Exhibit 99.5
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is entered into as of March 23,
1998 by and between Xxxxx Xxxxxxx, an individual ("Xxxxxxx"), and DEP
Corporation, a Delaware corporation (the "Company").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Xxxxxxx is currently the Chief Financial Officer and Senior Vice
President, Finance of the Company; and
WHEREAS, the Board of Directors of DEP has determined that it is in the
best interests of DEP and the stockholders of DEP that Xxxxxxx'x continued
employment by the Company be assured and the terms of such employment
established pursuant to this Agreement; and
WHEREAS, Xxxxxxx is willing to enter into an employment agreement on the
terms and conditions set forth herein;
NOW THEREFORE, in consideration of the mutual covenants set forth herein,
and for other good and valuable consideration, receipt of which is hereby
acknowledged, the parties do hereby agree as follows:
A G R E E M E N T:
- - - - - - - - -
1. EMPLOYMENT BY THE COMPANY AND TERM.
(a) POSITION AND REPORTING. Subject to the terms set forth herein,
the Company agrees to employ Xxxxxxx as Chief Financial Officer and Senior Vice
President, Finance and Xxxxxxx hereby accepts such employment. During the term
of his employment hereunder, Xxxxxxx will report solely and directly to the
President and Chief Executive Officer of the Company (the "CEO"). During the
term of his employment hereunder, the Company will nominate and recommend
Xxxxxxx for re-election as a director at each annual meeting of stockholders
coinciding with the expiration of his term as a director.
(b) FULL TIME AND BEST EFFORTS. During the term of his employment
with the Company; Xxxxxxx will devote substantially all of his business time,
except for sick leave, vacations and approved leaves of absence, and use his
best efforts to advance the business and welfare of the Company. During the
term of Xxxxxxx'x employment, he will not engage in any other employment or
business activities that would be directly harmful or detrimental to, or that
may compete with, the business and affairs of the Company, or that would
interfere with his duties hereunder. However, the foregoing will not prevent
Xxxxxxx from devoting a reasonable amount of time to personal investment, civic
and charitable activities.
(c) DUTIES. Xxxxxxx'x duties during the term of his employment
hereunder shall be consistent with those in effect immediately prior to the
execution of this Agreement and shall be such as are customarily associated with
his position in a corporation of the size and nature of the Company, consistent
with the Bylaws of the Company. Xxxxxxx'x principal place of business shall be
in Los Angeles, California or its neighboring communities, subject to normal and
reasonable requirements for business travel.
(d) COMPANY POLICIES. The employment relationship between the
parties will be governed by the general employment policies and practices of the
Company, including but not limited to those relating to protection of
confidential information and assignment of inventions, except that when the
terms of this Agreement differ from or are in conflict with the Company's
general employment policies or practices, this Agreement will control.
(e) TERM. The term of this Agreement ("Employment Term") will begin
as of March 23, 1998 and end on March 23, 2003. Such term shall automatically
be renewed for additional one year terms unless either party has given written
notice to the other at least six months prior to the expiration of this
Agreement.
2. COMPENSATION AND BENEFITS.
(a) SALARY. Xxxxxxx will receive for services to be rendered
hereunder a base salary at the annual rate of Two Hundred Twenty-Seven Thousand
Dollars ($227,000) payable at least as frequently as every other week and
subject to payroll deductions as may be necessary or customary in respect of the
Company's salaried employees. Such amount, as it may be increased from time to
time hereunder, is referred to herein as the "Base Salary". The Base Salary
will be subject to review at least annually and to increase (but not decrease)
at such times and in such amounts as the Board may approve. In the event that
the Company, in its sole discretion, from time to time determines to increase
the Base Salary, such increased amount shall, from and after the effective date
of the increase, constitute "Base Salary" for purposes of this Agreement.
(b) PARTICIPATION IN INSURANCE AND BENEFIT PLANS. During the
Employment Term, Xxxxxxx will be entitled to participate in any insurance,
hospitalization, medical, dental, health, accident, disability or similar plan
or program of the Company now existing or established hereafter. In the event
Xxxxxxx is not eligible to participate in any plan or program of the Company
under the general provisions thereof, the Company will make arrangements for
such participation (including any necessary amendment of the applicable plan) if
permitted by applicable law and, except as otherwise provided in Sections 5(d),
5(e) and 6(c) if the cost of doing so is not unreasonable or if such cost is
reimbursed to the Company by the affected person. The Company may, in its sole
discretion and from time to time, amend, eliminate or establish additional
benefit programs as it deems appropriate. Xxxxxxx will also participate in all
fringe benefits offered by the Company to any of its senior Executives.
