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SPECIAL ASSIGNMENT AGREEMENT
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This Agreement (the "Agreement") between Xxxxx X. Xxxxxxxxx ("Xxxxxxxxx")
and Xxxxxxxx'x Inc. ("Xxxxxxxx'x" or the "Company") intended to be effective as
of April 21, 1997.
WHEREAS, financial circumstances made it prudent and necessary for
Xxxxxxxx'x to file for reorganization pursuant to Title 11 of the United States
Code and Xxxxxxxx'x has determined to retain Xxxxxxxxx to devote time to
Xxxxxxxx'x affairs as interim Executive Vice President and Chief Financial
Officer in connection with the Chapter 11 bankruptcy proceedings (such services
generally referred to as "Special Assignment Duties"); and
WHEREAS, this Agreement is intended to supersede any oral or written
agreements between Xxxxxxxx'x and Xxxxxxxxx or his corporation, Xxxxx X.
Xxxxxxxxx, Inc. ("Xxxxxxxxx, Inc.") prior to the effective date hereof which are
in any way inconsistent with this Agreement and any such agreements shall be
deemed to have been satisfied as of the effective date hereof; and
WHEREAS, in recognition of the foregoing and the services to be performed
by Xxxxxxxxx during periods on and after April 21, 1997, the Board has
authorized the arrangements set forth in this Agreement subject to any approval
or modification which may be required by the United States Bankruptcy Court for
the District of Delaware where the Xxxxxxxx'x case is pending;
NOW, THEREFORE, the parties hereby agree as follows:
1. Xxxxxxxxx and Xxxxxxxx'x agree that Xxxxxxxxx will be available during
the period of the bankruptcy proceedings and a transitional period thereafter to
perform Special Assignment Duties as directed by the Board. For these services,
Xxxxxxxxx shall be compensated by Xxxxxxxx'x at the rate of $1,600 per day plus
the cost of actual and necessary reasonable business expenses incurred in the
performance of such duties, including, without limitation, Xxxxxxxxx'x
reasonable business travel expenses (subject to submission by Xxxxxxxxx of
reasonable substantiation thereof). Provided that in cases in which it would be
reasonable for Xxxxxxxxx to incur travel expenses to fly home to Phoenix from
Boston for weekends to visit his family, he may choose to remain in Boston and
fly his spouse or other family members to Boston from Phoenix to visit provided
that such total cost does not exceed the cost of his flying from Boston to
Phoenix on such weekend(s). Provided, further, that Xxxxxxxxx shall also be
reimbursed for the expense of retaining through Xxxxxxxxx, Inc. an
administrative assistant to perform Xxxxxxxx'x related duties up to 5 hours per
week at a rate of no more than $40 per hour. Such assistant shall not be an
employee of Xxxxxxxx'x or have any employment rights as a Xxxxxxxx'x employee.
Xxxxxxxxx, Inc. or the assistant shall be responsible for any tax or other
payments or employment liabilities due as a result of Xxxxxxxxx, Inc.'s
retention of this Administrative Assistant. Further, Xxxxxxxxx or Xxxxxxxxx,
Inc. shall not be entitled to any xxxx up or premium over actual expenses
incurred by Xxxxxxxxx or Xxxxxxxxx, Inc.
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2. Xxxxxxxx'x may terminate this Agreement with cause upon written notice,
and such termination shall be effective immediately upon such notice. For
purposes of this provision cause shall include the following acts or omissions
by Xxxxxxxxx or Xxxxxxxxx, Inc.: (i) a breach of fiduciary duty; (2) commission
of a misdemeanor involving personal integrity, any felony or any other act which
brings Xxxxxxxx'x into disrepute; (3) gross negligence or willful misconduct or
(4) other material breach of this Agreement. Upon termination with cause,
Xxxxxxxx'x will pay Xxxxxxxxx payments due under paragraph 1 for services
performed and expenses incurred prior to the issuance of the termination notice
and Xxxxxxxx'x shall have no further obligation to Xxxxxxxxx or Xxxxxxxxx, Inc.
under this Agreement, except as provided in paragraph 7 below. Either Xxxxxxxxx
xx Xxxxxxxx'x may terminate this Agreement for any reason other than cause as
defined above, upon sixty (60) days written notice ("60 Day Notice Period").
