EXHIBIT INDEX
EXHIBIT NUMBER
(10) MATERIAL CONTRACTS
(a) Amended and Restated Employment Agreement, effective October 1, 1996,
between Anacomp, Inc. and X. Xxxx Xxxxxx, III.
(b) Employment Agreement, effective October 1, 1992, between Anacomp, Inc.
and Xxxxxxx X. Xxxx.
(c) Employment Agreement, effective February 15, 1996, between Anacomp,
Inc. and Xxxxxx X. Xxxxx.
(11) STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS.
(21) SUBSIDIARIES OF THE REGISTRANT.
(27) FINANCIAL DATA SCHEDULE (REQUIRED FOR ELECTRONIC FILING ONLY).
58
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement") is made
and entered into effective as of the 1st day of October, 1996 (the "Effective
Date"), by and between ANACOMP, INC., a corporation organized and existing under
the laws of the State of Indiana (hereinafter referred to as "Company"), and X.
XXXX XXXXXX III, an individual resident of the State of Georgia (hereinafter
referred to as "Employee").
STATEMENT OF BACKGROUND
Company and Employee are parties to that certain Amended and Restated
Employment Agreement dated effective as of September 24, 1995, as amended,
governing the employment of Employee by Company (such Amended and Restated
Employment Agreement, as amended to date, is hereinafter referred to as the
"Original Employment Agreement"). Company and Employee desire to amend and
restate the Original Employment Agreement in its entirety in order to set forth
in a single agreement all of the provisions of the Original Employment
Agreement, as previously amended and as further amended by the amendments to the
Original Employment Agreement contained herein, and for convenience of
reference. Provisions included in the Original Employment Agreement, which due
to the passage of time, changes in the course of dealings between the parties,
or for other reasons are no longer applicable, have been deleted from this
Agreement.
STATEMENT OF AGREEMENT
NOW, THEREFORE, for and in consideration of the mutual covenants and
promises contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged and accepted, the
parties hereto, intending to be legally bound, agree as follows:
1. Employment. Company hereby agrees to employ Employee in the positions of
Chairman of the Board of Directors and Chief Executive Officer of Company, and
Employee accepts such employment, all subject to the terms and conditions
hereinafter set forth.
2. Employment Term. The initial term of this Agreement is from the
Effective Date until September 30, 1997 (the "Initial Term"). In addition to the
Initial Term, this Agreement shall be renewed for additional 1-year periods
("Renewal Terms"), ad infinitum, unless either party gives notice of non-renewal
at least sixty (60) days prior to the expiration of the Initial Term or then
current Renewal Term. Either the Initial Term or any Renewal Term may be
terminated pursuant to Section 8 hereof. If prior to the expiration of the
Initial Term or any Renewal Term, Company gives notice to Employee of
non-renewal of this Agreement, then upon the expiration of the Initial Term or
the then-current Renewal Term, this Agreement shall terminate and (i) Company
shall immediately pay to Employee all benefits and payments due him under this
Agreement through such termination date, together with severance in the form of
a lump sum cash payment equal to the value of the base salary and the bonus
payments that Employee received during the twenty-four (24) month period
immediately preceding such expiration; provided, however, that the lump sum cash
payment which Employee shall receive upon the expiration of this Agreement shall
not exceed an amount equal to $1 million; (ii) Company shall continue to provide
to Employee the insurance benefits described in Section 7.2 below, for a period
expiring twenty-four (24) months after the expiration of this Agreement or until
Employee obtains other employment with comparable insurance benefits, whichever
shall first occur (The lump sum cash payment and insurance benefits described in
this Section 2 which Employee shall receive upon the expiration of this
Agreement are hereinafter collectively referred to as the "Severance
Allowance."); (iii) the options granted pursuant to the Incentive Stock Plan
described in Section 4.3 and the option described in Section 5.1 shall
immediately vest and shall be fully exercisable upon the date this Agreement
shall terminate and for ninety (90) days thereafter. If prior to the expiration
of the Initial Term or any Renewal Term, Employee gives Company notice of
non-renewal of this Agreement, then upon termination of this Agreement Employee
shall receive only the benefits and payments due him under this Agreement
through such termination date and the required COBRA notices; Employee shall not
receive any Severance Allowance and there shall be no further vesting of
options.
3. Duties of Employee. Except as otherwise provided in this Agreement,
Employee shall have the duties set forth in this Section 3 during the Initial
Term and any Renewal Term of this Agreement.
Company employs Employee as Chairman of the Board of Directors and Chief
Executive Officer. In such capacities, Employee is responsible for establishing
operational priorities, determining the organizational structure for all of
Company's operating divisions and strategic business units, approving all
Company compensation plans and submitting such plans to Company's Board of
Directors (if such submission is required), and developing Company policies and
procedures.
As Chairman of the Board of Directors, Employee shall be a member of the
Board of Directors and shall preside at all meetings of the shareholders and
directors. Employee shall give general direction and supervision to the affairs
of the Company, and shall have and perform such other duties as may be assigned
by the Board of Directors.
4. Compensation of Employee. Except as otherwise provided in this
Agreement, Company shall compensate Employee in the manner set forth in this
Section 4 during the Initial Term and any Renewal Term of this Agreement. 4.1
Base Salary. Employee shall receive a base salary of Five Hundred Thousand
Dollars ($500,000) per annum as compensation for his services hereunder. The
base salary shall be payable in 26 installments, paid every other week in
accordance with the general payroll practices of Company. The amount of the base
salary shall be reviewed at the beginning of each fiscal year of the Company.
The Company, in its sole discretion, may increase the amount of compensation
provided in this Section 4.1 without the necessity of amending this Agreement
but the Company shall not decrease the base salary at any time during the term
of this Agreement. Any increase shall not affect any of the other terms and
conditions of this Agreement other than determination of the Severance Allowance
payable to Employee hereunder.
4.2 Incentive Bonuses. Employee shall participate in, and be entitled to
receive incentive bonuses pursuant to, the Company's 1997 Annual Management
Incentive Plan (the "Bonus Plan"). Employee's "target" bonus and maximum bonus
pursuant to the Bonus Plan shall be equal to $333,333 and $616,666,
respectively, during the Initial Term. During each Renewal Term, Employee shall
participate in, and be entitled to receive incentive bonuses pursuant to,
comparable management incentive plans then in effect with a "target" bonus of
not less than $333,333. Any bonus earned by Employee pursuant to the Bonus Plan
or future comparable plans shall be paid to Employee as soon as practicable
following the date such bonus is earned.
4.3 1996 Long-Term Incentive Plan. Employee shall be entitled to
participate in the Company's 1996 Long-Term Incentive Plan, and in any successor
stock option plan (the "Incentive Stock Plan"), to the extent and in the manner
approved by the Board of Directors. Pursuant to the Incentive Stock Plan, on the
15th day of November, 1996, the Company granted Employee an option to acquire
190,679 shares of Company's Common Stock, $.01 par value per share (the "Common
Stock") at an exercise price of $7.95 per share vesting three years after the
grant. All of the options granted to Employee pursuant to the Incentive Stock
Plan shall be issued to Employee under and in accordance with the terms and
conditions of the Incentive Stock Plan (including the anti-dilution provisions
contained in such Plan).
5. Non-Qualified Stock Options.
5.1 Grant of New Options. Subject to the terms and conditions set forth in
Section 5.2 below, Company granted to Employee on August 22, 1996, an option to
acquire 40,000 shares of Company's Common Stock which option shall vest and
become exercisable according to the following schedule:
Date of Vesting Number of Shares Vested
June 30, 1997 10,000
June 30, 1998 10,000
June 30, 1999 10,000
September 30, 1999 10,000
Notwithstanding the foregoing, the option for 10,000 shares that is
scheduled to vest on September 30, 1999 shall only vest and become exercisable
if Company meets at least 95% of its EBITDA goal for the years ending September
30, 1997, September 30, 1998 and September 30, 1999 combined, which EBITDA goal
is set forth in the Company's Disclosure Statement dated Xxxxx 00, 0000 (xx
being understood that the EBITDA goal is set forth in the Projected Consolidated
Statements of Operations included in the Disclosure Statement).
5.2 Price and Terms of New Options. The option described in Section 5.1
above shall be exercisable for shares of Common Stock at an exercise price equal
to $4.63 per share. Such option shall be issued to Employee under and in
accordance with the terms and conditions of Company's 1996 Restructure
Recognition Incentive Plan (the "Non-Qualified Stock Option Plan") (including
the anti-dilution provisions contained in such Plan). As consideration for
Company's grant of such option to Employee, Employee has executed the Anacomp
Confidentiality, Non-Competition and Non-Disclosure Agreement attached hereto as
Exhibit A.
5.3 Accelerated Vesting of Options. Notwithstanding anything to the
contrary in this Agreement, in the Non-Qualified Stock Option Plan, in the
Incentive Stock Plan or in any other agreement entered into by the Company and
Employee, in the event of Employee's termination of employment with Company,
other than Employee non-renewal pursuant to Section 2, or any termination
pursuant to Sections 8.1(b) (voluntary written resignation by Employee), 8.1(e)
(termination with cause), or 8.1(h) (termination due to events), the option
described in Section 5.1 above and any options granted pursuant to the Incentive
Stock Plan described in Section 4.3 shall immediately vest and shall be fully
exercisable upon such termination and for ninety (90) days thereafter.
6. Business-Related Expenses. Upon presentation in accordance with Company
policies of itemized accounts of his expenditures relating to his performance as
an Employee, Company promptly shall reimburse Employee for all reasonable and
necessary travel expenses and other disbursements incurred by Employee on behalf
of Company in the performance of his duties under this Agreement. Without
limiting the generality of the foregoing, the parties acknowledge that Company
temporarily transferred Employee from Company's executive offices in Atlanta,
Georgia to Company's Poway, California facility and back to Atlanta, Georgia
("Temporary Transfer"). Company agrees to reimburse Employee in accordance with
the provisions of the Company's Relocation and Moving Expense Policy and letters
to Employee from the Company dated November 16, 1995, and December __, 1996, for
any and all travel, living and relocation expenses incurred by Employee and/or
Employee's family in connection with or related to Employee's Temporary Transfer
and/or Employee's return transfer to Company's executive offices in Atlanta,
Georgia.
