Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT ("Agreement"), dated as of July 1, 2009, between
THE XXXXX XXXXXX COMPANIES INC., a Delaware corporation (the "Company"), and
XXXXXXX X. XXXXX, a resident of 000 Xxxx Xxxx Xxxx, Xxxxxxxxxx, Xxx Xxxx 00000
(the "Executive" or "you"),
W I T N E S S E T H:
WHEREAS, the Company and its subsidiaries are principally engaged
in the business of manufacturing, marketing and selling skin care, makeup,
fragrance and hair care products and related services (the "Business"); and
WHEREAS, the Company and the Executive are parties to an
employment agreement dated as of July 1, 2006; and
WHEREAS, the Company desires to continue to retain the services of
the Executive as Executive Vice President and Chief Financial Officer and the
Executive desires to provide services in such capacity to the Company, upon the
terms and subject to the conditions hereinafter set forth; and
WHEREAS, the Compensation Committee of the Board of Directors of
the Company (the "Compensation Committee") and the Stock Plan Subcommittee of
the Compensation Committee have approved the terms of this Agreement; and
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and obligations hereinafter set forth, the parties hereto,
intending to be legally bound, hereby agree as follows:
1. Employment Term.
The Company hereby agrees to employ the Executive, and the
Executive hereby agrees to enter into employment, as Executive Vice President
and Chief Financial Officer of the Company subject to termination pursuant to
Section 6 hereof. The period from July 1, 2009 through the date of such
termination shall be the "Term of Employment".
2. Duties and Extent of Services.
(a) During the Term of Employment, the Executive shall serve as
Executive Vice President and Chief Financial Officer of the Company reporting to
the President and Chief Executive Officer and the Executive Chairman, and, in
such capacity, shall render such executive, managerial, administrative and other
services as customarily are associated with and incident to such position, and
as the Company may, from time to time, reasonably require of him consistent with
such position.
(b) The Executive shall also hold such other positions and
executive offices of the Company and/or of any of the Company's subsidiaries or
affiliates as may from time to time be agreed by the Executive or assigned by
the Chief Executive Officer, the Executive Chairman or the Executive's direct
supervisor if not the Chief Executive Officer or Executive Chairman, or the
Board of Directors, provided that each such position shall be commensurate with
the Executive's standing in the business community as Executive Vice President,
Chief Financial Officer. The Executive shall not be entitled to any compensation
other than the compensation provided for herein for serving during the Term of
Employment in any other office or position of the Company or any of its
subsidiaries or affiliates, unless the Board of Directors of the Company or the
appropriate committee thereof shall specifically approve such additional
compensation.
(c) The Executive shall be a full-time "at will" employee of the
Company and shall exclusively devote all his business time and efforts
faithfully and competently to the Company and shall diligently perform to the
best of his ability all of the duties required of him as Executive Vice
President, Chief Financial Officer, and in the other positions or offices of the
Company or its subsidiaries or affiliates assigned to him hereunder.
Notwithstanding the foregoing provisions of this section, the Executive may
serve as a non-management director of such business corporations (or in a like
capacity in other for-profit or not-for-profit organizations) as the Chief
Executive Officer, the Executive Chairman or the Board of Directors of the
Company may approve, such approval not to be unreasonably withheld.
(d) The Executive shall comply with the Company's stock ownership
guidelines applicable to the Executive as they may be implemented and/or amended
by the Board of Directors or the Compensation Committee of the Board of
Directors.
3. (a) Base Salary. As compensation for all services to be
rendered pursuant to this Agreement and as payment for the rights and interests
granted by Executive hereunder, the Company shall pay or cause any of its
subsidiaries to pay the Executive a base salary (the "Base Salary") during the
Term of Employment subject to the provisions of Section 3(c) at a rate set by
the Compensation Committee from time to time. Subject to Section 6(j) of this
Agreement, all amounts of Base Salary provided for hereunder shall be payable in
accordance with the regular payroll policies of the Company in effect from time
to time.
(b) Incentive Bonus Compensation. The Executive shall be eligible
to participate in the Company's Executive Annual Incentive Plan or any
subsequent Bonus Plan for executives that is approved by the stockholders of the
Company (the "Bonus Plan")
Any target bonus opportunities granted to the Executive shall be subject to the
terms and conditions of the Bonus Plan, which are incorporated herein by
reference; provided, however, that the bonus payout with respect to any fiscal
year shall be paid to Executive no later than the 15th day of the third month
following the end of such fiscal year.
(c) Deferral.
(i) Deferral Elections--In General. The Executive may elect
to defer payment of all or any part of any incentive bonus compensation payable
under Section 3(b) by making an election, in a manner prescribed by the Company,
on or before December 31 of the calendar year before the fiscal year begins (or
such earlier date as may be necessary to comply with the applicable tax laws and
regulations).
(ii) Deferral Elections--Performance-Based Compensation.
For any incentive bonus compensation that qualifies as performance-based
compensation under Treas. Reg. Section 1.409A-1(e) and is based upon a
performance period of at least twelve (12) months, the Executive may make a
deferral election at any time before the date that is six (6) months before the
applicable performance period ends, but only if (i) the incentive bonus
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compensation is not readily ascertainable when the election is made and (ii) the
service provider has performed services continuously from the later of the
beginning of the performance period or the date the performance criteria are
established.
(iii) Amounts Subject to Section 162(m). If any amount of
Base Salary, any amount payable under the Bonus Plan, or any other amount
payable to the Executive is not currently deductible under Section 162(m) of the
Internal Revenue Code of 1986, as amended (the "Code"), or like or successor
provisions (a "Non-Deductible Amount"), the Company will defer payment of the
Non-Deductible Amount until section 162(m) no longer applies to the Executive.
Any amounts so deferred will be credited to a bookkeeping account in the name of
the Executive as of the date scheduled for payment (the "Deferred Compensation
Account"). The Deferred Compensation Account will be credited with interest as
of each June 30 during the term of deferral, compounded annually, at an annual
rate equal to the annual rate of interest announced by Citibank N.A. in New
York, New York as its base rate in effect on such June 30, but limited to a
maximum annual rate of 9%.
(iv) Payment of Amounts Deferred and Vested On or Before
December 31, 2004. Amounts credited to the Executive's Deferred Compensation
Account on or before December 31, 2004, and any subsequently credited interest,
will be paid in cash to the Executive (or the Executive's designated beneficiary
if the Executive dies before payment,) subject to applicable withholding taxes.
