EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (the "Agreement"), executed as of June 22, 2000,
is by and between Fairfield Communities, Inc., a Delaware corporation (the
"Company"), and Xxxxxx X. Xxxxxx ("Executive").
WITNESSETH:
WHEREAS, Executive is Executive Vice President and Chief Financial Officer
(subject to possible future changes in job title, the "Officer Position") of the
Company and has made and is expected to continue to make major contributions to
the short- and long-term profitability, growth and financial strength of the
Company;
WHEREAS, the Company desires (a) to assure itself of both present and
future continuity of management and (b) to provide certain minimum termination
benefits for Executive; and
WHEREAS, Executive is willing to render services to the Company on the
terms and subject to the conditions set forth in this Agreement.
NOW, THEREFORE, the Company and Executive agree as follows:
1. Employment. The Company agrees to and does hereby employ Executive to
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perform the duties of the Officer Position, and Executive accepts such
employment, upon the terms and conditions set forth herein. During the Term
hereof, prior to the termination of Executive's employment, unless otherwise
agreed by the Chief Executive Officer of the Company, Executive shall not be
engaged in any other employment or business activities, shall devote his full
business time and effort to the Company and shall not serve as an officer or
director of any public company or other "for profit" enterprise, other than the
Company and its subsidiaries and affiliates. While Executive currently maintains
offices in both the Company's Little Rock, Arkansas and Orlando, Florida
offices, Executive has agreed to relocate under the Company's standard
relocation policy which has been applicable to other moves, from the Little
Rock, Arkansas office to the Orlando, Florida office not later than September 1,
2000; provided, however, that in connection with Executive's move to the
Orlando, Florida area, the Company shall bear the expense (up to a maximum cost
to the Company of $5,000) for transporting automotive repair and workshop
equipment which is not generally covered by the Company's standard relocation
policy.
2. Term. The term of this Agreement shall be the period commencing as of
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the date set forth above and continuing thereafter through a date representing
the length of time defined herein as the "Severance Period" following the date
either the Company or Executive, as the case may be, gives termination notice
(the "Notice") hereunder (the "Term"); provided that the minimum Term shall be
automatically extended (regardless of whether or not the "Notice" has previously
been given by the Company) through a date representing the length of time
defined herein as the "Severance Period" plus one year following the date on
which a "Change in Control" occurs; and further provided, that it is understood
that if Executive remains employed
by the Company after the Term, such employment shall be "at-will" unless
different terms are established in writing.
The term "Change in Control" shall mean the happening of any of the
following:
(a) During any period of 24 consecutive months, ending after the date
hereof:
(i) individuals who were directors of the Company at the beginning of
such 24-month period, and
(ii) any new director whose election or nomination for election by the
Board of Directors was approved by a vote of the greater of (A) at least
two-thirds (2/3), or (B) four affirmative votes, in each case, of the
directors then still in office who were either directors at the beginning
of such 24-month period or whose election or nomination for election was
previously so approved
cease for any reason to constitute a majority of the Board of Directors of the
Company;
(b) Any person or entity (other than the Company or its Subsidiary employee
benefit plan or plans or any trustee of or fiduciary with respect to such plan
or plans when acting in such capacity), or any group acting in concert, shall
beneficially own, directly or indirectly, more than fifty percent (50%) of the
total voting power represented by the then outstanding securities of the Company
entitled to vote generally in the election of directors ("Voting Securities");
(c) Upon a merger, combination, consolidation or reorganization of the
Company, other than a merger, combination, consolidation or reorganization which
would result in (i) the Voting Securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into Voting Securities of the surviving entity) at least 50% of
the voting power represented by the Voting Securities of the Company or such
surviving entity outstanding immediately after such transaction and (ii) at
least such 50% of voting power continuing to be held in the aggregate by the
holders of the Voting Securities of the Company immediately prior to such
transaction (conditions (i) and (ii) are referred to as the "Continuance
Conditions"); or
(d) All or substantially all of the assets of the Company are sold or
otherwise disposed of, whether in one transaction or a series of transactions,
unless the Continuance Conditions shall have been satisfied with respect to the
purchaser of such assets.
3. Duties and Services. Executive agrees to serve the Company in the
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Officer Position, and to devote such working time as is reasonably necessary for
proper performance of the duties and obligations attaching to such office.
