AGREEMENT
AGREEMENT made this fifteenth day of July 1996, between Xxxxxx X.
Xxxxxx, Xx. ("Executive") and Resort Funding, Inc. (the "Company").
RECITALS
WHEREAS, the Company desires to employ Executive and to enter into
an agreement embodying the terms of such agreement;
WHEREAS, the Company recognizes that the possibility of a change in
control of the Company exists and that such possibility creates an uncertainty
on the part of Executive whether to accept employment;
WHEREAS, the Board of the Company has determined that it is in the
best interest of the Company and its stockholder to induce Executive to accept
employment and to ensure Executive's continued availability to the Company in
the event of a change of control; and
WHEREAS, Executive is willing to be employed by the Company on the
terms, covenants and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual
convenants contained herein and for other good and valuable consideration, the
parties agree as follows:
Section I
EMPLOYMENT
The Company hereby employs, engages and hires Executive as Chief
Financial Officer, and Executive hereby accepts and agrees to such hiring,
engagement, and employment subject to the general supervision and pursuant to
the orders and direction of the President of the Company. In such capacity,
Executive shall have the customary powers, responsibilities and authority of
other persons having similar positions at companies of the same size, type and
nature of the Company as they exist from time to time, and such other duties and
authority as shall be determined from time to time by the Board of Directors of
the Company or its designee.
Section II
TERM OF EMPLOYMENT
The term of this Agreement shall be for a period commencing July 15,
1996 through July 16, 1999, subject, however, to prior termination as
hereinafter provided. The term of this Agreement shall renew automatically for
one (1) year periods unless either party elects not to renew the Agreement, in
writing, ninety (90) days prior to the expiration of the term or any renewal
term.
Section III
BEST EFFORTS OF EMPLOYEE
Executive agrees to devote his full working time and efforts, to the
best of his ability, experience and talent, to the performance of services,
duties and responsibilities in connection therewith and that he will at all
times faithfully, industriously, and to the best of his ability, experience and
talents perform all of the duties that may be required of and from him pursuant
to the terms hereof, and to the reasonable satisfaction of the Company. Nothing
in this Agreement shall preclude Executive from engaging, consistent with his
duties and responsibilities hereunder, in charitable and community affairs, from
managing his personal investments, or from serving, subject to approval of the
Board of the Company, as a member of a board of directors or as a trustee of
other companies, associations or entities.
Section IV
COMPENSATION OF EMPLOYEE
Company shall pay Executive and Executive shall accept from Company
in full payment of Executive's services hereunder, compensation at the initial
annual base salary rate of One Hundred Twenty-Five Thousand ($125,000) dollars,
increased on each July 15 by the urban consumer price index for the preceding
twelve-month period as published by the United States government (such amount,
as adjusted, the "Base Salary"). In addition, Executive will receive additional
annual compensation of One Thousand Five Hundred ($1,500) dollars for coverage
of medical premiums, which sum shall be increased only in the event of an
increase in medical premiums by the amount of the medical premium increase.
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In addition to the Base Salary, Executive will be eligible to
receive, subject to discretion of the Board of Directors, additional bonuses,
incentive compensation, and equity participation based on the overall
performance and contribution to the Company. As of the date hereof, Executive
shall have the right to participate in the Company's pension, profit-sharing,
and retirement plans (including a Section 401(k) plan) in accordance with
applicable law and Company policy on the same basis as those benefits are
generally made available to senior executives of the Company.
Section V
OTHER EMPLOYMENT
Executive shall devote sufficient amount of his time, attention,
knowledge, and skills to the business and interest of Company and Company shall
be entitled to all of the benefits, profits or other issues arising from or
incident to all work, services, and advice of Executive. Executive may not,
during the term hereof, have a financial interest directly or indirectly in any
manner as partner, officer, director, stockholder, advisor, employee, or in any
other capacity or in any other business that is similar to Company's business or
any allied trade.
Section VI
RECOMMENDATION FOR IMPROVING OPERATIONS
Executive shall make available to Company all information of which
Executive shall have any knowledge and shall make all suggestions and
recommendations that will be of mutual benefit to Company and himself.
Section VII
CONFIDENTIAL INFORMATION
During the period commencing on the date hereof and following the
date Executive's employment with the Company terminates, Executive shall not,
unless and to the extent that the Company (and their successors and assigns)
otherwise have consented in writing, divulge, disclose or make accessible to any
other person, firm, partnership, corporation, association or other entity any
Confidential Information pertaining to the Company's business
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(including that of its subsidiaries), except (i) while employed by the Company,
in the business of and for the benefit of the Company, or (ii) when required to
do so by a court of competent jurisdiction or an individual duly appointed
thereby, by any administrative body or legislative body (including a committee
thereof) having supervisory authority over such business, or by any
administrative body or legislative body (including a committee thereof) with
jurisdiction to order Executive to divulge, disclose or make accessible such
information. "Confidential Information" shall mean non-public information
concerning the financial data, strategic business plans, product development (or
other proprietary product data), customer lists, marketing plans and other
non-public, proprietary and confidential information of the Company and its
subsidiaries that is not otherwise available to the public. Confidential
Information shall also include any such information which has become publicly
available through any breach of fiduciary duty. Executive agrees that upon
termination of his employment with the Company, for any reason, he will return
to the Company immediately all memoranda, books, papers, plans, information,
letters, and other data and all copies thereof or therefrom, in any way relating
to the business of the Company and its affiliates, except that he may retain
personal notes, notebooks and diaries.
Section VIII
BUSINESS EXPENSES
Company shall reimburse Executive for all reasonable business
expenses pertaining to Executive's duties provided that Executive submits to
Company an expense report in which Executive has recorded at or near the time of
the expenditure:
1. the amount of the expenditure;
2. the time, place and nature of the travel or entertainment expense or
the date and description of the gift;
3. the business reason for the expense and the business benefit derived
or expected to be derived therefrom;
4. the names, occupations, and other data concerning individuals
entertained or given gifts sufficient to establish their business
relationship to Company, and,
5. that all such expenses shall be in such form and in such manner to
be deductible expense acceptable to the Internal Revenue Service.
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Company supporting documents such as receipts or paid bills
sufficient to establish the amount, date, place and essential character of any
expenditure.
Section IX
VACATION, MEDICAL, AND LIFE INSURANCE
Executive shall receive three (3) weeks vacation with pay each year
during the term of the Agreement until the Executive has worked for the company
for a period of five (5) years after which time he shall receive four (4) weeks
paid vacation. Executive will be entitled to the annual vacation time on the
first day of each contract year, beginning with the first day of employment.
Upon termination of this Agreement, as provided in Section XII or Section XIII,
Executive shall be paid any accrued vacation time within thirty (30) days of the
effective date of Executive's termination. Executive shall be prohibited from
taking all vacation at once without the prior permission of Company. Unused
vacation time will accrue from year to year as per Company policy, which
currently permits employees to carry over up to one week of unused vacation into
the first quarter of the succeeding year. During the Executive's second year of
employment, he shall be permitted to use up to two weeks of vacation time, if
any, that he may not have used during his first year of employment.
Executive shall receive family medical coverage from the Company, at
a cost as provided to all other employees. This coverage will begin on the first
day of employment and shall not include any "waiting" period. The Executive, at
his sole option and expense, may elect to enroll in the Company's provided
dental coverage.
The Company shall pay for and provide Life Insurance for the
Executive. The amount of Life Insurance coverage shall be the greater of
$350,000 dollars or the greatest amount of coverage provided to any of the
company's Officers or Directors.
Section X
OFFICE
Company shall furnish Executive with an office, personal computer
and secretarial services commensurate with Executive's title and position with
the Company at its headquarters, presently at Two Clinton Square, Syracuse, New
York.
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Section XI
INDEMNIFICATION
The Company will indemnify Executive (and his legal representative
or other successors) to the fullest extent permitted (including a payment of
expenses in advance of final disposition of a proceeding) by the laws of the
State of Delaware, as in effect at the time of the subject act or omission, or
by the Certificate of Incorporation and By-Laws of the Company, as in effect at
such time or on the effective date of this Agreement, or by the terms of any
indemnification agreement between the Company and Executive, whichever affords
or afforded greatest protection to Executive, and Executive shall be entitled to
the protection of any insurance policies the Company may elect to maintain
generally for the benefit of its directors and officers (and to the extent the
company maintains such an insurance policy or policies, Executive shall be
covered by such policy or policies, in accordance with its or their terms to the
maximum extent of the coverage available for any Company officer or director),
against all costs, charges, and expenses whatsoever incurred or sustained by him
or his legal representatives (including, but not limited to, any judgement
entered by a court of law) at the time such costs, charges, and expenses are
incurred or sustained, in connection with any action, suit or proceeding to
which Executive (or his legal representatives or other successors) may be made a
party by reason of his having accepted employment with the Company or by reason
of his being or having been an officer or employee of the Company, or any
subsidiary of the Company, or his serving or having served any other enterprise
as a director, officer, or employee at the request of the Company; provided,
however, that the Company shall not indemnify Executive with respect to any act
or acts (or failure to take action) which constitute grounds for termination for
Cause under Section XIII hereof. Executive's rights under this Section XI shall
continue without time limit for so long as he may be subject to any such
liability, whether or not his term of employment may have ended.
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Section XII
TERMINATION
Anything in this Agreement to the contrary notwithstanding,
Executive may have the unconditional right to terminate this Agreement by giving
thirty (30) days' written notice to Company at the office of the place of
Employment. If Executive shall terminate this Agreement pursuant to the
provisions of this Section, Company's liability and obligations under this
Agreement shall cease and terminate on the effective date of Executive's
termination. Such date of termination of employment, whether voluntarily by the
Executive or for Cause pursuant to Section XIII, shall be known as the
"Termination Date."
Section XIII
TERMINATION AND DISCHARGE FOR CAUSE ONLY
Company may discharge Executive and thereby terminate this Agreement
for "Cause," which for purposes of this Agreement shall mean (i) gross
insubordination or malfeasance of employee, (ii) Executive's willful and
continued failure substantially to perform his duties hereunder (other than as a
result of total or partial incapacity due to physical or mental illness), (iii)
a breach of the non-competition or confidentiality provisions contained in this
Agreement; (iv) dishonesty in the performance of Executive's duties hereunder,
or (v) an act or acts by Executive that would constitute a misdemeanor involving
moral turpitude or a felony under the laws of the United States or any State
thereof. If Executive is terminated for Cause, he shall be entitled to receive
his Base Salary through the Termination Date. All other benefits due Executive
following the Termination Date pursuant to this Section XIII shall be determined
in accordance with the plans, policies and practices of the Company. The
confidentiality obligations under Section VII shall continue in full force and
effect following the Termination Date pursuant to this Section XIII.
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Section XIV
TERMINATION WITHOUT CAUSE
If prior to 16 July 1998 Executive resigns for Good Reason or is
terminated by the Company for any reason other than for Cause, then Executive
shall be entitled to receive a cash lump sum severance amount equal to (i) the
remaining Base Salary due through the end of the term of the Agreement,
excluding any cost of living adjustments, and any other accrued monies due
pursuant to this Agreement or (ii) 150% multiplied by Executive's then-current
Base Salary, if such amount is greater than the lump sum payment under (i)
above. If such resignation or termination occurs on or after 16 July 1998 but
before 16 July 1999, Executive shall be entitled to receive a cash lump sum
severance amount equal to the remaining Base Salary payable under this Agreement
to 16 July 1999 plus 50% multiplied by Executive's then-current Base Salary.
Following the third anniversary hereof, Executive shall receive a cash lump sum
severance of 50% multiplied by Executive's then-current Base Salary as full
settlement of the Company's obligations to him.
Executive understands and agrees that he shall not be entitled to
any further notice or compensation upon the termination of this Agreement other
than the amounts specified in this paragraph. Executive shall not have any
obligation to seek comparable employment following such termination or
resignation, and any payment hereunder shall not be offset by compensation
Executive earns with a new employer or from self-employment. However, in no
event shall Executive be entitled to any payment hereunder if he resigns on
account of retirement, or if his employment terminates as a result of death or
total disability.
"Good Reason" shall mean the resignation of Executive from
employment by the Company as a result of a reduction in his Base Salary, a
"Change of Control," or a substantial diminution in his duties, responsibilities
or reporting responsibility (unless due to a promotion), without his express
prior written consent.
A "Change of Control" shall be deemed to occur if (i) any "person"
or "group" (as such terms are used in Section 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), other than Xxxxxxx X.