3. INCENTIVE, BONUS AND OPTION PLANS. During the Employment Term,
Xxxxxxx will be entitled to participate in the bonus plan similar to that set
forth in Exhibit A attached hereto. Upon expiration of such plan, a new
performance bonus program will be developed, which shall
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provide the opportunity for Xxxxxxx to receive future bonuses on a basis: (a) no
less favorable than provided under the plan set forth in Exhibit A; and (b) no
less favorable than those applying to other senior Executives of the Company.
In addition, Xxxxxxx will, during the Employment Term, be entitled to
participate on terms and conditions appropriate to his position and
responsibilities at the Company in deferred compensation, retirement, stock
option and other compensation plans of the Company currently or hereafter made
available by the Company to senior Executives of the Company
4. PERQUISITES, VACATIONS AND REIMBURSEMENT OF EXPENSES. During the term
of the Xxxxxxx'x employment:
(a) The Company will furnish Xxxxxxx with, and Xxxxxxx will be
allowed full use of, office facilities, a monthly car allowance of $575,
secretarial and clerical assistance and other Company property and services
commensurate with his position and of at least comparable quality, nature and
extent to those made available to Xxxxxxx prior to the date hereof or, if
greater, those made available to other senior Executives of the Company from
time to time.
(b) Xxxxxxx will be allowed three weeks paid vacation per year to be
taken at such times as Xxxxxxx may designate.
(c) The Company will reimburse Xxxxxxx for all monies which he has
expended for purposes of the Company's business, including entertainment, such
reimbursement to be effected in accordance with Company reimbursement practices,
policies and procedures as in effect prior to the date hereof. The parties
agree that Xxxxxxx shall be entitled to first class travel and accommodations in
connection with all business travel on behalf of the Company.
5. TERMINATION OF EMPLOYMENT.
(a) DEFINITIONS. The following definitions will apply to Sections 5
and 6 as applicable:
(i) JUST CAUSE. The term "Just Cause" means: (A) conviction
of a felony involving moral turpitude, or (B) willful gross neglect or
willful gross misconduct in carrying out Xxxxxxx'x duties under this
Agreement, resulting in material economic harm to the Company, unless
Xxxxxxx believed in good faith that such conduct was in, or not contrary
to, the best interests of the Company.
(ii) DISABILITY. The term "Disability" means the inability of
Xxxxxxx due to illness (mental or physical), accident, or otherwise, to
perform his duties for any period of 180 consecutive days, as determined by
an independent physician selected by the Company and reasonably acceptable
to Xxxxxxx or his legal representative. Any return to work from a period
of disability must be authorized by Xxxxxxx'x physician.
(iii) GOOD REASON. The term "Good Reason" means: (A) a
material breach of this Agreement by the Company; (B) without Xxxxxxx'x
prior written consent, assignment to Xxxxxxx of duties materially
inconsistent in any respect with his position or
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any other action by the Company that results in a material diminution in
Xxxxxxx'x position, authority, duties or responsibilities, it being
expressly understood that a change in Xxxxxxx'x reporting responsibility so
that he does not report directly and solely to the CEO will constitute
"Good Reason"; (C) any transaction in which the Company becomes a
subsidiary of another corporation or which is described in clause (iii) of
the definition of "Change in Control" in Section 6(a) below; (D) reduction,
without Xxxxxxx'x prior written consent, of Xxxxxxx'x Base Salary, or his
bonus or other cash incentive compensation opportunity; (E) any material
reduction of fringe benefits provided to Xxxxxxx; (F) assignment of
Xxxxxxx, without his prior written consent, to a Company office located
more than 25 miles from Xxxxxxx'x current office location; or (G) the
Company's failure to obtain an agreement from any successor or assign of
the Company to assume and to agree to perform this Agreement.
