EXHIBIT 10.22
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (the "Agreement") is made and entered into as
of the 31st day of October, 2001, by and between Xxxx Xxxxx ("Xxxxx") and
Xxxxxxx Entertainment Company (the "Company").
RECITALS
WHEREAS, Xxxxx is currently employed by the Company as President of its
Opryland Hospitality Group ("OHG"), and the Company has determined to
discontinue its OHG, but desires to retain Xxxxx as a consultant for the Company
going forward on the terms outlined herein;
WHEREAS, Xxxxx has agreed to resign as President of the OHG as a part
of the discontinuance of that division, and Xxxxx also desires to remain
employed by the Company as a consultant on the terms set forth in this
Agreement; and
WHEREAS, Xxxxx and the Company desire to resolve fully and finally all
issues that may arise out of the cessation of Xxxxx' employment as President of
the OHG.
AGREEMENT
In consideration of the premises and mutual promises herein contained,
it is agreed as follows:
1. XXXXX' DUTIES. Xxxxx and the Company agree that Xxxxx' duties as
President of the OHG shall be substantially complete by October 31, 2001, and
Xxxxx' employment as President of the OHG will end on October 31, 2001.
2. KEY EMPLOYEE AGREEMENT. Xxxxx and the Company are parties to a
severance agreement dated February 1, 1999 (the "Key Employee Agreement"). Xxxxx
and the Company agree that the Key Employee Agreement is canceled and its
provisions void and of no effect as of the date of this Agreement.
3. PAYMENT FOR TERMINATION OF KEY EMPLOYEE AGREEMENT. In exchange for
Xxxxx' agreement to the termination of the Key Employee Agreement, the Company
agrees to pay Xxxxx a total of Three Hundred Fifty One Thousand One Hundred
Ninety Six Dollars ($351,196) (the "Key Employee Agreement Termination Fee") in
nineteen (19) monthly installments of Eighteen Thousand Four Hundred Eighty Four
Dollars ($18,484) each, payable beginning November 25, 2001, and on the twenty
fifth (25th) day of each consecutive month thereafter until the Key Employee
Agreement Termination Fee has been paid in full. In addition, as additional
consideration for the termination of the Key Employee Agreement, on or before
January 31, 2002, the Company agrees to transfer to Xxxxx or his designee the
title of the 2002 Cadillac Escalade, VIN 0XXXX00X00X000000, that Xxxxx is
currently driving. The Company will
deduct from the payments described above all taxes, social security and other
usual deductions as required by law. The Company's obligation to pay the Key
Employee Agreement Termination Fee and transfer the automobile to Xxxxx shall
survive any termination of this Agreement.
4. EMPLOYMENT AS CONSULTANT. The Company and Xxxxx agree that the
Company will employ Xxxxx as a consultant from October 31, 2001, until May 31,
2003 (the "Consulting Period"). As compensation for the performance by Xxxxx of
his consulting obligations under this Agreement, the Company agrees to pay Xxxxx
a consulting fee throughout the nineteen (19) month term hereof at a rate of
Thirteen Thousand One Hundred Fifty Eight Dollars ($13,158) per month, payable
on or about the 25th day of each month during the Consulting Period. The Company
will deduct from the payments described above, all taxes, social security and
other usual deductions as required by law. The compensation paid to Xxxxx under
this paragraph 4 shall be in addition to the Key Employee Agreement Termination
Fee.
During the Consulting Period, the Company will pay or reimburse Xxxxx'
reasonable out of pocket expenses directly pertaining to his consulting services
provided to the Company, including transportation, entertainment, mileage
reimbursement, etc., in accordance with the Company's travel and entertainment
policies.
5. DUTIES AS CONSULTANT. During the Consulting Period, Xxxxx will make
himself available to consult with the Company with respect to its Florida and
Texas Hotel projects, and other matters as the Company may reasonably request.
During the first eight (8) months of the Consulting Period (i.e., through June
30, 2002), Xxxxx agrees that he will be available (if requested by the Company)
to consult for at least (but not more than) 30 hours per week. He will travel to
Orlando or Grapevine as requested by the Company (but no more than four times
per month in the aggregate) during such time. Thereafter, during the remaining
eleven (11) months of the Consulting Period, Xxxxx shall be available to consult
with the Company approximately five (5) hours per week. Xxxxx acknowledges that
during the Consulting Period he will not have the authority to bind the Company
to agreements without the express written consent of the Company, and that
during such time, he will report to and take instruction from any of the
Company's Chief Executive Officer, Chief Financial Officer or Director of Real
Estate Development. The Company acknowledges that during the Consulting Period
Xxxxx may provide consulting services to or be employed by other hospitality
related businesses, but not prior to June 30, 2002, without the Company's prior
written approval and, in the event the Company provides such approval, the
Company shall not be relieved of its obligations to pay consulting fees to Xxxxx
by reason of Xxxxx' employment by or providing such consulting services to other
hospitality related businesses. In addition, during the Consulting Period, Xxxxx
agrees that he will make himself available to consult with the Company in
connection with any present or future actual or threatened litigation or
administrative proceedings involving the Company or its affiliates relating to
events or conduct occurring (or claimed to have occurred) during the period of
his employment or related to his employment with the Company.
