Relief. In the event of a breach or threatened
breach by Executive of any of the provisions of this Section 10, the
Company, in addition to, and not in limitation of, any other rights,
remedies or damages available at law or in equity, shall be entitled to
preliminary and permanent injunctive relief in order to prevent or
restrain any such breach or threatened breach by Executive or
Executive's agents, representatives or any and all persons directly or
indirectly acting for or with Executive.
11. Key Man Insurance. The Company may purchase key man term life
insurance on the life of Executive in an amount of up to $2,000,000 for the
benefit of the Company (the "Life Insurance Policy"). Executive agrees to submit
to any reasonable physical examination required in connection with the Life
Insurance Policy and to otherwise cooperate with the Company in connection with
its obtaining the Life Insurance Policy. Executive confirms to Company that to
the best of his knowledge, he is insurable at normal rates.
12. General Provisions.
12.1. Notices. All notices which are required or may be given
pursuant to the terms of this Agreement shall be in writing and shall
be sufficient in all respects if (a) delivered personally, (b) mailed
by registered or certified mail, return receipt requested and postage
prepaid, or (c) sent via a nationally recognized overnight courier
service or (d) sent via facsimile confirmed in writing to the recipient
in each case as follows:
If to Company or Executive:
Geotrac, Inc.
0000 Xxxxxx Xxxx
Xxxxxxx, Xxxx 00000
Attention: Xxxxxx X. Xxxxx
Telephone (000) 000-0000
Telecopy: (000) 000-0000
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with a copy to:
Benesch, Friedlander, Xxxxxx & Aronoff LLP
0000 XX Xxxxxxx Xxxxxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxx Xxxxxx, Esq.
Telephone (000) 000-0000
Telecopy: (000) 000-0000
and copy to:
Insurance Management Solutions Group, Inc.
000 Xxxxxxx Xxxxxx
Xx. Xxxxxxxxxx, Xxxxxxx 00000
Attention: C. Xxxxxxx Xxxxxx, Esq.
Telephone: (000) 000-0000 extension 4894
Telecopy: (000) 000-0000
or such other address or addresses as either party hereto shall have
designated by notice in writing to the other party hereto.
12.2 Waiver and Amendment. This Agreement may be amended,
supplemented, modified and/or rescinded only through an express written
instrument signed by the parties or their respective legal
representatives, successors and assigns. Any party may specifically and
expressly waive in writing any portion of this Agreement or any breach
hereof, but no such waiver shall constitute a further or continuing
waiver of any preceding or succeeding breach of the same or any other
provision. The consent by one party to any act for which such consent
was required shall not be deemed to imply consent or waiver of the
necessity of obtaining such consent for the same or similar acts in the
future.
12.3 Severability. Each provision of this Agreement is
intended to be severable. If any covenant, condition or other provision
contained in this Agreement is held to be invalid, void or illegal by
any court of competent jurisdiction, such provision shall be deemed
severable from the remainder of this Agreement and shall in no way
affect, impair or invalidate any other covenant, condition or other
provisions contained in this Agreement. If such condition, covenant or
other provision shall be deemed invalid due to its scope or breadth,
such covenant, condition or other provision shall be deemed valid to
the extent of the scope or breadth permitted by law.
12.4 Successors and Assigns. Each of the terms, provisions and
obligations of this Agreement shall be binding upon, shall inure to the
benefit of, and shall be enforceable by the parties and their
respective legal representatives, successors and assigns.
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12.5 Interpretation. The language in all parts of this
Agreement shall be in all cases construed simply according to its fair
meaning and not strictly for or against any party. Whenever the
context requires, all words used in the singular will be construed to
have been used in the plural, and vice versa, and each gender will
include any other gender. The captions of the Sections and Subsections
of this Agreement are for convenience only and shall not affect the
construction or interpretation of any of the provisions of this
Agreement.
12.6 Integration. This Agreement sets forth the entire
agreement between the parties with regard to the subject matter of this
Agreement. All agreements, covenants, representations and warranties,
express or implied, oral and written, of the parties with regard to the
subject matter of this Agreement are contained in this Agreement, in
the exhibits, schedules or annexes to this Agreement, and the documents
referred to or implementing any provision of this Agreement. No other
agreements, covenants, representations or warranties, express or
implied, oral or written, have been made by either party to the other
with respect to the subject matter of this Agreement. All prior and
contemporaneous conversations, negotiations, covenants and warranties
with respect to the subject matter of this Agreement are waived, merged
in this Agreement and superseded by this Agreement. This is an
integrated agreement.
12.7 Entire Agreement. This Agreement, and any exhibits,
schedules or annexes and any documents executed concurrently herewith,
constitute the entire agreement between the parties hereto with respect
to the subject matter hereof and supersede all prior agreements and
understandings, oral and written, between the parties with respect to
the subject matter hereof. No representation, warranty promise,
inducement or statement of intention has been made by either party
which as not embodied in this Agreement or such other documents; and
neither party shall be bound by, or be liable for, any alleged
representation, warranty, promise, inducement or statement or intention
not embodied herein or therein.
12.8 Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Ohio, without
regard to conflicts of law principles. However, jurisdiction and venue
for any action brought to enforce the terms or conditions of this
Agreement shall be the domicile of the defendant or respondent in any
such action.
12.9 Attorneys' Fees. If any party to this Agreement should
bring an arbitration or court action alleging breach of this Agreement
or seeking to enforce, rescind, renounce, declare void or terminate
this Agreement or any provisions thereof, the prevailing party shall be
entitled to recover all of its legal expenses, including reasonable
attorneys' fees and costs (including legal expenses for any appeals
taken), and to have the same awarded as part of the judgment in the
proceeding in which such legal expenses and attorneys' fees were
incurred.
12.10 Representation Acknowledged. The parties acknowledge
that each party and its counsel have reviewed and revised this
Agreement and that the normal rule of construction to the effect that
any ambiguities are to be resolved against the drafting party
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shall not be employed in the interpretation of this Agreement or any
amendments, exhibits, schedules or annexes hereto.
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the duly authorized officers of the parties hereto as of the day and year
indicated above.
WITNESSES COMPANY
Geotrac, Inc.
By:
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Its:
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WITNESSES EXECUTIVE
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Xxxxxx X. Xxxxx
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