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EXHIBIT 10.8
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT ("Agreement") is entered into as of March 17,
2000, by and between THE WACKENHUT CORPORATION, a Florida corporation, its
successor or successors (the "COMPANY"), and XXXXXX X. XXXXXXXXX (the
"EXECUTIVE").
The Executive is presently an executive officer of the Company and the
parties wish to continue their employment relationship on the terms of this
Agreement.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements contained in this Agreement, the parties
hereto agree as follows:
1. EMPLOYMENT.
a. RETENTION. The Company agrees to employ the Executive, and the
Executive agrees to accept such employment, subject to the
terms and conditions of this Agreement.
b. EMPLOYMENT TERM. The period during which the Executive shall
serve as an Executive of the Company shall commence on the
date hereof and, unless earlier terminated pursuant to Section
4 of this Agreement, shall expire on the third anniversary of
the date hereof (the "Employment Term"). Thereafter, this
Agreement and the Employment Term shall be automatically
renewed for successive one year terms, unless either party
shall deliver a written notice to the other party during the
last calendar month of the initial three-year term or any
successive one-year term of this Agreement advising the other
party that this Agreement and the Employment period shall be
terminated at the end of such term.
c. DUTIES AND RESPONSIBILITIES. During the Employment Term, the
Executive shall have such authority and responsibility and
perform such duties as may be assigned to him from time to
time at the direction of the Board of Directors of the Company
(the "Board").
2. LOYALTY. Executive agrees that during the Employment Term, he will
devote such time that is reasonably necessary to perform his duties and
responsibilities.
3. COMPENSATION. During the Employment Term, the Company agrees to pay,
and Executive agrees to accept, the amounts set forth below:
a. BASE SALARY. As compensation for all services rendered by
Executive in performance of his duties or obligations under
this Agreement, Company shall pay Executive an annual base
salary of one million five hundred eighty-four thousand
dollars ($1,584,000) (the "Base Salary"). Such base salary
shall be increased (but not decreased) from time to time in
the sole discretion of the Board or the Compensation Committee
of the Board. Such base salary shall be payable in equal
installments, no
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less frequently than monthly, pursuant to the Company's
customary payroll policies in force at the time of payment,
less any required or authorized withholding or payroll
deductions. In addition, the Executive shall be eligible to
receive, on an annual basis a bonus (the "Bonus") in such
amounts and subject to such targets and incentives as set
forth in the Designated Executive Officer Bonus Plan. In no
event shall any such Bonus be less than thirty five percent
(35%) of the Executive's Base Salary, subject to satisfaction
of applicable targets and incentives.
b. EXECUTIVE BENEFITS. In addition to receiving the Base Salary
provided for in Section 3a., Executive shall be entitled
during the Employment Term to participate in all retirement
(subject to any eligibility requirements with respect to any
tax-qualified retirement plans), deferred compensation,
health, dental, disability, life insurance and fringe benefits
or programs now or hereafter established by the Company which
cover the Company's executives or its employees.
c. VACATION. Executive shall be entitled to receive six weeks of
paid vacation for each year during the Employment Term and
shall be entitled to receive paid holidays as enjoyed by all
other employees of the Company.
d. EXPENSES. The Company agrees to reimburse Executive for all
reasonable expenses incurred by him in providing services
under this Agreement in accordance with its policies and
practices regarding expense reimbursement then in effect.
e. AUTOMOBILE ALLOWANCE. Executive shall be entitled to receive
an automobile allowance in accordance with The Wackenhut
Corporation Executive Automobile Policy (the " Executive
Automobile Policy") as in effect on the date hereof. Both the
Company and Executive shall be responsible for paying the
costs related to Executive's automobile in accordance with the
terms of the Executive Automobile Policy.
f. CLUB MEMBERSHIP. The Company will provide Executive with a
corporate membership to a country club mutually acceptable to
Executive and to the Company, including initiation fees and
monthly dues.