7. Employee Benefits.
7.1 Benefits Generally. Employee shall participate in all employee benefit,
bonus and similar programs of Company in which he is a participant as of the
date hereof and shall be eligible to participate in all other incentive,
pension, thrift, profit sharing, stock option, deferred compensation, employee
loan and insurance plans and arrangements maintained by Company from time to
time for the benefit of its employees. Company may change, alter or modify any
benefits or benefit programs from time to time, provided Employee continues to
receive benefits equivalent to those received by other members of Company's
senior management. Any compensation received by Employee pursuant to any benefit
programs shall be in addition to the compensation described elsewhere in this
Agreement.
7.2 Insurance Benefits. Company shall provide for Employee and his
dependents life, medical, disability and dental insurance coverage in keeping
with the insurance benefits provided to other members of Company's senior
management and on the same expense sharing basis as other members of Company's
senior management. Company may change, alter or modify any such insurance
coverage from time to time, provided that Employee and his dependents continue
to be provided such coverage equivalent to that provided to other members of
Company's senior management.
7.3 Vacations. Employee shall be entitled to vacations in accordance with
Company policy, during which time his compensation shall be paid in full;
provided, however, Employee shall receive no less than two (2) full weeks of
vacation each year. If Employee is unable to take any or all of his vacation
during a year due to business reasons, Employee may take his unused paid
vacation at a later time.
7.4 Other Fringe Benefits. Employee shall also be entitled to any other
fringe benefits, including regular holidays, that are normally available to
other members of Company's senior management.
8. Termination.
8.1 Compensation and Benefits Upon Termination. This Agreement may be
terminated prior to the expiration of the Initial Term or any Renewal Term by
any of the following events:
a) mutual written agreement expressed in a single document signed by both
the Company and Employee;
b) except as contemplated by Section 8.4.3, voluntary written resignation
by Employee as President and Chief Executive Officer of Company; provided,
however, that Employee shall be permitted to resign solely as Chairman of the
Board of Directors of Company at any time, and such resignation shall not be
deemed a termination hereunder;
c) death of Employee;
d) written notice of termination without cause as defined in Section 8.2;
e) written notice of termination with cause as defined in Section 8.3;
f) the occurrence of any of the events specified in Section 8.4.1, which
Employee elects to treat as a termination under Section 8.4.1;
g) the occurrence of any of the events specified in Section 8.4.2, which
Employee elects to treat as a termination under Section 8.4.2; or
h) written notice of termination as contemplated by Section 8.4.3.
Upon termination for any of the foregoing reasons, Employee shall continue
to render his services and shall be paid his regular compensation and benefits
up to the date of termination. If this Agreement is terminated under Sections
8.1(b) or 8.1(e), no Severance Allowance shall be paid to Employee (except, with
respect to any termination pursuant to Section 8.1(e), as otherwise provided in
Section 8.3). If this Agreement is terminated under Sections 8.1(a), 8.1(c),
8.1(d), 8.1(f), 8.1(g) or 8.1(h), then the Company shall pay to Employee the
Severance Allowance. This Severance Allowance is in addition to the regular
compensation and benefits which Employee shall receive up to the date of
termination and shall be paid by the Company on the last date that Employee
actually reports to the Company's premises for full time duties. In the event of
such termination, this Agreement shall be deemed terminated for all purposes
except to the extent otherwise herein provided. Upon termination, for any of the
foregoing reasons, the accelerated vesting of options shall be governed by
Section 5.3.
8.2 Termination Without Cause. If Employee is unable, as determined in good
faith by the Company's Board of Directors, to perform Employee's assigned duties
on a full-time basis for any continuous period of 120 days or a total of 180
days in any 12-month period, or if the Company otherwise concludes Employee's
services are no longer required, this Agreement may be terminated without cause
by giving Employee written notice thereof. The noninsurability of Employee,
either present or future, does not constitute grounds for termination under this
or any other Section of this Agreement. If Employee is terminated under this
Section 8.2, the Company shall pay the compensation, benefits and Severance
Allowance provided in Section 8.1 above.
8.3 Termination With Cause.
8.3.1 The Company may immediately terminate this Agreement at any time with
cause upon written notice to Employee specifying the cause and the effective
date of termination. For purposes of this Agreement, "cause" shall mean only the
following: (i) willful breach of fiduciary duty or willful dishonesty, in either
case involving acts directed towards the Company and involving personal profit
(except for acts which may be cured as set forth below), or (ii) criminal
conduct of Employee against the Company which results in a felony conviction of
Employee. The Company agrees that in the event that it shall allege that
Employee engaged in a willful breach of fiduciary duty or willful dishonesty of
the type for which the Company believes that it has cause for Employee's
termination, the Company shall give notice to the Employee. If the Employee,
following receipt of such notice, shall maintain in good faith that any such
alleged action was unintentional, the Employee shall have the right to cure such
action by full reimbursement to the Company of any sums wrongfully received;
provided that such cure shall be permitted only if, with respect to any single
act or occurrence, the amount wrongfully received by Employee with respect to
such single act or occurrence was less than $5,000. The agreement by Employee to
return such sums shall constitute a cure, and the Company shall not be entitled
to terminate the Employee with cause under this Section 8.3 for such act or
occurrence. Termination with cause shall be determined in good faith by
Company's Board of Directors after written notice to Employee and an opportunity
for Employee to be heard by Company's Board of Directors.
8.3.2 Employee agrees that, in the event written notice of termination is
given under this Section 8.3, Employee shall treat the contents of said notice
as privileged and Employee shall have no action against Company or any of its
officers, agents or employees due to the contents of said notice unless the
contents are intentionally false and malicious. If Employee is terminated under
this Section 8.3, he shall receive no Severance Allowance at the time of such
termination. If Employee is given notice of termination under this Section 8.3
and it is later determined that no "cause" existed, Employee shall be entitled
to all compensation, benefits and allowances due him for the period following
such alleged termination and through the date of such determination and shall be
entitled to the Severance Allowance, plus legal interest from the date of
termination and all reasonable attorneys' fees incurred by Employee in
contesting the notice of termination.
8.3.3 The Company represents that as of the date this Agreement is executed
by the Company, the Company knows of no fact or circumstance that would provide
the Company with a basis for terminating this Agreement for cause.
8.4 Demotion, Transfer or Reduction in Compensation, Merger, Transfer of
Assets, Change in Control or Business Discontinuation.
8.4.1 Demotion, Transfer, Reduction in Compensation, or Business
Interference. If any of the following takes place:
a) Employee is demoted, including for these purposes (i) any change in the
title or duties described in Section 3 hereof, (ii) any significant reduction or
change by Company in the functions, duties or responsibilities of Employee under
this Agreement, or (iii) the removal of Employee as Chairman of the Board of
Directors of Company without his written consent,
b) after Employee's Temporary Transfer has terminated, a transfer of
Employee to another location outside of Metropolitan Atlanta not agreed to in
writing by Employee,
c) any reduction in Employee's annual compensation, or
d) intentional interference by Company or any person or entity directly or
indirectly controlling Company with the performance by Employee of the duties
required of him hereunder,
then Employee may, in his sole and absolute discretion, elect to treat any
such occurrence as a termination of this Agreement by giving written notice of
such election to the Company, entitling Employee to payment of the compensation,
benefits and Severance Allowance provided in Section 8.1 above. In the event the
Company disputes any election made by Employee pursuant to this Section 8.4.1,
the Company shall notify Employee in writing of such dispute within ten (10)
days of receiving Employee's written election. If Company does not so notify
Employee within the ten (10) day period, the Company shall be deemed to have
accepted Employee's election and shall pay all compensation, benefits and
Severance Allowance provided in Section 8.1 above.
8.4.2 Merger, Transfer of Assets, Change in Control or Business
Discontinuation. In the event of any:
a) merger or consolidation where Company is not the consolidated or
surviving company and the surviving or resulting company does not expressly
agree to be bound by and have the benefits of the provisions of this Agreement,
b) transfer of all or substantially all of the assets of Company and the
transferee of Company's assets does not expressly agree to be bound by and have
the benefits of the provisions of this Agreement,
c) change in control of Company of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated
under the Securities Exchange Act of 1934 as in effect on the Effective Date
(the "Exchange Act"), provided that, without limiting the generality of the
foregoing, such a change in control shall be deemed to have occurred if: (i) any
person or persons acting in concert (as such term is used in Section 13(d) and
14(d)(2) of the Exchange Act) is or becomes the beneficial holder directly or
indirectly of securities of Company representing 25% or more of the combined
voting power of Company's then outstanding securities; (ii) during any period of
two consecutive years, individuals who at the beginning of such period
constitute the Board cease for any reason to constitute a majority thereof,
unless the election or nomination for election by Company's shareholders of each
new director was approved by a vote of at least 2/3 of the directors who were
directors at the beginning of such period; or (iii) transfer of all or
substantially all of the stock of Company, or
d) discontinuation of business by Company,
then (i) Employee may, in his sole discretion, elect to treat any such
occurrence as a termination of this Agreement by giving written notice of such
election and immediate termination of his employment to Company, and (ii)
Company shall pay Employee within thirty (30) days of Employee's election and
termination of employment a payment equal to the Severance Allowance. This
Severance Allowance shall be in addition to the regular compensation and
benefits that Employee is entitled to receive up to the date Employee's
employment with Company terminates.
8.4.3 Existence of Termination Events. Company acknowledges and agrees that
Employee was entitled to terminate the Original Employment Agreement pursuant to
Sections 8.4.1 and 8.4.2 thereof as a result of the appointment of Xxxx X.
Xxxxxx as Company's Chairman of the Board of Directors and the confirmation in
Company's chapter 11 bankruptcy case of Company's Third Amended Joint Plan of
Reorganization, dated May 20, 1996 (the "Plan"), and the consummation of the
transactions contemplated therein, respectively (the appointment of Xx. Xxxxxx
as Company's Chairman of the Board of Directors and the consummation of the
transactions contemplated by the Plan are referred to collectively hereinafter
as the "Termination Events"). Company further acknowledges and agrees that, as
of the Effective Date, Employee has not waived any of his rights arising as a
result of the occurrence of the Termination Events. Therefore, at any time from
the Effective Date through September 30, 1997, Employee shall have the right in
his sole and absolute discretion to terminate this Agreement by giving Company
written notice of termination at least 120 days prior to the designated
termination date (it being understood that Employee may give the 120-day notice
of termination at any time through and including September 30, 1997). If
Employee terminates the Agreement pursuant to this Section 8.4.3, Company shall
pay the compensation, benefits and Severance Allowance provided in Section 8.1
above in equal amounts each month during the 120-day notice period..