Xxxxx may terminate this Agreement at any time on thirty (30) days'
written notice to the Company. If Xxxxx terminates his consulting relationship
with the Company prior to June 30, 2002, then the Company will have no remaining
obligations to Xxxxx except to pay him his consulting payment through the date
of termination and to pay the balance of the Key Employee Agreement Termination
Fee by making the remaining payments and transferring the automobile
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to Xxxxx as provided for above in paragraph 3. If, however, Xxxxx completes his
consulting arrangement with the Company through at least June 30, 2002, then the
Company may not terminate Xxxxx as a consultant without cause. As used herein,
the term "cause" shall mean the failure by Xxxxx to perform in any material
respect his duties hereunder which is not cured within thirty (30) days after
Xxxxx' receipt of written notice from the Company advising Xxxxx of such
failure, or other misconduct by Xxxxx which is likely to result in damage to the
Company. If Xxxxx provides consulting services or is employed by another
hospitality related business prior to June 30, 2002, without the Company's prior
written consent, then that will be deemed a termination of this Agreement by
Xxxxx; provided, however, that such a termination will not relieve the Company
of its continuing obligation to pay the Key Employee Agreement Termination Fee
and transfer the automobile to Xxxxx upon the terms set forth in paragraph 3.
6. BENEFITS. As an employee, and during the Consulting Period, the
Company shall provide Xxxxx with the same employee benefits that he was
receiving as an employee of the Company immediately prior to the date hereof,
including without limitation, medical and dental coverage, and pension and
retirement savings, based upon his current elections under the Company's plans;
provided, however, that instead of providing Xxxxx with the same amount of life
insurance he was receiving as an employee of the Company, the Company will
provide Xxxxx with life insurance coverage of $300,000 per year. Any changes
made to these plans during the Consulting Period shall apply equally to Xxxxx.
Effective June 1, 2003, or upon any earlier termination of this Agreement, Xxxxx
shall be eligible for continuation of health insurance benefits pursuant to
COBRA for eighteen (18) months, provided he both timely elects COBRA coverage
and pays the premiums for such coverage. Xxxxx agrees that if he obtains other
employment that offers to provide health insurance to him that the Company will
no longer be required to provide him with medical, dental or life insurance as
an employee or pursuant to COBRA. Xxxxx agrees to promptly notify the Company if
he becomes employed by any entity which offers health insurance coverage to him.
The Company will pay to Xxxxx the vested amount currently held in his
account under the Company's Supplemental Deferred Compensation Plan within
ninety (90) days after the end of the Consulting Period or upon any earlier
termination of this Agreement, or according to Xxxxx' payout election then in
effect.
At the end of the Consulting Period the Company will pay Xxxxx his
accrued benefit in the Company's Retirement Plan and Supplemental Executive
Retirement Plan pursuant to which he is entitled to benefits as provided in
those respective plans.
At the end of the Consulting Period and with respect to the Company's
401(K) Plan Xxxxx may leave his account in the 401(K) Plan or may elect to
"roll" his account to another qualified plan or take a taxable distribution.
Vesting of Xxxxx 401(K) Plan matching contributions and earnings vesting will be
determined as provided by the Plan.
7. RELEASE BY THE COMPANY; INDEMNIFICATION. The Company hereby releases
Xxxxx from any and all legal claims, causes of action, agreements, obligations,
liabilities, damages and/or demands whatsoever at law or in equity, in any
federal or state court, which it, its successors and assigns had, has, or may
have, against Xxxxx or his heirs, successors, administrators, or assigns,
relating in any way to or arising out of his employment with the Company as
President of OHG and/or the termination of his employment with the Company as
President of OHG, but only to the extent that Xxxxx' conduct giving rise to any
such released
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matter was in accordance with his authority in his official capacity at the
Company, was done in good faith, and in accordance with then-applicable federal,
state and local laws and regulations.
8. STOCK OPTIONS. As of the date of this Agreement, Xxxxx has 21,667
Company stock options vested pursuant to the Company's 1997 Omnibus Stock Option
and Incentive Plan. Additional stock options will vest as follows: 8,334 options
will vest as of February 15, 2002; 5,000 options will vest as of May 12, 2002;
and 21,667 options will vest as of May 15, 2002. Accordingly, at the successful
completion of the Consulting Period on May 31, 2003, Xxxxx will have 56, 668
vested stock options. In addition, 1,167 shares of restricted stock will have
restrictions lifted as of February 8, 2002. Each of these options must be
exercised within ninety (90) days of the end of the Consulting Period. Xxxxx and
the Company agree that all other stock options and shares of restricted stock
granted to Xxxxx by the Company and not previously vested or exercised are
hereby terminated.