Executive also agrees to perform from time to time such other executive services
as the Company shall reasonably request, provided that such services shall be
consistent with his position and status in the Officer Position. In attending to
the business and affairs of the Company, Executive agrees to serve the Company
faithfully, diligently and to the best of his ability.
4. Compensation. As consideration for the services to be rendered hereunder
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by Executive, the Company agrees to pay Executive, and Executive agrees to
accept, payable in accordance with the Company's standard payroll practices for
executives, but payable in not less than monthly installments, compensation of
Two Hundred Sixty Two Thousand Five Hundred Dollars ($262,500) per annum or such
greater amount as may be determined from time to time by the Company (the "Base
Salary").
5. Incentive and Transition Compensation. The Company may, in its sole
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discretion, establish incentive compensation programs applicable to Executive
from time to time during the Term hereof. The incentive compensation program
previously established for 2000 shall remain unaffected by this Agreement. In
the event that Executive remains employed by the Company on the first
anniversary of a "Change in Control", then he shall, within five (5) calendar
days from such anniversary date, be paid a one time transition payment (in
addition to any incentive compensation plan which may then be in effect) equal
to 100% of his Base Salary.
6. Termination for Cause.
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(a) In the event that the Company provides Executive with written notice
terminating his employment for "Cause", as defined in Section 6(b), all
compensation to Executive pursuant to Section 4 in respect of periods after such
discharge shall terminate immediately upon such termination, and the Company
shall have no further obligations with respect thereto, nor shall the Company be
obligated to pay Executive termination pay under Section 8 or any accrued but
unpaid incentive compensation.
(b) For the purposes of this Agreement, "Cause" shall mean (i) an
intentional act or acts of fraud, embezzlement or theft constituting a felony
and resulting or intended to result directly or indirectly in gain or personal
enrichment for Executive at the expense of the Company; or (ii) the continued,
repeated, intentional and willful refusal to perform the duties associated with
Executive's position with the Company, which is not cured within 15 days
following written notice to Executive. For purposes of this Agreement, no act or
failure to act on the part of Executive shall be deemed "intentional" if it was
due primarily to an error in judgment or negligence, but shall be deemed
"intentional" only if done or omitted to be done by Executive not in good faith
and without reasonable belief that his action or omission was in the best
interest of the Company. Executive shall not be deemed to have been terminated
for "Cause" hereunder unless and until there shall have been delivered to
Executive a copy of a resolution duly adopted by the affirmative vote of not
less than a majority of the Board of Directors of the Company then in office at
a meeting of the Board called and held for such purpose, after reasonable notice
to Executive and an opportunity for Executive, together with his counsel (if
Executive chooses to have counsel present at such meeting), to be heard before
the Board, finding that, in the good faith opinion of the Board, Executive had
committed an act constituting "Cause" as herein defined and specifying the
particulars thereof in detail. Nothing herein will limit the right of Executive
or his beneficiaries to contest the validity or propriety of any such
determination.
7. Termination Without Cause. Either the Company or Executive may terminate
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Executive's employment without Cause, but only upon delivery to the other party
of a written notice of termination specifying a termination date, in the case of
a notice by Executive, of 30 days after the date of delivery of such notice. In
the event of a notice by Executive, the Company may, at any time thereafter,
notify Executive that he is excused from working for the remaining duration of
the 30 day notice period, without incurring any liability for termination
compensation as a result thereof, provided, however, that the Company shall
continue to pay Executive's Base Salary during the remainder of the 30 day
notice period. Notwithstanding the Term of this Agreement and Section 4 hereof
relating to the annual salary to be paid to Executive during Executive's
employment by the Company, nothing in this Agreement should be construed as
conferring any right of Executive to be employed by the Company for a fixed or
definite term. Subject to Section 8 hereof, Executive agrees that the Company
may dismiss Executive under this Section without regard to (a) any general or
specific policies (whether written or oral) of the Company relating to the
employment or termination of employment of Company employees; or (b) any
statements made to Executive, whether made orally or contained in any document
or instrument, pertaining to Executive's relationship with the Company.
Notwithstanding anything to the contrary contained herein, Executive's
employment by the Company is not for any specified term, is at-will and may be
terminated by the Company pursuant to this Section at any time by delivery of
the notice referred to herein, for any reason, without any liability whatsoever,
except with respect to the payment provided for in Section 8.