(iv) NOTICE OF TERMINATION. The term "Notice of Termination"
means a notice which indicates the specific termination provision in this
Agreement relied upon and sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of employment
under the provision so indicated. Any purported termination of employment
by the Company or by Xxxxxxx must be communicated by written Notice of
Termination to the other party hereto in accordance with Section 11(a)
hereof. With respect to any termination of employment by Xxxxxxx for Good
Reason, Xxxxxxx will have 180 days following the occurrence of any event
described in Section 5(a)(iii) to provide the Company with Notice of
Termination, and may not do so thereafter.
(v) TERMINATION DATE. The term "Termination Date" means:
(i) if Xxxxxxx terminates his employment for Good Reason, the date that is
60 days after Notice of Termination is given and (ii) if Xxxxxxx'x
employment is terminated by the Company other than for Just Cause, death or
Disability, the date that is 30 days after Notice of Termination is given.
(b) TERMINATION BY THE COMPANY FOR JUST CAUSE. The Board may
terminate Xxxxxxx'x employment with the Company at any time for Just Cause,
immediately upon notice to Xxxxxxx of the circumstances leading to such
termination for Just Cause. In the event that Xxxxxxx'x employment is
terminated for Just Cause, Xxxxxxx will receive payment for all accrued salary
and vacation time through the Termination Date, which in this event will be the
date upon which Notice of Termination is given; and the Company shall have no
future obligation to pay compensation or benefits. Except as set forth in this
paragraph (b), the Company will have no further obligation to pay severance of
any kind whether under this Agreement or otherwise nor to make any payment in
lieu of notice.
(c) TERMINATION BY XXXXXXX FOR GOOD REASON. Xxxxxxx will have the
right, at his election, to terminate his employment with the Company by written
notice to the Company to that effect for a period of 180 days following any
occurrence constituting Good Reason; PROVIDED, HOWEVER, that termination for
Good Reason will not be effective until Xxxxxxx gives written notice specifying
the occurrence constituting Good Reason and, PROVIDED that if such
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occurrence is curable, the Company fails to correct it within 10 days after the
receipt of the applicable notice.
(d) TERMINATION BY THE COMPANY WITHOUT JUST CAUSE OR BY XXXXXXX FOR
GOOD REASON. In the event that Xxxxxxx'x employment is terminated by the
Company (other than pursuant to Section 5(b)) or such employment is terminated
by Xxxxxxx for Good Reason, (and in either such case Xxxxxxx is not entitled to
benefits pursuant to Section 6(b)), the Company agrees to pay or provide to
Xxxxxxx as termination compensation the following:
(i) A single lump sum payment, payable in cash within five
days of the Termination Date, equal to the sum of:
(A) the accrued portion of any Base Salary and
vacation through the Termination Date; plus
(B) an amount representing bonus and all other cash
incentive compensation for such period determined by multiplying:
(I) the greater of the following ("Assumed Incentive
Compensation"): (x) the average of such bonus and other cash
incentive compensation accrued for each of the three preceding
full years, (y) the amount of such bonus and other cash incentive
compensation accrued for the immediately preceding year, and (z)
the projected amount of such bonus and other cash incentive
compensation for the year in which termination occurs, based upon
the most recent available interim results of operations and
projected results of operations for the remainder of such year,
prepared by the Company in the normal course of its business; by
(II) the fraction of the year of termination elapsed
prior to the Termination Date; plus
(C) the total amount of:
(I) Xxxxxxx'x Base Salary in effect upon the
Termination Date for the remaining part of the Employment Term,
plus
(II) incentive compensation for the remaining part of
the Employment Term, at the rate per year of the Assumed
Incentive Compensation,
less standard withholdings for tax and social security purposes.
(ii) All stock options, restricted stock or other equity
awards then held by Xxxxxxx will automatically be deemed amended, without
further action on the part of the Company or Xxxxxxx, so that (A) all
options will be fully vested and not subject to forfeiture or expiration by
reason of Xxxxxxx'x termination, and will be subject to exercise
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in full until the end of the Employment Term or their normal expiration
date, whichever comes first; and (B) all restricted stock or other equity
awards subject to vesting prior to the end of the Employment Term will be
fully vested and all restrictions thereon will lapse.
