EMPLOYMENT AGREEMENT
(▇▇▇▇▇ ▇'▇▇▇▇▇ Houston)
This Employment Agreement (the "Agreement"), by and among Vacation
Properties International, Inc., a Delaware corporation ("VPI"), Houston and
▇'▇▇▇▇▇ Company, a Colorado corporation and a wholly-owned subsidiary of VPI
(the "Company"), and ▇▇▇▇▇ ▇'▇▇▇▇▇ Houston ("Employee"), is hereby entered into
as of this [___] day of [________], 1998, and shall be effective as of the date
of the consummation of the initial public offering of the common stock of VPI.
R E C I T A L S
---------------
A. As of the date of this Agreement, the Company is engaged primarily in the
business of providing noncommercial property management, rental and sales
services and hotel management services.
B. Employee is employed hereunder by the Company in a confidential relationship
wherein Employee, in the course of Employee's employment with the Company, has
and will continue to become familiar with and aware of information as to the
Company's and VPI's customers, specific manner of doing business, including the
processes, techniques and trade secrets utilized by the Company and VPI, and
future plans with respect thereto, all of which has been and will be established
and maintained at great expense to the Company and VPI; this information is a
trade secret and constitutes the valuable good will of the Company and VPI.
A G R E E M E N T S
-------------------
In consideration of the mutual promises, terms, covenants and
conditions set forth herein and the performance of each, the parties hereto
hereby agree as follows:
1. EMPLOYMENT AND DUTIES.
(a) The Company hereby employs Employee as President of the Company to
perform the duties described herein at the Company's offices in Aspen, Colorado.
As such, Employee shall have responsibilities, duties and authority reasonably
accorded to and expected of a President of the Company and will report directly
to the Board of Directors of the Company (the "Board"). Employee hereby accepts
this employment upon the terms and conditions herein contained and, subject to
paragraph 1(c) hereof, agrees to devote Employee's full working time, attention,
and efforts to promote and further the business of the Company.
(b) Employee shall faithfully adhere to, execute and fulfill all
policies established by the Company.
(c) Employee shall not, during the term of his or her employment
hereunder, be engaged in any other business activity pursued for gain, profit or
other pecuniary advantage if such activity interferes with Employee's duties and
responsibilities hereunder. The foregoing limitations shall not be construed as
prohibiting Employee from making personal investments or engaging in community
affairs in such form or manner as will neither require Employee's services in
the operation or affairs of the
companies or enterprises in which such investments are made nor violate the
terms of paragraph 3 hereof.
2. COMPENSATION.
For all services rendered by Employee, the Company shall compensate
Employee as follows:
(a) Base Salary. The base salary payable to Employee shall be $150,000
per year, payable on a regular basis in accordance with the Company's standard
payroll procedures but not less frequently than monthly. Such base salary shall
not be decreased during the Term hereof or prior to any termination pursuant to
the terms of Section 5 hereof.
(b) Incentive Bonus Plan. For 1998 and subsequent years, it is the
Company's intent to develop a written Incentive Bonus Plan (which may be VPI's
Incentive Bonus Plan) setting forth the performance and other criteria under
which Employee and other officers and key employees of the Company will be
eligible to receive year-end bonus awards.
(c) Executive Perquisites, Benefits and Other Compensation. Employee
shall be entitled to receive additional benefits and compensation from the
Company in such form and to such extent as specified below:
(i) Payment of all premiums for coverage for Employee under
health, hospitalization, disability, dental, life and other insurance
plans that the Company or VPI may have in effect from time to time,
benefits provided to Employee under this clause (i) to be at least
equal to such benefits provided to VPI executives.
(ii) Reimbursement for all business travel and other
out-of-pocket expenses reasonably incurred under the circumstances by
Employee in the performance of Employee's services pursuant to this
Agreement and consistent with past practice. All reimbursable expenses
shall be appropriately documented in reasonable detail by Employee upon
submission of any request for reimbursement, and in a format and manner
consistent with the Company's expense reporting policy.
(iii) Six weeks' paid vacation time, provided, however, that
any such vacation, paid or unpaid, shall be consistent with adequate
performance of all duties and obligations of Employee, including as set
forth in paragraph 1 hereof, and provided further, that nothing
contained in this paragraph 2(c)(iii) shall be construed as a
limitation of any rights of termination for good cause pursuant to and
in accordance with paragraph 5(c)(2) hereof.