8. Termination Compensation.
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(a) If, during the Term, Executive's employment is terminated (i) for any
reason other than (A) pursuant to Section 6(a), (B) by reason of death, (C) by
reason of "Disability" or (D) by notice by Executive pursuant to Section 7
hereof or (ii) by Executive due to "Constructive Discharge" (the occurrence of
(a)(i) or (a)(ii) being referred to as being "Terminated Without Cause"), then
Executive shall receive termination pay in an amount equal to one and one half
years (the "Severance Period") of his Base Salary, payable in a lump sum within
ten (10) calendar days of the date of termination.
(b) In the event that Executive is Terminated Without Cause prior to the
first anniversary following a Change in Control, then in addition to the
termination pay provided in Section 8(a) above, Executive shall be paid an
amount equal to 100% of his Base Salary. Such amount shall be paid in a lump sum
within ten (10) calendar days following his termination date.
(c) For the purposes of this Agreement, "Constructive Discharge" shall
mean:
(i) any reduction in Base Salary;
(ii) a material reduction in Executive's job function, duties or
responsibilities, or a similar change in Executive's reporting
relationships; or
(iii) a required relocation of Executive of more than thirty five (35)
miles from Executive's current job location, except that this provision
shall not apply in connection with the relocation of Executive's job from
Little Rock, Arkansas to the Company's
executive office located in the Orlando, Florida area (which shall be
considered to be Executive's job location, following any such relocation),
provided that, it is understood that Executive's job responsibilities will
require that he travel extensively to other locations on the Company's
business; or
(iv) any breach of any of the material terms of this Agreement by the
Company which is not cured within 15 days following written notice thereof
by Executive to the Company;
provided, however, that the term "Constructive Discharge" shall not include a
specific event described in the preceding clause (i), (ii), (iii) or (iv) unless
Executive actually terminates his employment with the Company within 60 days
after the occurrence of such event.
(d) The amount of compensation payable pursuant to this Section 8 is not
subject to any deduction (except for withholding taxes), reduction, offset or
counterclaim, and the Company may not give advance notice of termination in lieu
of the payment provided for in this Section 8.
(e) For purposes of this Agreement, "Disability" shall mean an illness or
accident which prevents Executive, for a continuous period lasting six months,
from performing the material job duties normally associated with the Officer
Position. In the event that any disagreement or dispute arises between the
Company and Executive as to whether Executive has incurred a "Disability", then,
in any such event, Executive shall submit to a physical and/or mental
examination by a competent and qualified physician licensed under the laws of
the State of Executive's residence who shall be mutually selected by the Company
and Executive, and such physician shall make the determination of whether
Executive suffers from any "Disability". In the absence of fraud or bad faith,
the determination of such physician as to Executive's condition at such time
shall be final and binding upon both the Company and Executive. The entire cost
of any such examination shall be borne solely by the Company.
(f) Notwithstanding any provision of this Agreement to the contrary, if any
amount or benefit to be paid or provided under this Agreement would be an
"Excess Parachute Payment", within the meaning of Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"), or any successor provision
thereto, but for the application of this sentence, then the payments and
benefits to be paid or provided under this Agreement shall be reduced to the
minimum extent necessary (but in no event to less than zero) so that no portion
of any such payment or benefit, as so reduced, constitutes an Excess Parachute
Payment; provided, however, that the foregoing reduction shall be made only if
and to the extent that such reduction would result in an increase in the
aggregate payment and benefits to be provided, determined on an after-tax basis
(taking into account the excise tax imposed pursuant to Section 4999 of the
Code, or any successor provision thereto, any tax imposed by any comparable
provision of state law, and any applicable federal, state and local income
taxes). The determination of whether any reduction in such payments or benefits
to be provided under this Agreement or otherwise is required pursuant to the
preceding sentence shall be made at the expense of the Company, if requested by
Executive or the Company, by the Company's independent accountants. The fact
that Executive's right to payments or benefits may be reduced by reason of the
limitations
contained in this Section 8(f) shall not of itself limit or otherwise affect any
other rights of Executive other than pursuant to this Agreement. In the event
that any payment or benefit intended to be provided under this Agreement or
otherwise is required to be reduced pursuant to this Section 8(f), Executive
shall be entitled to designate the payments and/or benefits to be so reduced in
order to give effect to this Section 8(f). The Company shall provide Executive
with all information reasonably requested by Executive to permit Executive to
make such designation. In the event that Executive fails to make such
designation within 10 business days following the date Executive ceases to be
employed by the Company, the Company may effect such reduction in any manner it
deems appropriate.
