EXHIBIT 10.15
CHANGE OF CONTROL AGREEMENT
THIS AGREEMENT (the "Agreement") is made as of this 17th day of December,
2000 by and between XXXXX GOLF MANAGEMENT CORP, a Delaware corporation, and
XXXXX XXXXX (the "Executive"). Xxxxx Golf Management Corp. is sometimes
referred to herein as the "Employer".
WITNESSETH
WHEREAS, the Board of Directors of Management Corp. (the "BOARD") has
determined that it is in the best interest of Management Corp. and its group
of affiliated entities, the ultimate parent of which is Xxxxx Golf, Inc., a
Delaware Corporation ("XXXXX GOLF," collectively with the affiliated
entities, the "COMPANY") as well as the shareholders of Xxxxx Golf, for
Management Corp. do agree to provide benefits under the circumstances
described below to Executive and certain other executives who are responsible
for the policy-making functions of the Company; and
WHEREAS, the Board believes it important, should the Company receive
proposals from outside parties, to enable such executives, without being
distracted by the uncertainties of their own employment situation, to perform
their regular duties, and, where appropriate, to assess such proposals and
advise the Board and/or the Board of Directors of Xxxxx Golf (the "XXXXX
BOARD") as to the best interests of the Company and its shareholders and to
take other action regarding such proposals as the Board and/or the Xxxxx
Board determines to be appropriate; and
WHEREAS, the Board also desires to demonstrate to the executives that
Management Corp. is concerned with their welfare and intends to provide that
loyal executives are treated fairly.
NOW, THEREFORE, in consideration of the foregoing, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1: DEFINITIONS
(a) "Base Salary" means the Executive's annual base salary in effect
(i) on the day prior to a Sale (as defined below), Change of Control (as
defined below), or Restructuring (as defined below), or at the time of
execution of this Agreement, whichever is higher,
(b) "Cause" means the following:
(i) the Executive's admission or conviction of a felony,
(ii) the Executive's commission of an act of dishonesty in the
course of his duties,
(iii) the Executive's repeated disregard of policy directives of
the Employer,
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(iv) the executive's repeated failure to satisfactorily perform
assigned duties, or
(v) the Executive's breach of his fiduciary responsibilities or
fiduciary duties as an employee of the Employer.
(c) "Termination" means the following (without the Executive's express
written consent) after written notice provided by the Executive and the
failure of the Employer or its successors to remedy the following within
thirty (30) days after receipt of such written notice:
(i) a reduction in the Executive's Base Salary;
(ii) a relocation of the Executive's principal place of business
to any location which is not within the greater Dallas/Fort
Worth metropolitan area;
(iii) the assignment to the Executive of any duties inconsistent
with and inferior to the position with the Employer that the
Executive held immediately prior to the execution of the
Agreement, or a significant adverse alteration in the nature
or status of the Executive's responsibilities or the
conditions of the Executive's employment from those in effect
immediately prior to the execution of this Agreement;
(iv) the failure by the Employer to continue in effect any
compensation plan in which the Executive participates
immediately prior to the execution of this Agreement that is
material to the Executive's total compensation, including,
but not limited to, Xxxxx Golf Employee Stock Option Plan, or
any additional or substitute plan adopted prior to the
execution of this agreement, or the failure by the Employer
to continue the Executive's participation in any compensation
plan referred to above on a basis less favorable, both in
terms of benefits provided and the level of the Executive's
participation relative to other participants as existed at
the time of execution of this Agreement;
(v) failure by the Employer to continue to provide the Executive
with benefits substantially similar at a substantially
similar cost to those enjoyed the by the Executive under any
of the Employer's life insurance, medical, health and
accident, or disability plans in which the Executive was
participating at the execution of this Agreement, the taking
of any action by the Employer which would directly or
indirectly materially reduce any of such benefits or deprive
the Executive of any material fringe benefit enjoyed by the
Executive at the executive of this Agreement.
(vi) firing or laying off the Executive.
