Exhibit (10)(xvii)
C O N F I D E N T A L
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EMPLOYMENT AGREEMENT
This Agreement ("Agreement") is made this 1st day of March 2001,
between Xxxxxxx X. Xxxxx ("Xxxxx") and American Greetings Corporation ("AG" or
"Company").
In consideration of the mutual promises contained herein, the parties
agree as follows:
1. POSITION: Xxxxx is employed by AG as the Company's Senior Vice
President, Sales. Xxxxx will perform any and all duties commensurate with that
position.
2. TERM: This Agreement will be in effect for "rolling" three (3) year
terms commencing March 1, 2001; successive three (3) year terms will commence on
March 2, 2001, and on each day thereafter, and will terminate three (3) years
from each commencement date.
3. TERMINATION: It is understood that Xxxxx'x employment with AG,
whether pursuant to this Agreement or otherwise, is terminable at-will, and may
be terminated by either party at any time for any reason or for no reason. This
Agreement will end on the date that Xxxxx ends his employment with AG
("Termination Date"). As of the Termination Date, Xxxxx will no longer be an
employee of AG and will not be entitled to or receive any benefits or privileges
of employment, except for those provided herein and those post-employment
benefits generally afforded such former employees under AG's then current
policies and procedures.
4. COMPENSATION: During the term of this Agreement, in addition to the
other regular benefits offered to Executive Officers (as designated by the AG
Board of Directors or otherwise), including but not limited to, profit sharing,
40l(k), stock option plans, health benefits and life insurance, Xxxxx will
receive the following salary and benefits:
a. Beginning on March 1, 2001, Xxxxx will be paid an annual base
salary of $299,304, plus an annual payment of $25,000, for a total of
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$324,304 considered base pay for purposes of determining AG's contribution to
Xxxxx'x account in the Retirement Profit Sharing and Savings Plan and for
purposes of his Supplemental Executive Retirement Plan account, but is not
considered base pay for purposes of determining the one year bonus and three
year bonus under the one and three year bonus plans referenced in subparagraphs
4.b. and 4.c. below or other bonuses under successor or additional plans, less
payroll taxes and other withholdings as required by law ("Base Salary"). Such
Base Salary will be reviewed at or around the end of each AG fiscal year
thereafter and at that time may be changed at the discretion of AG's President.
Unless Xxxxx voluntarily resigns or is terminated "for cause," the then current
Base Salary will be paid for three years from the Termination Date payable in
installments on the same dates as Xxxxx'x Base Salary was paid immediately
before the Termination Date, but Xxxxx will not be eligible for bonuses under
subparagraphs 4.b. or 4.c. below. Notwithstanding the foregoing, if Xxxxx either
breaches the non-competition provisions in paragraph 6 below or otherwise
engages in any business activities that are in competition with AG's businesses
as defined in paragraph 6 below during such three year payment period, payments
of his Base Salary hereunder shall cease and any future payments shall be
forfeited. If Xxxxx voluntarily resigns, he will receive no further Base Salary
or bonuses under subparagraphs 4.b. or 4.c. below after the Termination Date.
"For Cause" is defined as termination as a result of Xxxxx'x personal
dishonesty, incompetence, willful misconduct, any breach of fiduciary duty
involving personal profit, intentional failure to perform stated duties, willful
violation of any law, rule, or regulation (other than traffic violations or
similar offenses) or final cease-and-desist order, or material breach of
paragraphs 5, 6, 7, or 8(e) of this Agreement.
b. For each AG fiscal year in which AG pays its officers and
certain key employees a one year cash bonus pursuant to the Company's regular
Executive Incentive Compensation Plan, Xxxxx will receive such a bonus based
upon a target bonus of 35% of his then current annual base salary excluding the
annual payment of $25,000 set forth in the first sentence of this subparagraph
and the terms of such plan.
x. Xxxxx shall further be eligible to receive a cash bonus, if
and when paid, under the terms of AG's current three year Special Bonus Plan or
other future long-term executive incentive compensation plans for officers and
certain key employees, in accordance with its/their terms. If the Special Bonus
Plan is not renewed or a similar plan is not instituted at the end of the
current three year Special Bonus Plan period, AG agrees to review, but not
necessarily act upon, the need for such a bonus as an element of Xxxxx'x
compensation
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package.
d. During the term of this Agreement, Xxxxx shall own at
least 5,000 shares of AG Common Stock.