9. FUTURE COOPERATION. Xxxxx further agrees that, at any time in the
future, he will cooperate fully with the Company and with the Company's counsel
in connection with any present or future actual or threatened litigation or
administrative proceedings involving the Releasees (as defined below) relating
to events or conduct occurring (or claimed to have occurred) during the period
of his employment or related to his employment with the Company. This
undertaking includes making himself reasonably available for interviews and
discussions with the Company's counsel as well as for depositions and trial
testimony. Xxxxx will be reimbursed for his reasonable attorney's fees and costs
incurred by Xxxxx in so cooperating and also all reasonable travel, telephone,
and similar expenses incurred in connection with such cooperation, which the
Company shall schedule at times not conflicting with his then prior commitments
or the reasonable requirements of any future employer.
10. CONFIDENTIAL INFORMATION; NONDISPARAGEMENT. In consideration for
the payments and other obligations described herein, Xxxxx agrees that:
(a) He will return to the Company all company credit cards,
customer or client lists and records, policy manuals, pricing lists or
information, business contracts, and other confidential information
relating to the Company's marketing or distribution data; internal
financial information; business methods, plans and efforts; personnel
data; and courses of dealing and contracts with its actual or potential
customers, vendors, distributors and suppliers (herein collectively
referred to as "Confidential Information"). Xxxxx acknowledges that all
Confidential Information is solely the Company's property and
constitutes the Company's trade secrets and confidential information.
Xxxxx agrees, represents, warrants, and covenants that he will not
disclose, directly or indirectly, any Confidential Information to any
person, firm, company, or entity; and
(b) He will refrain publicly from making any disparaging or
other negative comments or statements with respect to the Company.
11. RELEASE BY XXXXX. Xxxxx understands and acknowledges that, except
as expressly stated in this Agreement, Xxxxx shall not be entitled to any other
benefits (including unused or earned vacation days), bonuses, payments or
compensation of any kind at any time after the date hereof. Xxxxx agrees that
(i) the Company has not breached any oral or written employment or
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other agreement which may have existed between Xxxxx and the Company with
respect to any aspect of Xxxxx' employment by, or separation of employment from,
the Company or with respect to any other matter whatsoever as of the time of
execution of this Agreement, and (ii) the Company has not violated any law,
statute, rule, regulation, or ordinance of the United States or of any State or
political subdivision thereof, with respect to any aspect of Xxxxx' employment
by, or separation of employment from, the Company as of the time of execution of
this Agreement. In addition, Xxxxx does, both for himself and for his heirs
dependents, successors, assigns, heirs, executors, and administrators, release
and forever discharge the Company, its successors and assigns, and its officers,
directors, agents, employees, shareholders, subsidiaries, and related or
affiliated companies ("Releasees") from any and all claims, demands, damages,
actions, and causes of action whatsoever (including claims for attorneys' fees)
("Claims") which he now has or may have in the future against the Releasees
arising from or in any way related to his employment with the Company and/or its
affiliates, including, but not limited to, claims for severance or other
termination pay and benefits; breach of contract; wrongful discharge; claims
under Title VII of the Civil Rights Act of 1964, which prohibits discrimination
in employment based on race, color, national origin, religion or sex or
retaliation against someone who makes a claim of discrimination; the Americans
With Disabilities Act; the Equal Pay Act, which prohibits paying men and women
unequal pay for equal work; the Tennessee Human Rights Act; claims under the Age
Discrimination in Employment Act of 1967, which prohibits discrimination in
employment based on age; or any other federal, state or local laws or
regulations prohibiting employment discrimination. This does not mean that the
Releasees admit to any violation of law, liability, or invasion of any of Xxxxx'
rights. In fact, any such violation, liability, or invasion is expressly denied.
Xxxxx is not releasing the Company for any Claims arising out of the
non-performance of any obligation of the Company under this Agreement or from
any claim under the Age Discrimination in Employment Act which arises after the
date of this Agreement; provided that nothing contained in this paragraph shall
be deemed to release the Company from its obligations under this Agreement.
12. ACKNOWLEDGEMENT; REVIEW PERIOD; REVOCATION. XXXXX ACKNOWLEDGES AND
UNDERSTANDS THAT:
(A) He has been advised by the Company to consult with legal counsel of
his choice prior to executing this Agreement and the general release provided
for, and has had an opportunity to consult with and been advised by legal
counsel of his choice, fully understands the terms of this Agreement, and enters
into this Agreement freely and voluntarily and intending to be bound;
(B) He has been given a period of twenty-one (21) days to review and
consider the terms of this Agreement prior to executing it and that he may use
as much of that such twenty-one (21) day period as he desires; and
(C) He has seven (7) days after signing this Agreement in which to
change his mind. This Agreement will not take effect, and neither party will
have any obligation to do any of the things provided for in this Agreement until
those seven (7) days have passed. To revoke this Agreement, Xxxxx must state
that intention in writing and deliver that writing to the Company on or before
the seventh (7th) day. If he revokes this Agreement, Xxxxx understands
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that it will be ineffective, and neither party will have any obligation to do
any of the things provided for in this Agreement.
13. NOTICE. All notices required to be given by this Agreement shall be
in writing and may be delivered personally (which notice shall be deemed to have
been received upon delivery to the addressee at the address appearing below), or
by Federal Express or other nationally recognized overnight courier guaranteeing
overnight delivery (which notice shall be deemed to have been received on the
date of delivery to the addressee at the address appearing below), or by
telecopy facsimile electronic confirmation of transmission with original to
follow by United States mail, postage prepaid (which notice shall be deemed to
have been received by the addressee on the next Business Day following the date
of transmission to the telecopy facsimile number appearing below). The term
"Business Day" as used herein shall mean every day except Saturdays, Sundays,
and national holidays. Notice must be in writing and must be delivered to the
addressee at the address appearing below (or if sent by telecopy facsimile, to
the telecopy facsimile number appearing below).
Notice to the Company:
Xxxxxxx Entertainment Company
Xxx Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: General Counsel
Telecopy Facsimile No. 000 000-0000
Notice to Xxxxx:
Xxxx Xxxxx
4 Castle Rising
Xxxxxxxxx, Xxxxxxxxx 00000
Telecopy Facsimile No. 000 000-0000
14. ATTORNEYS' FEES. In the event that any dispute or litigation arises
between the parties regarding this Agreement, the prevailing party shall be
entitled to recover from the other party, and shall be awarded judgment against
such other party, for reasonable attorneys' fees and expenses incurred by the
prevailing party in such dispute or litigation.
15. BINDING AGREEMENT. This Agreement shall be binding upon Xxxxx and
the Company and upon their respective heirs, administrators, representatives,
executors, successors and assigns, and shall inure to the benefit of the Company
and its agents and affiliates, and to their heirs, administrators,
representatives, executors, successors and assigns.
16. CHOICE OF LAW; CONSTRUCTION; VENUE. This Agreement is made and
entered into in the State of Tennessee and shall, in all respects, be
interpreted, enforced and governed under the laws of said State. The language of
all parts of this Agreement shall, in all cases, be construed as a whole,
according to its fair meaning, and not strictly for or against any of the
parties. Any action to enforce the Agreement shall be heard in the courts of
Davidson County, Tennessee.
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17. ENTIRE AGREEMENT; AMENDMENT. This Agreement sets forth the entire
agreement between the parties hereto and fully supersedes any and all prior
agreements or understandings between the parties hereto pertaining to the
subject matter hereof. Any amendment, waiver, or modification of this Agreement
shall be effective only if in writing and signed by both the parties. If any
part of this Agreement is found to be invalid, the parties agree that the
remainder of the Agreement shall remain effective and enforceable.
IN WITNESS WHEREOF, Xxxxx and the Company have executed this Agreement
as of the date first set forth above.
XXXXXXX ENTERTAINMENT COMPANY
By: /s/ Xxx Xxxxxx
-------------------------------------
Xxx Xxxxxx, Senior Vice President and
Chief Administrative Officer
XXXX XXXXX
/s/ Xxxx Xxxxx
----------------------------------
Xxxx Xxxxx
STATE OF TENNESSEE ]
]
COUNTY OF DAVIDSON ]
On this the 20th day of November, 2001, Xxxxx X. Xxxxx, to me
personally known, came before me and executed this Agreement as his free act and
deed.
/s/ Xxxx X. Wortylko
--------------------------------
Notary Public
My Commission Expires: 7/24/01
----------------------
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STATE OF TENNESSEE )
COUNTY OF DAVIDSON )
Before me, Xxxx X. Wortylko, a Notary Public of said County and State,
personally appeared Xxx Xxxxxx, with whom I am personally acquainted (or proved
to me on the basis of satisfactory evidence), and who, upon oath, acknowledged
himself to be Senior Vice President (or other officer authorized to execute the
instrument) of XXXXXXX ENTERTAINMENT COMPANY, the within named bargainor, a
Delaware corporation, and that he as such Senior Vice President executed the
foregoing instrument for the purposes therein contained, by personally signing
the name of the corporation by himself as Senior Vice President.
Witness my hand and seal, at Office in Nashville, Tennessee, this 20th
day of November, 2001.
/s/ Xxxx X. Wortylko
-------------------------------
Notary Public
My Commission Expires: 7/24/04
----------------------
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