(iv) The Company shall provide Employee with other executive
perquisites as may be available to or deemed appropriate for Employee
by the Board and participation in all other Company-wide or VPI-wide
employee benefits as available from time to time (e.g., any pension or
profit sharing plans if and to the extent adopted by the Company, if
Employee meets all eligibility requirements thereof and consistent with
the terms thereof).
2
(v) The Company shall provide the Employee with a new
automobile selected by the Employee to be leased by the Company and
replaced by a new automobile selected by Employee every two years and
the Company shall pay all expenses associated with such automobiles
(e.g., gas, parking, repair costs, licensing and insurance), in an
amount as budgeted and consistent with past practices, up to a maximum
total payment of $15,000 per year for all such payments and expenses.
3. NON-COMPETITION.
(a) Employee shall not, during the period of Employee's employment with
the Company, and for a period of two (2) years immediately following the
termination of Employee's employment under this Agreement (the "Noncompetition
Period"), for any reason whatsoever, directly or indirectly, for himself or
herself or on behalf of or in conjunction with any other person, persons,
company, partnership, corporation or business of whatever nature:
(i) engage, as an officer, director, shareholder, owner,
partner, joint venturer or in a managerial capacity, whether as an
employee, independent contractor, consultant or advisor, or as a sales
representative, in any noncommercial property management, rental or
sales business or hotel management business in direct competition with
the Company or VPI or any subsidiary of either the Company or VPI,
within 100 miles of the locations in which the Company or VPI or any of
the Company's or VPI's subsidiaries conducts any noncommercial property
management, rental or sales business or hotel management business (the
"Territory");
(ii) call upon any person who is, at that time, within the
Territory, an employee of the Company or VPI (including the respective
subsidiaries thereof) in a sales representative or managerial capacity
for the purpose or with the intent of enticing such employee away from
or out of the employ of the Company or VPI (including the respective
subsidiaries thereof), provided that Employee shall be permitted to
call upon and hire any member of his or her immediate family;
(iii) call upon any person or entity which is at that time, or
which has been, within one (1) year prior to that time, a customer of
the Company or VPI (including the respective subsidiaries thereof)
within the Territory for the purpose of providing noncommercial
property management, rental or sales services or hotel management
services to property owners and/or renters in direct competition with
the Company or VPI or any subsidiary of the Company or VPI within the
Territory; or
(iv) call upon any prospective acquisition candidate, on
Employee's own behalf or on behalf of any competitor in the
noncommercial property management, rental or sales business or hotel
management business, which candidate, to Employee's actual knowledge
after due inquiry, was called upon by the Company or VPI (including the
respective subsidiaries thereof) or for which, to Employee's actual
knowledge after due inquiry, the Company or VPI (or any subsidiary
thereof) made an acquisition analysis, for the purpose of acquiring
such entity, unless the Company or VPI (or any subsidiary thereof) has
expressly declined to pursue such acquisition candidate or at least one
(1) year has elapsed since the Company or VPI (or any subsidiary
thereof) has taken any action with respect to pursuing such acquisition
candidate.
3
Notwithstanding the above, the foregoing covenant shall not be deemed
to prohibit Employee from (A) acquiring as an investment not more than two
percent (2%) of the capital stock of a competing business whose stock is traded
on a national securities exchange or over-the-counter (B) engaging in
noncommercial property management, rental or sales business or hotel management
business only with respect to her primary personal residence or any real
property in which she has a noncontrolling interest such that she is unable to
direct management, retail or sales business or hotel management business
relating to such real property to the Company or VPI or (C) directly or
indirectly (e.g., personally or through a partnership or limited liability
company) investing in any real property or, in the event that Employee is no
longer employed by the Company, from acting as a real estate broker in any
location other than Aspen, Colorado and the 25-mile area around Aspen, Colorado,
or with respect to any real property in which Employee has invested.
(b) Because of the difficulty of measuring economic losses to the
Company and VPI as a result of a breach of the foregoing covenant, and because
of the immediate and irreparable damage that could be caused to the Company and
VPI for which they would have no other adequate remedy, Employee agrees that the
foregoing covenant may be enforced by VPI or the Company in the event of breach
by him or her, by injunctions and restraining orders.
