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SEVERANCE AGREEMENT AND MUTUAL RELEASE
This SEVERANCE AGREEMENT AND MUTUAL RELEASE ("Agreement"), dated as of
September 4, 1996, by and between Cardinal Realty Services, Inc. (the
"Company"), and Xxxxx X. Xxxxxxxxx ("Employee").
WHEREAS, Employee and the Company have agreed that Employee shall resign
from all positions held with the Company, and its affiliates, subsidiaries and
related entities; and
WHEREAS, the Company and Employee wish to resolve any and all matters and
issues between them arising from or relating to Employee's services to the
Company, including his resignation therefrom.
NOW, THEREFORE, in return for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and Employee
acknowledge and agree as follows:
1. Resignation. Employee hereby resigns from any and all positions he held
with the Company or its affiliated, related and subsidiary entities, including,
but not limited to, his position as Executive Vice President and Chief Financial
Officer of the Company and Plan Administrator of the Company's Pension Plan and
401(k) Savings Plan, as well as any position as an officer and director of any
subsidiaries of the Company, effective October 31, 1996.
2. Severance Period. Employee will receive the severance benefits from
November 1, 1996 through July 31, 1997 (the "Severance Period"), as specified in
this Agreement.
3. Final Compensation and Severance Benefits.
(a) The Company will pay Employee severance pay in the amount of One
Hundred Twelve Thousand Five Hundred Dollars ($112,500), less
applicable tax withholdings, which amount shall be paid in accordance
with the Company's normal payroll practices for the duration of the
Severance Period. This amount represents seventy-five percent (75%) of
Employee's annual base salary at the time of his resignation.
(b) The Company shall pay to Employee eighty-three and one-third
percent (83 1/3%) of Employee's Cash Bonus (as defined below) and
Stock Bonus (as defined below) for the 1996 fiscal year, if earned,
computed as follows:
(i) The Company will pay to Employee a cash bonus ("Cash Bonus")
determined on the basis of the increase, if any, of the Company's
consolidated earnings before interest, taxes, depreciation and
amortization, determined upon the application of generally
accepted accounting principles, consistently applied, and subject
to the independent audit of the Company's consolidated income
statement for the 1996 fiscal year by the Company's independent
certified public accountants ("EBITDA") when compared to the
Company's EBITDA for its immediately preceding fiscal year (the
"Comparison EBITDA") and measured as a percentage of Comparison
EBITDA, as follows:
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Cash Bonus Expressed as
EBITDA expressed as Percentage Percentage of Base
of Comparison EBITDA Compensation
------------------------------ -------------------------------------
up to 103% 0
greater than 103% up to 110% Percentage Increase in Comparison
EBITDA multiplied by 1.5;
plus, if applicable
greater than 110% up to 120% Additional Percentage Increase in
Comparison EBITDA (above 110%)
multiplied by 2; plus, if applicable
greater than 120% Additional Percentage Increase in
Comparison EBITDA multiplied by
2.5; provided, however, the Cash
Bonus shall not exceed 60% of
Base Compensation
(ii) For purposes of determining the Cash Bonus, if any,
payable to Employee on account of the Company's 1996 fiscal year,
Employee and the Company acknowledge and agree that Employee's
1996 Base Compensation is equal to One Hundred Fifty Thousand
Dollars ($150,000) and Comparison EBITDA equals $9,072,649.
(iii) Employee's Cash Bonus due under subsections (i) and
(ii) above shall be paid within thirty (30) days after EBITDA is
calculated from the applicable final audited year end income
statements, of the Company, but no later than the date a cash
bonus is paid to any of the Company's executive officers (the
"Bonus Payment Date").
(iv) In addition to the Cash Bonus, for the Company's 1996
fiscal year, the Company grants to Employee a stock bonus ("Stock
Bonus") payable in shares of the Company's common stock, without
par value (the "Common Stock"), in accordance with and subject to
the Company's Incentive Equity Plan, as amended. The dollar
amount of the Stock Bonus will be determined on the same basis as
the Cash Bonus (including the limitations set forth in subsection
(ii) above), except that the dollar value of the Stock Bonus as a
percentage of Base Compensation will be as follows:
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EBITDA expressed as Percentage Dollar Value of Stock
of Comparison EBITDA Bonus Expressed as Percentage
------------------------------ of Base Compensation
-----------------------------
up to 103% 0
greater than 103% up to 105% Equivalent to Percentage Increase
in Comparison EBITDA;
plus, if applicable
greater than 105% up to 110% Additional Percentage Increase in
Comparison EBITDA multiplied by
2; plus, if applicable
greater than 110% Additional Percentage Increase in
Comparison EBITDA multiplied by
3; provided, however, the Stock
Bonus shall not exceed 30% of
Base Compensation
(v) The number of shares constituting the Stock Bonus
payable to Employee will be determined by dividing (A) the dollar
value of the Stock Bonus determined in accordance with the table
above by (B) the closing price of the Company's Common Stock on
the NASDAQ National Market System, or if the Company's Common
Stock is not listed or admitted to trading in such system, the
principal securities exchange on which the Company's Common Stock
is listed or admitted to trading on December 31, 1996. Any Stock
Bonus which Employee is entitled to receive from the Company
shall be issued on the same date as the Cash Bonus. The
provisions of the Company's Incentive Equity Plan, as amended,
regarding fractional shares will apply to the Stock Bonus.