8.5 Return of Company Property. Employee agrees to return all property of
Company, including but not limited to, details of equipment, prices,
specifications, programs, customer and prospective customer lists and any other
proprietary data or objects acquired through the Employee's employment with
Company, within seven (7) days after termination of employment, regardless of
the reason therefor.
8.6 Failure to Pay Severance Allowance. In the event that Company fails to
timely pay to Employee any and all Severance Allowance payments to which
Employee is entitled pursuant to Sections 8.1, 8.2, 8.3, 8.4.1, 8.4.2 or 8.4.3
hereof, then (in addition to Employee's other rights hereunder) the Anacomp
Confidentiality, Non-Competition and Non-Disclosure Agreement described in
Section 5.2 above shall be void and of no force and effect.
8.7 Waiver of Claims. All Severance Allowance payments made by Company to
Employee pursuant to Section 2 hereof or this Section 8 shall be in full and
complete payment of any and all claims that Employee may have against Company
regarding his employment or the termination thereof, and Employee hereby
expressly waives all rights that he may have to any other payments or to bring
any other claims based upon his employment or the termination thereof. Except
for the qualification with respect to employee benefits described in Section 2
above, all Severance Allowance payments due from Company to Employee under this
Agreement are absolute, and shall not be diminished or otherwise affected by
virtue of Employee securing alternative employment.
8.8 Arbitration of Disputes. If a dispute arises between the parties,
including a dispute regarding an election Employee makes under Section 8.4.1
hereof, then the parties agree that their respective representatives shall meet
and consult in good faith and attempt to settle the dispute, within thirty (30)
days of written notice thereof, as a condition precedent to the initiation of
arbitration proceedings as set forth below.
Any dispute, controversy, or claim arising out of or relating to this
Agreement, the breach, termination or invalidity thereof, or Employee's
employment, including claims of tortious interference or other tort or statutory
claims, and including (without limitation) any dispute concerning the scope of
this arbitration clause, shall be settled by arbitration in accordance with the
Employment Dispute Resolution Rules of the American Arbitrators Association then
in effect. The judgment on the award rendered by the arbitrator may be entered
in any court having jurisdiction thereof. The arbitration under this Agreement
shall be held in Atlanta, Georgia, or at such other place as may be selected by
mutual agreement of the parties.
The arbitrator shall be a former federal judge agreed to by the parties or,
failing agreement, appointed by the Chief Judge of the United States District
Court (Northern District of Georgia). The parties intend that the arbitrator
shall be independent and impartial. To this end, the arbitrator shall disclose
to the parties any professional, family, or social relationships, past or
present, with any party or counsel.
Strict rules of evidence shall not apply in any arbitration conducted
pursuant to this Agreement. The parties may offer such evidence as they desire
and the arbitrator shall accept such evidence as the arbitrator deems relevant
to the issues and accord it such weight as the arbitrator deems appropriate. The
arbitrator shall have the discretion to order a prehearing exchange of
information by the parties, including, without limitation, production of
requested documents, exchange of summaries of testimony of proposed witnesses,
and examination by deposition of parties. No party shall be allowed, however, to
take more than one deposition of the opposing party and no deposition shall last
longer than six (6) hours. All disputes regarding discovery shall be decided by
the arbitrator.
The arbitrator's award shall be in writing and shall specify the factual
and legal bases for the award. In rendering the award, the arbitrator shall
determine the respective rights and obligations of the parties according to the
laws of the State of Georgia or, if applicable, federal law. The arbitrator
shall have the authority to award any remedy or relief that a federal or state
court within the State of Georgia could order or grant.
Any provisional remedy that would be available from a court of law shall be
available from the arbitrator to the parties, pending the arbitrator's
determination of the merits of the parties' dispute. This shall include orders
of attachment, temporary restraining orders, injunctions, and appointment of a
receiver. If the arbitrator issues such an order, either party may immediately
apply to a court of competent jurisdiction for enforcement of the order, even
though the arbitrator may not have rendered a final award.
All fees and expenses of the arbitration, including the fees of the
arbitrator and the fees and expenses of each party's counsel, experts, witnesses
and preparation and presentation of proofs, shall be paid by Company.
Unless legally required to do so, neither party may disclose the existence,
content, or results of any arbitration under this Agreement without the prior
written consent of the other party, nor may the arbitrator disclose any such
information without the consent of both parties. This provision shall apply to
all aspects of the arbitration proceeding, including, without limitation,
discovery, testimony, other evidence, briefs, and the award.
It is the specific intent of the parties that this arbitration clause be
governed by the Federal Arbitration Act, 9 U.S.C. Section 1, et seq. ("FAA");
however, if this clause is unenforceable for any reason under the FAA, then the
parties intend that it be governed by the provisions of the Georgia Arbitration
Code, O.C.G.A. Sections 9-9-1, et seq.
Both Employee and Company represent and warrant they have read the
foregoing Section 8.8 _____, that they have had an opportunity to consult with
and receive advice from legal counsel regarding the foregoing Section 8.8 _____,
and that they hereby forever waive all rights to assert that this Section 8.8
was the result of duress, coercion, or mistake of law or fact. _____ (Initial of
both parties in each space.)
0.0.0.0.0.1. Indemnification. Company shall indemnify Employee to the
fullest extent permitted by Company's Articles of Incorporation, Bylaws and
applicable federal or state laws for all amounts (including, without limitation,
judgments, fines, settlement payments, expenses and reasonable attorneys' fees)
incurred or paid by Employee in connection with any action, suit, investigation
or proceeding arising out of or relating to the performance by Employee of
services for, or the acting by Employee as a director, officer or employee of
Company, any subsidiary of Company or any other person or enterprise at
Company's request. Expenses, including (but not limited to) reasonable
attorneys' fees and disbursements, incurred in defending any action, suit,
investigation or proceeding, for which Employee may be entitled to
indemnification under this Section 9 upon final disposition of such action,
shall be paid by the Company in advance of the final disposition, to the maximum
extent permitted by applicable laws and regulations; provided, however, that
prior to making any such payments the Company shall receive an undertaking by or
on behalf of Employee to repay such amounts if it shall ultimately be determined
that he is not entitled to indemnification. Subject to applicable laws and
regulations, Company shall maintain in full force and effect, to the extent
available at reasonable cost, the Directors' and Officers' Liability Insurance
Policies in effect on the date of this Agreement, or other policies or means of
providing substantially similar protection to Employee. The parties acknowledge
and agree that when used in this Agreement, "reasonable attorneys' fees" shall
be deemed to mean the normal billing rates of counsel of Employee's choice.
0.0.0.0.0.2. Miscellaneous.
10.1 Governing Law. This Agreement is made in the State of Georgia and
shall be construed and enforced in accordance with the laws of that state,
except to the extent that federal law applies.
10.2 Time. Time is of the essence of this Agreement.
10.3 Board Approval. The Company represents and warrants that the execution
and delivery of this Agreement have been approved by all requisite Board of
Director or Committee action.
10.4 Severability. In the event that this Agreement, or any paragraph or
provision hereof, is declared invalid, void or unenforceable by a Court of
competent jurisdiction, the remaining provisions shall nevertheless continue in
full force and effect without being impaired or invalidated in any way or to any
extent.
10.5 Attorney's Fees and Costs. Company shall pay all reasonable attorney's
fees and expenses that Employee may incur as a result of the Company's breaching
or contesting the validity or enforceability of this Agreement and Employee
shall be entitled to receive interest on any payment not timely made for the
period of any delay in payment from the date such payment was due at the
interest rate determined by adding 200 basis points to the six-month Treasury
Xxxx rate prevailing from time to time over the period of nonpayment.
10.6 Waiver of Breach. Failure or delay of either party to insist upon
compliance with any provision hereof shall not operate as, and is not to be
construed as, a waiver or amendment of such provision or the right of the
aggrieved party to insist upon compliance with such provision or to take
remedial steps to recover damages or other relief for noncompliance. Any express
waiver of any provision of this Agreement shall not operate and is not to be
construed as a waiver of any subsequent breach, whether occurring under similar
or dissimilar circumstances.
10.7 Notices. All notices, consents, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given or delivered if (i) delivered personally; or (ii) mailed by certified
mail, return receipt requested, with proper postage prepaid; or (iii) delivered
by facsimile; or (iv) delivered by recognized courier contracting for same day
or next day delivery:
(a) To Company:
Anacomp, Inc.
0000 Xxxxxx Xxxxx, XX
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Corporate Counsel
Facsimile Number: (000) 000-0000
(b) To Employee:
X. Xxxx Xxxxxx III
000 Xxxxxxx Xxxx.
Xxxxxxx, XX 00000
Facsimile Number: (000) 000-0000 (as of 12/14/96)
(c) Attorney
Xxxxxxx X. Xxxxxxxxx, Xx.
King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Facsimile Number: (000) 000-0000
or at such other address as the parties hereto shall have last designated
by notice to the other parties. Any item delivered personally or by recognized
courier contracting for same day or next day delivery shall be deemed delivered
on the date of delivery. Facsimile deliveries shall be deemed delivered on the
date of transmission by the sender provided sender has evidence of successful
transmission. Any item mailed shall be deemed to have been delivered on the date
evidenced on the return receipt.
IN WITNESS WHEREOF, Company has caused this Agreement to be executed and
delivered by its duly authorized officers under seal and its corporate seal to
be affixed hereto, and Employee has executed and delivered this Agreement and
has hereunto affixed his hand and seal, each on the date(s) set forth beside
their respective signatures below, with this Agreement to be effective as of the
Effective Date.
COMPANY:
ANACOMP, INC.
Dated: By:________________________(SEAL)
Xxxxxxx X. Xxxx, Senior Vice
President, Secretary and
Chief Administrative Officer
EMPLOYEE:
Dated: ___________________________(SEAL)
X. Xxxx Xxxxxx III
EMPLOYMENT AGREEMENT
This Agreement is entered into between ANACOMP, INC. or any of its
subsidiaries or affiliates (herein referred to as "ANACOMP") and EMPLOYEE. The
full identification of each party, date of agreement, and date of expiration of
agreement are all included on the cover sheet immediately preceding this page
which is incorporated herein by this reference. The following conditions and
terms shall apply:
ARTICLE I
Merger of All Prior Agreements
This Agreement shall supersede and terminate all prior employment contracts
and agreements between EMPLOYEE and ANACOMP.
