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Exhibit 10.10
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of May 17, 1998 between Office Depot, Inc., a
Delaware corporation (the "COMPANY"), and Xxxxx Xxxxxx ("EXECUTIVE").
In consideration of the mutual covenants contained herein and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. EMPLOYMENT
The Company shall employ Executive, and Executive hereby accepts
employment with the Company, upon the terms and conditions set forth in this
Agreement for the period beginning on the date hereof and ending as provided in
paragraph 4 hereof (the "Employment Term").:
2. POSITION AND DUTIES
(a) During the Employment Period, Executive shall serve as a CEO and
President of Viking Products, Inc. and shall have the normal duties,
responsibilities and authority of an Executive Officer of the Company, subject
to the power of the Company's chief executive officer ("CEO") to expand or limit
such duties, responsibilities and authority.
(b) Executive shall devote Executive's best efforts and Executive's
full business time and attention (except for permitted vacation periods and
reasonable periods of illness or other incapacity) to the business and affairs
of the Company and its Subsidiaries; PROVIDED THAT Executive shall, with the
prior approval of the CEO, be allowed to serve as (i) a director or officer of
any non-profit organization including trade, civic, educational or charitable
organizations, or (ii) a director of any corporation which is not competing with
the Company or any of its Subsidiaries in the office product and office supply
industry so long as such duties do not materially interfere with the performance
of Executive's duties or responsibilities under this Agreement. Executive shall
perform Executive's duties and responsibilities under this Agreement to the best
of Executive's abilities in a diligent, trustworthy, businesslike and efficient
manner.
(c) For purposes of this Agreement, "SUBSIDIARIES" shall mean any
corporation of which the securities having a majority of the voting power in
electing directors are, at the time of determination, owned by the Company,
directly or through one or more Subsidiaries.
3. BASE SALARY AND BENEFITS
(a) Initially, Executive's base salary shall be $600,000 per annum (the
"BASE SALARY"), which salary shall be payable in regular installments in
accordance with the Company's general payroll practices and shall be subject to
customary withholding. Executive's Base Salary shall be reviewed at least
annually by the CEO and shall be subject
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to adjustment as the CEO shall determine based on among other things, market
practice and performance. In addition, during the Employment Term, Executive
shall be entitled to participate in certain of the Company's long term incentive
programs established currently or in the future by the Company for which
officers of the Company then at Executive's level are generally eligible
(including, but not limited to, stock option, restricted stock, performance
unit/share plans or long-term cash plans).
(b) In addition to the Base Salary, Executive shall be entitled to
participate in the Company's Management Incentive Plan (the "Bonus Plan") as
administered by the Compensation Committee. If the Compensation Committee (or
the Company's Board of Directors (the "Board")) modifies such Bonus Plan during
the Employment Term, Executive shall continue to participate at a level no lower
than the highest established for any officer of the Company then at Executive's
level.
(c) Executive shall be entitled to paid vacation in accordance with the
Company's general payroll practices for officers of the Company then at
Executive's level.
(d) The Company shall reimburse Executive for all reasonable expenses
incurred by Executive in the course of performing Executive's duties under this
Agreement which are consistent with the Company's policies in effect from time
to time with respect to travel, entertainment and other business expenses,
subject to the Company's requirements with respect to reporting and
documentation of such expenses.
(e) Executive will be entitled to all benefits currently or in the
future maintained for officers of the Company then at Executive's level,
including without limitation: medical and dental insurance, life insurance and
short-term and long-term disability insurance, supplemental health and life
insurance, profit sharing and retirement benefits.
4. TERM
(a) The Employment Term shall end on the second anniversary of the
Merger (as defined in the Agreement and Plan of Merger among Office Depot, Inc.,
VK Acquisition Corp. and Viking Office Products Inc. dated May 17,1998;
PROVIDED THAT (i) the Employment Term shall be extended for one year in the
event that written notice of the tennination of this Agreement is not given by
one party hereof to the other at least six months prior to the end of the
Employment Term PROVIDED FURTHER that (ii) the Employment Term shall terminate
prior to such date (A) upon Executive's death or permanent disability or
incapacity (as determined by the Board in its good faith judgment), (B) upon the
mutual agreement of the Company and Executive, (C) by the Company's termination
of this Agreement for Cause (as defined below) or without Cause or (D) by
Executive's termination of this Agreement for Good Reason (as defined below) or
without Good Reason.