(c) The Company shall award to Employee two thousand (2,000)
shares of the Company's Common Stock on the Bonus Payment Date.
(d) The Company will pay Employee any 1996 accrued, unused
vacation and discretionary time, determined as of October 31, 1996.
(e) Salary and benefits shall be available to Employee through
October 31, 1996.
4. Additional Consideration for Execution and Delivery of This Agreement.
As additional consideration to support Employee's execution and delivery of this
Agreement and his promises and undertakings hereunder, the Company will provide
to Employee:
(a) Health and dental insurance, as well as Employee Assistance
Program benefits, at the Company's expense, through November 30, 1996.
Employee's benefits will
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terminate after that date, subject to any right to benefit continuation
under the Comprehensive Omnibus Budget Reconciliation Act;
(b) Executive outplacement services through Right Associates
until such time as Employee has been placed in a position reasonably
comparable to his position with the Company. Such services shall
include, but are not limited to, career assessment, determination of
career objectives, career transition campaign design, career
transition campaign execution, financial consultation and support
services;
(c) Basic and optional life insurance benefits (not including
optional life insurance benefits provided by Cincinnati Life Insurance
Company), under the same terms and conditions that Employee received
such benefits during his employment, through November 30, 1996.
Employee has the right to convert his basic life insurance coverage to
an individual policy, at Employee's own expense, within thirty (30)
days from the date the coverage terminates by submitting the
appropriate conversion form to Community National Life Insurance
Company;
(d) Any benefits under the Company's 401(k) Savings Plan within
ten (10) business days of Employee's written request. Employee will be
required to complete and return appropriate election forms prior to
disbursal of such benefits;
(e) A loan equal to the amount of withholding tax attributable to
(i) the exercise of non-qualified stock options by Employee and (ii)
the awards of the Company's Common Stock under Sections 3(b) and (c)
hereof, which loan shall bear interest at The Provident Bank prime
rate and shall be repayable in full by Employee on or before twelve
(12) months from the date of such loan;
(f) A Consulting Agreement to be entered into by the Company and
Employee contemporaneously herewith, which provides for a payment by
the Company to Employee of Fifty Thousand Dollars ($50,000), which sum
shall be paid at Employee's option, in (i) lump sum on January 2,
1999, or (ii) nine (9) equal monthly installments commencing on
November 1, 1996;
(g) An extension of the termination date of Employee's option to
purchase four thousand three hundred seventy-eight (4,378) shares of
the Company's Common Stock issued in connection with the Trustee's
Second Employee Retention Plan at an exercise price of $1.42 per
share, until January 3, 1997; provided, however, that if Employee is
in possession of material nonpublic information regarding the Company
on such date, the termination date of such option will be extended
until the second day of the next Open Trading Window, as defined under
the Company's Xxxxxxx Xxxxxxx Compliance Policy; and
(h) An unlimited amount of time to interview for, or accept and
perform, for new employment, provided that Employee has obtained the
prior approval of the Company's President.
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5. Proxy. Employee will execute and deliver to the Company his irrevocable
proxy in the form of Exhibit "A", attached hereto and incorporated herein by
reference. Employee covenants that he will not take any action designed to
directly or indirectly defeat the intent of his irrevocable proxy, it being
understood and agreed that so long as said proxy remains in effect, Employee
will not exercise voting power over any capital stock of the Company within the
meaning of Rule 13d-3, promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934, as amended. By way of example, but
not by way of limitation, Employee will not transfer any voting capital stock of
the Company to any person or entity (other than a "regular way" over-the-counter
or stock exchange sale through a registered broker-dealer) without first causing
such person or entity to execute and deliver to the Company an irrevocable proxy
substantially in the form of said Exhibit "A". An exception will be allowed for
bona fide gifts of a nominal number of shares.
6. Return of Equipment. Employee will return all equipment owned by the
Company, including but not limited to dictation equipment. Employee may retain
the laptop computer currently in his possession so long as he returns all
confidential information on such computer to the Company.