4. TERMINATION OF EMPLOYMENT. At any time during the Employment Term, the
Executive or the Company shall have the right to terminate the
Employment Term for any reason effective upon delivery of written
notice to the other party. Upon any such termination, (i) the Company
shall pay to the Executive the unpaid portion of his Salary, payable
through the date of Executive's termination, when and as the same would
have been due and payable hereunder but for such termination and all of
the Executive's vested accrued benefits as of the date of termination
of employment that the Executive is entitled to under the Company's
benefit plans, (ii) the Company shall transfer all of its interest in
any automobile used by the Executive pursuant to the Executive
Automobile Policy and shall pay the balance of any outstanding loans or
leases on such automobile (whether such obligations are those of the
Executive or the Company) so that the Executive owns the automobile
outright (in the event
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such automobile is leased, the Company shall pay the residual cost of
such lease); and (iii) the Retirement Benefit (as defined in Section 5
Below).
5. RETIREMENT BENEFITS. Upon the termination of the Employment Term for
any reason, the Company shall provide the Executive and his spouse with
an annual Retirement Benefit (as defined below). The Retirement Benefit
shall be provided annually to the Executive and his spouse for the
remainder of the Executive's life, and upon the Executive's death, the
Retirement Benefit shall be provided to his spouse for the remainder of
her life. For purposes of this Agreement, the "Retirement Benefit"
shall mean any benefits or perquisites requested by the Executive (or
in the event of his death, his spouse), which shall not exceed $250,000
per year in total cost to the Company. The Retirement Benefit may
include, but is not limited to, health and life insurance, office
space, secretarial services, country club dues, living expenses, travel
allowances and automobile allowances.
a. EQUALIZATION PAYMENT. If any of the Retirement Benefit will be
subject to the tax (the "Excise Tax") imposed by Section 4999
of the Internal Revenue Code of 1986, as amended (the "Code")
(or any similar tax that may hereafter be imposed), the
Company shall pay to the Executive in cash an additional
amount (the "Gross-Up Payment") to enable the Executive to pay
the entire amount of any Excise Tax imposed upon the
Retirement Benefit and any federal, state and local income tax
and Excise Tax imposed upon the Gross-Up Payment. The Gross-Up
Payment is intended to place the Executive in the same
economic position he would have been in if the excise tax did
not apply. The Gross-Up Payment shall be paid to the Executive
within 60 days from the expiration of the Employment Term. For
purposes of determining the Gross-Up Payment pursuant to this
Section 5.a, the Retirement Benefit shall also include any
amounts which would be considered "Parachute Payments" (within
the meaning of Section 280G(b)(2) of the Code) to the
Executive.
b. TAX RATES. For purposes of determining the amount of the
Gross-Up Payment, the Executive shall be deemed to pay Federal
income taxes at the highest marginal rate of Federal income
taxation in the calendar year in which the Gross-Up Payment is
to be made, and state and local income taxes at the highest
marginal rate of taxation in the state and locality of the
Executive's residence on the date of termination, net of the
maximum reduction in Federal income taxes which could be
obtained from deduction of such state and local taxes.