ARTICLE II
Scope and Term of Employment, Compensation
ANACOMP and EMPLOYEE mutually agree that Addendum I, attached hereto and
incorporated herein by this reference, is intended to define the scope of
employment, base salary, incentive compensation, and responsibility assignments.
Subject always to termination provisions as provided elsewhere in this
Agreement, the term of this Agreement shall begin on the Effective Date of
Agreement and shall terminate on the Date of Expiration of Agreement, both as
shown on the cover sheet. Unless otherwise terminated as provided elsewhere
herein, this Agreement shall automatically renew after expiration date on an
annual basis unless either party gives the other party thirty (30) days written
notice requesting that said Agreement not be renewed. If this Agreement is not
renewed and EMPLOYEE continues working beyond Termination Date, said employment
shall be on a month-to-month basis. If, at the expiration of the original 3-year
term or any renewal term, ANACOMP declines to renew this Agreement, EMPLOYEE
shall be entitled to regular compensation and benefits up to the date of
termination and, unless the parties agree on a different amount, to a severance
allowance equal to EMPLOYEE'S previous twenty-four months' total cash
compensation, including bonuses, payable in a lump sum or bi-weekly at
EMPLOYEE'S option, and health benefits until other employment is secured or for
twenty-four months, whichever is sooner, and all existing options to acquire
Anacomp common stock shall immediately vest.
Compensation is confidential and is to be discussed only with the
officers of ANACOMP, as required.
ARTICLE III
Fringe Benefits
In addition to the regular compensation, EMPLOYEE shall be entitled to the
normally available employee fringe benefits including regular holidays,
vacations and health insurance. ANACOMP, however, reserves the right to change
or alter these fringe benefits from time to time with the understanding that the
EMPLOYEE will be treated on an equal basis with other employees of similar
status.
ARTICLE IV
Insurance on Employee
EMPLOYEE agrees that ANACOMP may, at its option and expense, obtain life
insurance on the life of the EMPLOYEE and the ownership of all such policies and
the proceeds therefrom shall be the sole property of ANACOMP.
EMPLOYEE agrees to undergo a routine physical examination for insurance
purposes within fifteen (15) days upon the request and at the expense of
ANACOMP.
ARTICLE V
Termination and Damages
The parties agree that the EMPLOYEE'S employment (the "Employment") may be
terminated as follows:
1. Without Cause The Employment may be terminated by ANACOMP at any time
without cause by giving EMPLOYEE written notice.
2. with Cause ANACOMP may immediately terminate this Agreement at any time
for cause upon written notice to the EMPLOYEE specifying the cause and effective
date of termination. As used in this section, "cause" shall mean:
(a) Inability of EMPLOYEE, as determined by the Board of Directors of
ANACOMP, to perform EMPLOYEE's assigned duties on a full-time basis for any
continuous period of one hundred twenty (120) days or a total of one hundred
eighty (180) days in any twelve (12) month period, which period shall commence
on the initial date of this contract and every anniversary date thereof.
(b) The willful and continued failure by EMPLOYEE substantially to perform
his duties and obligations or the willful engagement by EMPLOYEE in misconduct
which is materially injurious to ANACOMP, monetarily or otherwise. For purposes
of this subsection, no act or failure to act on EMPLOYEE'S part shall be
considered "willful" unless done or omitted to be done by EMPLOYEE in bad faith
and without reasonable belief that his action or omission was in the best
interests of ANACOMP.
3. Death Death of an EMPLOYEE shall automatically terminate this Agreement
but any remedies ANACOMP may have against the estate of this EMPLOYEE shall
survive.
3. Resignation EMPLOYEE may terminate the Employment at any time by giving
ANACOMP written notice of his intention to resign.
5. Demotion, Transfer or Reduction in Compensation A demotion, a transfer
or a reduction in compensation may, in EMPLOYEE's sole discretion, be deemed a
termination of the Employment.
6. Merger, Consolidation or Change in Control If either of the following
events occur:
(a) Substantially all of the assets of ANACOMP are sold or ANACOMP is
consolidated or merged with another corporation wherein stock of ANACOMP is
exchanged for stock and/or securities of another corporation; or
(b) There is a change of control of ANACOMP of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934 as in effect on the
date thereof; provided that, without limitation, such a change in control shall
be deemed to have occurred if (i) any person (as such term is used in Section
13(d) and 14(d)(z) of the Exchange Act) is or becomes the beneficial holder
directly or indirectly, of securities of ANACOMP representing 25% or more of the
combined voting power of ANACOMP'S then outstanding securities, or (ii) during
any period of two consecutive years, individuals who at the beginning of such
period constitute the Board of Directors of ANACOMP cease for any reason to
constitute a majority thereof, unless the election or nomination for election by
ANACOMP'S shareholders of each new director was approved by a vote of at least
2/3 of the directors then still in office who were directors at the beginning of
such period;
then in any such event, the EMPLOYEE shall continue to have the benefit of
and be subject to Sections 1-5 of this Article V and Article VI below.
ARTICLE VI
Payment and Obligations After Termination
If this Agreement is terminated by ANACOMP for cause or the Employment is
terminated by EMPLOYEE's resignation, EMPLOYEE shall be paid only that part of
EMPLOYEE's base salary accrued to the date of termination and EMPLOYEE shall not
be entitled to any quarter-end or year-end bonus not already paid or fully
earned except and to the extent required by law. If this Employment is
terminated due to the death or total and permanent disability of EMPLOYEE,
bonuses shall be paid on a pro rata basis computed through the date of
termination. If the Employment is terminated without cause or as a result of a
merger, consolidation or change in control, or the EMPLOYE deems a termination
to have occurred due to a demotion, transfer or reduction in compensation,
EMPLOYEE shall be entitled to termination pay equal to EMPLOYEE'S previous
twenty-four months' total cash compensation, including bonuses, payable in a
lump sum or bi-weekly at EMPLOYEES'S option, and health benefits until other
employment is secured or for twenty-four months, whichever is sooner, and all
his existing options to acquire ANACOMP Common Stock shall immediately vest. All
termination payments shall be made within forty-five (45) days after
termination. All termination payments made pursuant to this Article VI or
Article V shall be in full and complete payment of any and all claims EMPLOYEE
may have regarding his employment or termination and EMPLOYEE hereby expressly
waives all rights he may have to any other payments.
EMPLOYEE agrees to return all property of ANACOMP, including, but not
limited to details of equipment, prices, specifications, programs, customer and
prospective customer lists, and any other proprietary data or objects acquired
through the EMPLOYEE's employment with ANACOMP, within seven (7) days upon the
termination of employment, whether said termination be with or without cause.
ARTICLE VII
Restrictive Covenant and Non-Competition
Inventions and Improvements Confidential Information
EMPLOYEE and ANACOMP shall enter into "EMPLOYEE'S COVENANT NOT TO COMPETE
OR DISCLOSE TRADE SECRETS" in the form attached hereto as Addendum II. In the
event of any conflict between the terms of this Agreement and such Covenants,
this Agreement shall govern.
ARTICLE VIII
Warranties and Representations
EMPLOYEE hereby warrants and represents as follows:
(1) That the execution of this Agreement and the discharge of EMPLOYEE's
obligations hereunder will not breach or conflict with any other contract,
agreement or understanding between EMPLOYEE and any other party or parties.
(2) That EMPLOYEE has ideas, information and know-how relating to the type
of business conducted by ANACOMP and EMPLOYEE's disclosure of such ideas,
information and know-how to ANACOMP will not conflict with or violate the rights
of any third party or parties with respect thereto.
ARTICLE IX Remedies
The parties agree that the remedy for breach of this Agreement shall
include actions in equity for injunctive relief as well as money damages. The
remedies given to or reserved by ANACOMP hereunder shall be cumulative and not
exclusive of any other remedy available under law.
ARTICLE X No Waiver
The failure of EMPLOYEE to terminate this Agreement for the breach of any
condition or covenant herein by the EMPLOYEE shall not affect EMPLOYEE'S right
to terminate for subsequent breaches of the same or other conditions or
covenants. The failure of either party to enforce at any time or for any period
of time any of the provisions of this Agreement shall not be construed as a
waiver of such provisions or of the right of the party thereafter to enforce
each and every such provision.
ARTICLE XI
Benefit
This Agreement shall bind, benefit, and be enforceable by ANACOMP, its
successors and assigns, and by EMPLOYEE, EMPLOYEE'S heirs, executors,
administrators, and legal representatives.
ARTICLE XII
Severability
Should any provision of the Agreement not be enforceable in any
jurisdiction, the remainder of the Agreement shall not be affected thereby
ARTICLE XIII Survival The obligations contained in Articles VI and VII
shall survive the termination of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed or caused this
Agreement to be executed as of the day, month and year stated on the cover page
of this Agreement, which Agreement shall be effective only upon approval by
ANACOMP, INC., as evidenced by the authorized signature of an officer of ANACOMP
below.
APPROVED BY:
ANACOMP
By:
EMPLOYEE:
Xxxxxxx X. Xxxx
ADDENDUM I
TO
EMPLOYMENT AGREEMENT DATED OCTOBER 1, 1992
BETWEEN
ANACOMP, INC. ( "ANACOMP" )
AND
XXXXXXX X. XXXX (EMPLOYEE)
Scope of Employment
ANACOMP employs the EMPLOYEE in the capacity of Vice President, Chief
Administrative Officer and Secretary.
Assigned Responsibilities
EMPLOYEE is responsible for managing the Personnel and Employee Benefits,
Corporate Real Estate, Corporate Management Information Systems (MIS), Corporate
Communications, Legal, and General Administrative departments of the Corporation
and for performing such other duties as may be assigned by the President,
Chairman of the Board and Chief Executive Officer.
Base Salary
For all services rendered by EMPLOYEE under this Agreement, EMPLOYEE shall
receive a minimum Base Salary of $110,000 per year for fiscal year 1993,
beginning October 1, 1992. Base Salary will be reviewed at the beginning of each
fiscal year.
Incentive Compensation
Bonus
In addition to Base Salary, EMPLOYEE shall receive a minimum annual bonus
of $110,000 in fiscal year 1993, beginning October 1, 1992, based upon meeting
100% of assigned objectives. The annual bonus and objectives shall be
established at the beginning of each fiscal year, but in no case shall the bonus
be less than $110,000 for meeting 100% of assigned objectives.