(c) It is agreed by the parties hereto that the foregoing covenants in
this paragraph 3 impose a reasonable restraint on Employee in light of the
activities and business of the Company or VPI (including VPI's other
subsidiaries) on the date of the execution of this Agreement and the current
plans of the Company or VPI (including VPI's other subsidiaries); but it is also
the intent of the Company, VPI and Employee that such covenants be construed and
enforced in accordance with the changing locations of the Company and VPI
(including VPI's other subsidiaries) throughout the Noncompetition Period. For
example, if, during the Noncompetition Period, the Company or VPI (including
VPI's other subsidiaries) establishes new locations for its current activities
or business in addition to the locations currently established therefor, then
Employee will be precluded from soliciting customers or employees from such new
locations and from directly competing within 100 miles of such new locations
through the Noncompetition Period.
It is further agreed by the parties hereto that, in the event that
Employee shall enter into a business or pursue other activities not in
competition with the Company or VPI (including VPI's other subsidiaries), or
similar activities, or business in locations the operation of which, under such
circumstances, does not violate clause (i) of this paragraph 3, and in any event
such new business, activities or location are not in violation of this paragraph
3 or of Employee's obligations under this paragraph 3, if any, Employee shall
not be chargeable with a violation of this paragraph 3 if the Company or VPI
(including VPI's other subsidiaries) shall thereafter enter the same, similar or
a competitive (i) business, (ii) course of activities or (iii) location, as
applicable.
(d) The covenants in this paragraph 3 are severable and separate, and
the unenforceability of any specific covenant shall not affect the provisions of
any other covenant. Moreover, in the event any court of competent jurisdiction
shall determine that the scope, time or territorial restrictions set forth are
unreasonable, then it is the intention of the parties that such restrictions be
enforced to the fullest extent which the court deems reasonable, and the
Agreement shall thereby be reformed.
(e) Provided that the Company and VPI have complied with and performed
all obligations hereunder in all material respects, all of the covenants in this
paragraph 3 shall be construed as an agreement independent of any other
provision in this Agreement, and the existence of any claim or cause of action
of Employee against the Company or VPI (including the subsidiaries thereof),
whether
4
predicated on this Agreement or otherwise, shall not constitute a defense to the
enforcement by VPI or the Company of such covenants. It is specifically agreed
that the Noncompetition Period, during which the agreements and covenants of
Employee made in this paragraph 3 shall be effective, shall be computed by
excluding from such computation any time during which a court of competent
jurisdiction or other arbitrator or mediator has determined that Employee is in
violation of any provision of this paragraph 3.
4. PLACE OF PERFORMANCE.
If Employee is requested by the Board or VPI to relocate and Employee
refuses, such refusal shall not constitute "good cause" for termination of this
Agreement under the terms of paragraph 5(c).
5. TERM; TERMINATION; RIGHTS ON TERMINATION.
The term of this Agreement shall begin on the date hereof and continue
for three (3) years, and, unless terminated sooner as herein provided, shall
continue thereafter on a year-to-year basis on the same terms and conditions
contained herein in effect as of the time of renewal (such initial three year
period and any extensions thereof being referred to herein as the "Term"). This
Agreement and Employee's employment may be terminated in any one of the
following ways:
(a) Death. The death of Employee shall immediately terminate this
Agreement with no severance compensation due to Employee's estate.
(b) Disability. If, as a result of incapacity due to physical or mental
illness or injury, Employee shall have been absent from Employee's full-time
duties hereunder for one hundred twenty (120) consecutive days, then thirty (30)
days after receiving written notice (which notice may occur before or after the
end of such one hundred twenty (120) day period, but which shall not be
effective earlier than the last day of such one hundred twenty (120) day
period), the Company may terminate Employee's employment hereunder provided that
a doctor selected by the Company and reasonably acceptable to Employee certifies
that Employee is unable to resume Employee's full-time duties at the conclusion
of such thirty (30) day notice period. Also, in addition to any rights under
Section 5(e) below, Employee may terminate Employee's employment hereunder if
his or her health should become impaired to an extent that makes the continued
performance of Employee's duties hereunder hazardous to Employee's physical or
mental health or life, provided that Employee shall have furnished the Company
with a written statement from a qualified doctor to such effect and provided,
further, that, at the Company's request made within thirty (30) days of the date
of such written statement, Employee shall submit to an examination by a doctor
selected by the Company who is reasonably acceptable to Employee or Employee's
doctor and such doctor shall have concurred in the conclusion of Employee's
doctor. In the event this Agreement is terminated as a result of Employee's
disability, Employee shall have no right to any severance compensation.