(iii) All benefits provided under Section 2(b) will continue as
specified herein.
(A) Notwithstanding the foregoing, to the extent any
such benefit referred to in Section 2(b) cannot be provided through
the applicable plan of the Company, the Company will provide such
benefit outside of the plan or will provide a cash lump sum payment
equal to the value of such additional benefit.
(B) The Company shall meet its obligation under (A),
above, in connection with its group medical/dental plan for the period
ending on the date Xxxxxxx ceases to be eligible for continuation
coverage under the Company's group medical/dental plan pursuant to the
provisions of COBRA, by providing the continuation of such coverage at
Company expense, contingent upon the Xxxxxxx'x timely election of such
coverage under COBRA.
(C) To the extent required to avoid adverse tax
consequences under Section 105(h) of the Internal Revenue Code of 1986
(the "Code"), the Company's payments under this Section 5(d)(iii) will
be recognized by Xxxxxxx in his taxable income and Xxxxxxx will
receive, in addition, a "gross-up" payment to hold Xxxxxxx from and to
insulate him from all of the effects of any income or other tax
liability attributable to such recognized income; provided that such
gross-up shall, if necessary, be limited consistent with principles of
paragraph 6(c)(iv), below.
(e) TERMINATION BY REASON OF DEATH OR DISABILITY. This Agreement
will terminate upon the death of Xxxxxxx; and Johnson's employment hereunder may
be terminated by Xxxxxxx or the Company, at either of their election, upon
Xxxxxxx'x Disability. In the event Xxxxxxx'x employment is terminated as the
result of death or Disability, except as set forth in the following sentence,
Xxxxxxx, or his estate or legal representative, will be entitled to receive the
accrued portion of any Base Salary and vacation through the Termination Date,
plus any unreimbursed business expenses, plus for the remainder of the
Employment Term: (i) periodically not less frequently than every other week in
accordance with the Company's normal payroll practice, payments at the rate of
his then Base Salary; and (ii) at the normal and customary time for payment of
bonuses and all other cash incentive compensation, incentive compensation for
the remaining part of the Employment Term, at the rate per year of the Assumed
Incentive Compensation; in each case subject to any applicable withholdings for
tax and social security purposes. In addition, all benefits provided in Section
2(b) will continue as specified therein. The payments provided in this Section
5(e) will be reduced by the amount of any payments made to Xxxxxxx pursuant to
any disability or life insurance policy provided by the
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Company for this purpose, which insurance policy is in addition to any other
insurance benefits provided to Xxxxxxx as a benefit hereunder.
6. BENEFITS UPON CHANGE OF CONTROL.
(a) DEFINITIONS. In addition to the definitions provided in Section
5, the following definition will apply to this Section 6:
CHANGE IN CONTROL. The term "Change in Control" means the
occurrence of any of the following events after the date of this Agreement:
(i) Berglass, Xxxxxx Xxxxxxxx and any controlled affiliate
thereof (collectively, the "Berglass Family") is no longer the Beneficial
Owner of securities of the Company representing 26% or more of the combined
voting power of the Company's then outstanding securities. For purposes of
this Agreement, the term "Beneficial Owner" shall have the meaning given to
such term in Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"); provided, however, that the Berglass Family
shall be deemed to be the Beneficial Owner of any securities of the Company
which are owned by the Berglass Family but subject to call options by third
parties unless and until such options are exercised;
(ii) individuals who at the beginning of any period of two
consecutive years constitute the Board, and any new director (other than a
director designated by a Person who has entered into an agreement with the
Company to effect a transaction described in clauses (i) or (iv)) whose
election by the Board or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the beginning
of the period or whose election or nomination for election was previously
so approved, cease for any reason to constitute at least a majority
thereof. For purposes of this Agreement, the term "Person" is used as such
term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"); provided, however, that the term
shall not include the Company, any trustee or other fiduciary holding
securities under an employee benefit plan of the Company, or any
corporation owned, directly or indirectly, by the stockholders of the
Company in substantially the same proportions as their ownership of stock
of the Company;
(iii) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation (or other entity),
other than (i) a merger or consolidation which would result in 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) more than 66-2/3% of the
combined voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation
or (ii) a merger or consolidation is effected to implement a
recapitalization of the Company (or similar transaction) in which the
Berglass Family remains the Beneficial Owner of
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securities of the Company representing at least 26% of the combined voting
power of the Company's securities outstanding upon consummation of such
transaction; or
(iv) the stockholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's
assets.