9. Termination Obligations.
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(a) Executive hereby acknowledges and agrees that all personal property and
equipment, including, without limitation, all computers, 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 Executive in the course of or incident to Executive's employment,
belongs to the Company and shall be promptly returned to the Company within five
business days after Executive's last work day. Following Executive's last work
day, Executive will not retain any written or other tangible material containing
any proprietary information of the Company.
(b) Effective as of Executive's last work day, Executive shall be deemed to
have resigned from all offices and directorships then held with the Company or
any subsidiaries or affiliates of the Company. Executive shall provide the
Company with signed letters of resignation from all such positions.
(c) Notwithstanding anything herein to the contrary, the covenants and
agreements of Executive contained in Sections 9, 10, 11, 12, 15, 16, 20 and 21
shall survive termination of Executive's employment by the Company and the
termination of this Agreement, whether or not for "Cause".
(d) In exchange for the Company entering into this Agreement, and as a
condition precedent to payment of any amounts owed to Executive under Section 8
hereof, Executive agrees that, at the time of Executive's resignation or
termination from the Company, Executive will execute a release reasonably
acceptable to the Company of all liability of the Company and its subsidiaries
and their officers, shareholders, employees, directors and affiliates to
Executive in connection with or arising out of Executive's employment by the
Company, except with respect to (i) any then-vested rights under the Company's
stock warrant or stock option plans, (ii) any then-vested rights under the
Company's employee benefit plans (including Executive's right, if any, to
continued coverage under the Company's medical plan under COBRA and for payment
at termination of any accrued but unused vacation time in accordance with the
Company's usual policies), (iii) rights of indemnification under the Company's
Bylaws and directors' and officers' liability coverages, (iv) any amounts which
may be payable to Executive pursuant to Section 8 and (v) any claims Executive
may have pursuant to the Company's disability and workmen's compensation
insurance programs.
10. Covenant Not to Compete. Unless the Chief Executive Officer of the
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Company determines that any of the following conduct is in the Company's best
interests, during the Term of this Agreement and for the Non-Compete Period,
Executive shall not:
(a) directly or indirectly for himself 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, fractional ownership, exchange company, vacation plan, vacation
ownership or interval ownership project within the Territory; or
(b) directly or indirectly for himself or for any other person or entity,
sell, or otherwise procure purchasers for, any time-share, fractional ownership,
exchange company, 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, fractional ownership,
exchange company, 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-share, fractional ownership, exchange
company, vacation plan, vacation ownership or interval ownership business within
the Territory; or
(d) directly or indirectly for himself 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, fractional ownership, exchange
company, vacation plan, vacation ownership or interval ownership activities,
including, without limitation, The 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., Sunterra Corporation or Starwood Hotels & Resorts Worldwide, Inc. or any
of their respective subsidiaries or affiliates; or
(e) directly or indirectly, for himself, or for any other person or entity,
pursue or consummate or otherwise interfere with any Existing Project; or
(f) directly or indirectly, for himself, or for any other person or entity,
pursue or consummate or otherwise interfere with any Prospective Project; or
(g) directly or indirectly, for himself, 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 subsidiaries and
affiliates) described in clause (b) of the definition of Prospective Project.
Notwithstanding the foregoing, Executive may purchase stock as a
stockholder in any publicly traded company, including any company engaged in the
timeshare, fractional ownership, exchange or vacation ownership business;
provided, however, that Executive may not
own (individually or collectively with Executive's family members, trusts for
the benefit of Executive's family members and affiliates of Executive) more than
5% of any company (other than the Company).
"Existing Project" means a time-share, fractional ownership, exchange
company, vacation plan, vacation ownership or interval ownership resort or
project which the Company or any of its subsidiaries or affiliates owns,
operates, is under contract to provide property management services, is part of
the Company's FairShare Plus reservation system or has commenced to develop,
acquire or otherwise undertake as of the date Executive's employment with the
Company terminates.