(c) Good Cause. The Company may terminate the Agreement ten (10) days
after delivery of written notice to Employee for good cause, which shall be
limited to: (1) Employee's willful, material, and irreparable breach of this
Agreement; (2) Employee's failure to adequately perform, continuing for ten (10)
days after receipt of written notice stating the alleged failure with reasonable
specificity and the need to cure, any of Employee's material duties and
responsibilities hereunder; (3) Employee's willful
5
dishonesty, fraud, or misconduct which adversely affects the operations or
reputation of the Company or VPI; (4) Employee's conviction in a court of
competent jurisdiction of a felony or any misdemeanor other than a minor traffic
violation; or (5) chronic alcohol abuse or illegal drug use by Employee,
provided that in the case of any termination pursuant to clauses (1) or (2),
such termination first must be approved by at least two-thirds of the members of
the Board of Directors of VPI. In the event of a termination for good cause, as
enumerated above, Employee shall have no right to any severance compensation.
(d) Without Good Cause. Employee may only be terminated without good
cause by the Company during the Term hereof if such termination is first
approved by at least two-thirds of the members of the Board of Directors of VPI.
Should Employee be terminated by the Company without good cause during the Term,
Employee shall be entitled to continue to receive from the Company the base
salary at the rate then in effect for whatever time period is remaining under
the Term of this Agreement or for one (1) year, whichever period is longer. Any
termination without good cause by the Company shall operate to shorten the
Noncompetition Period to one (1) year immediately following the date of such
termination. Further, should Employee be terminated by the Company without good
cause at any time, Employee shall be entitled to waive Employee's right to
receive severance compensation (by a written waiver delivered to the Company
within ten (10) calendar days of the effective date of termination), and, in
such case, the non-competition provisions of paragraph 3 shall not apply.
(e) By Employee. At any time after the commencement of employment,
Employee may, without "good reason" (as defined below), terminate this Agreement
and Employee's employment without good reason, effective thirty (30) days after
written notice is provided to the Company. If Employee resigns or otherwise
terminates Employee's employment without good reason, Employee shall receive no
severance compensation. If Employee's resignation or other termination by
Employee is for good reason (defined as (i) the Company's failure to pay
Employee on a timely basis the amounts to which he or she is entitled under this
Agreement or (ii) any other material breach of this Agreement by the Company, as
determined by a court of competent jurisdiction or pursuant to the provisions of
paragraph 16 below), the Company shall pay all amounts and damages to which
Employee may be entitled as a result of such breach, including interest thereon
and all reasonable legal fees and expenses and other costs incurred by Employee
to enforce Employee's rights hereunder in addition to any severance compensation
to which Employee may be entitled to hereunder, as calculated pursuant to
Section 5(d) hereof. Further, none of the provisions of paragraph 3 hereof shall
apply in the event this Agreement is terminated by Employee for good reason as a
result of such a breach by the Company.
(f) Change in Control of VPI or the Company. In the event of a "Change
in Control" (as defined below) of VPI or the Company during the Term, refer to
paragraph 12 below.
Upon termination of this Agreement for any reason provided above,
Employee shall be entitled to receive all compensation earned and all benefits
and reimbursements due through the effective date of termination. Additional
compensation subsequent to termination, if any, will be due and payable to
Employee only to the extent and in the manner expressly provided above or in
paragraph 12 hereof. All other rights and obligations of VPI, the Company, and
Employee under this Agreement shall cease as of the effective date of
termination, except that the Company's obligations under paragraph 9 hereof and
Employee's obligations under paragraphs 3, 6, 7, 8 and 10 hereof shall survive
such termination in accordance with their terms.
6
6. RETURN OF COMPANY PROPERTY.
All records, designs, patents, business plans, financial statements,
manuals, memoranda, lists and other property delivered to or compiled by
Employee by or on behalf of the Company, VPI or their representatives, vendors
or customers which pertain to the business of the Company or VPI shall be and
remain the property of the Company or VPI, as the case may be, and be subject at
all times to their discretion and control. Likewise, all correspondence,
reports, records, charts, advertising materials and other similar data
pertaining to the business, activities or future plans of the Company or VPI
which is collected by Employee shall be delivered promptly to the Company
without request by it upon termination of Employee's employment.