(b) ELIGIBILITY FOR BENEFITS. The Company agrees to pay to Xxxxxxx
the benefits specified in Section 6(c) hereof if (i) there is a Change in
Control during the term of this Agreement and (ii) within the period commencing
on the date of the Change in Control, or (if earlier) the date of any agreement
by the Company to enter into the transaction resulting in such Change in
Control, and ending two years after the Change in Control (A) the Company
terminates the employment of Xxxxxxx for any reason other than Just Cause, death
or Disability or (B) Xxxxxxx voluntarily terminates employment with the Company
for Good Reason. A Change of Control will be deemed to have occurred during the
term of this Agreement, for purposes of this paragraph 6(b), if an agreement is
entered into during the term of this Agreement for a transaction resulting in a
Change of Control, notwithstanding that the Change of Control transaction is not
completed until after the Employment Term.
(c) BENEFITS UPON TERMINATION OF EMPLOYMENT. If Xxxxxxx is entitled
to benefits pursuant to Section 6(b) hereof, in lieu of any payments and
benefits provided in Section 5 the Company agrees to pay or provide to Xxxxxxx
as termination compensation the following:
(i) A single lump sum payment, payable in cash within five
days of the Termination Date, equal to the sum of:
(A) the accrued portion of any Base Salary and
vacation through the Termination Date; plus
(B) an amount representing bonus and all other cash
incentive compensation for such period determined by multiplying:
(I) the Assumed Incentive Compensation, by
(II) the fraction of the year of termination elapsed
prior to the Termination Date; plus
(C) 299% of the sum of:
(I) Xxxxxxx'x Base Salary in effect upon the
Termination Date, plus
(II) the Assumed Incentive Compensation.
(ii) All stock options, restricted stock or other equity
awards then held by Xxxxxxx will automatically be deemed amended, without
further action on the part of the Company or Xxxxxxx, so that (A) all
options will be fully vested and not subject to
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forfeiture or expiration by reason of Xxxxxxx'x termination, and will be
subject to exercise in full for the remainder of their stated term; and (B)
all restricted stock or other equity awards will be fully vested and all
restrictions thereon will lapse.
(iii) All benefits provided under Section 2(b) will continue as
set forth in Section 5(b) above.
(iv) In the event that any amount or benefit that may be paid
or otherwise provided to Xxxxxxx by the Company or any affiliated company,
whether pursuant to this Agreement or otherwise (collectively, "Covered
Payments"), is or may become subject to the tax imposed under Code Section
4999 ("Excise Tax"), the Company will pay to Xxxxxxx a "Reimbursement
Amount" equal to the total of: (A) any Excise Tax on the Covered Payments,
plus (B) any Federal, state, and local income taxes, employment and excise
taxes (including the Excise Tax) on the Reimbursement Amount (but without
reduction for any Federal, state, or local income or employment taxes on
such Covered Payments), plus (C) the product of any deductions disallowed
for Federal, state or local income tax purposes because of the inclusion of
the Reimbursement Amount in Xxxxxxx'x adjusted gross income multiplied by
the highest applicable marginal rate of Federal, state, and local income
taxation, respectively, for the calendar year in which the Reimbursement
Amount is to be paid. For purposes of this Section 6(c)(v), Xxxxxxx will
be deemed to pay (Y) Federal income taxes at the highest applicable
marginal rate of Federal income taxation for the calendar year in which the
Reimbursement Amount is to be paid and (Z) any applicable state and local
income taxes at the highest applicable marginal rate of taxation for the
calendar year in which such Reimbursement Amount is to be paid, net of the
maximum reduction in Federal income taxes which could be obtained from the
deduction of such state or local taxes if paid in such year (determined
without regard to limitations on deductions based upon the amount of
Xxxxxxx'x adjusted gross income).