(b) If the Employment Term is terminated by the Company without Cause
or is terminated by the Executive for Good Reason, Executive (and Executive's
family with respect to clause (iii) below) shall be entitled to receive (i)
Executive's Base Salary through
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the second anniversary of such termination and Executive's Pro Rata Bonus, if
and only if Executive has not breached the provisions of paragraph 5, 6 and 7
hereof, (ii) vested and earned (in accordance with the Company's applicable plan
or program) but unpaid amounts under incentive plans, health and welfare plans,
deferred compensation plans, and other employer programs of the Company which
Executive participates (other than the Pro Rata Bonus) and (iii) life insurance
and medical insurance through the second anniversary of such termination
pursuant to the Company's insurance programs to the extent Executive
participated immediately prior to the date of such termination; PROVIDED THAT
the insurance Executive or Executive's family is entitled to pursuant to this
clause (iii) shall be reduced by the amount of any such insurance Executive or
Executive's family is entitled to receive as a result of any other employment.
The amounts payable pursuant to paragraph 4(b)(i) and (ii) shall be payable, at
the Company's discretion, in one lump sum payment within 30 days following
termination of the Employment Term or in any other manner consistent with the
Company's normal payment policies.
(c) If the Employment Term is terminated by the Company for Cause or by
the Executive without Good Reason, Executive shall be entitled to receive (i)
Executive's Base Salary through the date of such termination and (ii) vested and
earned (in accordance with the Company's applicable plan or program) but unpaid
amounts under incentive plans, health and welfare plans, deferred compensation
plans, and other employer programs of the Company which Executive participates;
provided, however, Executive shall not be entitled to payment of a Pro Rata
Bonus.
(d) If the Employment Term is terminated upon Executive's death or
permanent disability or incapacity (as determined by the Board in its good faith
judgment), Executive, or Executive's estate if applicable, shall be entitled to
receive the sum of (i) Executive's Base Salary through the date of such
termination and (ii) vested and earned (in accordance with the Company's
applicable plan or program) but unpaid amounts under incentive plans, health and
welfare plans, deferred compensation plans, and other employer programs of the
Company which Executive participates. The amount payable pursuant to this
paragraph 4(d) shall be payable, at the Company's discretion, in one lump sum
payment within 30 days following termination of the Employment Term or in any
other manner consistent with the Company's normal payment policies.
(e) Except as otherwise provided herein, fringe benefits and bonuses
hereunder (if any) which accrue or become payable after the termination of the
Employment Term shall cease upon such termination.
(f) For purposes of the Agreement, Agreement, "CAUSE" shall mean:
(i) the willful and continued failure of the Executive to
perform substantially the Executive's duties with the Company or one of
its affiliates (other than any such failure resulting from incapacity
due to physical or mental illness), after a written demand for
substantial performance is delivered to the Executive by the Board or
the CEO which specifically identifies the manner in which the Board or
the
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CEO believes that the Executive has not substantially performed the
Executive's Duties, or
(ii) the willful engaging by the Executive in illegal conduct
or gross misconduct which is materially and demonstrably injurious to
the Company.
For purposes of this provision, no act of failure to act, on the part of the
Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interest of the Company. Any act,
or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or upon the instructions of the CEO or based upon the
advice of counsel for the Company shall be conclusively presumed to be done, or
omitted to be done, by the Executive in good faith and in the best interest of
the Company.
(g) For purposes of this Agreement, "GOOD REASON" shall mean a material
breach by the Company of a material provision of this Agreement which has not
been cured by the Company within thirty (30) days after written notice of
noncompliance has been given by Executive to the Company.
