June 30, 2008
Exhibit
10.1
![](https://www.sec.gov/Archives/edgar/data/313395/000114420408042360/logo.jpg)
June
30,
2008
Xx.
Xxxx
Xxxxxxxxxxx
000
X.
Xxxxxxxx Xxxx, Xxxxx 000
Xxx
Xxxxxxx, Xxxxx 00000
Dear
Xx.
Xxxxxxxxxxx:
In
its
meeting on June 26, 2008, the Board of Directors (the “Board”) of the Company
voted to amend the Change in Control Agreement dated May 15, 2007 (the “Prior
Agreement”), between the Company and you, in order to increase the amount you
would be paid in the event of a Change in Control. This Agreement amends,
restates and wholly replaces the Prior Agreement, as previously
amended.
The
Board
of the Company recognizes that your contribution to the past and future growth
and success of the Company has been and will be substantial, and the Board
desires to assure the Company of your continued services for the benefit of
the
Company, particularly in the face of a change in control.
This
Agreement therefore sets forth those benefits which the Company will provide
to
you in the event of a "Change in Control of the Company" [as defined in
paragraph 2] under the circumstances described below.
1. Term.
If a
Change in Control of the Company should occur while you are still an employee
of
the Company, then this Agreement shall continue in effect from the date of
such
Change in Control of the Company for so long as you remain an employee of the
Company, but in no event for more than one full calendar year following a Change
in Control of the Company; provided, however, that the expiration of the term
of
this Agreement shall not adversely affect your rights under this Agreement
which
have accrued prior to such expiration. If no Change in Control of the Company
occurs before your status as an employee of the Company is terminated, this
Agreement shall expire on your termination date. Prior to a Change in Control
of
the Company, your employment may be terminated by the Company with or without
cause at any time upon written notice to you, and in such event, you shall
not
be entitled to any of the benefits provided hereunder.
000
Xxxx
Xxxxxxxx Xxxxxxxxx • Suite 350 • Xxx Xxxxxxx, Xxxxx 00000 • (000) 000-0000 • fax
(000) 000-0000 • xxx.xxxx.xxx
Xx.
Xxxx
Xxxxxxxxxxx
June
30,
2008
Page
2
2. Change
in Control.
For
purposes of this Agreement, a "Change in Control of the Company" shall be
deemed
to have occurred if (A) there shall be consummated (I) any consolidation
or
merger of the Company in which the Company is not the continuing or surviving
corporation, or pursuant to which shares of the Company's Common Stock would
be
converted in whole or in part into cash, securities or other property, other
than a merger
of
the Company in which the holders of the Company's Common Stock immediately
prior
to the merger have substantially the same proportionate ownership of common
stock of the surviving corporation immediately after the merger, or (II)
any
sale, lease, exchange or transfer (in one transaction or a series of related
transactions) of all or substantially all the assets of the Company, or (B)
the
shareholders of the Company shall approve any plan or proposal for the
liquidation or dissolution of the Company, or (C) any "person" [as such term
is
used in Sections 13(d)(3) and 14(d)(2) of the Securities Exchange Act of
1934,
as amended (the "Exchange Act")] other than the Company or a subsidiary thereof
or any employee benefit plan sponsored by the Company or a subsidiary thereof
or
a corporation owned, directly or indirectly, by the shareholders of the Company
in substantially the same proportions as their ownership of stock of the
Company, shall become the beneficial owner (within the meaning of Rule 13d-3
under the Exchange Act) of securities of the Company representing 20% or
more of
the combined voting power of the Company's then outstanding securities
ordinarily (and apart from rights accruing in special circumstances) having
the
right to vote in the election of directors, as a result of a tender or exchange
offer, open market purchases, privately negotiated purchases or otherwise,
or
(D) at any time during a period of two consecutive years, individuals who
at the
beginning of such period constituted the Board of Directors of the Company
shall
cease for any reason to constitute at least a majority thereof, unless the
election or the nomination for election by the Company's shareholders of
each
new director during such two-year period was approved by a vote of at least
two-thirds of the directors then still in office who were directors at the
beginning of such two-year period, or (E) any other event shall occur that
would
be required to be reported in response to Item 6(e) (or any successor provision)
of Schedule 14A of Regulation 14A promulgated under the Exchange
Act.
3. Entitlement
Following Change in Control.