The Company will choose the payment date, which will be no later than 90 days
after Executive's employment with the Company terminates, unless the Executive
requests before terminating a later payment date or dates and the Company agrees
to the request.
(v) Payment of Amounts Deferred and Vested After December
31, 2004. Subject to Section 6(j), amounts credited to the Executive's Deferred
Compensation Account after December 31, 2004 will be paid to the Executive (or
the Executive's designated beneficiary if the Executive dies before payment),
subject to applicable withholding taxes on, or as soon as practicable after, the
date the Executive separates from service with the Company (as defined in Treas.
Reg. section 1.409A-1(h)). The Non-Deductible Amount will be paid at the
earliest date at which the Company reasonably expects that the deduction will
not be limited or eliminated by Code section 162(m). The Company, in its sole
discretion, may provide an investment facility for all or a portion of such
deferred amounts, but is not required to do so.
4. (a) Equity-Based Compensation. The Executive shall be eligible
to participate in the Amended and Restated Fiscal 2002 Share Incentive Plan or
such other share incentive plan that is approved by the stockholders of the
Company (the "Share Incentive Plan"). Any awards or opportunities granted to the
Executive shall be subject to the terms and conditions of the Share Incentive
Plan, which are incorporated herein by reference. The terms of such equity-based
compensation awards shall be set forth in separate grant letters approved by the
Stock Plan Subcommittee of the Compensation Committee.
(b) Certain Conditions. Executive acknowledges and agrees that any
grant of equity-based compensation shall be effective as provided only to the
extent permitted by the Share Incentive Plan, and this Agreement shall not
obligate the Company to adopt any successor plan providing for the grant of
equity-based compensation. If authority over the Company's equity compensation
programs is changed from the Stock Plan Subcommittee to the Compensation
Committee (or other committee), then after such change, references herein to the
Stock Plan Subcommittee shall be to the appropriate committee.
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5. Benefits.
(a) Standard Benefits. During the Term of Employment, the
Executive shall be entitled to participate in all pension and retirement
savings, fringe benefit and welfare plans, including life insurance, medical,
health and accident, disability, and vacation plans and programs maintained by
the Company from time to time for senior executives at a level commensurate with
his position. The Executive acknowledges that participation in such programs may
result in the receipt by him of additional taxable income.
(b) Perquisite Reimbursement; Financial Counseling. The Company
shall reimburse the Executive for the actual expenses incurred by him in
connection with his professional standing, in accordance with the guidelines set
out in the Company's Senior Executive Compensation Program Perquisite Plan and
upon presentation of proper expense statements or vouchers or such other
supporting information as the Company may reasonably require of the Executive.
Such reimbursement shall generally occur within seventy-five (75) days after the
end of the calendar year of presentment, provided that such presentment occurs
within ninety (90) days after the date the related expense were incurred.
Notwithstanding the above, to the extent that the expenses were incurred in one
calendar year and presentment occurs in the following calendar year, such
reimbursement shall occur by the end of the calendar year in which the
presentment occurs. In no event shall the gross amount of such reimbursements be
greater than $15,000.00 in respect of any calendar year, nor shall amounts that
are not reimbursed in one calendar year up to the $15,000.00 per year limitation
be able to be used in another calendar year or otherwise be made available to
the Executive. Additionally, the Company will pay directly to the service
provider following presentment of invoice(s) reasonably acceptable to the
Company up to $5,000.00 per year for reasonable financial counseling services
for the Executive, and in no event shall amounts up to the $5,000.00 per year
limitation that are not paid in one calendar year be able to be used in another
calendar year or otherwise be made available to the Executive. The Executive
acknowledges that participation in such programs will result in the receipt by
him of additional taxable income.
(c) Executive Auto. The Executive will participate in the
Executive Automobile Program of the Company, and may elect to be provided an
automobile having an acquisition value of up to $50,000.00. Alternatively, the
Executive may receive an automobile allowance in the gross monthly amount of
$1,100.00. The Executive acknowledges that participation in this program will
result in the receipt by him of additional taxable income.
(d) Expenses. The Company agrees to reimburse the Executive for
all reasonable and necessary travel (inclusive of first class air travel),
business entertainment and other business out-of-pocket expenses incurred or
expended by him in connection with the performance of his duties hereunder upon
presentation of proper expense statements or vouchers or such other supporting
information as the Company may reasonably require of the Executive. The timing
of payment of such reimbursements and presentation by the Executive of expenses
incurred shall be in accordance with the rules described in Section 5(b).
(e) Spousal Travel. The Executive may upon prior approval of the
Chief Executive Officer, the Executive Chairman or either of their designees
arrange for his spouse or domestic partner to accompany him on up to two (2)
business related travel itineraries per fiscal year, on a reasonable basis, at
Company expense. Any reimbursement for such travel shall require presentation of
proper expense statements or vouchers or such other supporting information as
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the Company may reasonably require of the Executive, and shall be payable within
seventy-five (75) days after the end of the calendar year of presentment. The
Executive acknowledges that participation in this program will result in the
receipt by him of additional taxable income.
(f) Executive Term Life Insurance. During the Term of Employment,
the Company shall continue to pay premiums on the existing term life insurance
policy with a face amount of $5,000,000.00. Such obligation to pay premiums is
subject to standard underwriting conditions. The Executive acknowledges that
this coverage will result in the receipt by him of additional taxable income.
(g) Modification of Benefits. Nothwithstanding anything to the
contrary contained herein, the Company rerseves the right with repsect to any
benefit set forth in this Section 5 to modify such benefit or not to provide
such benefit. Changes in any benefit provided solely to Executive Officers of
the Company shall be subject to approval of the Compensation Committee.
6. Termination.
(a) Permanent Disability. In the event of the "permanent
disability" (as hereinafter defined) of the Executive during the Term of
Employment, the Company shall have the right, upon written notice to the
Executive, to terminate the Executive's employment hereunder, effective upon the
giving of such notice (or such later date as shall be specified in such notice).