ANACOMP, INC: EMPLOYEE
Xxxxx X. Xxxxxxx Xxxxxxx X. Xxxx
ADDENDUM II
CONFIDENTIALITY, NON-COMPETITION AND NON-DISCLOSURE AGREEMENT
In consideration of the employment or continued employment of Employee by
Anacomp, Inc. and its successors, assigns, subsidiaries, or duly authorized
representatives (hereinafter collectively referred to as "Anacomp") and of the
award of an option for the purchase of 25,000 shares of Anacomp, Inc. Common
Stock, par value $.01 per share, at a price of $4.63 (price to be set on the
date of award by Anacomp's Board of Directors), Employee hereby agrees as
follows:
1. Confidentiality and Trade Secrets. The Employee recognizes and
acknowledges that during the course of his/her employment, he/she will have
access to and become acquainted with confidential, trade secret and proprietary
information about Anacomp's businesses and customers (hereinafter collectively
referred to as the "Protected Information"). The parties hereto recognize that
the Protected Information available to Employee may pertain both to customers
and accounts handled by Employee personally as well as accounts with which
Employee is not personally involved. The parties agree that all Protected
Information constitutes a trade secret of Anacomp. Protected Information may
inc1ude, but is not limited to, the names, addresses, and requirements of any
customer or prospective customer of Anacomp; the terms (including price terms)
of contractual relations with such customers; special requirements of such
customers; the identities of individual contacts at such customers; and any
other information relating to Anacomp's research, operations, business
relationships, engineering data or results, specifications, concepts, methods,
processes, rates or schedules, vendor information, products or services
(including prices, costs, sales or content), financial information or measures,
business methods, future business plans, data bases, computer programs, designs,
models, operating procedures, and knowledge of the organization. The Employee
recognizes and acknowledges that all of the Protected Information is valuable,
special and essential to the successful and effective conduct of Anacomp's
business. Therefore, the Employee shall not, during his/her employment with
Anacomp or at any time thereafter, regardless of the reasons for leaving that
employment, use, disclose or communicate, directly or indirectly, any Protected
Information to any third party for any reason or purpose whatsoever, except as
required in the course of his/her employment with Anacomp. Further, upon the
termination of his/her employment with Anacomp, for any reason whatsoever,
Employee shall promptly return any and all copies of any written material,
documents, computer hardware and software, tools and equipment belonging to
Anacomp or relating to the business of Anacomp in his/her possession.
2. Non-Competition.
2.1 Non-Competition While an Employee or Consultant. While an employee of
Anacomp, or as a consultant to Anacomp after his termination of employment,
Employee agrees not to compete in any manner, either directly or indirectly as
an employee, consultant, investor or owner, whether for compensation or
otherwise, with Anacomp, or to assist any other person or entity to compete with
Anacomp. Further, while an employee of Anacomp, Employee agrees not to engage in
any other employment without the prior written permission of Anacomp.
3. Non-Solicitation.
9.1 Non-Solicitation of Employees. During the term of his/her employment at
Anacomp and for two (2) years following the termination for any reason of such
employment, Employee agrees, either on his/her own behalf or on behalf of any
other person or entity, directly or indirectly, not to hire, solicit, or
encourage to leave the employ of Anacomp any person who is then an employee of
Anacomp. The foregoing restrictions shall apply to employees located in all
geographical areas where Employee performed services for Anacomp during the
two-year period prior to his/her termination, including areas for which Employee
had supervisory authority.
3.2 Non-Solicitation of Customers. Because of Employee's access to
Protected Information of Anacomp, Employee agrees that, during the term of
his/her employment at Anacomp and for two (2) years following the termination
for any reason of such employment, he/she will not, directly or indirectly, in
connection with the products and services offered by Anacomp and those products
and services which are competitive with the products and services of Anacomp:
(a) solicit, attempt to obtain, or in any way transact business with any
customers which were customers of Anacomp during his/her employment or at the
time of his/her termination; (b) aid or assist any other party in the
solicitation of any such customers; or (c) interfere with Anacomp's
relationships with any of its customers by soliciting such customers or inducing
them to discontinue their relationships with Anacomp. Products and services
which are competitive with the products and services of Anacomp include but are
not limited to: Micrographics Products (computer output to
microfilm-COM-equipment and software, cameras and film, processors, duplicators,
retrieval and display equipment and software, computer aided
retrieval-CAR-systems, readers, reader printers, other micrographics equipment,
micrographics equipment maintenance, micrographics consumable supplies and
accessories, records management software); Output Services (computer output to
microfilm-COM, source document microfilming, output of data to compact disk,
laser printing, conversion of paper and film to electronic images, micrographic
or electronic imaging system design, consulting and education, system
implementation and integration); Electronic Image Management Products (hardware,
software, magnetics products including tapes, tape drives and optical media
supplies, maintenance of electronic imaging equipment); Electronic Image
Management Services (conversion of computer generated data to optical or laser
disk, COLD, electronic document imaging and workflow, conversion of paper
documents to electronic images, system design consulting and education, system
implementation and integration, conversion of microfilm to electronic images);
and Archival Services (storage, management and retrieval of all forms of
customer information and business records, including but not limited to paper,
microfiche, magnetic media and digital storage media). The foregoing
restrictions shall apply to all geographical areas where Employee performed
services for Anacomp during the two-year period prior to his/her termination,
including areas for which Employee had supervisory authority.
4. Remedies. Employee acknowledges that compliance with Sections 1, 2 and 3
of this Agreement is necessary to protect the business and good will of Anacomp
and that a breach of those sections will irreparably and continually damage
Anacomp for which money damages may not be adequate. Therefore, Employee agrees
that, in the event he/she breaches or threatens to breach any of these Sections,
Anacomp shall be entitled to both a preliminary or permanent injunction in order
to prevent the continuation of such harm and money damages insofar as they can
be determined. Nothing in this Agreement, however, shall be construed to
prohibit Anacomp from also pursuing any other remedy, the parties having agreed
that all remedies shall be cumulative.
5. Inventions. Employee agrees that all inventions, improvements,
discoveries, systems, techniques, ideas, processes, programs, and other things
of value made or conceived in whole or in part by Employee while an employee of
Anacomp shall be and remain the sole and exclusive property of Anacomp, and
he/she will disclose all such things of value to Anacomp and will cooperate with
Anacomp to insure that the ownership by Anacomp of such things of value is
protected. Nothing in this Section is meant to apply to an invention for which
no equipment, supplies, facility or trade secret information of Anacomp was
used, which was developed entirely on Employee's own time, and which does not
relate to Anacomp's business, research, development or from any work performed
by Employee for Anacomp.
6. Employment. This Agreement does not confer upon Employee any rights to
continue in the employ of Anacomp or affect in any way Anacomp's right to
terminate his/her employment at any time.
7. Severability. If any provision or clause of this Agreement, or portion
thereof, shall be held by any court or other tribunal of competent jurisdiction
to be illegal, void or unenforceable in such jurisdiction, the remainder of such
provisions shall not thereby be affected and shall be given full effect, without
regard to the invalid portion. It is the intention of the parties that, if any
court construes any provision or clause of this Agreement, or any portion
thereof, to be illegal, void or unenforceable because of the duration of such
provision or the area or matter covered thereby, such court shall reduce the
duration, area or matter of such provision and, in its reduced form, such
provision shall then be enforceable and shall be enforced.
8. Binding Effect. The rights and obligations of this Agreement shall inure
to and be binding upon the parties and their respective heirs, successors and
assigns.
9. Attorneys' Fees. In the event of any dispute, proceeding or litigation
concerning any controversy, claim or dispute between the parties hereto,.
arising out of or relating to this Agreement or the interpretation or breach
thereof, the prevailing party shall be entitled to recover from the losing party
its reasonable expenses, attorneys' fees, expert fees, and costs incurred
therein or in the enforcement or collection of any judgment or award rendered
therein.
10. No Waiver. Anacomp's failure to enforce any provision of this Agreement
shall not in any way be construed as a waiver of any such provision, or prevent
Anacomp thereafter from enforcing each and every provision of this Agreement.
11. Entire Agreement. This Agreement represents the entire agreement
between Employee and Anacomp, with respect to the subject matter hereof,
superseding all previous oral and written communications, representations,
understandings or agreements.
12. Employee's Understanding. Employee represents and warrants that he/she
has read each and every term of this Agreement and understands the serious
duties and obligations imposed upon Employee thereby. Employee further
represents and warrants that he/she has had full and ample opportunity to
question Anacomp about this Agreement and each of its terms and to consult an
attorney regarding this Agreement and each of its terms. Employee represents
that he/she is free to enter this Agreement and to perform each of its terms and
covenants. Employee represents that he/she is not restricted or prohibited,
contractually or otherwise, from entering into and performing this Agreement,
and that his or her execution and performance of this Agreement is not a
violation or breach of any other agreement between Employee and any other person
or entity.
Dated: October 2, 1996
ANACOMP, INC.
By: __________________________________
Xxxx X. Xxxxxxxx
Its: Vice President
--------------------------------------
Employee (signature)
Employee (printed) - Xxxxxxx X. Xxxx
Current Position - Senior Vice President & CAO, U.S. G5roup
Current Location - Poway, California
Social Security Number:
ADDENDUM III
TO
EMPLOYMENT AGREEMENT DATED OCTOBER 1, 1992
BETWEEN
ANACOMP, INC. ( "ANACOMP" )
XXXXXXX X. XXXX (EMPLOYEE)
The Addendum will serve to define the terms of EMPLOYEE'S relocation from
Indianapolis, Indiana to San Diego, California.
(1) Upon his relocation, EMPLOYEE will assume the title of Senior Vice
President and Chief Administrative Officer, U.S. Group, reporting to the
President, U.S. Group.
(2) The standard Anacomp Relocation and Expense Policy (the "Policy") will
apply to EMPLOYEE'S move, except as set forth below.
(3) ANACOMP will pay for the cost of temporary housing and meals for up to
ninety (90) days instead of the 60 days stated in the Policy. During this time,
EMPLOYEE'S spouse may visit San Diego for a reasonable number of visits (i.e.
one per month) which will be reimbursed by ANACOMP in lieu of EMPLOYEE returning
to Indianapolis.