"Non-Compete Period" shall mean the period commencing on the date
Executive's employment with the Company terminates during the Term hereof
(regardless of the reason for such termination of employment, "Executive's
Termination Date") and continuing for the "Post Employment Non-Compete Period"
(as set forth in the following table, which time period may extend beyond, and
shall survive, the expiration of the Term):
Executive's Post Employment
Termination Date Non-Compete Period
Through December 30, 2000 12 months
January 1, 2001 through March 31, 2001 10 months
April 1, 2001 through June 30, 2001 8 months
July 1, 2001 through September 30, 2001 6 months
October 1, 2001 through December 30, 2001 4 months
January 1, 2002 through March 31, 2002 2 months
On or after April 1, 2002 None
"Prospective Project" means (a) a prospective time-share, fractional
ownership, exchange company, vacation plan, vacation ownership or interval
ownership resort or project with respect to which Executive has been made aware
or has been advised prior to the termination of his employment with the Company
that the Company or any of its subsidiaries or affiliates is considering
developing or undertaking and (b) any person or entity, including its respective
affiliates, with respect to which Executive has been made aware or has been
advised prior to the termination of his employment by the Company that the
Company or any of its subsidiaries or affiliates has commenced to evaluate or
negotiate with in respect of any transaction involving (i) the acquisition by
the Company or any of its subsidiaries or affiliates of all or a portion of such
person or entity or its consolidated assets or (ii) the acquisition by such
person or entity (or its affiliates) of all or a portion of the Company or its
consolidated assets.
"Territory" means the total geographic area located within a 150-mile
radius of each Existing Project and each Prospective Project.
In light of the substantial remuneration provided to Executive hereunder
and Executive's management position with the Company, Executive 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, 11 and 12, are reasonable and
appropriate, and that Executive will not claim to the contrary in any action
brought by the Company to enforce any of such provisions.
11. Covenant Against Solicitation of Employees and Contractors. Executive
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shall not, directly or indirectly or on behalf of any person, organization,
business or enterprise with which Executive may become associated in any
capacity (whether as an employee, officer, director, consultant, investor (debt
or equity) or otherwise), during the Term of this Agreement and for two years
from the date Executive ceases to be employed by the Company (regardless of the
reason for such change in Executive's employment status), (a) solicit or cause
or suggest there be solicited for employment or as an independent contractor,
consultant or other service provider, or hire, any people then serving, or
serving within the 180 days prior thereto, as employees of the Company or any of
its subsidiaries or affiliates or (b) contact or solicit or attempt to establish
a commercial relationship with any of the Company's or its subsidiaries' or
affiliates' outside providers of information systems, marketing services, OPC
locations or sales prospects.
12. Remedies For Breach. It is understood and agreed by the parties that no
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amount of money would adequately compensate the Company for damages which the
parties acknowledge would be suffered as a result of a violation by Executive of
the covenants contained in Sections 9, 10, 11 and 15 hereof, and that,
therefore, the Company shall be entitled, upon application to a court of
competent jurisdiction, to obtain injunctive relief (without the need to prove
irreparable injury or inadequate remedy at law) to enforce the provisions of
Sections 9, 10, 11 or 15, 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. Other Benefits; Life Insurance; Extension of Loan.
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(a) Except as expressly provided herein, this Agreement shall not:
(i) be deemed to limit or affect the right of Executive to receive
other forms of additional compensation or to participate in any insurance,
retirement, disability, profit-sharing, stock purchase, stock option, stock
appreciation rights, cash or stock bonus or other plan or arrangement or in
any other benefits now or hereafter provided by the Company or any of the
Company's subsidiary or affiliated companies for its employees; or
(ii) be deemed to be a waiver by Executive of any vested rights which
Executive may have or may hereafter acquire under any employee benefit plan
or arrangement of the Company or any of the Company's subsidiary or
affiliated companies.
(b) It is contemplated that, in connection with his employment hereunder,
Executive may be required to incur reasonable business, entertainment and travel
expenses. The Company agrees to reimburse Executive in full for all reasonable
and necessary business, entertainment and other related expenses, including
travel expenses, incurred or expended by him incident to
the performance of his duties hereunder, upon submission by Executive to the
Company of such vouchers or expense statements satisfactorily evidencing such
expenses as may be reasonably requested by the Company.
(c) It is understood and agreed by the Company that during the term of
Executive's employment hereunder, he shall be entitled to annual paid vacations
(taken consecutively or in segments), the length of which shall be consistent
with the effective discharge of Executive's duties and the general customs and
practices of the Company applicable to its management personnel.
(d) The Company shall, at its sole expense (up to an initial maximum annual
premium of $5,000), obtain and maintain in full force and effect term life
insurance on Executive's life in an amount equal to twice Executive's Base
Salary, payable to a beneficiary of Executive's choice.