In the event of such termination, the Company shall have no further obligations
hereunder, except that the Executive shall be entitled to receive (i) any
accrued but unpaid salary and other amounts to which the Executive otherwise is
entitled hereunder prior to the date of his termination of employment, in
accordance with Section 3(a) and other applicable payment provisions herein;
(ii) bonus compensation earned but not paid under Section 3(b) hereof that
relates to any fiscal year ended prior to the date of his termination of
employment, in accordance with Section 3(b) hereof; (iii) a pro-rata portion of
the annual bonus payout that the Executive would have been entitled to receive
had he remained in employment through the end of the fiscal year during which
termination due to permanent disability occurred, based on the portion of the
fiscal year that has elapsed prior to such termination, and paid in accordance
with Section 3(b) hereof; (iv) reimbursement for financial counseling services
under Section 5(b) hereof for a period of one (1) year from the date of
termination, in accordance with Section 5(b) hereof; and (v) his Base Salary at
a rate equal to the highest rate during the past twelve (12) months for a period
of one (1) year from the date of termination as a result of permanent
disability, in accordance with Section 3(a) hereof (the "Disability Continuation
Period"), paid in accordance with Section 6(j)(i) hereof; provided, however,
that the Company shall only be required to pay that amount of the Executive's
Base Salary which shall not be covered by short-term disability payments or
benefits or long-term disability payments or benefits, if any, to the Executive
under any Company plan or arrangement. In addition, upon termination for
permanent disability, the Executive shall continue to participate, to the extent
permitted by applicable law and regulations and the applicable benefit plan,
program or arrangement, in any and all healthcare, life insurance and accidental
death and dismemberment insurance benefit plans, programs or arrangements of the
Company during the Disability Continuation Period (disregarding any required
delay in payments under Section 6(j)). Thereafter, the Executive's rights to
participate in such programs and plans, or to receive similar coverage, if any,
shall be as determined under such programs. Because continued participation in
any qualified pension and qualified retirement savings plans of the Company is
not permitted during the Disability Continuation Period, the Company shall
provide to the Executive, subject to Section 6(j), cash payments, to be paid in
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accordance with Section 6(j)(i), equal to the sum of (x) the maximum qualified
defined contribution retirement savings plan match for pre-tax and after-tax
contributions allowable by the plan and by applicable laws and regulations for
each year during the Disability Continuation Period (or other period as
expressly provided herein), and (v) the excess of the benefit that would have
been received by the Executive had he been credited with additional years of age
and service equal to the Disability Continuation Period (or other period as
expressly provided herein) over the actual benefit to which the Executive is
entitled, in each case, under any and all qualified and non-qualified defined
benefit pension plans and qualified defined contribution retirement savings
plans in which the Executive participates as of the date of termination of
employment, calculated as of and based upon the Executive's date of termination
(such sum the "Pension Replacement Payment"). Notwithstanding the above, any
amounts payable under this Section 6(a) that are separation pay as described
under Treas. Reg. ss.1.409A-1(b)(9)(iii)(A) shall be paid no later than December
31 of the second calendar year following the year in which the Executive's
termination for permanent disability occurs; any amounts payable under this
Section 6(a) that are not otherwise exempt from Code section 409A are subject
to, and payable in accordance with, Section 6(l) of this Agreement. Except as
otherwise provided in this Section 6(a), the Company will have no further
obligations under Sections 3, 4 and 5 hereof or otherwise. For purposes of this
Section 6(a), "permanent disability" means any disability as defined under the
Company's applicable disability insurance policy or, if no such policy is
available, any physical or mental disability or incapacity that renders the
Executive incapable of performing the services required of him in accordance
with his obligations under Section 2 hereof for a period of six (6) consecutive
months or for shorter periods aggregating six (6) months during any twelve-month
period.
(b) Death. In the event of the death of the Executive during the
Term of Employment, Executive's employment and this Agreement shall
automatically terminate. In the event of such termination the Company shall have
no further obligations hereunder, except to pay the Executive's beneficiary or
legal representative (i) any accrued but unpaid salary and other amounts to
which the Executive otherwise is entitled hereunder prior to the date of his
death, in accordance with Section 3(a) and other applicable payment provisions
herein; (ii) bonus compensation earned but not paid under Section 3(b) hereof
that relates to any fiscal year ended prior to the date of his death, in
accordance with Section 3(b) hereof; (iii) a pro-rata portion of the annual
bonus payout the Executive would have been entitled to receive had he remained
in the employ of the Company through the end of the fiscal year during which
termination due to his death occurred, based on the portion of the fiscal year
that has elapsed prior to such termination, and paid in accordance with Section
3(b) hereof; (iv) reimbursement for financial counseling services under Section
5(b) hereof for a period of one (1) year from the date of termination, in
accordance with Section 5(b) hereof; and (v) for a period of one (1) year from
the date of his death, the Executive's Base Salary as established under Section
3(a) hereof as of the date of his death, in accordance with Section 3(a) hereof;
provided, however, that, except as otherwise provided in this Section 6(b), the
Company will have no further obligations under Sections 3, 4 and 5 hereof or
otherwise.
(c) Termination Without Cause. The Company shall have the right,
upon ninety (90) days' prior written notice given to the Executive, to terminate
the Executive's employment for any reason whatsoever (except for Cause (as
defined below) which is covered by Section 3(d)). In the event of such
termination, the Company shall have no further obligations hereunder, except
that the Executive shall be entitled to (i) receive any accrued but unpaid
salary and other amounts to which the Executive otherwise is entitled hereunder
prior to the date of his termination without Cause, in accordance with Section
3(a) and other applicable payment provisions herein; (ii) receive bonus
compensation earned but not paid under Section 3(b) hereof that relates to any
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fiscal year ended prior to the date of his termination without Cause, in
accordance with Section 3(b) hereof; (iii) receive a pro-rata portion of the
annual bonus payout that the Executive would have been entitled to receive had
he remained in employment through the end of the fiscal year during which the
termination without Cause occurred, based on the portion of the fiscal year that
has elapsed prior to such termination, and paid in accordance with Section 3(b)
hereof; (iv) receive as damages (A) for a period ending on a date two (2) years
from the date of termination without Cause, in accordance with the regular
payroll policies of the Company in effect from time to time, his Base Salary as
established under and in accordance with Section 3(a) hereof and (B) bonus
compensation equal to fifty percent (50%) of the average of the actual annual
bonuses paid or payable to the Executive under the Bonus Plan during the past
two (2) completed fiscal years; (v) receive reimbursement for financial
counseling services under Section 5(b) hereof for a period of two (2) years from
the date of termination, in accordance with Section 5(b) hereof; and (vi)
participate for a period ending on a date two (2) years from the date of
termination without Cause (the "Without Cause Continuation Period"), to the
extent permitted by applicable law and regulations and the applicable benefit
plan, program or arrangement, in any and all qualified and non-qualified pension
and qualified retirement savings, healthcare, life insurance and accidental
death and dismemberment insurance benefit plans, programs or arrangements, on
terms identical to those applicable to full-term senior officers of the Company.