(4) EMPLOYEE will forego the guaranteed offer on his home as provided by
the Policy. The sale, whenever closed, will be handled as an employee referral
sale at greater than 100% of the guaranteed offer (section F.5.b., 2nd bullet of
the Policy) with the 2% payment based on the selling price. If the home is sold
without using a broker, EMPLOYEE will receive an additional 5% of the selling
price. The 2% will not be "grossed up" for tax purposes. However, the 5% if
applicable, will be grossed up since it is in lieu of real estate commission.
(5) As set forth in the Policy, EMPLOYEE will receive, effective on his
relocation date, a 7.29% cost of living allowance representing the difference
between Noblesville, Indiana and Rancho Xxxxxxxx, California, multiplied by
$240,000 or $17,496 the first year, $8,748 the second year and $4,374 the third
year. This allowance will be applied to EMPLOYEE's compensation components in
the same relationship as his current compensation is paid (70% base, 15% monthly
incentive base, and 15% annual incentive base).
(6) ANAACOMP will pay the actual costs, up to $100,000, to relocate
EMPLOYEE back to Indianapolis or another city of his choosing outside a 50-mile
area of San Diego if, within two years of his move, EMPLOYEE is terminated
without cause, his position is eliminated, he resigns because his salary is
reduced by 10% or more or he refuses a company-directed transfer requiring
relocation (other than to Indianapolis if the company moves his position there).
Such relocation must occur within 180 days of EMPLOYEE's termination from
ANACOMP and he must have executed the standard Settlement and Release Agreement.
(7) EMPLOYEE agrees that neither the transfer to San Diego nor the change
to his job title, responsibility and reporting caused by the relocation to San
Diego creates a Demotion, Transfer or Reduction in Compensation pursuant to
Article V of the Agreement. EMPLOYEE will have no right to any termination pay
caused by such circumstances.
(8) After his relocation to San Diego, EMPLOYEE will be eligible to receive
new ANACOMP stock incentives to be awarded by the Board of Directors to the same
extent and in the same amounts as other employees reporting directly to the
President and Chief Executive Officer.
This Addendum III has been executed this 25 day of June , 1996.
ANACOMP, INC. EMPLOYEE
By: X. Xxxx Xxxxxx, III Xxxxxxx X. Xxxx
EMPLOYMENT AGREEMENT
This Agreement is entered into between ANACOMP, INC. or any of its
subsidiaries or affiliates (herein referred to as "ANACOMP") and EMPLOYEE. The
full identification of each party, date of Agreement, effective date of
Agreement, and date of expiration of Agreement are all included on the cover
sheet immediately preceding this page which is incorporated herein by this
reference. The following conditions and terms shall apply:
SECTION I
Merger of All Prior Agreements
1.1 Merger. This Agreement shall supersede and terminate all prior
employment contracts and agreements between EMPLOYEE and ANACOMP.
SECTION II
Scope and Term of Employment, Compensation
2.1 Scope of Employment. ANACOMP and EMPLOYEE mutually agree that Addendum
I, attached hereto and incorporated herein by this reference, is intended to
define the scope of employment, base salary, and incentive compensation.
2.2 Employment Term. Subject always to termination provisions as provided
elsewhere in this Agreement, the term of this Agreement shall begin on the
Effective Date of Agreement and shall terminate on the Date of Expiration of
Agreement, both as shown on the cover sheet. Unless otherwise terminated as
provided elsewhere herein, this Agreement shall automatically renew after
expiration date on an annual basis unless either party gives the other party
thirty (30) days written notice requesting that said Agreement not be renewed.
If this Agreement is not renewed and EMPLOYEE continues working beyond
Termination Date at the request of ANACOMP, said employment shall be on a
month-to-month basis. If, at the expiration of the original 3-year term or any
renewal term, ANACOMP declines to renew this Agreement and does not request that
EMPLOYEE continue working, EMPLOYEE shall be entitled to all benefits due him
under this Agreement and not previously paid him and, unless the parties agree
on a different amount, to a severance allowance equal to the prior twenty-four
months' total compensation payable in a lump sum or bi-weekly at EMPLOYEE'S
option, and health benefits until other employment is secured or for twenty-four
months, whichever is sooner (the "Severance Allowance").
2.3 Compensation. Compensation is confidential and is to be discussed only
with the officers of ANACOMP, as required.
SECTION III
Fringe Benefits
3.1 Benefits. In addition to the regular compensation, EMPLOYEE shall be
entitled to the normally available employee fringe benefits including regular
holidays, vacations and health insurance. ANACOMP, however, reserves the right
to change or alter these fringe benefits from time to time with the
understanding that the EMPLOYEE will be treated on an equal basis with other
employees of similar status.
SECTION IV
Insurance on Employee
4.1 Insurance. EMPLOYEE agrees that ANACOMP may, at its option and expense,
obtain life insurance on the life of the EMPLOYEE and the ownership of all such
policies and the proceeds therefrom shall be the sole property of ANACOMP.
EMPLOYEE agrees to undergo a routine physical examination for insurance purposes
within fifteen (15) days upon the request and at the expense of ANACOMP.
SECTION V
Demotion and Relocation
5.1 Demotion. If, at any time during the six month period following
ANACOMP's emergence from Chapter 11 bankruptcy, X. Xxxx Xxxxxx, ANACOMP's
President and Chief Executive Officer, determines that EMPLOYEE is not
satisfactorily performing the duties of Chief Financial Officer and/or he has
not made improvement in the areas included on the attached Addendum II, then Xx.
Xxxxxx, with approval of ANACOMP's Board of Directors, may demote EMPLOYEE to
his previous position of Vice President and Controller under the same
compensation plan he had prior to assuming the Chief Financial Officer position.
If such demotion occurs, this Agreement shall remain in force except for the
scope of employment and compensation. If, at any time prior to ANACOMP's
emergence from Chapter 11 bankruptcy, Xx. Xxxxxx demotes EMPLOYEE to his
previous position pursuant to the above criteria, this employment agreement
shall be void and EMPLOYEE's rights shall be as contained in his prior
Employment Agreement dated July 1, 1990. This section 5.1 will no longer apply
if the employment of Xx. Xxxxxx with ANACOMP is terminated.
5.2 Relocation. EMPLOYEE agrees that if at any time during the first two
years of the term of this Agreement he is required to relocate to a location
outside of Metropolitan Indianapolis, such relocation will not trigger a
termination of this Agreement nor a right to receive the Severance Allowance
pursuant to Section 6.4.2 hereof.
SECTION VI
Termination
6.1 Compensation and Benefits Upon Termination. This Agreement may be
terminated prior to the expiration of the initial term or any renewal term by
any of the following events:
(a) mutual written agreement expressed in a single document signed by both
ANACOMP and EMPLOYEE;
(b) voluntary written resignation by EMPLOYEE;
(c) death of EMPLOYEE;
(d) written notice of termination without cause as defined in Section
6.2;
(e) written notice of termination with cause as defined in Section 6.3; or
(f) the occurrence of any of the events specified in Section 6.4.1, which
EMPLOYEE elects to treat as a termination under Section 6.4.2.
Upon termination for any of the foregoing reasons, EMPLOYEE shall continue
to render his services and shall be paid his regular compensation and benefits
up to the date of termination. If this Agreement is terminated under Sections
6.1(b), 6.1(c) or 6.1(e), no Severance Allowance (as defined in Section 2.2)
shall be paid to EMPLOYEE (except, with respect to any termination pursuant to
Section 6.1(e), as otherwise provided in Section 6.3). If this Agreement is
terminated under Sections 6.1(a), 6.1(d) or 6.1(f), then ANACOMP shall pay to
EMPLOYEE the Severance Allowance. This Severance Allowance is in addition to the
regular compensation and benefits which EMPLOYEE shall receive up to the date of
termination. In the event of such termination, this Agreement shall be deemed
terminated for all purposes except to the extent otherwise herein provided.
6.2 Termination Without Cause. If EMPLOYEE is unable, as determined in good
faith by ANACOMP's Board of Directors, to perform EMPLOYEE's assigned duties on
a full-time basis for any continuous period of 120 days or a total of 180 days
in any 12-month period, or if ANACOMP otherwise concludes EMPLOYEE's services
are no longer required, this Agreement may be terminated without cause by giving
EMPLOYEE written notice thereof. The noninsurability of EMPLOYEE, either present
or future, does not constitute grounds for termination under this or any other
section of the Agreement. If EMPLOYEE is terminated under this section, ANACOMP
shall pay EMPLOYEE the compensation, benefits and Severance Allowance provided
in Section 6.1 above.
6.3 Termination With Cause.
6.3.1 ANACOMP may immediately terminate this Agreement at any time with
cause upon written notice to the EMPLOYEE specifying the cause and effective
date of termination. As used in this section, "cause" shall mean only the
following:
(i) Inability of EMPLOYEE, as determined by ANACOMP, to perform EMPLOYEE's
assigned duties on a full-time basis for any continuous period of one hundred
twenty (120) days or a total of one hundred eighty (180) days in any twelve (12)
month period, which period shall commence on the initial date of this contract
and every anniversary date thereof.
(ii) The willful and continued failure by EMPLOYEE substantially to perform
his duties and obligations or the willful engagement by EMPLOYEE in misconduct
which is materially injurious to ANACOMP, monetarily or otherwise. For purposes
of this subsection, no act or failure to act on EMPLOYEE's part shall be
considered "willful" unless done or omitted to be done by EMPLOYEE in bad faith
and without reasonable belief that his action or omission was in the best
interests of ANACOMP.
6.3.2 Employee agrees that in the event written notice of termination is
given under this Section 6.3, the EMPLOYEE agrees to treat the contents of said
notice as privileged and EMPLOYEE shall have no action against ANACOMP or any of
its officers, agents or employees due to the contents of said notice unless the
contents are intentionally false and malicious. If EMPLOYEE is terminated under
this Section 6.3, he shall receive no Severance Allowance at the time of such
termination. If EMPLOYEE is given notice of termination under this Section 6.3
and it is later established that no "cause" existed, EMPLOYEE shall be entitled
to all compensation, benefits and allowances due him for the period following
such alleged termination and through the date of such determination and shall be
entitled to the Severance Allowance, plus legal interest from the date of
termination and all reasonable attorneys' fees incurred by EMPLOYEE in
contesting the notice of termination.
6.4 Demotion, Transfer or Reduction in Compensation, Merger, Transfer of
Assets, Change in Control or Business Discontinuation.