7. INVENTIONS.
Employee shall disclose promptly to VPI and the Company any and all
significant conceptions and ideas for inventions, improvements and valuable
discoveries, whether patentable or not, which are conceived or made by Employee,
solely or jointly with another, during the Term or within one (1) year
thereafter, and which are directly related to the business or activities of the
Company or VPI and which Employee conceives as a result of Employee's employment
by the Company. Employee hereby assigns and agrees to assign all of Employee's
interests therein to the Company or its nominee. Whenever requested to do so by
the Company, Employee shall execute any and all applications, assignments or
other instruments that the Company shall deem necessary to apply for and obtain
Letters Patent of the United States or any foreign country or to otherwise
protect the Company's interest therein.
8. TRADE SECRETS.
Employee agrees that he or she will not, during or after the Term of
this Agreement with the Company, disclose the specific terms of the Company's or
VPI's relationships or agreements with their respective significant vendors or
customers or any other significant and material trade secret of the Company or
VPI, whether in existence or proposed, to any person, firm, partnership,
corporation or business for any reason or purpose whatsoever.
9. INDEMNIFICATION.
In the event Employee is made a party to any threatened, pending, or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by the Company or VPI against Employee), by
reason of the fact that Employee is or was performing services under this
Agreement, then the Company shall indemnify Employee against all expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement, as
actually and reasonably incurred by Employee in connection therewith. In the
event that both Employee and the Company are made a party to the same
third-party action, complaint, suit or proceeding, the Company or VPI agrees to
engage competent legal representation to defend the Company and Employee, and
Employee agrees to use the same representation, provided that if counsel
selected by VPI shall have a conflict of interest that prevents such counsel
from representing Employee, Employee may engage separate counsel and the Company
or VPI shall pay all reasonable attorneys' fees and expenses of such separate
counsel.
7
10. NO PRIOR AGREEMENTS.
Employee hereby represents and warrants to the Company that the
execution of this Agreement by Employee and his or her employment by the Company
and the performance of Employee's duties hereunder will not violate or be a
breach of any agreement with a former employer, client or any other person or
entity. Further, Employee agrees to indemnify the Company for any claim,
including but not limited to reasonable attorneys' fees and expenses of
investigation, by any such third party that such third party may now have or may
hereafter come to have against the Company based upon or arising out of any
noncompetition agreement, invention or secrecy agreement between Employee and
such third party which was in existence as of the date of this Agreement.
11. ASSIGNMENT; BINDING EFFECT.
Employee understands that he or she has been selected for employment by
the Company on the basis of Employee's personal qualifications, experience and
skills. Employee, therefore, shall not assign all or any portion of Employee's
performance under this Agreement. Subject to the preceding two (2) sentences and
the express provisions of paragraph 12 below, this Agreement shall be binding
upon, inure to the benefit of and be enforceable by the parties hereto and their
respective heirs, legal representatives, successors and assigns.
12. CHANGE IN CONTROL.
(a) Unless Employee elects to terminate this Agreement pursuant to (c)
below, Employee understands and acknowledges that the Company and/or VPI may be
merged or consolidated with or into another entity and that such entity shall
automatically succeed to the rights and obligations of the Company and/or VPI
hereunder or that the Company and/or VPI may undergo another type of Change in
Control. In the event such a merger or consolidation or other Change in Control
is initiated prior to the end of the Term, then the provisions of this paragraph
12 shall be applicable.
(b) In the event of a pending Change in Control wherein the Company
and/or VPI and Employee have not received written notice at least five (5)
business days prior to the anticipated closing date of the transaction giving
rise to the Change in Control from the successor to all or a substantial portion
of the Company's and/or VPI's business and/or assets that such successor is
willing as of the closing to assume and agree to perform all of the Company's
and/or VPI's obligations under this Agreement in the same manner and to the same
extent that the Company and/or VPI is hereby required to perform, then such
Change in Control shall be deemed to be a termination of this Agreement by the
Company without cause during the Term and the applicable portions of paragraph
5(d) will apply; however, under such circumstances, the amount of the severance
payment due to Employee shall be triple the amount calculated under the terms of
paragraph 5(d) and shall be payable in a lump-sum payment and the noncompetition
provisions of paragraph 3 shall not apply.