Because continued participation in any qualified pension and qualified
retirement savings plans of the Company is not permitted during the Without
Cause Continuation Period, the Company shall provide to the Executive, subject
to Section 6(j), cash payments, to be paid in accordance with Section 6(j)(i),
equal to the Pension Replacement Payment (as defined in Section 6(a)) with
respect to the Without Cause Continuation Period. Notwithstanding the above, any
amounts payable under this Section 6(c) that are separation pay as described
under Treas. Reg. ss.1.409A-1(b)(9)(iii)(A) shall be paid no later than December
31 of the second calendar year following the year in which the Executive's
termination pursuant to this section 6(c) occurs; any amounts payable under this
Section 6(c) that are not otherwise exempt from Code section 409A are subject
to, and payable in accordance with, Section 6(j) of this Agreement. Except as
otherwise provided in this Section 6(c), the Company will have no further
obligations under Sections 3, 4 and 5 hereof or otherwise. In the event of
termination pursuant to this Section 6(c), the Executive shall not be required
to mitigate his damages hereunder.
(d) Cause. The Company shall have the right, upon notice to the
Executive, to terminate the Executive's employment under this Agreement for
"Cause" (as defined below), effective upon the Executive's receipt of such
notice (or such later date as shall be specified in such notice), and the
Company shall have no further obligations hereunder, except to pay the Executive
his accrued but unpaid salary, in accordance with Section 3(a) hereof, and
provide the Executive with any benefit under the employee benefit programs and
plans of the Company as determined under such programs and plans upon and as of
such a termination for Cause. Except as otherwise provided in this Section 6(d),
the Company will have no further obligations under Sections 3, 4 and 5 hereof or
otherwise.
For purposes of this Agreement, "Cause" means:
(i) a material breach of, or the willful failure or refusal
by the Executive to perform and discharge duties or obligations he has agreed to
perform or assume under this Agreement (other than by reason of disability or
death) that, if capable of correction, is not corrected within ten (10) business
days following notice thereof to the Executive by the Company, such notice to
state with specificity the nature of the breach, failure or refusal;
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(ii) willful misconduct by the Executive, unrelated to the
Company or any of its subsidiaries or affiliates, that could reasonably be
anticipated to have a material adverse effect on the Company or any of its
subsidiaries or affiliates (the determination of Cause to be made by the Chief
Executive Officer or Executive Chairman in his or her reasonable judgment or the
Company's Board of Directors in its reasonable judgment);
(iii) the Executive's gross negligence, whether related or
unrelated to the business of the Company or any of its subsidiaries or
affiliates which could reasonably be anticipated to have a material adverse
effect on the Company or any of its subsidiaries or affiliates that, if capable
of correction, is not corrected within ten (10) business days following notice
thereof to the Executive by the Company, such notice to state with specificity
the nature of the conduct complained of (the determination of Cause to be made
by the Chief Executive Officer or Executive Chairman in his or her reasonable
judgment or the Company's Board of Directors in its reasonable judgment);
(iv) the Executive's failure to follow a lawful directive
of the Chief Executive Officer, Executive Chairman or the Board of Directors of
the Company that is within the scope of the Executive's duties for a period of
ten (10) business days after notice from the Chief Executive Officer, Executive
Chairman or the Board of Directors of the Company specifying the performance
required;
(v) any violation by the Executive of a policy contained in
the Code of Conduct of the Company (the determination of Cause to be made by the
Chief Executive Officer or Executive Chairman in his or her reasonable judgment
or the Company's Board of Directors in its reasonable judgment);
(vi) drug or alcohol abuse by the Executive that materially
affects the Executive's performance of his duties under this Agreement; or
(vii) conviction of, or the entry of a plea of guilty or
nolo contendere by the Executive for, any felony.
(e) Termination by Executive. The Executive shall have the right,
exercisable at any time during the Term of Employment, to terminate his
employment for any reason whatsoever, upon ninety (90) days' prior written
notice to the Company. Upon such termination, the Company shall have no further
obligations hereunder other than to (i) pay the Executive his accrued but unpaid
salary, in accordance with Section 3(a) hereof; (ii) provide bonus compensation,
if any, earned but not paid under Section 3(b) hereof that relates to any fiscal
year ended prior to the date of such a termination by the Executive, in
accordance with Section 3(b) hereof; and (iii) provide the Executive with any
benefit under the employee benefit programs and plans of the Company as
determined under such programs and plans upon and as of such a termination by
the Executive. Except as otherwise provided in this Section 6(e), the Company
will have no further obligations under Sections 3, 4 and 5 hereof or otherwise.
(f) Termination by Executive for Material Breach. The Executive
shall have the right, exercisable by notice to the Company, to terminate his
employment effective ninety (90) days after the giving of such notice, if, at
any time during the Term of Employment, the Company shall be in material breach
of its obligations hereunder; provided, however, that such notice must be
provided to the Company within thirty (30) days of the date on which the
Executive obtains knowledge or reasonably should obtain knowledge of such
material breach; and provided further, that such termination will not become
effective if within thirty (30) days after receiving the notice the Company
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shall have cured all such material breaches of its obligations hereunder. For
purposes of this Section 6(f), a material breach shall only be, (i) a material
reduction in the Executive's authority, functions, duties or responsibilities
provided in Section 2 hereof, or (ii) the Company's failure to pay any award
that the Executive is entitled to receive pursuant to the terms of this
Agreement. Such termination shall be deemed to be a termination without Cause
and shall be controlled by the provisions of Section 6(c) hereof. Except as
otherwise provided in this Section 6(f), the Company will have no further
obligations under Sections 3, 4 and 5 hereof or otherwise.
(g) Change of Control.