(vii) any material breach of this Agreement by the Employer or its
successors.
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(d) "Sale Termination" means (i) the termination (as defined above) of
the Executive's employment with Xxxxx Golf by the Employer or its successors
for any reason other than cause on or before September 30, 2001 and at a time
in which the following is anticipated or actually takes place:
(i) a majority of the capital stock of Xxxxx Golf is sold or
transferred to an unaffiliated entity, or
(ii) substantially all of the assets of Xxxxx Golf are sold or
transferred to an unaffiliated entity, or
(e) "Change of Control Termination" means the termination (as defined
above) of the Executive's employment with Xxxxx Golf by the Employer or its
successors for any reason other than cause on or before September 30, 2001
and at a time in which the following is anticipated or actually takes place;
(i) any person is or becomes the "beneficial owner' (as defined
in Rule 13d-3 under the Exchange Act), directly or
indirectly, or securities of Xxxxx Golf, representing twenty
(20) percent or more of the combined voting power of Xxxxx
Golf's then outstanding securities;
(ii) the stockholders of Xxxxx Golf approve a merger or
consolidation, a sale or disposition of all or substantially
all of Xxxxx Golf's assets or a plan of liquidation or
dissolution of Xxxxx Golf; or
(f) "Restructuring Termination" means:
(i) the termination (as defined above) of the Executive's
employment by Xxxxx Golf or its successors for any reason
other than cause on or before September 30, 2001 and at a
time in which Xxxxx Golf merges with or is purchased by
another entity, or
(ii) the termination (as defined above) of the Executive's
employment by Xxxxx Golf for any reason other than cause
occurring within the execution date of this agreement and its
September 30, 2001 expiration date regardless of a Change of
Control event.
SECTION 2 TERMINATION RESULTING FROM SALE, CHANGE OF CONTROL, OR
RESTRUCTURING.
Upon a Sale Termination, Change of Control Termination, or a Restructuring
Termination the Executive shall be entitled to:
(a) within 30 days of the date of termination, all unpaid Base Salary
(as defined below) accrued, and provide the Executive with all benefits and
expense reimbursements to which the Executive would otherwise be entitled,
through and including the date of termination, including, without limitation,
compensation for vacation days accrued in the year of termination which are
unused as of the termination date.
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(b) in exchange for a General Release in form and substance reasonably
satisfactory to the Employer receive:
(i) payments of Base Salary to the Executive for the 12 month
period following the date of termination at such times as
salary payments were made to management employees of Xxxxx
Golf;
(ii) a pro-rated performance bonus for the quarter in which a
termination occurs. The maximum amount of such performance
bonus shall be the amount of the defined bonus under the
2000 Xxxxx Golf Bonus Plan, prorated through the date of
termination. The bonus shall be paid within thirty (30) days
following the date of termination.
(iii) continued substantially equal medical benefits for the 12
month period following the date of termination.
(iv) the immediate vesting of any stock options granted under the
Xxxxx Golf Employee Stock Option Plan or any substituted or
amended plan prior to the execution of the Agreement.
Executive shall have shall have 120 days thereafter to
exercise those stock options.
(c) Any payments owed to the Executive pursuant to Section 2(b) shall
be offset by any severance payments paid to the Executive by the Employer or
its successor.
SECTION 3: NO MITIGATION. In the event of a Sale Termination, Change
of Control Termination, or Restructuring Termination, the Executive shall not
be required to mitigate the payments or benefits to be received by the
Executive hereunder by securing other employment or otherwise.
SECTION 4: CONTINUED EMPLOYMENT. This Agreement is not a contract of
employment. Nothing expressed or implied in this Agreement shall create any
right or duty of Executive's continued employment by Xxxxx Golf or its
successor. The Employer reserves all rights to cause the Executive's
employment to be terminated at any time with or without cause.
SECTION 5: SUCCESSORS BOUND. The rights and obligations of the
Employer hereunder shall inure to the benefit and are binding upon the
successor of the Employer.