Xxxxxxx as Trustee in bankruptcy of the Xxxxxxx Companies, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the
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Exchange Act as in effect on the date hereof, except that a person shall be
deemed to be the "beneficial owner" of all shares that any such person has the
right to acquire pursuant to any agreement or arrangement or upon exercise of
conversion rights, warrants, options or otherwise, without regard to the 60-day
period provided in such Rule), directly or indirectly, of securities
representing 50% or more of the combined voting power of the Company's or its
parent's then-outstanding securities or (ii) the Company shall consolidate,
merge or exchange securities with any other entity. Notwithstanding the
foregoing, however, a Change of Control shall not be deemed to occur merely by
reason of an acquisition of Company securities by, or any consolidation, merger,
or exchange of securities with, any entity that, immediately prior to such
acquisition, consolidation, merger or exchange of securities, was a corporation
of which the Company owned directly or indirectly 95% of the capital stock or
was an unincorporated entity with respect to which the Company has, directly or
indirectly, an equivalent degree of ownership.
Section XV
NOTICE AND PAYMENT DUE UPON TERMINATION
In the event the Company determines that Cause exists, it shall
notify Executive, who may be terminated for Cause upon thirty (30) days prior
notice. Termination shall be effected by a majority vote or the Board (excluding
Executive) at a meeting at which Executive shall have had the opportunity (along
with his counsel) to be heard, unless within fifteen (15) days after receiving
such notice, Executive shall have cured Cause to the reasonable satisfaction of
the Board. Executive shall cooperate to cause any valid Board meetings to occur.
Notice of Good Reason shall be given at least 45 days prior to the
intended Termination Date during which the Company shall have the opportunity to
cure the Good Reason during the first thirty (30) days of such notice period. If
notice is not given within 45 days after the event giving rise to Good Reason,
such Good Reason shall be deemed waived.
If this Agreement is terminated for any reason, Company shall only
be liable to pay Executive his salary earned to the Termination Date and any
accrued vacation pay as defined in Section X. Any bonus payment or additional
payment that has been accrued and unpaid shall
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be paid on the effective date of Executive's termination. In no event shall
Executive be entitled to any severance if he resigns without Good Reason or is
terminated by the Company for Cause.
Section XVI
LIQUIDATION, COMPANY RELOCATION
If the company is liquidated through Chapter 7 bankruptcy or for any
other reason, the Executive will be paid in full 60 days following bankruptcy
filing or notice of liquidation. The Executive will be paid the remaining
compensation due through the end of the term, including any annual increases not
yet invoked, and any other accrued monies due pursuant to Section XIV or any
other sections within this Agreement. In addition, if the Company is liquidated
for any reason, the Executive's obligations hereunder will cease and terminate.
If the company relocates its offices outside of Onondaga County in
the State of New York, the Executive, at his option, may terminate this
Agreement pursuant to the notification clause contained within Section XII and
will be paid the remaining compensation due through the end of the term,
including any annual increases not yet invoked, and any other accrued monies due
pursuant to Section XIV or any other sections within this Agreement.
Section XVI
MODIFICATION & INTEGRATION
No waiver or modification of this Agreement or of any covenant
condition or limitation herein contained shall be valid unless in writing and
duly executed by both parties herein. This Agreement contains the complete
agreement concerning the Employment arrangement between the parties and shall as
of the effective date hereof, supersede all other agreements between the
parties.
Section XVII
SEVERABILITY & SURVIVORSHIP
All terms and conditions herein are severable and in the event any
of them shall be held to be invalid by any competent court, this Agreement shall
be interpreted as if such invalid agreement or covenant were not contained
herein. In addition, the Company shall bear,
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or reimburse Executive for, all reasonable legal fees incurred in the
enforcement of the rights under this Agreement. The respective rights and
obligations of the parties hereunder shall survive any termination of this
Agreement to the extent necessary to the intended preservation of such rights
and obligations.
Section XVIII
LEGAL
In any action hereunder, the parties consent to personal
jurisdiction and venue in the Supreme Court of the State of New York, County of
Onondaga.
IN WITNESS WHEREOF, the parties executed this Agreement on the date
first above written.
RESORT FUNDING, INC.
By /s/ Xxxx X. Xxxxxx
--------------------------------------
Xxxx X. Xxxxxx
President
/s/ Xxxxxx X. Xxxxxx Xx.
---------------------------------
Xxxxxx X. Xxxxxx, Xx.
Approved and ratified by Xxxxxx X. Xxxxx, sole director of Resort Funding, Inc.,
as of the date first hereinabove written.
/s/ Xxxxxx X. Xxxxx
---------------------------------
Xxxxxx X. Xxxxx
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