5. CONFIDENTIAL AND TRADE SECRET INFORMATION: Xxxxx acknowledges that
in the course of his employment with AG he has and will have access to
confidential information and trade secrets, oral or written which a reasonable
person would believe to be confidential to or a trade secret of AG
("Confidential Information"), misuse or disclosure of which could adversely
affect AG's business. Xxxxx agrees that he will not, either during his
employment with AG or at any time thereafter, use for himself or others, or
disclose or convey to others (except as is necessary in the ordinary course of
his employment) any of AG's Confidential Information. This paragraph shall not
prohibit disclosure of information which has become public, unless it became
public through Xxxxx'x breach of this Agreement.
6. NON-COMPETITION; NON-DISPARAGEMENT: In consideration of AG's
agreement to employ Xxxxx under the terms of this Agreement, Xxxxx agrees that
he will not for the following periods engage anywhere in the United States or
Canada, directly or indirectly, in any business activities, either as principal,
agent or consultant or through any corporation, firm or organization in which he
may be an officer, director, employee, substantial shareholder, partner, member
or be otherwise affiliated that are in competition with AG's businesses at such
time: (i) for the period of his employment hereunder, (ii) and for a period of
one (1) year after the Termination Date; provided, however, that unless Xxxxx
voluntarily resigns or is terminated "For Cause" in which case the one (1) year
period runs from the Termination Date, the one (1) year period in subparagraph
(ii) above shall lapse on the thirtieth (30th) day after the date that Xxxxx
gives written notice to AG that a payment is due Xxxxx under paragraph 4.a.
above which remains unpaid on such thirtieth (30th) day. Further, Xxxxx agrees
that at no time during or following his employment with AG will he directly or
indirectly disparage AG, its affiliates and subsidiaries or any of AG's
directors, officers, employees, agents and representatives.
7. CONFLICT OF INTEREST: Xxxxx represents and warrants that he has no
interest or obligation that is inconsistent with or in conflict with this
Agreement or that would prevent, limit or impair his performance of any part of
this Agreement.
8. MISCELLANEOUS:
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a. This Agreement constitutes the entire understanding between
Xxxxx and AG relating to the subject matter contained herein and effective March
1, 2001, this Agreement supersedes any previous oral or written agreement(s) and
understandings, including without limitation, the employment agreement, dated
July 1, 1984, between AG and Xxxxx. This Agreement may not be changed, modified,
or altered without the express written consent of Xxxxx and AG.
b. Either party's failure to insist upon strict adherence to
any term of this Agreement on any occasion shall not be considered a waiver or
deprive the other party of his/its rights thereafter to insist upon strict
adherence to that term or any other term of this Agreement.
c. If any part or section of this Agreement is found to be
contrary to law or unenforceable, the remainder shall remain in force and
effect.
d. This Agreement will be governed by and construed in
accordance with the law of the State of Ohio. Any disputes regarding this
Agreement that cannot be resolved amicably shall be resolved through AG's
"Solutions" alternative dispute resolution program or its successor, if any. If
such dispute cannot be resolved through mediation under that program, except as
otherwise provided under the terms of the Solutions program, it shall be
resolved by binding arbitration in Cleveland in accordance with the applicable
rules of the American Arbitration Association.
e. Upon Xxxxx'x termination, regardless of the reason, Xxxxx
will promptly surrender to AG any of its property in Xxxxx'x possession
including, but not limited to, all correspondence, memoranda, notes, records,
reports, plans, computer printouts, reproductions, slides, and any other papers
or items, and copies of papers and other items, received or made by Xxxxx in
connection with his employment with AG.
9. REVIEW BY ADVISORS: Xxxxx acknowledges that he has had ample
opportunity to consult with his legal and financial advisors, has carefully
considered this Agreement, and fully understands its provisions. He has not
relied on any other representations or statements, written or oral.
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10. SURVIVAL: The following paragraphs shall survive the expiration or
termination of this Agreement; 3, 4.a., 5, 6, 7 and 8.
AMERICAN GREETINGS CORPORATION XXXXXXX X. XXXXX
BY: _______________________________ __________________________________
NAME: ____________________________ __________________________________
TITLE: ____________________________ __________________________________
DATE: _____________________________ __________________________________
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