(c) In any Change in Control situation, Employee may elect to terminate
this Agreement by providing written notice to the Company at least five (5)
business days prior to the anticipated closing of the transaction giving rise to
the Change in Control. In such case, the applicable provisions of paragraph 5(d)
will apply as though the Company had terminated the Agreement without cause
during the Term; however, under such circumstances, the amount of the severance
payment due to Employee shall be
8
double the amount calculated under the terms of paragraph 5(d) and shall be
payable in a lump-sum payment and the noncompetition provisions of paragraph 3
shall all apply for a period of two (2) years from the effective date of
termination. Employee shall have the right to waive Employee's right to receive
the severance compensation payable under this paragraph 12(c) (by a written
waiver delivered to the Company on or before the effective date of the
termination), in which case the noncompetition provisions of paragraph 3 shall
not apply.
(d) For purposes of applying paragraph 5 hereof under the circumstances
described in (b) and (c) above, the effective date of termination will be the
closing date of the transaction giving rise to the Change in Control and all
compensation, reimbursements and lump-sum payments due Employee must be paid in
full by the Company at or prior to such closing. Further, Employee will be given
sufficient time and opportunity to elect whether to exercise all or any of
Employee's vested options to purchase VPI Common Stock, including any options
with accelerated vesting under the provisions of VPI's 1998 Long-Term Incentive
Plan, such that Employee may convert the options to shares of VPI Common Stock
at or prior to the closing of the transaction giving rise to the Change in
Control, if Employee so desires.
(e) A "Change in Control" shall be deemed to have occurred if any of
the following shall have occurred unless the transaction or event shall have
been approved by at least two-thirds (2/3) of the Board of Directors of VPI:
(i) any person or entity, other than VPI or an employee
benefit plan of VPI, acquires directly or indirectly the Beneficial
Ownership (as defined in Section 13(d) of the Securities Exchange Act
of 1934, as amended) of any voting security of the Company or VPI and
immediately after such acquisition such person or entity is, directly
or indirectly, the Beneficial Owner of voting securities representing
50% or more of the total voting power of all of the then-outstanding
voting securities of the Company or VPI;
(ii) the following individuals no longer constitute a majority
of the members of the Board of Directors of VPI: (A) the individuals
who, as of the closing date of VPI's initial public offering,
constitute the Board of Directors of VPI (the "Original Directors");
(B) the individuals who thereafter are elected to the Board of
Directors of VPI and whose election, or nomination for election, to the
Board of Directors of VPI was approved by a vote of at least two-thirds
(2/3) of the Original Directors then still in office (such directors
becoming "Additional Original Directors" immediately following their
election); and (C) the individuals who are elected to the Board of
Directors of VPI and whose election, or nomination for election, to the
Board of Directors of VPI was approved by a vote of at least two-thirds
(2/3) of the Original Directors and Additional Original Directors then
still in office (such directors also becoming "Additional Original
Directors" immediately following their election);
(iii) the stockholders of VPI shall approve a merger,
consolidation, recapitalization or reorganization of VPI, a reverse
stock split of outstanding voting securities, or consummation of any
such transaction if stockholder approval is not obtained, other than
any such transaction which would result in at least 75% of the total
voting power represented by the voting securities of the surviving
entity outstanding immediately after such transaction being
Beneficially Owned by at least 75% of the holders of outstanding voting
securities of VPI immediately prior to the
9
transaction, with the voting power of each such continuing holder
relative to other such continuing holders not substantially altered in
the transaction; or
(iv) the stockholders of VPI shall approve a plan of complete
liquidation of VPI or an agreement for the sale or disposition by VPI
of all or a substantial portion of VPI's assets (i.e., 50% or more of
the total assets of VPI).
(f) Employee must be notified in writing by the Company at any time
that the Company anticipates that a Change in Control may take place.
(g) Employee shall be reimbursed by the Company or its successor for
any excise taxes that Employee incurs under Section 4999 of the Internal Revenue
Code of 1986, as a result of any Change in Control. Such amount will be due and
payable by the Company or its successor within ten (10) days after Employee
delivers a written request for reimbursement accompanied by a copy of Employee's
tax return(s) showing the excise tax actually incurred by Employee.