During such 60 Day Notice Period, Xxxxxxxxx shall continue to be available to
perform Special Assignment Duties as directed by the Xxxxxxxx'x Board of
Directors, and the Board shall continue to pay Xxxxxxxxx at the $1,600 per day
rate provided in paragraph 1 above, for no fewer than 40 days. In addition,
during such 60 Day Notice Period, Xxxxxxxxx shall continue to be eligible for
expense reimbursement, if applicable, as provided in Paragraph 1 above, but
Xxxxxxxx'x shall have no further obligation under this Agreement to Xxxxxxxxx or
Xxxxxxxxx, Inc., except as provided in paragraph 7 below.
3. All notices and other communications shall be in writing, either hand
delivered or mailed by first class registered mail, postage prepaid, if to
Xxxxxxxxx at the address set forth below under Xxxxxxxxx'x signature, or, if to
Xxxxxxxx'x, at 00 Xxx Xxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, attention of the
Secretary, or at such other address as either party shall designate by written
notice to the other. Notice to Xxxxxxxxx shall be deemed to be notice to
Xxxxxxxxx, Inc. and vice versa. No notice shall be deemed to have been given
until actually received by the party to whom it is addressed; provided, that a
certified, registered mail return receipt, or proof of delivery from an
established overnight delivery service shall be conclusive evidence of such
receipt.
4. This Agreement may not be changed, waived, discharged or terminated
orally, but only by an instrument in writing, signed by the party against which
enforcement of such change, waiver, discharge or termination is sought, or by
order of a court with jurisdiction and authority to enter such order.
5. All Special Assignment Duties performed hereunder shall be performed by
Xxxxxxxxx. Neither this Agreement nor any rights or obligations hereunder may be
assigned by either party without the written consent of the other, except that
this Agreement will be binding upon and inure to the benefit of any successor or
successors of Xxxxxxxx'x whether by merger, consolidation, sale of assets or
otherwise and reference herein to Xxxxxxxx'x is intended to include any such
successor or successors, and any Bankruptcy trustee.
6. Xxxxxxxx'x agrees to pay the reasonable fees and expenses of Xxxxxxxxx'x
counsel in connection with the negotiation of this Agreement.
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7. From the effective date of this Agreement, Xxxxxxxxx and Xxxxxxxxx, Inc.
will be entitled to indemnification by Xxxxxxxx'x and limitation of liability
for acts and omissions by reason of and in Xxxxxxxxx'x capacity as interim
Executive Vice President and Chief Financial Officer of Xxxxxxxx'x or any
subsidiary as an administrative expense under its Agreement subject to any
limitations on indemnification set forth by the Restated Certificate of
Incorporation and By-laws of Xxxxxxxx'x as in effect on the effective date of
this Agreement or to any greater extent provided by any amendment to those
documents.
8. This Agreement shall be governed by and construed in accordance with the
internal laws of the State of Delaware. This Agreement embodies the entire
agreement of the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings. If any one or more of the
provisions of this Agreement shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such provision shall be in effective to
the extent, but only to the extent, of such invalidity, illegibility or
unenforceability without invalidating the remainder of such invalid, illegal or
unenforceable provision or provisions or any other provision hereof.
9. All information obtained or possessed by Xxxxxxxxx or Xxxxxxxxx, Inc.
relative to the activities of Xxxxxxxx'x and its subsidiaries which is of a
secret or confidential nature, including business plans, expansion plans,
marketing data, financial data, customer lists, technical know-how, patents,
trademarks, developments, inventions, processes or administrative procedures, is
the property of Xxxxxxxx'x and its subsidiaries or its licensors, as the case
may be, and Xxxxxxxxx or Xxxxxxxxx, Inc. shall not, during the term of this
Agreement or thereafter, use any such information for the benefit of others than
Xxxxxxxx'x and its subsidiaries or disclose it to others; provided, that nothing
herein shall prevent Xxxxxxxxx or Xxxxxxxxx, Inc. from using or availing himself
of his general commercial, technical and inventive skill, knowledge and
experience, including that pertaining to or derived from the nonsecret and
nonconfidential aspects of the business of Xxxxxxxx'x and its subsidiaries nor
shall this paragraph apply to information made available in Xxxxxxxx'x
securities or bankruptcy court filings or otherwise publically available other
than by breach by them of their obligations hereunder.
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10. Nothing in this Agreement shall be construed to make Xxxxxxxxx an
employee of Xxxxxxxx'x it being understood that Xxxxxxxxx is an independent
contractor and Xxxxxxxxx is entitled to no rights as an employee of Xxxxxxxx'x.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
XXXXXXXX'X INC.
By:
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Xxxxx X. Xxxxxxxxx
Title: 0000 Xxxxx 00xx Xxxxxx
------------------------------ Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
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