(h) For purposes of the Agreement, "PRO RATA BONUS" shall mean the sum
of (i) the pro rata portion (calculated as if the "target" amount under such
plan has been reached) under any current annual incentive plan from the
beginning of the year of termination through the date of termination and (ii) if
and to the extent Executive is vested, the pro rata portion (calculated as if
the "target" amount under such plan has been reached) under any long-term
incentive plan or performance plan from the beginning of the period of
determination through the date of termination.
5. CONFIDENTIAL INFORMATION. Executive acknowledges that the
information, observations and data obtained by Executive while employed by the
Company and its Subsidiaries concerning the business or affairs of the Company
or any other Subsidiary ("CONFIDENTIAL INFORMATION") are the property of the
Company or such Subsidiary. Therefore, Executive agrees that Executive shall not
disclose to any unauthorized person or use for Executive's own purposes any
Confidential Information without the prior written consent of the Board or the
CEO, unless and to the extent that the aforementioned matters become generally
known to and available for use by the public other than as a result of
Executive's acts or omissions. Executive shall deliver to the Company at
termination of the Employment Term, or at any other time the Company may
request, all memoranda, notes, plans, record, reports, computer tapes, printouts
and software and other documents and data (and copies therein) in any form or
medium relating to the Confidential Information, Work Product (as defined below)
or the business of the Company or any Subsidiary that Executive may then possess
or have under Executive's control.
6. INVENTIONS AND PATENTS. Executive acknowledges that all inventions,
innovations, improvements, development, methods, designs, analyses, drawings,
reports and all similar or related information (whether or not patentable) that
relate to the Company's or any of its Subsidiaries' actual or anticipated
business, research and development or existing or
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future products or services and that are conceived, developed or made by
Executive while employed by the Company and its Subsidiaries ("WORK PRODUCT")
belong to the Company or such Subsidiary. Executive shall promptly disclose such
Work Product to the Board or the CEO and perform all actions reasonably
requested by the Board or the CEO (whether during or after the Employment Term)
to establish and confirm such ownership (including, without limitation,
assignments, consents, powers of attorney and other instruments).
7. NON-COMPETE, NON-SOLICITATION.
(a) In further consideration of the compensation to be paid to
Executive hereunder, Executive acknowledges that in the course of Executive's
employment with the Company Executive shall become familiar with the Company's
trade secrets and with other Confidential Information concerning the Company and
its Subsidiaries and that Executive's services shall be of special, unique and
extraordinary value to the Company and its Subsidiaries. Therefore, Executive
agrees that, during the Employment Term and for one year thereafter (the
"NONCOMPETE PERIOD"), Executive shall not directly or indirectly own any
interest in, manage, control, participate in, consult with, render services for,
or in any manner engage in any business competing with the businesses of the
Company or its Subsidiaries, as such businesses exist or are in process on the
date of the termination of Executive's employment, within any geographical area
in which the Company or its Subsidiaries engage or plan to engage in such
businesses. Nothing herein shall prohibit Executive from being a passive owner
of not more than 2% of the outstanding stock of any class of a corporation which
is publicly traded, so long as Executive has no active participation in the
business of such corporation.
(b) During the Noncompete Period, Executive shall not directly or
indirectly through another entity (i) induce or attempt to induce any employee
of the Company or any Subsidiary to leave the employ of the Company or such
Subsidiary, or in any way interfere with the relationship between the Company or
any Subsidiary and any employee thereof, (ii) hire any person who was an
employee of the Company or any Subsidiary at any time during the Employment Term
or (iii) induce or attempt to induce any customer, supplier, licensee, licensor,
franchisee or other business relation of the Company or any Subsidiary to cease
doing business with the Company or such Subsidiary, or in any way interfere with
the relationship between any such customer, supplier, licensee or business
relation and the Company or any Subsidiary (including, without limitation,
making any negative statements or communications about the Company or its
Subsidiaries).
