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EXHIBIT 10.20
LAI WORLDWIDE, INC.
Xxxxx 000X Xxxxxxxxx Xxxxx
0000 Xxxxxxxxx Xxxxxxxxx
Xxxxx, XX 00000-0000
February 25, 1999
Xx. Xxxxxx X. Xxxxxxxx
0000 Xxx Xxxxx Xxxxxx
Xxxxx, XX 00000
Dear Phil:
This letter confirms in writing our agreements with you regarding your
position as Chief Financial Officer ("CFO") of LAI Worldwide, Inc. (the
"Company").
1. Effective February 1, 1999 (the "Effective Date"), you became the
Chief Financial Officer ("CFO") of the Company.
2. In your capacity as CFO, you will perform duties and services
consistent with your position, as may reasonably be assigned to you by the
Chief Operating Officer. Your duties and responsibilities will be commensurate
with those customarily associated with the Chief Financial Officer of a
corporation comparable to the Company. You will report directly to the Chief
Operating Officer. You will be based and reside in Tampa, Florida. During your
employment with the Company, except during periods of vacation or other leave
permitted under this letter agreement, you shall devote your best reasonable
efforts and your full business time and attention during regular business hours
to the business and affairs of the Company as may be reasonably necessary in
performing your duties under this letter agreement. You shall not become
employed, engaged or involved, in any capacity, in any commercial or
professional endeavor or business other than the business and affairs of the
Company. Notwithstanding the foregoing, you may (i) serve on corporate, trade
association, civic, religious or charitable boards
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or committees, and (ii) manage personal investments, so long as such activities
do not interfere with the performance of your duties and responsibilities under
this letter agreement and do not create a conflict of interest with your duties
hereunder.
3. Commencing with the Effective Date, the Company shall pay you a
base salary at the rate of $175,000 per year (the "Base Salary") in bi-weekly
or such installments as is the Company's practice with respect to its senior
management.
4. You shall be eligible to earn as incentive compensation an annual
bonus based upon your performance as CFO (the "Performance Bonus") in
accordance with the incentive bonus plan(s) adopted from time to time by the
Compensation and Management Development Committee (the "Committee") of the
Board of Directors of the Company (the "Board"). The Committee shall establish
criteria for such Performance Bonus at the beginning of each fiscal year. Your
Performance Bonus for the Company's current fiscal year ending February 28,
1999 shall be paid in accordance with the terms of the letter agreement between
you and the Company dated November 9, 1998 regarding your employment as Interim
CFO of the Company (the "Interim CFO Letter Agreement"), which terms as to such
Performance Bonus are incorporated herein and made a part hereof. To receive
any Performance Bonus, you must be employed by the Company as of the last day
of the fiscal year with respect to which any such Performance Bonus relates.
For each fiscal year during the term of this letter agreement, unless the
Committee shall determine otherwise for fiscal years after February 28, 2000,
your Target Performance Bonus (the "Target Bonus") shall be equal to 65% of
your Base Salary, and your Maximum Performance Bonus (the "Maximum Bonus")
shall be equal to 120% of your Base Salary.
5. Immediately upon execution of this letter agreement, you shall
receive a bonus of $30,000 in cash in consideration of your appointment as CFO.
Also upon execution of this letter agreement, you waive all rights to Severance
Benefits as defined in Section 7 of the Interim CFO Letter Agreement.
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6. In the event of the termination of your employment (A) by the
Company for any reason other than "Good Cause" (as defined in Section 9 of this
letter agreement) or (B) by you at any time during the 60 day period which
occurs six months after a "Change in Control" (as that term is defined in
Section 2(d) of the Company's 1998 Omnibus Stock and Incentive Plan), (A) you
shall receive (i) a deferred bonus in cash in the amount of 100% of one year's
Base Salary plus (ii) 100% of one year's Target Bonus (the "Deferred Bonus"),
payable in a cash lump sum payment within ten days after such termination and
(B) the Company will continue, at its sole cost and expense, for a period of 18
months after such termination, the health and medical insurance provided to you
and your dependents immediately prior to such termination.
7. If you receive any payment under Section 6 hereof (a "Section 6
Payment"), and the Section 6 Payment, or any portion thereof, is subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code 1986 (as
amended from time to time, the "Code"), or any successor or similar provision
of the Code (the "Excise Tax"), the Company shall pay you such additional cash
amount (the "Gross Up") such that the net amount retained by you after payment
of any Excise Tax on the Section 6 Payment (and other state or federal income
tax and Excise Tax on any amounts paid as Gross Up hereunder) shall be equal to
the Section 6 Payment. For purposes of determining the Gross Up, you shall be
deemed to pay the federal income tax at the highest marginal rate of taxation
(currently 39.6%) in the calendar year in which the payment to which the Gross
Up applies is to be made. The determination of whether such Excise Tax is
payable and the amount thereof shall be made upon the opinion of tax counsel
selected by the Company and reasonably acceptable to you. The Gross Up, if any,
that is due as a result of such determination shall be paid to you in cash in a
lump sum within thirty (30) days of such computation. If such opinion is not
finally accepted by the Internal Revenue Service upon audit or otherwise, then
appropriate adjustments shall be computed (without interest but with additional
Gross Up, if applicable) by such tax counsel based upon the amount of the
Excise Tax as finally determined by the internal Revenue Service or a court of
law. Any additional amount
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due you as a result of such adjustment shall be paid to you by the Company in
cash in a lump sum within thirty (30) days of such computation, or, if less
than the Gross Up, any amount due the Company as a result of such adjustment
shall be paid to the Company by you in cash in a lump sum within thirty (30)
days of such computation.