6.4.1 Demotion, Transfer, or Reduction in Compensation. of the following
takes place:
If any
(1) EMPLOYEE is demoted, including for these purposes (i) any change in the
title or duties described in Addendum I hereto, or (ii) any significant
reduction or change by ANACOMP in the functions, duties or responsibilities of
EMPLOYEE under this Agreement, except as provided in Section V hereof,
(2) a transfer of EMPLOYEE to another location outside of Metropolitan
Indianapolis not agreed to in writing by EMPLOYEE, except as provided in Section
V hereof, or
(3) any reduction in annual compensation (but not including a reduction in
the incentive bonus received by EMPLOYEE resulting from a decrease in Pre-Tax
Income earned by ANACOMP for the relevant period), except at provided in Section
V hereof,
EMPLOYEE may, in his sole discretion, elect to treat any such occurrence as
a termination of this Agreement by giving written notice of such election to
ANACOMP, entitling EMPLOYEE to payment of the compensation, benefits and
Severance Allowance provided in Section 6.1 above. In the event ANACOMP disputes
any election made by EMPLOYEE pursuant to this Section 6.4.1, ANACOMP shall
notify EMPLOYEE in writing of such dispute within ten (10) days of receiving
EMPLOYEE's written election. If ANACOMP does not so notify EMPLOYEE within the
ten (10) day period, ANACOMP shall be deemed to have accepted EMPLOYEE's
election and shall pay all compensation, benefits and Severance Allowance
provided in Section 6.1 above.
6.4.2 Merger, Transfer of Assets, Change in Control or Business
Discontinuation. In the event of any:
(a) merger or consolidation where ANACOMP is not the consolidated or
surviving company and the surviving or resulting company does not expressly
agree to be bound by and have the benefits of the provisions of this Agreement,
or
(b) transfer of all or substantially all of the assets of ANACOMP and the
transferee of ANACOMP's assets does not expressly agree to be bound by and have
the benefits of the provisions of this Agreement, or
(c) change in control of ANACOMP of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated
under the Securities Exchange Act of 1934 as in effect on the day thereof (the
"Exchange Act"), provided that, without limitation, such a change in control
shall be deemed to have occurred if: (i) any person or persons acting in concert
(as such term is used in Section 13(d) and 14(d) (2) of the Exchange Act) is or
becomes the beneficial holder directly or indirectly of securities of ANACOMP
representing 25% or more of the combined voting power of ANACOMP's then
outstanding securities; (ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board cease for
any reason to constitute a majority thereof,
unless the election or nomination for election by ANACOMP's shareholders of
each new director was approved by a vote of at least 2/3 of the directors who
were directors at the beginning of such period; or (iii) transfer of all or
substantially all of the stock of ANACOMP and the transferee of ANACOMP's stock
does not expressly agree to be bound by and have the benefits of the provisions
of this Agreement, or
(d) discontinuation of the business by ANACOMP,
then (i) EMPLOYEE may, in his sole discretion, elect to treat any such
occurrence as a termination of this Agreement by giving written notice of such
election and immediate termination of his employment to ANACOMP, and (ii)
ANACOMP shall pay EMPLOYEE within thirty (30) days of EMPLOYEE's election and
termination of employment a payment equal to the Severance Allowance. This
Severance Allowance shall be in addition to the regular compensation and
benefits that EMPLOYEE is entitled to receive up to the date EMPLOYEE's
employment with ANACOMP terminates. This Section 6.4.2 shall be of no effect if
changes to ANACOMP's Board of Directors and outstanding securities occur as a
result of ANACOMP's Chapter 11 bankruptcy filing of January 5, 1996.
6.5 Return of Company Property. EMPLOYEE agrees to return all property of
ANACOMP, including but not limited to, details of equipment, prices,
specifications, programs, customer and prospective customer lists and any other
proprietary data or objects acquired through the EMPLOYEE's employment with
ANACOMP, within seven (7) days after termination of employment, regardless of
the reason therefor.
6.6 Waiver of Claims. All Severance Allowance payments made by ANACOMP to
EMPLOYEE pursuant to Section II hereof or this Section VI shall be in full and
complete payment of any and all claims that EMPLOYEE may have against ANACOMP
regarding his employment or the termination thereof, and EMPLOYEE hereby
expressly waives all rights that he may have to any other payments or to bring
any other claims based upon his employment or the termination thereof. Except
for the qualification with respect to employee benefits described in Section II
above, all Severance Allowance payments due from ANACOMP to EMPLOYEE under this
Agreement are absolute, and shall not be diminished or otherwise affected by
virtue of Employee's securing alternative employment.
SECTION VII
Restrictive Covenant and Non-Competition
Confidential Information
7.1 Non-Competition. EMPLOYEE and ANACOMP shall enter into the
"Confidentiality, Non-Competition and Non-Disclosure Agreement" attached hereto
as Addendum III. In the event of any conflict between the terms of this
Agreement and such Non-Disclosure Agreement, this Agreement shall govern. If
EMPLOYEE violates such Non-Disclosure Agreement, ANACOMP shall have the right to
stop all termination payments due under Sections II and/or VI hereof, which have
not yet been fully paid to EMPLOYEE.
The provisions of this Section shall not prevent EMPLOYEE from complying
with the terms of this Employment Agreement with ANACOMP nor from owning any
shares of stock of any competitor of ANACOMP so long as such-shares are
regularly traded on a recognized security exchange or are listed for trade by
NASDAQ in the over-the-counter Market.
SECTION VIII
Warranties and Representations
8.1 EMPLOYEE hereby warrants and represents as follows:
(1) That the execution of this Agreement and the discharge of employee's
obligations hereunder will not breach or conflict with any other contract,
agreement or understanding between EMPLOYEE and any other party or parties.
(2) That EMPLOYEE has ideas, information and know-how relating to the type
of business conducted by ANACOMP and employee's disclosure of such ideas,
information and know-how to ANACOMP will not conflict with or violate the rights
of any third party or parties with respect thereto.
SECTION IX Remedies
9.1 The parties agree that the remedy for breach of this Agreement shall
include actions in equity for injunctive relief as well as money damages. The
remedies given to or reserved by ANACOMP hereunder shall be cumulative and not
exclusive of any other remedy available under law.
SECTION X
No Waiver
10.1 The failure of EMPLOYER to terminate this Agreement for the breach of
any condition or covenant herein by the EMPLOYEE shall not affect EMPLOYER's
right to terminate for subsequent breaches of the same or other conditions or
covenants. The failure of either party to enforce at any time or for any period
of time any of the provisions of this Agreement shall not be construed as a
waiver of such provisions or of the right of the party thereafter to enforce
each and every such provision.
ARTICLE XI
Benefit
11.1 This Agreement shall bind, benefit, and be enforceable by ANACOMP, its
successors and assigns, and by EMPLOYEE, EMPLOYEE's heirs, executors,
administrators, and legal representatives.
ARTICLE XII
Severability
12.1 Should any provision of this Agreement not be enforceable in any
jurisdiction, the remainder of the Agreement shall not be affected thereby.
ARTICLE XIII Survival 13.1 The obligations contained in Sections II, VI,
and VII shall survive the termination of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed or caused this
Agreement to be executed as of the day, month and year stated on the cover page
of this Agreement, which Agreement shall be effective only upon approval by
ANACOMP, INC., as evidenced by the authorized signature of an officer of ANACOMP
below.
APPROVED BY:
ANACOMP, INC.
EMPLOYEE:
Xxxxxx X. Xxxxx
ADDENDUM 1
TO
EMPLOYMENT AGREEMENT DATED
BETWEEN
ANACOMP, INC. ("ANACOMP")
XXXXXX X. XXXXX (EMPLOYEE)
Scope of Employment
ANACOMP employs the EMPLOYEE in the capacity of Executive Vice President
and Chief Financial Officer.
Base Salary
For all services rendered by EMPLOYEE under this Agreement, EMPLOYEE shall
receive a Base Salary of $168,000 per year beginning February 15, 1996. Base
Salary will be reviewed at the beginning of each fiscal year.
Incentive Compensation
Bonus
In addition to Base Salary, EMPLOYEE shall receive a maximum annual bonus
of $72,000 beginning February 15, 1996, provided that certain quotas are met by
ANACOMP. Such bonus shall be paid as follows: $10,800 shall be paid monthly
against Company revenue goals; $25,200 shall also be paid monthly against
Company net profit goals; and $36,000 shall be paid at year-end if ANACOMP meets
its EBIT goal. The annual bonus and quotas shall be established at the beginning
of each fiscal year. The bonus shall be more particularly described in
EMPLOYEE's Compensation Plan.
ANACOMP, INC.
EMPLOYEE
Xxxxxx X. Xxxxx
ADDENDUM I I
Xxx Xxxxx Performance Appraisal
Strength
Very intellectual
Honest
High values
Financial reporting rules and
regulations
Anacomp experience and history Accounting principles Work ethic and loyalty
Focused and thorough Meets deadlines
Need For Improvement
Accessibility
Sometimes fails to see the "big picture"
Communication
Organizational skills
Delegation and people management
I believe that for Don to carry out Anacomp's future strategies as chief
financial officer he will require skills and behavior patterns to accomplish
specific objectives such as the following:
A. Leadership Skills
1) Achieve results through support from others.
2) Develop and implement new programs and initiatives that contribute
to Company goals and profitability.
3) Maintain and improve morale and enthusiasm in area of responsibility.
B. Managerial Skills
1) Improve processes to gain maximum effectiveness.
2) Involve others in decision making and problem solving.
3) Identify and solve communication problems.
4) Improve ability to work both from a pragmatic as well as big picture
level.
C. Personnel Development
1) Become accessible and more responsive to personnel
especially Chief Executive Officer.
2) Promote team approach.
3) Enhance staff's ability to perform on their own.
D. Specific Objectives
1) Develop new organization staffed with effective professionals.
The new organization is needed to support our changing environment:
Revitalize and improve the treasury functions especially cash reporting,
budgeting, analysis and cash management including the hiring of an outside Vice
President and Treasurer.
- Hire or promote a strong domestic controller.
- Increase internal audit functions.
- Address European organization structure.