(c) If, at the time of enforcement of this paragraph 7, a court shall
hold that the duration, scope or area restrictions stated herein are
unreasonable under circumstances then existing, the parties agree that the
maximum duration, scope or area reasonable under such circumstances shall be
substituted for the stated duration, scope or area and that the court shall be
allowed to revise the restrictions contained in this paragraph 7 are reasonable.
(d) In the event of the breach or a threatened breach by Executive of
any of the provisions of this paragraph 7, the Company, in addition and
supplementary to other rights and remedies existing in its favor, may apply to
any court of law or equity of
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competent jurisdiction for specific performance and/or injunctive or other
relief in order to enforce or prevent any violations for the provisions hereof
(without posting a bond or other security). In addition, in the event of any
alleged breach or violation by Executive of this paragraph 7, the Noncompete
Period shall be tolled until such breach or violation has been duly cured.
8. EXECUTIVE'S REPRESENTATIONS. Executive hereby represents and
warrants to the Company that (i) the execution, delivery and performance of this
Agreement by Executive do not and shall not conflict with, breach, violate or
cause a default under any contract, agreement, instrument, order, judgment or
decree to which Executive is a party or by which Executive is bound, (ii)
Executive is not a party to or bound by any employment agreement, noncompete
agreement or confidentiality agreement with any other person or entity and (iii)
upon the execution and delivery of this Agreement by the Company, this Agreement
shall be the valid and binding obligation of Executive, enforceable in
accordance with its terms. Executive hereby acknowledges and represents that
Executive has had an opportunity to consult with independent legal counsel
regarding Executive's rights and obligations under this Agreement and that
Executive fully understands the terms and conditions contained herein.
9. SURVIVAL. Paragraphs 5, 6 and 7 and paragraphs 9 through 16 shall
survive and continue in full force in accordance with their terms
notwithstanding any termination of the Employment Term.
10. NOTICES. Any notice provided for in this Agreement shall be in
writing and shall be either personally delivered, or mailed by first class mail,
return receipt requested, to the recipient at the address below indicated:
NOTICE TO EXECUTIVE:
Name: Xxxxx Xxxxxx
Address: 00 Xxxxxxxxxx
Xxxxxx Xxxxx Xxxxxx, XX 00000
NOTICE TO THE COMPANY:
Office Depot, Inc.
0000 Xxx Xxxxxxxxxx Xxxx
Xxxxxx Xxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
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and
Office Depot, Inc.
0000 Xxxxxxxxxx Xxxx
Xxxxxx Xxxxx, Xxxxxxx 00000
Attention: Executive Vice President - Human Resources
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement shall be deemed to have been given when so delivered
or mailed.
11. SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not effect
any other provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
12. COMPLETE AGREEMENT. This Agreement and those documents expressly
referred to herein and other documents of even date herewith embody the complete
agreement and understanding among the parties and supersede and preempt any
prior understandings, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter hereof in any way.
13. NO STRICT CONSTRUCTION. The language used in this Agreement shall
be deemed to be the language chosen by the parties hereto to express their
mutual intent, and no rule of strict construction shall be applied against any
party.
14. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
15. SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and
inure to the benefit of and be enforceable by Executive, the Company and their
respective heirs, successors and assigns, except that Executive may not assign
Executive's rights or delegate Executive's obligations hereunder without the
prior written consent of the Company.
16. CHOICE OF LAW. All issues and questions concerning the
construction, validity, enforcement and interpretation of this Agreement and the
exhibits and schedules hereto shall be governed by, and construed in accordance
with, the laws of the State of Florida, without giving effect to any choice of
law or conflict of law rules or provisions (whether of the State of Florida or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Florida.
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17. AMENDMENT AND WAIVER. The provisions of this Agreement may be
amended or waived only with the prior written consent of the Company and
Executive, and no course of conduct or failure or delay in enforcing the
provisions of this Agreement shall affect the validity, binding effect or
enforceability of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
OFFICE DEPOT, INC.
By: /s/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
Its: Executive Vice President,
Human Resources
EXECUTIVE
/s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