(i) Definitions. For purposes of this Agreement,
(A) a "Change of Control" shall be deemed to have
occurred upon any of the following events:
(1) a change in control of a nature that would
be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14(A) promulgated under the Securities Exchange Act of 1934, as
amended; or
(2) during any period of two (2) consecutive
years, the individuals who at the beginning of such period constitute the
Company's Board of Directors or any individuals who would be "Continuing
Directors" (as defined below) cease for any reason to constitute a majority
thereof; or
(3) the Company's Class A Common Stock shall
cease to be publicly traded; or
(4) the Company's Board of Directors shall
approve a sale of all or substantially all of the assets of the Company, and
such transaction shall have been consummated; or
(5) the Company's Board of Directors shall
approve any merger, exchange, consolidation, or like business combination or
reorganization of the Company, the consummation of which would result in the
occurrence of any event described in Section 6(g)(i)(A)(2) or (3) above, and
such transaction shall have been consummated.
Notwithstanding the foregoing, (X) changes in
the relative beneficial ownership among members of the Lauder family and
family-controlled entities shall not, by itself, constitute a Change of Control
of the Company, (Y) any spin-off of a division or subsidiary of the Company to
its stockholders shall not constitute a Change of Control of the Company.
(B) "Continuing Directors" shall mean (1) the
directors in office on July 1, 2009 and (2) any successor to such directors and
any additional director who after July 1, 2009 was nominated or selected by a
majority of the Continuing Directors in office at the time of his or her
nomination or selection.
(C) "Good Reason" means the occurrence of any of the
following, without the express written consent of the Executive, within two (2)
years after the occurrence of a Change in Control:
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(1) (a) the assignment to the Executive of any
duties inconsistent in any material adverse respect with the Executive's
position, authority or responsibilities as contemplated by Section 2 hereof, or
(b) any other material adverse change in such position, including title,
authority or responsibilities;
(2) any failure by the Company to comply with
any provisions of Sections 3, 4 or 5 hereof or a material reduction of the
overall amounts set by the Compensation Committee or the Stock Plan Subcommittee
and in effect within twelve (12) months prior to the Change in Control, other
than an insubstantial or inadvertent failure remedied by the Company promptly
after receipt of notice thereof given by the Executive;
(3) the Company's requiring the Executive to be
based at any office or location more than fifty (50) miles from that location at
which he performed his services specified under the provisions of Section 2
immediately prior to the Change in Control, except for travel reasonably
required in the performance of the Executive's responsibilities; or
(4) any failure by the Company to obtain the
assumption and agreement to perform this Agreement by a successor as
contemplated by Section 14, unless such assumption occurs by operation of law.
(ii) Termination for Good Reason. Within two (2) years
after the occurrence of a Change of Control, the Executive may terminate his
employment for Good Reason. Such termination shall be deemed to be a termination
without Cause and shall be controlled by the provisions of Section 6(c) hereof.
Except as otherwise provided in this Section 6(g)(ii), the Company will have no
further obligations under Sections 3, 4 and 5 hereof or otherwise.
(h) Certain Limitations.
(i) Notwithstanding anything to the contrary contained
herein, in the event that any amount or benefit paid or distributed to the
Executive pursuant to this Agreement, taken together with any amounts or
benefits otherwise paid or distributed to the Executive by the Company or any
affiliated company (collectively, the "Covered Payments"), are or become subject
to the tax (the "Excise Tax") imposed under Section 4999 of the Code, or any
similar tax that may hereafter be imposed, the Covered Payments shall be reduced
(but not below zero) until no portion of such payments would be subject to
Excise Tax.
(ii) For purposes of determining whether any of the Covered
Payments will be subject to the Excise Tax and the amount of such Excise Tax,
(A) such Covered Payments will be treated as
"parachute payments" to the extent they exceed the "2.99 base amount threshold"
within the meaning of Section 280G of the Code, and all "parachute payments" in
excess of the "base amount" (as defined under Section 280G(b)(3) of the Code)
shall be treated as subject to the Excise Tax, unless, and except to the extent
that, in the good faith judgment of the Company's independent certified public
accountants appointed prior to the date of the change in ownership or control or
tax counsel selected by such accountants (the "Accountants"), the Company has a
reasonable basis to conclude that such Covered Payments (in whole or in part)
either do not constitute "parachute payments" or are otherwise not subject to
such Excise Tax, and
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(B) the value of any non-cash benefits or any
deferred payment or benefit shall be determined by the Accountants in accordance
with the principles of Section 280G of the Code.
(i) Effect of Termination. Upon the termination of the Executive's
employment hereunder for any reason, the Company shall have no further
obligations hereunder, except as otherwise provided herein. The Executive,
however, shall continue to have the obligations provided for in Sections 7 and 8
hereof. Furthermore, upon any such termination, the Executive shall be deemed to
have resigned immediately from all offices and directorships held by him in the
Company or any of its subsidiaries.
(j) Section 409A of the Code. It is the intention of the parties
to this Agreement that no payment or entitlement pursuant to this Agreement will
give rise to any adverse tax consequences to the Executive under Section 409A of
the Code and Department of Treasury regulations and other interpretive guidance
issued thereunder, including that issued after the date hereof (collectively,
"Section 409A"). The Agreement shall be interpreted to that end and, consistent
with that objective and notwithstanding any provision herein to the contrary,
the Company may unilaterally take any action it deems necessary or desirable to
amend any provision herein to avoid the application of or excise tax under
Section 409A. Further, no effect shall be given to any provision herein in a
manner that reasonably could be expected to give rise to adverse tax
consequences under that provision. The Company shall from time to time compile a
list of "specified employees" as defined in, and pursuant to, Treas. Reg.
Section 1.409A-1(i). Notwithstanding any other provision herein, if the
Executive is a specified employee on the date of termination, no payment of
compensation under this Agreement shall be made to the Executive during the
period lasting six (6) months from the date of termination unless the Company
determines that there is no reasonable basis for believing that making such
payment would cause the Executive to suffer any adverse tax consequences
pursuant to Section 409A of the Code. If any payment to the Executive is delayed
pursuant to the foregoing sentence, such payment instead shall be made on the
first business day following the expiration of the six-month period referred to
in the prior sentence, unless specified otherwise in Section 6(j)(i) hereof.