7. NO OBLIGATION TO MITIGATE DAMAGES. In the event of a termination of
Xxxxxxx'x employment for any reason, Xxxxxxx will not be required to seek other
employment or to mitigate any of the Company's obligations under this Agreement,
and no amount payable hereunder will be reduced (a) by any claim the Company may
assert against Xxxxxxx or (b) by any compensation or benefits earned by Xxxxxxx
as a result of employment by another employer, self-employment or from any other
source after such termination of employment with the Company; PROVIDED, HOWEVER,
that the benefits provided pursuant to Sections 5(d)(iii) and 6(c)(iii) will
terminate at such time as Xxxxxxx becomes eligible for comparable benefits as
the result of employment by another Person.
8. PROPRIETARY INFORMATION OBLIGATIONS. During Xxxxxxx'x employment
pursuant to this Agreement, Xxxxxxx will have access to and become acquainted
with confidential and proprietary information of the Company and its
subsidiaries, including, but not limited to, information or plans regarding
customer relationships, personnel, or sales, marketing, and financial operations
and methods; trade secrets; formulas; devices; secret inventions; processes; and
other compilations of information, records, and specifications (collectively
"Proprietary
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Information"). Xxxxxxx will not disclose any such Proprietary Information
directly or indirectly, or use it in any way, either during Xxxxxxx'x employment
pursuant to this Agreement or at any time thereafter, except as required in the
course of his employment for the Company or as authorized in writing by the
Company. Notwithstanding the foregoing, nothing contained herein shall prevent
Xxxxxxx from making use of any knowledge or information properly in his
possession in the course of any business or consulting activities in which he
may engage following the termination of his employment by the Company.
Notwithstanding the foregoing, Proprietary Information will not include
(a) information which is or becomes generally public knowledge or public except
through disclosure by Xxxxxxx in violation of this Agreement and (b) information
that may be required to be disclosed by applicable law.
9. MISCELLANEOUS.
(a) NOTICES. Any notices provided hereunder must be in writing and
will be deemed effective upon the earlier of two days following personal
delivery (including personal delivery by telecopy or telex), or the fourth day
after mailing by first class mail to the recipient at the address indicated
below:
To the Company:
0000 Xxxx Xxx Xxxxx
Xxxxxx Xxxxxxxxx, XX 00000
Attn: Secretary
Telecopier No: (000) 000-0000
With a copy to:
To Xxxxxxx:
00000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx Xxxxx, XX 00000
or to such other address or to the attention of such other person as the
recipient party will have specified by prior written notice to the sending
party.
(b) SEVERABILITY. Any provision of this Agreement which is deemed
invalid, illegal or unenforceable in any jurisdiction will, as to that
jurisdiction and subject to this Section be ineffective to the extent of such
invalidity, illegality or unenforceability, without affecting in any way the
remaining provisions hereof in such jurisdiction or rendering that or any other
provisions of this Agreement invalid, illegal, or unenforceable in any other
jurisdiction. If any covenant should be deemed invalid, illegal or
unenforceable because its scope is considered excessive, such covenant will be
modified so that the scope of the covenant is reduced only to the minimum extent
necessary to render the modified covenant valid, legal and enforceable.
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(c) ENTIRE AGREEMENT. This document constitutes the final, complete,
and exclusive embodiment of the entire agreement and understanding between the
parties related to the subject matter hereof and supersedes and preempts any
prior or contemporaneous understandings, agreements, or representations by or
between the parties, written or oral; provided that nothing contained herein
shall affect the continuation of Xxxxxxx'x rights to indemnification from the
Company pursuant to any and all contract, bylaw or charter provisions which may
be in effect on the date hereof. Without limiting the generality of the
foregoing, the parties expressly agree that the agreement between them dated
August 15, 1998 pursuant to the Company's Retention and Severance Plan shall be
terminated and of no further effect.
(d) COUNTERPARTS. This Agreement may be executed on separate
counterparts, any one of which need not contain signatures of more than one
party, but all of which taken together will constitute one and the same
agreement.
(e) SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and
inure to the benefit of and be enforceable by Xxxxxxx (as provided in
Section 2(b)) and the Company, and their respective successors and assigns,
except that Xxxxxxx may not assign any of his duties hereunder and he may not
assign any of his rights hereunder without the prior written consent of the
Company. The Company shall 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 to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken place.