c. TAX CALCULATION. Within 30 days from the expiration of the
Employment Term, the Company shall deliver to the Executive a
written statement (the "Gross-Up Statement") specifying the
total amount of the Gross-Up Payment (if any), together with
all supporting calculations. If the Executive disagrees with
the Company's calculation of said payment, the Executive shall
submit to the Company, no later than 30 days after receipt of
the Company's calculations, a written notice advising the
Company of the disagreement and setting forth his calculation
of said payments. The Executive's failure to submit such
notice within such period shall be conclusively
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deemed to be an agreement by the Executive as to the amount of
the Gross-Up Payment. If the Company agrees with the
Executive's calculations, it shall pay any shortfall to the
Executive within 20 days after receipt of such a notice from
the Executive, together with interest thereon accruing at the
rate of 18 percent per annum, compounded monthly, from the
original due date of the Gross-Up Statement through the actual
date of payment of said shortfall. If the Company does not
agree with the Executive's calculations, it shall provide the
Executive with a written notice within 20 days after the
receipt of the Executive's calculations advising the Executive
that the disagreement is to be referred to an independent
accounting firm for resolution. Such disagreement shall be
referred to an independent "Big 5" accounting firm which is
not the regular accounting firm of the Company and which is
agreed to by the Company and the Executive within 10 days
after issuance of the Company's notice of disagreement (if the
parties cannot agree on the identity of the accounting firm
which is to resolve the dispute, the accounting firm shall be
selected by means of a coin toss conducted in Palm Beach
County, Florida by counsel to the Executive on the first
business day after such 10 day period in such manner as such
counsel may specify). The accounting firm shall review all
information provided to it by the parties and submit a written
report setting forth its calculation of the GrossUp Payment
within 15 days after submission of the matter to it, and such
decision shall be final and binding on all of the parties. The
fees and expenses charged by said accounting firm shall be
paid by the Company. If the amount of the Gross-Up Payment
actually paid by the Company was less than the amount
calculated by the accounting firm, the Company shall pay the
shortfall to the Executive within 5 days after the accounting
firm submits its written report, together with interest
thereon accruing at the rate of 18 percent per annum,
compounded monthly, from the original due date of the Gross-Up
Statement through the actual date of payment of said
shortfall.
d. SUBSEQUENT RECALCULATION. In the event the Internal Revenue
Service imposes an Excise Tax with respect to the Retirement
Benefit that is greater than the Excise Tax calculated
hereunder, the Company shall reimburse the Executive for the
full amount necessary to make the Executive whole in
accordance with the principles set forth above, including any
interest and penalties which may be imposed.
6. NO MITIGATION AND REEMPLOYMENT. Executive shall not be required to
mitigate the amount of any payment or benefit contemplated by this
Agreement upon his termination of employment (whether by seeking new
employment or in any other manner), nor shall any such payment or
benefit be reduced by any earnings or benefits that Executive may
receive from any other source. Notwithstanding anything else in this
Agreement to the contrary, subsequent reemployment of the Executive by
the Company or any successor of the Company following a Change in
Control will not cause the Executive to forfeit any payment or benefit
contemplated by this Agreement upon his termination of employment
7. RELEASE AND INDEMNITY. The Company hereby fully and forever releases,
acquits, discharges and holds the Executive harmless from any and all,
and all manner of, actions and causes of
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action, claims, suits, costs, debts, sums of money, claims and demands,
presently known or unknown, whatsoever in law or equity or otherwise,
which the Company ever had, now has or may now have, or will have in
the future, by reason of any matter, cause or thing whatsoever, from
the beginning of the world and all times thereafter. The preceding
sentence does not apply to any matters, events, actions, claims,
damages or losses arising from, in connection with or relating to (i)
any intentional illegal conduct of the Executive, or (ii) conduct of
the Executive after the Executive ceases to be employed by the Company.
The Company at all times shall indemnify, save harmless and reimburse
the Executive, from and against any and all demands, claims,
liabilities, losses, actions, suits or proceedings, or other expenses,
fees, or charges of any character or nature, which the Executive may
incur or with which they may be threatened with, arising from, in
connection with, relating to or arising as a result of Executive's
employment by the Company or any other relationship that the Executive
has with the Company as an officer, director, agent shareholder or
otherwise, including without limitation settlement costs and attorneys'
fees and court costs at trial and appellate levels which the Executive
may incur in connection with settling, defending against or resisting
any of the foregoing. The Company shall pay to the Executive any
amounts due with respect to said indemnity within 5 business days after
the Executive issues a written demand therefor to the Company. The
provisions of this section are an expansion of any rights that the
Executive may have with respect to the subject matter, and no other
agreement or arrangement which the Company may have that benefits the
Executive with respect to the subject matter hereof shall be superseded
or limited in any way as a result of the parties entering into this
Agreement.