Although the Company shall consult with Executive in good faith regarding
implementation of this Section 6(j), neither the Company nor its employees or
representatives shall have liability to the Executive with respect to any
additional taxes that the Executive may be subject to in the event that any
amounts under this Agreement are determined to violate Code section 409A.
(i) Notwithstanding the above, amounts described as being
subject to payment in accordance with the provisions of this Section 6(l)(i)
shall be subject to a delay in payment for a six-month period following the date
of termination and shall be paid as follows: For any Base Salary under Section
6(a)(v) or Section 6(c)(iv)(A) to be continued beyond the date of termination
and for any Pension Replacement Payment, all payments that would have been made
during the six-month period immediately following the date of termination shall
be made in a single cash payment on the first business day following the
expiration of such six-month period, and as of the first business day following
the expiration of such six-month period all such payments shall resume in
accordance with the regular payroll practices of the Company until the end of
the specified period; any bonus payments under Section 6(c)(iv)(B) shall be paid
in a single lump sum payment on the first business day following the expiration
of such six-month period.
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(k) Release of Claims. As a condition precedent to the receipt of
payments and benefits pursuant to this Section, the Executive, or, in the case
of his death or Disability that prevents the Executive from performing his
obligation under this Section 6(k), his personal representative, and his
beneficiary, if applicable, will execute an effective general release of claims
against the Company and its subsidiaries and affiliates and their respective
directors, officers, employees, attorneys and agents; provided, however, that
such effective release will not affect any right that the Executive, or in the
event of his death, his personal representative or beneficiary, otherwise has to
any payment or benefit provided for in this Agreement or to any vested benefits
the Executive may have in any employee benefit plan of Company or any of its
subsidiaries or affiliates, or any right the Executive has under any other
agreement between the Executive and the Company or any of its subsidiaries or
affiliates that expressly states that the right survives the termination of the
Executive's employment. Such release shall be substantially in the form attached
hereto as Exhibit A or such form that is used from time to time by the Company
for other senior employees based in the United States.
(l) Modification of Severance Payments and Benefits.
Nothwithstanding anything to the contrary contained herein except as provided in
this Section 6(l), the Company rerseves the right with repsect to any severance
payments or benefits set forth in this Section 6 to modify such payments or
benefits or not to provide such payments or benefits. Changes in any severance
payment or benefit provided to the Executive may only be made by the
Compensation Committee (or the Stock Plan Subcommittee, if there is one, and the
change relates to matters subject to the authority of such Subcommittee). Unless
agreed to by the Executive, no change to any severance payments or benefits set
forth in this Section 6 will be effective until two years after such change is
approved by the Compensation Committee (or Stock Plan Subcommittee). No changes
may be made in severance payments or benefits set forth in this Section 6 either
(i) at such time the Company is contemplating one or more transactions that will
result in a Change of Control or (ii) after a Change of Control.
7. Confidentiality; Ownership.
(a) The Executive agrees that he shall forever keep secret and
retain in strictest confidence and not divulge, disclose, discuss, copy or
otherwise use or suffer to be used in any manner, except in connection with the
Business of the Company, its subsidiaries or affiliates and any other business
or proposed business of the Company or any of its subsidiaries or affiliates,
any "Protected Information" in any "Unauthorized" manner or for any
"Unauthorized" purpose (as such terms are hereinafter defined).
(i) "Protected Information" means trade secrets,
confidential or proprietary information and all other knowledge, know-how,
information, documents or materials owned, developed or possessed by the Company
or any of its subsidiaries or affiliates, whether in tangible or intangible
form, pertaining to the Business or any other business or proposed business of
the Company or any of its subsidiaries or affiliates, including, but not limited
to, research and development, operations, systems, data bases, computer programs
and software, designs, models, operating procedures, knowledge of the
organization, products (including prices, costs, sales or content), processes,
formulas, techniques, machinery, contracts, financial information or measures,
business methods, business plans, details of consultant contracts, new personnel
hiring plans, business acquisition plans, customer lists, business relationships
and other information owned, developed or possessed by the Company or its
subsidiaries or affiliates; provided that Protected Information shall not
include information that becomes generally known to the public or the trade
without violation of this Section 7.
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(ii) "Unauthorized" means: (A) in contravention of the
policies or procedures of the Company or any of its subsidiaries or affiliates;
(B) otherwise inconsistent with the measures taken by the Company or any of its
subsidiaries or affiliates to protect their interests in any Protected
Information; (C) in contravention of any lawful instruction or directive, either
written or oral, of an employee of the Company or any of its subsidiaries or
affiliates empowered to issue such instruction or directive; or (D) in
contravention of any duty existing under law or contract. Notwithstanding
anything to the contrary contained in this Section 7, the Executive may disclose
any Protected Information to the extent required by court order or decree or by
the rules and regulations of a governmental agency or as otherwise required by
law or to his legal counsel and, in connection with a determination under
Section 6(h), to accounting experts; provided that the Executive shall provide
the Company with prompt notice of such required disclosure in advance thereof so
that the Company may seek an appropriate protective order in respect of such
required disclosure.
(b) The Executive acknowledges that all developments, including,
without limitation, inventions (patentable or otherwise), discoveries, formulas,
improvements, patents, trade secrets, designs, reports, computer software, flow
charts and diagrams, procedures, data, documentation, ideas and writings and
applications thereof relating to the Business or any business or planned
business of the Company or any of its subsidiaries or affiliates that, alone or
jointly with others, the Executive may conceive, create, make, develop, reduce
to practice or acquire during the Executive's employment with the Company or any
of its subsidiaries or affiliates (collectively, the "Developments") are works
made for hire and shall remain the sole and exclusive property of the Company.
The Executive hereby assigns to the Company, in consideration of the payments
set forth in Section 3(a) hereof, all of his right, title and interest in and to
all such Developments. The Executive shall promptly and fully disclose all
future material Developments to the Board of Directors of the Company and, at
any time upon request and at the expense of the Company, shall execute,
acknowledge and deliver to the Company all instruments that the Company shall
prepare, give evidence and take all other actions that are necessary or
desirable in the reasonable opinion of the Company to enable the Company to file
and prosecute applications for and to acquire, maintain and enforce all letters
patent and trademark registrations or copyrights covering the Developments in
all countries in which the same are deemed necessary by the Company. All
memoranda, notes, lists, drawings, records, files, computer tapes, programs,
software, source and programming narratives and other documentation (and all
copies thereof) made or compiled by the Executive or made available to the
Executive concerning the Developments or otherwise concerning the Business or
planned business of the Company or any of its subsidiaries or affiliates shall
be the property of the Company or such subsidiaries or affiliates and shall be
delivered to the Company or such subsidiaries or affiliates promptly upon the
expiration or termination of the Term of Employment.