Failure of the Company to obtain such assumption and agreement prior to the
effectiveness of any such succession shall be a breach of this Agreement and
shall entitle Xxxxxxx to terminate his employment and receive compensation from
the Company in the same amount and on the same terms to which he would be
entitled hereunder if he terminated his employment for Good Reason. Where the
context requires, the term Company shall include any successor to its business
and/or assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
(f) AMENDMENTS. No amendments or other modifications to this
Agreement may be made except by a writing signed by both parties. No amendment
or waiver of this Agreement requires the consent of any individual, partnership,
corporation or other entity not a party to this Agreement. Nothing in this
Agreement, express or implied, is intended to confer upon any third person any
rights or remedies under or by reason of this Agreement.
(g) CHOICE OF LAW. All questions concerning the construction,
validity and interpretation of this Agreement will be governed by the laws of
the State of California without giving effect to principles of conflicts of law.
10. ARBITRATION.
(a) Any disputes or claims arising out of or concerning Xxxxxxx'x
employment or termination by the Company, whether arising under theories of
liability or damages based upon contract, tort or statute, will be determined
exclusively by arbitration before a single arbitrator in accordance with the
employment arbitration rules of the American Arbitration
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Association, except as modified by this Agreement. The arbitrator's decision
will be final and binding on both parties. Judgment upon the award rendered by
the arbitrator may be entered in any court of competent jurisdiction. In
recognition of the fact that resolution of any disputes or claims in the courts
is rarely timely or cost effective for either party, the Company and Xxxxxxx
enter this mutual agreement to arbitrate in order to gain the benefits of a
speedy, impartial and cost-effective dispute resolution procedure.
(b) Any arbitration will be held in Xxxxxxx'x place of employment
with the Company. The arbitrator must be an attorney with substantial
experience in employment matters, selected by mutual agreement of the parties.
If the parties are unable to agree to an arbitrator within 30 days following a
demand for arbitration hereunder, an arbitrator meeting the foregoing experience
requirement shall be selected by alternately striking names from a list of five
such persons provided by the American Arbitration Association (AAA) office
located nearest to the place of employment, following a request by the party
seeking arbitration for a list of five such attorneys. If either party fails to
strike any of the names from the list, the arbitrator will be selected from the
list by the other party.
(c) Each party will have the right to take the deposition of one
individual and any expert witness designated by the other party. Each party
will also have the right to propound requests for production of documents to any
party and the right to subpoena documents and witnesses for the arbitration.
Additional discovery may be made only where the arbitrator selected so orders
upon a showing of substantial need. The arbitrator will have the authority to
entertain a motion to dismiss and/or a motion for summary judgment by any party
and will apply the standards governing such motions under the Federal Rules of
Civil Procedure.
(d) The Company and Xxxxxxx agree that they will attempt, and they
intend that they and the arbitrator should use their best efforts in that
attempt, to conclude the arbitration proceeding and have a final decision from
the arbitrator within 120 days from the date of selection of the arbitrator;
PROVIDED, HOWEVER, that the arbitrator will be entitled to extend such 120-day
period for one additional 120-day period. The arbitrator will deliver a written
award with respect to the dispute to each of the parties, who must promptly act
in accordance therewith.
(e) The Company will pay any and all reasonable fees and expenses
incurred by Xxxxxxx in seeking to obtain or enforce any rights or benefits
provided by this Agreement, including all reasonable attorneys' and experts'
fees and expenses, accountants' fees and expenses, and court costs (if any) that
may be incurred by Xxxxxxx in pursuing a claim for payment of compensation or
benefits or other right or entitlement under this Agreement, PROVIDED that
Xxxxxxx shall refund to the Company any amounts so paid, and shall not be
entitled to any further such payment if the Arbitrator shall rule against
Xxxxxxx on all claims asserted by him and shall determine, in writing, that such
claims were without any substantial basis.
(f) In a contractual claim under this Agreement, the arbitrator must
act in accordance with the terms and provisions of this Agreement and applicable
legal principles and will have no authority to add, delete or modify any term or
provision of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
date it is last executed below by either party.
/s/ Xxxxx Xxxxxxx
-----------------------------------
XXXXX XXXXXXX
DEP CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chairman, Compensation & Management
Stock Option Committee
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