If a
Change in Control of the Company shall occur while you are still an employee
of
the Company, you shall be entitled to the payments and benefits provided in
paragraph 4 delivered to you on or before 30 days following the date of the
Change in Control of the Company. However, the Company may defer such delivery
to you until March 15th
of the
year following the year in which the Change in Control occurs by continuing
to
employ you in the same geographic location and with the same or substantially
the same salary and benefits and comparable duties and responsibilities as
were
in effect at the time of the Change in Control of the Company. Should the
Company terminate your employment prior to March 15th
of the
year following the year in which the Change in Control occurs, the payments
and
benefits to which you are entitled under paragraph 4 shall be delivered to
you
on or before 10 days following the date of your termination. In the event your
employment is not terminated by the Company prior to March 15th
of the
year following the year in which the Change in Control occurs, you shall
nevertheless become entitled to the payments and benefits provided in paragraph
4 on March 15th
of the
year following the year in which the Change in Control occurs.
Xx.
Xxxx
Xxxxxxxxxxx
June
30,
2008
Page
3
4. Payments
and Benefits Due.
(i)
Subject to the provisions of paragraph 3 above, in the event of a Change
in
Control of the Company, you shall be entitled to an amount equal to the sum
of
the following:
(x) your
full
base salary through the date on which your employment by the Company is
terminated at the rate in effect on the date of the Change in Control of the
Company; plus
(y) an
amount
equal to the product of (a) the sum of your annual base salary at the highest
rate in effect during the 12-month period immediately preceding the date of
the
Change in Control of the Company, multiplied by (b) the number
three.
(ii) You
shall
not be required to mitigate the amount of any payment provided for in this
paragraph 4 or in paragraphs 6 or 15 by seeking other employment or otherwise,
nor shall the amount of any payment provided for in this paragraph 4 be reduced
by any compensation earned by you as the result of employment by another
employer after the date of termination of your employment by the Company, or
otherwise.
(iii) The
provisions of this Agreement, and any payment provided for hereunder, shall
not
reduce any amounts otherwise payable, or in any way diminish your existing
rights, or rights which would accrue solely as a result of the passage of time,
under any employee benefit plan of the Company, any employment agreement or
other contract, plan or arrangement of the Company, except to the extent
necessary to prevent double payment under any other severance plan or program
of
the Company in effect at the date of termination of your
employment.
5. Gross-Up
Provision.
If any
portion of any payments received by you from the Company (whether payable
pursuant to the terms of this Agreement or any other plan, agreement or
arrangement with the Company, its successors or any person whose actions result
in a Change in Control of the Company) shall be subject to the tax imposed
by
Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"),
or
any successor statutory provision ("Excess Parachute Payments"), the Company
shall pay to you such additional amounts as are necessary so that, after taking
into account any tax imposed by such Section 4999 or any successor statutory
provision only on any Net Excess Parachute Payments (as hereinafter defined),
as
well as on payments made pursuant to this sentence, and any federal and state
income taxes payable as a result of any payments due you pursuant to this
sentence, you are in the same after-tax position that you would have been in
if
such Section 4999 or any successor statutory provision did not apply and no
payments were made pursuant to this sentence. "Net Excess Parachute Payments"
shall mean that amount equal to the difference between (i) all Excess Parachute
Payments and (ii) all "parachute payments" (as that term is defined in Section
280G of the Code) attributable to the acceleration of the exercisability of
stock options (or any right to receive cash in lieu thereof) under any plan
of
the Company or any successor or person whose actions result in a Change in
Control of the Company.
Xx.
Xxxx
Xxxxxxxxxxx
June
30,
2008
Page
4
6. Successor's
Binding Agreement.
(i) The
Company will require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
and/or assets of the Company, by agreement in form and substance satisfactory
to
you, expressly to assume and agree to perform this Agreement in the same
manner
and to the same extent that the Company would be required to perform if no
such
succession had taken place. Failure of the Company to obtain such agreement
prior to the effectiveness of any such succession shall be a breach of this
Agreement and shall entitle you to compensation from the Company in the same
amount and on the same terms as you would be entitled hereunder if you
terminated your employment on the date of the Change in Control of the Company
(whether or not you terminate your employment). As used in this Agreement,
"Company" shall mean the Company as herein before defined and any successor
to
its business and/or assets as aforesaid which executes and delivers the
agreement provided for in this paragraph 6 or which otherwise becomes bound
by
all the terms and provisions of this Agreement by operation of law. If you
received payments pursuant to this paragraph 6 prior to termination of your
employment, you shall not be entitled to any benefits hereunder at the time
of
any subsequent termination of your employment.
(ii) This
Agreement shall inure to the benefit of, and be enforceable by, your personal
or
legal representatives, executors, administrators, successors, heirs,
distributes, devisees and legatees. If you should die while any amounts would
still be payable to you hereunder if you had continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with
the
terms of this Agreement to your devisee, legatee or other designee or, if there
be no such designee, to your estate.