(c) During the Term of Employment, the Company, its subsidiaries
and affiliates shall have the exclusive right to use the Executive's name and
image throughout the world in its advertising and promotional materials in
connection with the advertising and promotion of the Company, its subsidiaries
and affiliates, and their products. After the expiration of the Term of
Employment, the Company, it subsidiaries and affiliates shall have the
non-exclusive right in perpetuity to use the Executive's name and image
throughout the world solely in connection with promotional materials related to
the history of the Company, it subsidiaries and affiliates, and their products.
The consideration for such rights is the payments set forth in Section 3(a)
hereof. The rights conveyed hereby may be assigned by the Company, its
subsidiaries or affiliates to a successor in the interest of the Company or the
relevant subsidiary or affiliate or their businesses or product lines.
13
(d) The provisions of this Section 7 shall, without any limitation
as to time, survive the expiration or termination of the Executive's employment
hereunder, irrespective of the reason for any termination.
8. Covenant Not to Compete. The Executive agrees that during the
Executive's employment with the Company or any of its subsidiaries or affiliates
and for a period of two (2) years commencing upon the expiration or termination
of the Executive's employment for any reason whatsoever (the "Non-Compete
Period"), the Executive shall not, directly or indirectly, without the prior
written consent of the Company:
(a) solicit, entice, persuade or induce any employee, consultant,
agent or independent contractor of the Company or of any of its subsidiaries or
affiliates to terminate his, her or its employment with the Company or such
subsidiary or affiliate, to become employed by any person, firm or corporation
other than the Company or such subsidiary or affiliate or approach any such
employee, consultant, agent or independent contractor for any of the foregoing
purposes, or authorize or assist in the taking of any such actions by any third
party (for purposes of this Section 8 (a), the terms "employee," "consultant,"
"agent" and "independent contractor" shall include any persons with such status
at any time during the six (6) months preceding any solicitation in question);
or
(b) directly or indirectly engage, participate, or make any
financial investment in, or become employed by or render consulting, advisory or
other services to or for any person, firm, corporation or other business
enterprise, wherever located, which is engaged, directly or indirectly, in
competition with the Business or any business of the Company or any of its
subsidiaries or affiliates as conducted or any business proposed to be conducted
at the time of the expiration or termination of the Executive's employment with
the Company and its subsidiaries and affiliates; provided, however, that nothing
in this Section 8(b) shall be construed to preclude the Executive from making
any investments in the securities of any business enterprise whether or not
engaged in competition with the Company or any of its subsidiaries or
affiliates, to the extent that such securities are actively traded on a national
securities exchange or in the over-the-counter market in the United States or on
any foreign securities exchange and represent, at the time of acquisition, not
more than 3% of the aggregate voting power of such business enterprise.
To ensure that the Company is able to enforce these provisions in Sections 8(a)
and (b) above, the Executive and the Company further agree that if such
noncompetition and nonsolicitation requirements should be violated during this
additional two-year period after the Executive's termination of employment, the
remedy (determined at the Company's option) shall be either equitable relief (in
the form of an injunction to stop the violation), or liquidated damages payable
by the Executive to the Company in an amount equal to (a) (i) (A) twenty-four
(24) minus (B) the number of full months between the date of Executive's
termination and the date of breach ("Months Complied") divided by (ii) 12, times
(b) one year's Base Salary in effect at the time of termination. In other words:
Twenty-four (24) - Months Complied
---------------------------------- x One Year's Base Salary
12
If equitable relief is elected by the Company as an alternative to liquidated
damages, any equitable relief shall not include any forfeiture or cash refund of
monies or benefits. If liquidated damages is elected by the Company, the Company
14
may elect not to pay amounts that would otherwise be payable but for the breach;
provided that, the Executive would remain liable to the Company to the extent
that the liquidated damages exceeded the amounts not paid by the Company. The
foregoing shall have no impact on the operation of the provisions of any other
compensation program of the Company or its subsidiaries, including without
limitation the Amended and Restated Fiscal 2002 Share Incentive Plan.
9. Specific Performance. The Executive acknowledges that the
services to be rendered by the Executive are of a special, unique and
extraordinary character and, in connection with such services, the Executive
will have access to confidential information vital to the Company's Business and
the other current or planned businesses of it and its subsidiaries and
affiliates. By reason of this, the Executive consents and agrees that if the
Executive violates any of the provisions of Sections 7 or 8 hereof, the Company
and its subsidiaries and affiliates would sustain irreparable injury and that
monetary damages would not provide adequate remedy to the Company and that the
Company shall be entitled to have Section 7 or 8 hereof specifically enforced by
any court having equity jurisdiction. Nothing contained herein shall be
construed as prohibiting the Company or any of its subsidiaries or affiliates
from pursuing any other remedies available to it or them for such breach or
threatened breach, including the recovery of damages from the Executive. This
provision shall, without any limitation as to time, survive the expiration or
termination of the Executive's employment hereunder, irrespective of the reason
for any termination.
10. Deductions and Withholding. The Executive agrees that the
Company or its subsidiaries or affiliates, as applicable, shall withhold from
any and all compensation paid to and required to be paid to the Executive
pursuant to this Agreement, all Federal, state, local and/or other taxes which
the Company determines are required to be withheld in accordance with applicable
statutes or regulations from time to time in effect and all amounts required to
be deducted in respect of the Executive's coverage under applicable employee
benefit plans. For purposes of this Agreement and calculations hereunder, all
such deductions and withholdings shall be deemed to have been paid to and
received by the Executive.