ADDENDUM III
CONFIDENTIALITY, NON-COMPETITION AND NON-DISCLOSURE AGREEMENT
In consideration of the employment or continued employment of Employee by
Anacomp, Inc. and its successors, assigns, subsidiaries, or duly authorized
representatives (hereinafter collectively referred to as "Anacomp") and of the
award of an option for the purchase of 25,000 shares of Anacomp, Inc. Common
Stock, par value $.01 per share, at ~ price of $4.63 (price to be set on the
date of award by Anacomp's Board of Directors), Employee hereby agrees as
follows:
1. Confidentiality and Trade Secrets. The Employee recognizes and
acknowledges that during the course of his/her employment, he/she will have
access to and become acquainted with confidential, trade secret and proprietary
information about Anacomp's businesses and customers (hereinafter collectively
referred to as the "Protected Information"). The parties hereto recognize that
the Protected Information available to Employee may pertain both to customers
and accounts handled by Employee personally as well as accounts with which
Employee is not personally involved. The parties agree that all Protected
Information constitutes a trade secret of Anacomp. Protected Information may
include, but is not limited to, the names, addresses, and requirements of any
customer or prospective customer of Anacomp; the terms (including price terms)
of contractual relations with such customers; special requirements of such
customers; the identities of individual contacts at such customers; and any
other information relating to Anacomp's research, operations, business
relationships, engineering data or results, specifications, concepts, methods,
processes, rates or schedules, vendor information, products or services
(including prices, costs, sales or content), financial information or measures,
business methods, future business plans, data bases, computer programs, designs,
models, operating procedures, and knowledge of the organization. The Employee
recognizes and acknowledges that all of the Protected Information is valuable,
special and essential to the successful and effective conduct of Anacomp's
business. Therefore, the Employee shall not, during his/her employment with
Anacomp or at any time thereafter, regardless of the reasons for leaving that
employment, use, disclose or communicate, directly or indirectly, any Protected
Information to any third party for any reason or purpose whatsoever, except as
required in the course of his/her employment with Ariacomp. Further, upon the
termination of his/her employment with Anacomp, for any reason whatsoever,
Employee shall promptly return any and all copies of any written material,
documents, computer hardware and software, tools and equipment belonging to
Anacomp or relating to the business of Anacomp in his/her possession.
2. Non-Competition.
2.1 Non-Competition While an Employee. While an employee of Anacomp,
Employee agrees not to compete in any manner, either directly or indirectly as
an employee, consultant, investor or owner, whether for compensation or
otherwise, with Anacomp, or to assist any other person or entity to compete with
Anacomp. Further, while an employee of Anacomp, Employee agrees not to engage in
any other employment without the prior written permission of Anacomp.
2.2 Non-Competition After Termination. After the termination, for any
reason or cause, of Employee's employment with Anacomp, Employee agrees that
'for a period of one (1) year following such termination, he/she will not
compete in any manner, either directly or indirectly as an employee, consultant,
investor or owner, whether for compensation or otherwise, with Anacomp by
developing, marketing, selling or maintaining, or assisting others to develop,
market, sell or maintain, products or services which are competitive with the
products or services of Anacomp or with any Protected Information of Anacomp,
currently existing or planned for the future, which Employee learns of or
develops while an employee of Anacomp. Employee further agrees that for the same
period following such termination, for any reason, he/she will not accept
employment or have any other relationship (including, without limitation, to
own, manage, operate, control, be employed by, or participate) with any entity
which is competitive with the products or services of Anacomp currently existing
or which are known by Employee to be planned for the future. Products and
services which are competitive with the products and services of Anacomp include
but are not limited to: Micrographics Products (computer output to
microfilm-COM-equipment and software, cameras and film, processors, duplicators,
retrieval and display equipment and software, computer aided
retrieval-CAR-systems, readers, reader printers, other micrographics equipment,
micrographics equipment maintenance, micrographics consumable supplies and
accessories, records management software); Output Services (computer output to
microfilm-COM, source document microfilming, output of data to compact disk,
laser printing, conversion of paper and film to electronic images, micrographic
or electronic imaging system design, consulting and education, system
implementation and integration); Electronic Image Management Products (hardware,
software, magnetics products including tapes, tape drives and optical media
supplies, maintenance of electronic imaging equipment); and Electronic Image
Management Services (conversion of computer generated data to optical or laser
disk, COLD, electronic document imaging and workflow, conversion of paper
documents to electronic images, system design consulting and education, system
implementation and integration, conversion of microfilm to electronic images);
and Archival Services (storage, management and retrieval of all forms of
customer information and business records, including but not limited to paper,
microfiche, magnetic media and digital storage media). The foregoing
restrictions shall apply to all geographical areas where Employee performed
services for Anacomp during the two-year period prior to his/her termination,
including areas for which Employee had supervisory authority.
2.3 Reasonableness of Post-Termination Non-Compete. Employee acknowledges
that this Section 2.2 is enforceable and effective because of his/her access to
and use of Protected Information. Employee hereby represents and acknowledges
that: (a) the restrictions on the activities in which he/she may engage upon
termination of his/her employment with Anacomp are reasonable and, despite such
restrictions, Employee will be able to earn his/her livelihood following any
such termination; (b) the locations designated are reasonable because they are
limited to the locations in which Employee performed services for Anacomp; and
(c) the period of time designated is reasonable because it extends only for one
year following the termination of his/her employment with Anacomp.
3. Non-Solicitation.
3.1 Non-Solicitation of Employees. During the term of his/her employment at
Anacomp and for two (2) years following the termination for any reason of such
employment, Employee agrees, either on his/her own behalf or on behalf of any
other person or entity, directly or indirectly, not to hire, solicit, or
encourage to leave the employ of Anacomp any person who is then an employee of
Anacomp. The foregoing restrictions shall apply to employees located in all
geographical areas where Employee performed services for Anacomp during the
two-year period prior to his/her termination, including areas for which Employee
had supervisory authority.
3.2 Non-Solicitation of Customers. Because of Employee's access to
Protected Information of Anacomp, Employee agrees that, during the term of
his/her employment at Anacomp and for two (2) years following the termination
for any reason of such employment, he/she will not, directly or indirectly, in
connection with the products and services offered by Anacomp and those products
and services which are competitive with the products and services of Anacomp (as
set forth in Section 2.2 above): (a) solicit, attempt to obtain, or in any way
transact business with any customers which were customers of Anacomp during
his/her employment or at the time of his/her termination; (b) aid or assist any
other party in the solicitation of any such customers; or (c) interfere with
Anacomp's relationships with ' any of its customers by soliciting such customers
or inducing them to discontinue their relationships with Anacomp. The foregoing
restrictions shall apply to customers located in all geographical areas where
Employee performed services for Anacomp during the two-year period prior to
his/her termination, including areas for which Employee had supervisory
authority.
4. Remedies. Employee acknowledges that compliance with Sections 1, 2 and 3
of this Agreement is necessary to protect the business and good will of Anacomp
and that a breach of those sections will irreparably and continually damage
Anacomp for which money damages may not be adequate. Therefore, Employee agrees
that, in the event he/she breaches or threatens to breach any of these Sections,
Anacomp shall be entitled to both a preliminary or permanent injunction in order
to prevent the continuation of such harm and money damages insofar as they can
be determined. Nothing in this Agreement, however, shall be construed to
prohibit Anacomp from also pursuing any other remedy, the parties having agreed
that all remedies shall be cumulative.
5. Inventions. Employee agrees that all inventions, improvements,
discoveries, systems, techniques, ideas, processes, programs, and other things
of value made or conceived in whole or in part by Employee while an employee of
Anacomp shall be and remain the sole and exclusive property of Anacomp, and
he/she will disclose all such things of value to Anacomp and will cooperate with
Anacomp to insure that the ownership by Anacomp of such things of value is
protected. Nothing in this Section is meant to apply to an invention for which
no equipment, supplies, facility or trade secret information of Anacomp was
used, which was developed entirely on Employee's own time, and which does not
relate to Anacomp's business, research, development or from any work performed
by Employee for Anacomp.
6. Employment. This Agreement does not confer upon Employee any rights to
continue in the employ of Anacomp or affect in any way Anacomp's right to
terminate his/her employment at any time.
7. Severability. If any provision or clause of this Agreement, or portion
thereof, shall be held by any court or other tribunal of competent jurisdiction
to be illegal, void or unenforceable in such jurisdiction, the remainder of such
provisions shall not thereby be affected and shall be given full effect, without
regard to the invalid portion. It is the intention of the parties that, if any
court construes any provision or clause of this Agreement, or any portion
thereof, to be i11egal, void or unenforceable because of the duration of such
provision or the area or matter covered thereby, such court shall reduce the
duration, area or matter of such provision and, in its reduced form, such
provision shall then be enforceable and shall be enforced.
8. Binding Effect. The rights and obligations of this Agreement shall inure
to and be binding upon the parties and their respective heirs, successors and
assigns. ~
9. Attorneys' Fees. In the event of any dispute, proceeding or litigation
concerning any controversy, claim or dispute between the parties hereto, arising
out of or relating to this Agreement or the interpretation or breach thereof,
the prevailing party shall be entitled to recover from the losing party its
reasonable expenses, attorneys' fees, expert fees, and costs incurred therein or
in the enforcement or collection of any judgment or award rendered therein.
10. No Waiver. Anacomp's failure to enforce any provision of this Agreement
shall not in any way be construed as a waiver of any such provision, or prevent
Anacomp thereafter from enforcing each and every provision of this Agreement.
11. Entire Agreement. This Agreement represents the entire agreement
between Employee and Anacomp, with respect to the subject matter hereof,
superseding all previous oral and written communications, representations,
understandings or agreements.
12. Employee's Understanding. Employee represents and warrants that he/she
has read each and every term of this Agreement and understands the serious
duties and obligations imposed upon Employee thereby. Employee further
represents and warrants that he/she has had full and ample opportunity to
question Anacomp about this Agreement and each of its terms and to consult an
attorney regarding this Agreement and each of its terms. Employee represents
that he/she is free to enter this Agreement and to perform each of its terms and
covenants. Employee represents that he/she is not restricted or prohibited,
contractually or otherwise, from entering into and performing this Agreement,
and that his or her execution and performance of this Agreement is not a
violation or breach of any other agreement between Employee and any other person
or entity.
Dated: October 7, 1996
ANACOMP, INC.
By: Xxxx X. Xxxxxxxx
Its: Vice President
Employee - Xxxxxx X. Xxxxx
Current Position - Chief Financial Officer
Current Location: Indianapolis
Social Security Number:
