AMENDMENT NUMBER TWO TO EMPLOYMENT AGREEMENT
This Amendment Number Two to Employment Agreement (this "amendment") is
made and entered into as of the 2nd day of January, 2000, by and between IGF
Holdings, Inc., an Indiana corporation, and Xxxxxx X. Xxxxx with respect to that
certain Employment Agreement executed April 9, 1996 and April 15, 1996 and that
certain Amendment thereto dated August 1, 1997 and that certain Assignment and
Assumption by and between IGF Insurance Company, an Indiana corporation, and IGF
Holdings, Inc. dated August 1, 1997 (collectively, the "Agreement").
WHEREAS, the parties desire to amend the Agreement as set forth herein.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Section 2.1 is hereby deleted in its entirety and there is inserted in
lieu thereof the following:
"2.1 Salary. During the term of this agreement, the
Company shall pay Executive a salary at the minimum
annual rate of One Hundred Sixty-Five Thousand
Dollars ($165,000). This salary shall be payable in
twenty-six (26) equal installment. Company may
increase this annual rate at its discretion but no
reduction of Executive's then current rate of pay
shall be made without his prior written consent."
2. Section 2.6 (b) is hereby amended as follows: The words "Seven
Hundred Fifty Dollars ($750)" are hereby deleted and there is
inserted in lieu thereof, "One Thousand Dollars ($1,000)".
3. The first sentence of Section 1.1 is hereby amended as follows:
The words "effective as of February 1, 1996 and continuing for a
period of thirty-six (36) months through January 31, 1999" are
hereby deleted and there is inserted in lieu thereof, "effective
as of January 1, 2000 and continuing for a period of thirty-six
(36) months through December 31, 2002".
4. There is hereby added to the end of the last sentence of Section
1.1 the following: "provided, however, that the Executive's
right to receive the amount of such severance payments shall be
offset by income to the Executive from other than the Company,
if any, during such twelve month period. Executive shall use his
best efforts to obtain gainful employment or earn income within
a reasonable area of Central Iowa with a similar position and
within 80% of his current compensation, during the term of such
severance period."
5. Section 3.4 is hereby added as follows, as amended:
"3.4 Change of Control. Notwithstanding any other
provisions of this Agreement, if (i) a Change of
Control shall occur; and (ii) within twelve (12)
months of any such Change of Control, Executive (a)
receives a Notice of Non-Renewal, (b) is terminated
for any reason other than for Cause, or (c) Company
(including its successors, if any) is in breach of
this Agreement, (each of which is a "Triggering
Event") then Executive shall continue to receive his
current salary (in bi-weekly payments) as severance
pay until the earlier to occur of:
(a) Executive shall commence employment
with a firm or entity other than the
Company such that his base salary is
within 80% of his current base
salary pursuant to this Agreement;
or
(b) The expiration of one (1) year from the date of the Triggering Event.
The receipt by Executive of payments pursuant to this
Section 3.4 is specifically conditioned, and no
payments pursuant to this Section 3.4 shall be made
to executive if he is, at the time of his
Termination, in breach of any provision (specifically
including, but not limited to, the provision s of
this agreement pertaining to non-solicitation and
confidentiality) of this Agreement and has received
written notice from the Company specifying the
conduct constituting such breach and the section(s)
of this Agreement that are being breached. Further,
if such payments have already begun, the continuation
of payments to Executive pursuant to this Section 3.4
shall cease at the time Executive shall fail to
comply with the non solicitation and confidentiality
provision of Article 4 herein and has received
written notice from the Company specifying the
conduct constituting such breach and the section(s)
of this Agreement that are being breached. It is
expressly understood and agreed that the amount of
any payment to Executive required pursuant to this
Section 3.4 shall be offset (but not below zero) by
any base salary received by Executive during the
period called for in this Section 3.4 from a
subsequent employer.
"Change of Control" shall mean the inability of any one or
all collectively G. Xxxxxx Xxxxxx, Xxxx X. Xxxxxx and
Xxxxxxx X. Xxxxxx to directly or indirectly cause the
election of a majority of the members of the Board of
Directors of Goran Capital Inc., Xxxxxx International Group,
Inc., IGF Holdings, Inc. or IGF Insurance Company or their
respective successors."
6. Section 4.1 is deleted in its entirety and inserted in lieu thereof the
following:
4.1 Non-solicitation.
During Executive's employment with the Company during
the term of this Agreement and for a period of one
(1) year from and after termination of that
employment, except for a termination without Cause,
Executive agrees that he will not; (a) directly or
indirectly, solicit any of the Company's employees
for the purpose of hiring them or inducing them to
leave employment with the Company; and (b) directly
solicit any person or entity that is, or was within
the then most recent 12-month period, a customer or
client of the company, whether for his own account or
for the account of any other individual, partnership,
firm, corporation or other entity, for the purpose of
selling that third party crop insurance that would
replace or supersede coverage then provided by the
Company to that third party. For purposes of
subsection 4.1 (b), the term "solicit" shall be
limited to sales efforts initiated by Executive and
shall not include any response by Executive to
inquiries made to him without invitation or
solicitation on his part of referrals made by others
to Executive where such referrals were not invited or
encouraged by Executive.
7. All references in this Agreement to Section 4.1 and/or a
non-competition covenant shall be deemed to apply only to new
Section 4.1 and its non-solicitation provision.
8. Section 5.3 is hereby amended as follows: Notice to Executive
shall be to:
Xxxxxx X. Xxxxx
0000 Xxxxxxxxxx
Xxxxxxxx, XX 00000
Notice to the Company shall be to:
Xxxx X. Xxxxxx
Xxxxx Capital
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
9. Exhibit C is hereby deleted in its entirety and there is
inserted in lieu thereof Exhibit C as attached hereto. All
references in Exhibit C in the Agreement shall mean Exhibit C as
attached hereto.
10. Terms used herein and not otherwise defined shall have the meaning as
set forth in the Agreement.
11. Except as otherwise expressly set forth herein, the Agreement shall
continue in full force and effect.
12. Executive shall be employed as President of the Company and shall have
duties assigned to him as are customarily assigned to
the President of the Company by the Chief Executive officer of
the Company or members of the Board. The Executive shall carry
out his duties using this best efforts ensure the well being of
the Company. Any reduction in his title or scope of duties shall
constitute a termination without cause. To the extent that the
Agreement lists other titles and/or duties that shall be
superceded by this paragraph.
13. Notwithstanding any other provision of this Agreement, upon
termination or expiration of the Agreement for any reason,
Executive shall be entitled to not less than a one-year
severance payment and continuation of benefits and insurance for
12 months after the date his employment ends, based upon the
offset agreed upon in 4.
IGF Holdings, Inc.
By: _________________________________
Xxxx X. Xxxxxx, Chief Executive Officer
---------------------------------
Xxxxxx X. Xxxxx
Exhibit C
Bonus Arrangement
The bonus shall be calculated based upon the Company's pre-tax profit before
management fees and bonuses to Executive. A minimum pre-tax profit target of Ten
Million ($10,000,000) must b e obtained for the year ended December 31, 2000 in
order for a bonus to be earned. The minimum pre-tax profit target will increase
ten percent (10%) per year for the life of the contract. By way of example, the
minimum pre-tax profit target for 2001 must be $11,000,000 for a bonus to be
earned. The bonus payable to Executive shall be seventy-five (75%) of base
salary.
Notwithstanding with the preceding paragraph, during the 36-month term of this
Agreement, a bonus of not less than $150,000 shall be paid to Executive as a
guaranteed amount. If the bonus paid under the first paragraph of this exhibit C
do not reach $150,000, the remaining amount will be paid to Executive or used to
offset any advances made to him by the company. To the extent such bonus
payments have not been sufficient to offset advances made to the executive prior
to the date of signing of this Agreement, will be considered discharged and paid
in full without tax consequence to the Executive (Thus, if any additional
amounts or "gross up" payments must be made to offset taxes, the Company shall
pay the amount necessary to the Executive prior to the tax filing due date of
the Executive.)