(e) Executive shall be extended a loan, in the amount of $450,000, for use
in connection with Executive's construction of a house, located at 0000 Xxxxx
Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx 00000, for Executive's occupancy as his and
his family's primary personal residence, such loan to be advanced in a single
draw at such time as Executive elects, provided that this agreement to extend a
loan shall expire on June 30, 2001 if such loan has not theretofore been drawn
by Executive, or sooner, in the event that Executive's employment with the
Company has terminated (or notice of termination has been given by either
Executive or the Company). It shall be a condition precedent to the extension of
such loan that Executive and his spouse shall have executed and delivered to the
Company loan documentation in substantially the form attached as Attachments A1,
A2 and A3, and such other documents ancillary thereto as the Company's counsel
may reasonably require.
14. No Mitigation Obligation. The Company hereby acknowledges that it will
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be difficult and may be impossible (a) for Executive to find reasonably
comparable employment following the date of termination and (b) to measure the
amount of damages which Executive may suffer as a result of termination of
employment hereunder. Accordingly, the payment of the termination compensation
by the Company to Executive in accordance with the terms of this Agreement is
hereby acknowledged by the Company to be reasonable and will be liquidated
damages, and Executive will not be required to mitigate the amount of any
payment provided for in this Agreement by seeking other employment or otherwise,
nor will any profits, income, earnings or other benefits from any source
whatsoever create any mitigation, offset, reduction or any other obligation on
the part of Executive hereunder or otherwise.
15. Confidentiality.
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(a) Recognizing that the knowledge and information about the business
methods, systems, plans and policies of the Company and of its affiliated
companies which Executive has heretofore and shall hereafter receive, obtain or
establish as an employee of the Company or its affiliated companies are valuable
and unique assets of the Company and its affiliated companies, Executive agrees
that he shall not (otherwise than pursuant to his duties while an employee)
disclose or use (whether for himself or, directly or indirectly, for any person,
organization, business or enterprise with which Executive may become associated
in any capacity (whether as
an employee, officer, director, consultant, investor (debt or equity) or
otherwise)), without the express prior written consent of the Chief Executive
Officer of the Company, any knowledge or information not readily available to
the general public pertaining to the Company or its affiliated companies
(including specifically any information relating to the Company's points based
product or reservation system, lists of current or prospective clients,
marketing and other service providers, business plans and proposals, current or
prospective business opportunities, financial records, research and development
and marketing strategies and programs (including present and prospective OPC
locations and the terms of leases of similar arrangements)), or any of their
business, personnel or plans, for any reason or purpose whatsoever, unless
required by law or legal process. In the event Executive is required by law or
legal process to provide documents or disclose information, he shall take all
reasonable steps to maintain the confidentiality of such documents and
information, including notifying the Company as soon as reasonably practical in
advance of such disclosure and giving it an opportunity to seek a protective
order, at its sole cost and expense.
(b) The provisions of this Section 15 shall survive the expiration or
termination of this Agreement, without regard to the reason therefor, for a
period of two years from the earlier of (i) expiration of the Term or (ii)
termination of Executive's employment with the Company.
16. Legal Fees and Expenses. In the event a dispute arises between the
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parties hereto and suit is instituted, the prevailing party in such litigation
shall be entitled to recover reasonable attorneys' fees and other costs and
expenses from the non-prevailing party, whether incurred at the trial level or
in any appellate proceeding. For purposes hereof, the Company shall be deemed to
have prevailed in any suit involving a breach or alleged breach by Executive of
any of the covenants contained in Sections 9, 10 and 11 above if the Company
prevails to any degree in such suit (even if such covenant or covenants are not
enforced to the fullest extent sought by the Company).
17. Withholding of Taxes. The Company may withhold from any amounts payable
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under this Agreement all federal, state, city or other taxes as the Company is
required to withhold pursuant to any law or government regulation or ruling.
18. Successors and Binding Agreement.
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(a) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation, reorganization or otherwise) to all or
substantially all of the business or assets of the Company, by agreement in form
and substance reasonably satisfactory to Executive, expressly to assume and
agree to perform this Agreement in the same manner and to the same extent the
Company would be required to perform if no such succession had taken place. This
Agreement will be binding upon and inure to the benefit of the Company and any
successor to the Company, including, without limitation, any persons acquiring
directly or indirectly all or substantially all of the business or assets of the
Company whether by purchase, merger, consolidation, reorganization or otherwise
(and such successor shall thereafter be deemed the "Company" for the purposes of
this Agreement), but will not otherwise be assignable, transferable or delegable
by the Company.
(b) This Agreement will inure to the benefit of and be enforceable by
Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees and legatees.
(c) This Agreement is personal in nature and neither of the parties hereto
shall, without the consent of the other, assign, transfer or delegate this
Agreement or any rights or obligations hereunder. Without limiting the
generality or effect of the foregoing, Executive's right to receive payments
hereunder will not be assignable, transferable or delegable, whether by pledge,
creation of a security interest or otherwise, other than by a transfer by
Executive's will or by the laws of descent and distribution and, in the event of
any attempted assignment or transfer contrary to this Section 18(c), the Company
shall have no liability to pay any amount so attempted to be assigned,
transferred or delegated.
19. Notices. For all purposes of this Agreement, all communications,
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including, without limitation, notices, consents, requests or approvals,
required or permitted to be given hereunder will be in writing and will be
deemed to have been duly given when hand delivered or dispatched by electronic
facsimile transmission (with receipt thereof orally confirmed); or five business
days after having been mailed by United States registered or certified mail,
return receipt requested, postage prepaid; or three business days after having
been sent by a nationally recognized overnight courier service such as Federal
Express, UPS or Purolator, addressed to the Company (to the attention of the
President and Chief Executive Officer of the Company, at 0000 Xxxxxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, with a copy to the General Counsel of the
Company, at 0000 Xxxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 32819), and to
Executive at his principal residence located at 0000 Xxx Xxxxxxx Xxxxxxxxx,
Xxxxxxx, Xxxxxxx 00000, or to such other address as any party may have furnished
to the other in writing and in accordance herewith, except that notices of
changes of address shall be effective only upon receipt.
20. Governing Law and Venue. The validity, interpretation, construction and
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performance of this Agreement will be governed by and construed in accordance
with the substantive laws of the State of Florida, without giving effect to the
principles of conflict of laws of such State. 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 Middle District of Florida,
Orlando Division, and the parties waive any other jurisdiction and venue.
21. Validity and Construction. If any provision of this Agreement or the
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application of any provision hereof to any person or circumstances is held
invalid, unenforceable or otherwise illegal, the remainder of this Agreement and
the application of such provision to any other person or circumstances will not
be affected, and the provision so held to be invalid, unenforceable or otherwise
illegal will be reformed to the extent (and only to the extent) necessary to
make it enforceable, valid or legal; provided, however, that the Company shall
have no obligation to pay the termination pay provided for in Section 8 hereof
(and Executive shall refund the gross amount of such termination pay which may
have been previously paid) in the event that either of the covenant not to
compete provided for in Section 10 hereof or the covenant against solicitation
of employees and contractors provided for in Section 11 hereof is held to be
unenforceable or otherwise given limited effect, in whole or in any material
part.
The parties have participated jointly in the negotiation and drafting of
this Agreement. In the event of an ambiguity or a question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties hereto and no presumption or burden of proof shall arise favoring
or disfavoring either party by virtue of the authorship of any of the provisions
of this Agreement.
22. Miscellaneous. No provision of this Agreement may be modified, waived
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or discharged unless such waiver, modification or discharge is agreed to in
writing signed by Executive and the Company. No waiver by either party hereto at
any time of any breach by the other party hereto or compliance with any
condition or provision of this Agreement to be performed by such other party
will 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, expressed or implied with respect to the subject matter hereof
have been made by either party which are not set forth expressly in this
Agreement. References to Sections are references to Sections of this Agreement.
23. Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same agreement.
24. Warranty. Executive warrants and represents that he is not a party to
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any agreement, contract or understanding, whether of employment or otherwise,
which would in any way restrict or prohibit him from undertaking or performing
employment in accordance with the terms and conditions of this Agreement.
25. Approval. By executing this Agreement, the Company acknowledges that
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this Agreement has been approved by the Board of Directors of the Company and
that no other approvals are required as a condition precedent for this Agreement
to become effective.
26. Prior Agreement. This Agreement shall in all respects supersede all
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previous agreements providing severance pay benefits, whether written or oral,
between Executive and the Company, including the Severance Pay Agreement dated
as of May 13, 1993, and any existing or future adopted Company policies or
procedures with respect to separation, severance or termination pay.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
FAIRFIELD COMMUNITIES INC.
By: /s/ Xxxxx X. Xxxx
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Xxxxx X. Xxxx
President and
Chief Executive Officer
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx, Individually