11. Entire Agreement. Except for the Amended and Restated Fiscal
2002 Share Incentive Plan, the Executive's outstanding stock option and other
equity-compensation agreements, the Executive Annual Incentive Plan, the
Executive Perquisites Program, the Executive Automobile Program, the term life
insurance arrangement between the Company and the Executive, the Company's
qualified and non-qualified defined benefit pension plans, the Company's
qualified defined contribution retirement savings plan and applicable successor
plans or agreements, this Agreement embodies the entire agreement of the parties
with respect to the Executive's employment, compensation, perquisites and
related items and supersedes any other prior oral or written agreements,
arrangements or understandings between the Executive and the Company or any of
its subsidiaries or affiliates, and any such prior agreements, arrangements or
understandings are hereby terminated and of no further effect. This Agreement
may not be changed or terminated orally but only by an agreement in writing
signed by the parties hereto.
12. Waiver. The waiver by the Company of a breach of any provision
of this Agreement by the Executive shall not operate or be construed as a waiver
of any subsequent breach by him. The waiver by the Executive of a breach of any
provision of this Agreement by the Company shall not operate or be construed as
a waiver of any subsequent breach by the Company.
15
13. Governing Law; Jurisdiction.
(a) This Agreement shall be subject to, and governed by, the laws
of the State of New York applicable to contracts made and to be performed
therein, without regard to conflict of laws principles.
(b) Any action to enforce any of the provisions of this Agreement
shall be brought in a court of the State of New York located in the Borough of
Manhattan of the City of New York or in a Federal court located within the
Southern District of New York. The parties consent to the jurisdiction of such
courts and to the service of process in any manner provided by New York law.
Each party irrevocably waives any objection which it may now or hereafter have
to the laying of the venue of any such suit, action or proceeding brought in
such court and any claim that such suit, action or proceeding brought in such
court has been brought in an inconvenient forum and agrees that service of
process in accordance with the foregoing sentences shall be deemed in every
respect effective and valid personal service of process upon such party.
14. Assignability. The obligations of the Executive may not be
delegated and, except with respect to the designation of beneficiaries in
connection with any of the benefits payable to the Executive hereunder, the
Executive may not, without the Company's written consent thereto, assign,
transfer, convey, pledge, encumber, hypothecate or otherwise dispose of this
Agreement or any interest herein. Any such attempted delegation or disposition
shall be null and void and without effect. The Company and the Executive agree
that this Agreement and all of the Company's rights and obligations hereunder
may be assigned or transferred by the Company to and shall be assumed by and be
binding upon any successor to the Company. Unless assumption occurs by operation
of law, the Company shall require any successor by an agreement in form and
substance satisfactory to the Executive, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent as the Company
would be required to perform if no such succession had taken place. The term
"successor" means, with respect to the Company or any of its subsidiaries, any
corporation or other business entity which, by merger, consolidation, purchase
of the assets or otherwise acquires all or a majority of the operating assets or
business of the Company.
15. Severability. If any provision of this Agreement or any part
thereof, including, without limitation, Sections 7 and 8 hereof, as applied to
either party or to any circumstances shall be adjudged by a court of competent
jurisdiction to be void or unenforceable, the same shall in no way affect any
other provision of this Agreement or remaining part thereof, or the validity or
enforceability of this Agreement, which shall be given full effect without
regard to the invalid or unenforceable part thereof.
If any court construes any of the provisions of Section 7 or 8
hereof, or any part thereof, to be unreasonable because of the duration of such
provision or the geographic scope thereof, such court may reduce the duration or
restrict or redefine the geographic scope of such provision and enforce such
provision as so reduced, restricted or redefined.
16. Notices. All notices to the Company or the Executive permitted
or required hereunder shall be in writing and shall be delivered personally, by
telecopier or by courier service providing for next-day or two-day delivery or
sent by registered or certified mail, return receipt requested, to the following
addresses:
16
The Company:
The Xxxxx Xxxxxx Companies Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: General Counsel
Tel: (000) 000-0000
Fax: (000) 000-0000
The Executive:
Xxxxxxx X. Xxxxx
c/o The Xxxxx Xxxxxx Companies Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
Either party may change the address to which notices shall be sent by sending
written notice of such change of address to the other party. Any such notice
shall be deemed given, if delivered personally, upon receipt; if telecopied,
when telecopied; if sent by courier service providing for next-day or two-day
delivery, the next business day or two business days, as applicable, following
deposit with such courier service; and if sent by certified or registered mail,
three days after deposit (postage prepaid) with the U.S. mail service.
17. No Conflicts. The Executive hereby represents and warrants to
the Company that his execution, delivery and performance of this Agreement and
any other agreement to be delivered pursuant to this Agreement will not (i)
require the consent, approval or action of any other person or (ii) violate,
conflict with or result in the breach of any of the terms of, or constitute (or
with notice or lapse of time or both, constitute) a default under, any
agreement, arrangement or understanding with respect to the Executive's
employment to which the Executive is a party or by which the Executive is bound
or subject. The Executive hereby agrees to indemnify and hold harmless the
Company and its directors, officers, employees, agents, representatives and
affiliates (and such affiliates' directors, officers, employees, agents and
representatives) from and against any and all losses, liabilities or claims
(including interest, penalties and reasonable attorneys' fees, disbursements and
related charges) based upon or arising out of the Executive's breach of any of
the foregoing representations and warranties.
18. Legal Fees. Following a Change of Control, the Company shall
reimburse the Executive up to $20,000.00, in the aggregate, for all legal fees
and related expenses (including the costs of experts, evidence and counsel)
reasonably and in good faith incurred by the Executive in an action (i) by the
Executive to obtain or enforce any right or benefit to which the Executive is
entitled under this Agreement or (ii) by the Company to enforce a
post-termination covenant referred to in Section 7 or 8 against the Executive,
in each case, provided that the Executive substantially prevails in such action.
Such amount shall be reimbursed to the Executive by the end of the calendar year
in which the Executive substantially prevails in such action, based on the date
of any settlement, judgment, or other official document evidencing same.
17
19. Cooperation. During the Term of Employment and thereafter,
Executive shall provide reasonable cooperation in connection with any action or
proceeding (or any appeal therefrom) that relates to events occurring during
Executive's employment with the Company.
20. Paragraph Headings. The paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
21. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first written above.
THE XXXXX XXXXXX COMPANIES INC.
By: /s/ Xxx XxXxxx
--------------------------------------
Name: Xxx XxXxxx
Title: Executive Vice President,
Global Human Resources
/s/ Xxxxxxx X. Xxxxx
------------------------------------------
Xxxxxxx X. Xxxxx
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