8. We confirm that as an additional inducement to your accepting the
position of CFO, on February 1, 1999, you were granted options to purchase
30,000 shares of the Company's stock, which options have an initial exercise
price of $6.25 per share (the closing price for the Company's stock on February
1, 1999). Attached hereto as Exhibit A is a Stock Option Certificate in the
form to be issued to evidence the options.
9. The Company may terminate your employment for "Good Cause," which
shall mean (A) conviction of a felony or conviction of any crime in connection
with your employment by the Company which causes the Company a substantial
detriment (other than traffic offenses); (B) your willful, substantial,
continued and unjustified refusal or failure to perform your duties with the
Company to the extent of your ability to do so (other than any failure due to
physical or mental incapacity); (C) your willful misconduct materially and
demonstrably injurious to the Company, financially or otherwise or (D) your
substantial dependence on alcohol, or any narcotic drug or other controlled or
illegal substance, provided that failure to submit to any medical examination
reasonably requested by the Company shall itself constitute a separate basis
for termination for "Good Cause."
With respect to each of the bases for termination specified in
Subsections (B), (C) or (D) of this Section 9, the Company may terminate your
employment only if (i) you have been provided with notice from the Company of
any assertion that there is a basis for termination for "Good Cause," which
notice shall specify in reasonable detail specific facts regarding any such
assertion, and you will have been given a reasonable period of time within
which to remedy or cure the problem or complaint (which period of time shall in
no event exceed 60 days after the receipt of such notice), and (ii) an
additional written notice is provided to you at least 10 days
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before this letter agreement is terminated for Good Cause.
10. If your employment is terminated as the result of your death, your
Base Salary will be paid to your estate until the end of the calendar month in
which the death occurs. If you voluntarily terminate your employment or the
Company terminates your employment for Good Cause, you shall be paid only your
Base Salary until the date of termination. All rights under this letter
agreement, other than those already accrued, terminate upon the termination of
your employment with the Company.
11. You will be eligible to participate in such employee health and
medical insurance, disability insurance, benefit plans and other fringe
benefits as the Company may from time to time provide or make available to its
senior management. In addition, the Company will provide to you, and maintain
at all times during the term of this letter agreement, at the Company's cost,
term life insurance in an amount not less than One Million Dollars
($1,000,000).
12. You will be entitled to vacations with pay and to such personal
and sick leave with pay in accordance with the policies of the Company as may
be established from time to time by the Company and applied to other members of
senior management of the Company.
13. The Company will provide you with a fully furnished office in
Tampa, Florida. The facilities of the Company will be generally available to
the you in the performance of your duties pursuant to this letter agreement, it
being understood and contemplated by the parties that all equipment, supplies
and office personnel required in the performance of your duties under this
letter agreement will be provided by and at the sole expense of the Company in
Tampa, Florida
14. The conditions of your employment as described in this letter
agreement may not be altered or otherwise amended except pursuant to an
instrument in writing signed by you and the Company.
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15. The Company will pay the reasonable fees and expenses of your
counsel assisting you in the negotiation and preparation of this letter
agreement.
16. You will be under no duty to mitigate any loss of income as result
of the termination of your employment hereunder and any payments due to you
upon termination of your employment will not be reduced in respect of any other
employment compensation received by you following such termination.
17. This letter agreement shall be construed pursuant to and governed
by the substantive laws of the State of Florida (except that any provision of
Florida law shall not apply if the application of such provision would result
in the application of the law of a state or jurisdiction other than Florida).
18. The Company shall reimburse you, in accordance with the Company's
policies and practices for senior management, for all reasonable expenses
incurred by you in the performance of your duties under this letter agreement;
provided, however, that you must furnish to the Company an itemized account,
reasonably satisfactory to the Company, in substantiation of such expenditures.
19. Except as provided in this letter agreement, and except as to
stock options previously granted by the Company to you, this letter contains
the entire agreement between the parties with respect to the subject matter
hereof and supersedes all prior agreements or understandings.
20. This letter agreement will inure to the benefit of and be binding
upon the parties hereto, and their respective heirs, successors and assigns,
including, without limitation, successors or assigns as a result of a Change of
Control, and any purchaser, assignee or
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transferee of all or substantially all of the assets of the Company.
21. All notices that are required or may be given pursuant to the
terms of this letter agreement must be in writing and will be sufficient in all
respects if given in writing and delivered personally or by a recognized
courier service or by registered or certified mail, postage prepaid, to a party
at the following address (or to the attention of such other person or to such
other address as any party shall provide to the other party by notice in
accordance with this Section):
If to the Company: Lamalie Associates, Inc.
0000 Xxxxxxxxx Xxxx., Xxxxx 000X
Xxxxx, XX 00000
If to Xxxxxx Xxxxxxxx: 0000 Xxx Xxxxx Xxxxxx
Xxxxx, XX 00000
Any such notice under this Section shall be deemed to have been given and
received on the day it is personally delivered or delivered by a recognized
courier service or, if mailed, on the seventh day after it is mailed.
22. The Company will maintain, at all times, during the term of this
letter agreement, at the Company's cost, a directors' and officers' liability
insurance policy or policies, with substantially the same coverages and in
substantially the same policy amounts, as are in effect as of the date of this
letter agreement.
Please understand that while it is our hope and belief that our
relationship will be a long one, this is an offer of employment on an "at will"
basis. Nothing in this letter should be construed as creating any other type of
employment relationship.
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If this letter accurately reflects our understandings, please date and
sign both copies of this letter, keeping one copy for your records and
returning one fully executed copy to the undersigned.
LAI WORLDWIDE, INC.
By:
-----------------------------------
Xxxxxxx X. XxXxxxxxx, President
Accepted and Agreed to this
_____ day of February, 1999
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Xxxxxx X. Xxxxxxxx