13. COMMISSIONS.
The parties agree that Employee has in the past, and may in the future,
directly or indirectly (e.g., personally or through a partnership, corporation,
limited liability company or otherwise, such entity being referred to as an
"Employee Entity") invest in real property. The parties further agree that (1)
the Company shall, upon request, on not more than two occasions in any calendar
year (or more frequently with the express written consent of VPI, which consent
shall not be unreasonably withheld by VPI after its consideration of all the
facts and circumstances of each case with respect to which such consent is
sought, including the past practice of the Employee and the Company, the
frequency of such requests and the impact on the Company and VPI of granting or
not granting such consent) waive any rights to any brokerage commission to which
the Company would otherwise be entitled in connection with such purchase (an
"Employee Entity Purchase") and (2) Employee shall be permitted to use such
waiver of such commission by the Company in order to receive (personally, and
not as an employee of the Company) an interest in any real property acquired
pursuant to an Employee Entity Purchase; provided that (a) all cash or other
consideration received or to be received by Employee as a result of any such
waiver of such commission by the Company shall not be retained by Employee and
must be fully invested by Employee in such real property or Employee Entity in
connection with the subsequent sale of any Employee Entity Property and (c)
Employee shall be responsible for any taxes (income or otherwise) payable by the
Employee or the Company that arise in connection with the waiver of a commission
with respect to which the Employee receives a personal benefit as described
herein.
14. COMPLETE AGREEMENT.
This Agreement is not a promise of future employment. This Agreement
supersedes any other agreements or understandings, written or oral, among the
Company, VPI and Employee, and Employee has no oral representations,
understandings or agreements with the Company or any of its officers, directors
or representatives covering the same subject matter as this Agreement.
This written Agreement is the final, complete and exclusive statement
and expression of the agreement between the Company and Employee and of all the
terms of this Agreement, and it cannot be varied, contradicted or supplemented
by evidence of any prior or contemporaneous oral or written agreements. This
written Agreement may not be later modified except by a written instrument
signed by a duly authorized officer of the Company and Employee, and no term of
this Agreement may be waived except by a written instrument signed by the party
waiving the benefit of such term.
15. NOTICE.
Whenever any notice is required hereunder, it shall be given in writing
addressed as follows:
To the Company: Vacation Properties International, Inc.
▇▇▇▇-▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
To Employee: ▇▇▇▇▇ ▇'▇▇▇▇▇ Houston
c/o Houston and ▇'▇▇▇▇▇ Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Marked: "Personal and Confidential"
10
Notice shall be deemed given and effective three (3) days after the deposit in
the U.S. mail of a writing addressed as above and sent first class mail,
certified, return receipt requested, or when actually received. Either party may
change the address for notice by notifying the other party of such change in
accordance with this paragraph 15.
16. SEVERABILITY; HEADINGS.
If any portion of this Agreement is held invalid or inoperative, the
other portions of this Agreement shall be deemed valid and operative and, so far
as is reasonable and possible, effect shall be given to the intent manifested by
the portion held by a court or other authority of competent jurisdiction to be
invalid or inoperative. The paragraph headings herein are for reference purposes
only and are not intended in any way to describe, interpret, define or limit the
extent or intent of the Agreement or of any part hereof.
17. ARBITRATION.
Any unresolved dispute or controversy arising under or in connection
with this Agreement shall be settled exclusively by arbitration, conducted
before a panel of three (3) arbitrators in Aspen, Colorado in accordance with
the Commercial Arbitration Rules of the American Arbitration Association then in
effect. The arbitrators shall not have the authority to add to, detract from or
modify any provision hereof nor to award punitive damages to any injured party.
The arbitrators shall have the authority to order back-pay, severance
compensation, vesting of options (or cash compensation in lieu of vesting of
options), reimbursement of costs, including those incurred to enforce this
Agreement, and interest thereon in the event the arbitrators determine that
Employee was terminated without disability or good cause, as defined in
paragraphs 5(b) and 5(c) hereof, respectively, or that the Company has otherwise
materially breached this Agreement. A decision by a majority of the arbitration
panel shall be final and binding. Judgment may be entered on the arbitrators'
award in any court having jurisdiction. The direct expense of any arbitration
proceeding shall be borne by the Company.
18 GOVERNING LAW.
This Agreement shall in all respects be construed according to the laws
of the State of Colorado.
19. COUNTERPARTS.
This Agreement may be executed simultaneously in two (2) or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute but one and the same instrument.
11
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
Houston and ▇'▇▇▇▇▇ Company
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
Vacation Properties International, Inc.,
a Delaware corporation
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
/s/ ▇▇▇▇▇ ▇'▇▇▇▇▇ Houston
----------------------------------------
▇▇▇▇▇ ▇'▇▇▇▇▇ Houston, Individually
12