7. Employment.
In
consideration of the foregoing obligations of the Company, you agree to be
bound
by the terms and conditions of this Agreement and to remain in the employ of
the
Company during any period following any public announcement by any person of
any
proposed transaction or transactions which, if effected, would result in a
Change in Control of the Company until a Change in Control of the Company has
taken place or, in the opinion of the Board, such person has abandoned or
terminated its efforts to effect a Change in Control of the Company. Subject
to
the foregoing, nothing contained in this Agreement shall impair or interfere
in
any way with your right to terminate your employment or the right of the Company
to terminate your employment with or without cause prior to a Change in Control
of the Company. Nothing contained in this Agreement shall be construed as a
contract of employment between the Company and you or as a right for you to
continue in the employ of the Company, or as a limitation of the right of the
Company to discharge you with or without cause prior to a Change in Control
of
the Company.
8. Injunctive
Relief.
You
acknowledge and agree that the remedy of the Company at law for any breach
of
the covenants and agreements contained in paragraph 8 of this Agreement will
be
inadequate, and that the Company shall be entitled to injunctive relief as
its
sole and exclusive remedy against any such breach or any threatened breach.
You
represent and agree that such injunctive relief shall not prohibit you from
earning a livelihood acceptable to you. The Company waives all right to any
claim for damages or set-off in connection with any such breach of such
covenants and agreements.
Xx.
Xxxx
Xxxxxxxxxxx
June
30,
2008
Page
5
9. Notice.
For the
purpose of this Agreement, notices and all other communications provided for
in
this Agreement shall be in writing and shall be deemed to have been duly given
when delivered or mailed by United States registered mail, return receipt
requested, postage prepaid, addressed to the respective addresses set forth
on
the first page of this Agreement, provided that all notices to the Company
should be directed to the attention of the Chief Financial Officer of the
Company, or to such other address as either party may have furnished to the
other in writing in accordance herewith, except that notices of change of
address shall be effective only upon receipt.
10. Indemnification.
The
Company will indemnify you to the fullest extent permitted by the laws of the
State of Delaware and the by-laws of the Company as in effect on the date of
the
Change in Control of the Company, in respect of all your services rendered
to
the Company and its subsidiaries prior to the date on which your employment
is
terminated. You shall be entitled to the protection of any insurance policies
the Company now or hereafter maintains generally for the benefit of its
directors, officers and employees (but only to the extent of the coverage
afforded by the existing provisions of such policies) to protect against all
costs, charges and expenses whatsoever incurred or sustained by you in
connection with any action, suit or proceeding to which you may be made a party
by reason of your being or having been a director, officer or employee of the
Company or any of its subsidiaries during your employment
therewith.
11. Further
Assurances.
Each
party hereto agrees to furnish and execute such additional forms and documents,
and to take such further action, as shall be reasonable and customarily required
in connection with the performance of this Agreement or the payment of benefits
hereunder.
12. Miscellaneous.
No
provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing signed by you and
such
officer as may be specifically designated by the Board of the Company. No waiver
by either party hereto at any time of any breach by the other party hereto
of,
or compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar provisions
or conditions at the same or at any prior or subsequent time. No agreements
or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not set forth
expressly in this Agreement. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Texas.
13. Validity.
The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
which shall remain in full force and effect.
Xx.
Xxxx
Xxxxxxxxxxx
June
30,
2008
Page
6
14. Counterparts.
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed to be an original but all of which together will constitute one and
the
same instrument.
15. Legal
Fees and Expenses.
In
addition to any other benefits to which you may be entitled hereunder, the
Company shall pay all legal fees and expenses which you may incur as a result
of
the Company's contesting the validity, enforceability or your interpretation
of,
or determinations under, this Agreement or otherwise as a result of
any
termination
as a result of which you are entitled to the benefits set forth in this
Agreement.
16. Arbitration.
Any
dispute or controversy arising under or in connection with this Agreement shall
be settled exclusively by arbitration in San Antonio, Texas, in accordance
with
the rules of the American Arbitration Association then in effect. Judgment
may
be entered on the arbitrator's award (which the parties agree may include any
measure or type of damages or other remedy available at law or in equity) in
any
court having jurisdiction; provided, however, that you shall be entitled to
seek
specific performance of your right to be paid until the date on which your
employment is terminated during the pendency of any dispute or controversy
arising under or in connection with this Agreement.
If
this
Agreement correctly sets forth our agreement on the subject matter hereof,
kindly sign and return to the Company the enclosed copy of this Agreement which
will then constitute our agreement on this subject.
Sincerely,
|
|
By:
|
/s/
XXXXX X. XXXXXX
|
Xxxxx
X. Xxxxxx,
|
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Chief
Executive Officer
|
AGREED
TO
this 1st
day of
July,
2008.
/s/
XXXX XXXXXXXXXXX
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Xxxx
Xxxxxxxxxxx
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