SECTION 6: NOTICES AND OTHER DOCUMENTS. All payments, requests,
notices and the like may be made to the Executive by mailing the same to the
Executive. Notices, requests and the like sent by the Executive to Xxxxx Golf
at Attn. Human Resources, Xxxxx Golf, 0000 X. Xxxxx Xxxxxxx, Xxxxx, XX 00000,
or to such other address as Xxxxx Golf may furnish to the Executive for this
purpose from time to time in writing.
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SECTION 7: EMPLOYMENT TAXES. All payments made under this Agreement
shall be subject to withholding tax, other employment taxes and other
withholds and deductions as required by applicable law or regulation, as in
effect from time to time.
SECTION 8: TERM. If a Sale, Change of Control or Termination shall not
have been anticipated or occurred by September 30, 2001, this Agreement shall
expire as of such date and be of no further force or effect.
SECTION 9: MISCELLANEOUS PROVISIONS
(a) ASSIGNMENT This Agreement and the Executive's rights and
obligations hereunder may not be assigned by the Executive. The Employer may
assign its right, together with its obligations hereunder (i) to any
successor-in-interest, or (ii) to third parties in connection with any sale,
transfer or other disposition of all or substantially all of the business or
assets; in any event the obligations of the Employer hereunder shall be
binding on its successor or permitted assign, whether by merger,
consolidation or acquisition of all or substantially all of its businesses or
assets.
SECTION 10: SIGNIFICANCE OF HEADINGS
Section headings contained herein are solely for the purpose of aiding
in speedy location of subject matter and are not in any sense to be given
weight in the construction of this Agreement. Accordingly, in case of any
question with respect to the construction of this Agreement, it is to be
construed as though such section headings had been omitted.
SECTION 11: APPLICABLE LAW, VENUE
This Agreement shall be governed and construed according to the laws of
the State of Texas. Any action brought by either party arising out of this
agreement shall take place in Plano, Texas.
SECTION 12: ENTIRE AGREEMENT
The provisions of this Agreement are intended by the parties as a
complete, conclusive and final expression of their agreement concerning the
subject matter hereof, which Agreement supersedes all prior agreements
concerning the subject matter, and no other statement, representation,
agreement or understanding, oral or written, made prior to or at the
execution hereof, shall vary or modify the written terms hereof. No
amendments, modifications or releases from any provision hereof shall be
effective unless in writing and signed by both parties.
SECTION 13: WAIVER
Unless otherwise mutually agreed in writing, no departure from, waiver
of, or omission to require compliance with any of the terms hereof by either
party shall be deemed to authorize any prior or
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subsequent departure or waiver, or obligate either party to continue any
departure or waiver.
SECTION 14: SEVERABILITY
Any provision or part of this Agreement prohibited by applicable law
shall be ineffective to the extent of such prohibition without invalidating
the remaining provisions or parts hereof.
SECTION 15: ARBITRATION
In the event a dispute arises under this Agreement which cannot be
resolved, such dispute shall be submitted to arbitration and resolved by a
panel of three arbitrators (who shall be lawyers), in a decision required by
a majority of the arbitrators. If the parties cannot agree upon the panel of
three arbitrators, then each party may pick an arbitrator and the two chosen
arbitrators shall choose upon the three arbitrator panel. The arbitration
shall be conducted in accordance with the Arbitration Rules of the American
Arbitration Association. Venue shall be Plano, Texas. The award or decision
rendered by the arbitration panel shall be final, binding and conclusive and
judgment may be entered upon such award by any court of competent
jurisdiction.
IN WITNESS WHEREOF, this Agreement has been duly executed by each of the
parties hereto as of the date first written above.
/s/ XXXXX XXXXX
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Xxxxx Xxxxx
0000 Xxxx Xxxx Xxxxxxx Xxxxx
Xxxxx, XX 00000
XXXXX GOLF MANAGEMENT CORP.
By: /s/ XXXXXX X. XXXXXX III
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Name: Xxxxxx X. (Chip) Xxxxxx, III
President & COO
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