8. NOTICES. Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly
given when received at the address specified herein. In the case of
Executive, notices shall be delivered to him at the home address which
he has most recently communicated to the Company in writing. In the
case of the Company, notices shall be delivered to the Company's
corporate headquarters, and all notices shall be directed to the
attention of the Company's Chief Executive Officer, with a copy to the
Company's General Counsel.
9. MODIFICATION AND WAIVER. This Agreement shall not be canceled,
rescinded or revoked, nor may any provision of this Agreement be
modified, waived or discharged unless the cancellation, rescission,
revocation, modification, waiver or discharge is agreed to in writing
and signed by Executive and by the President or Chairman of the Board
of the Company. No waiver by either party of any breach of, or of
compliance with, any condition or provision of this Agreement by the
other party shall be considered a waiver of any other condition or
provision or of the same condition or provision at another time.
10. COMPLETE AGREEMENT. This Agreement supersedes all previous employment
agreements entered into by Executive and the Company. This Agreement
does not affect any deferred compensation agreements, nonqualified
retirement plans or any other agreements entered into by the parties.
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11. NO ASSIGNMENT. No right, benefit or interest hereunder, shall be
subject to anticipation, alienation, sale, assignment, encumbrance,
charge, pledge, hypothecation, or set-off in respect of any claim, debt
or obligation, or to execution, attachment, levy or similar process, or
assignment by operation of law. Any attempt, voluntary or involuntary,
to effect any action specified in the immediately preceding sentence
shall, to the full extent permitted by law, be null, void and of no
effect. This Agreement is binding on all successors of the Company,
whether by merger, consolidation, purchase or otherwise, and all
references to the Company shall also include references to any such
successor.
12. GOVERNING LAW. This Agreement shall be governed by, and construed and
enforced in accordance with and subject to, the laws of the State of
Florida applicable to Agreements made and to be performed entirely
within such State, as to all matters governed by state law or, if
controlling, by applicable federal law.
13. SEVERABILITY. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in
full force and effect.
14. LITIGATION; VENUE. Any action at law or in equity under this Agreement
shall be brought in the courts of Palm Beach County, Florida, and in no
other court (whether or not jurisdiction can be established in another
court). Each party hereto waives the right to argue that venue is not
appropriate in the courts of Palm Beach County, Florida. THE PARTIES
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT THAT
THEY MAY HAVE TO A TRIAL BY JURY, THIS WAIVER BEING A MATERIAL
INDUCEMENT FOR THE PARTIES ENTERING INTO THIS AGREEMENT.
15. EXPENSES. The Company shall reimburse the Executive for all legal
and/or accounting expenses he incurs in connection with the execution,
delivery and enforcement of his rights under this Agreement.
16. WITHHOLDING. All payments made pursuant to this Agreement will be
subject to withholding of applicable taxes.
17. 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 together will constitute one and the same instrument.
[Signatures on the Next Page]
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IN WITNESS WHEREOF, each of the parties has executed this Agreement as
of the date first above written.
SIGNED, SEALED AND DELIVERED EXECUTIVE:
IN THE PRESENCE OF:
/s/ Xxx Xxxxxxx /s/ XXXXXX X. XXXXXXXXX
----------------------------------- ---------------------------------
PRINT NAME OF WITNESS BELOW: XXXXXX X. XXXXXXXXX
Xxx Xxxxxxx
---------------------------------
Date:
/s/ Xxxxxx Xxxxxxxxx
--------------------------------- ----------------------------
PRINT NAME OF WITNESS BELOW:
---------------------------------
Xxxxxx Xxxxxxxxx
THE WACKENHUT CORPORATION
/s/ Xxxxxxxx Xxxxxxxx By: /s/ XXXXXXX X. XXXXXXXXX
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PRINT NAME OF WITNESS BELOW: Name: Xxxxxxx X. Xxxxxxxxx
Xxxxxxxx Xxxxxxxx Title: President and Chief
----------------------------------- Executive Officer
/s/ JC Tissot
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PRINT NAME OF WITNESS BELOW:
JC Tissot Date: 3/17/00
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