7. Consulting Agreement. Simultaneously with this Agreement, the Company
and Employee will enter into a consulting agreement in the form of Exhibit B, a
copy of which is attached as hereto and incorporated herein by reference.
8. Release by Employee.
(a) Except as provided below, Employee, for himself and his
dependents, successors, assigns, heirs, representatives, attorneys,
executors and administrators (and his and their legal representatives
of every kind), hereby completely and irrevocably discharges and
releases the Company, its officers, directors, employees, agents,
shareholders, affiliates, subsidiaries, related entities, successors
and assigns from any and all claims, demands, actions, causes of
action and/or liability whatsoever involving any matter arising out of
or in any way related, directly or indirectly, to Employee's
employment with the Company, including any positions with subsidiary
or affiliate entities, compensation therefor, or the termination
thereof, including, but not limited to, any claim for employment
discrimination in violation of Title VII of the Civil Rights Act of
1964, 42 U.S.C. ss.2000e, et seq., the Age Discrimination in
Employment Act, 29 U.S.C. ss.621, et seq., the Americans with
Disabilities Act, 42 U.S.C. ss.12101, et seq., Ohio Revised Code
Chapter 4112, Ohio Revised Code Chapter 4101 and any other federal,
state or municipal fair employment practice or discrimination laws,
statutes or ordinances, arising at any time prior to and including the
effective date of this Agreement. Employee agrees that he will not
seek reinstatement or reemployment with the Company or any affiliate
thereof at any time in the future. Nothing in this Section 8(a) shall
be deemed to constitute Employee's release of the Company from its
express obligations to indemnify Employee under any provision of the
Company's Articles of Incorporation or Regulations or under any
written contract of indemnification between the Company and Employee,
and such obligations shall remain unimpaired by this Section 8(a).
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(b) Employee further agrees and acknowledges that he (i) has been
advised by the Company to consult with legal counsel prior to
executing this Agreement and the release provided for in this Section
8, (ii) has had an opportunity to consult with and has been advised by
legal counsel of his choice, (iii) fully understands the terms of this
Agreement and (iv) enters into this Agreement freely and voluntarily
and intending to be bound.
9. Release by the Company. The Company, on behalf of itself and its
affiliated, related and subsidiary entities, successors and assigns (herein the
"Corporate Releasors"), hereby releases, dismisses and forever discharges
Employee, his successors, assigns, heirs, representatives, attorneys, executors
and administrators from any and all claims, demands, damages, actions and/or
causes of action of any kind and every description, whether known or unknown,
which the Corporate Releasors now have or may have had for, upon, or by reasons
of any cause whatsoever, against Employee. This release shall not, however,
apply to the obligations of Employee, if any, arising under this Agreement or
under the Non-Qualified Stock Option Agreement and Restricted Shares Agreement
between the Company and Employee. Any monies owed by Employee to the Company
under any loan program may be set off against any of the Company's obligations
under this Agreement.
10. Continued Availability and Cooperation.
(a) Employee shall cooperate reasonably with the Company and with
the Company's counsel in connection with any present and future actual
or threatened litigation or administrative proceeding involving the
Company, its affiliated, related or subsidiary entities, its officers,
directors, shareholders, employees, agents and representatives, and
its successors or assigns that relates to events, occurrences or
conduct occurring (or claimed to have occurred) during the period of
Employee's employment by the Company.
(b) Employee shall be reimbursed by the Company for reasonable
travel, lodging, telephone and similar expenses incurred in connection
with such cooperation, which the Company shall reasonably endeavor to
schedule at times not conflicting with the reasonable requirements of
any future employer of Employee or with the requirements of any third
party with whom Employee has a business relationship that provides
remuneration to Employee. Employee shall not unreasonably withhold his
availability for such cooperation.
11. Successors and Binding Agreement.
(a) This Agreement shall be binding upon and inure to the benefit
of the Company and any successor of or to the Company, including,
without limitation, any persons acquiring directly or indirectly all
or substantially all of the business and/or assets of the Company
whether by purchase, merger, consolidation, reorganization or
otherwise (and such successor shall thereafter be deemed included in
the definition of the Company for the purposes of this Agreement), but
shall not otherwise be assignable or delegable by the Company.
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(b) This Agreement shall inure to the benefit of and be
enforceable by Employee, his personal or legal representatives,
executors, administrators, successors, heirs, distributees and/or
legatees.
(c) This Agreement is personal in nature and none of the parties
hereto shall, without the consent of the other parties, assign,
transfer or delegate this Agreement or any rights or obligations
hereunder except as expressly provided in Sections 11(a) and 11(b) of
this Agreement.
(d) This Agreement is intended to be for the exclusive benefit of
the parties hereto, and except as provided in Section 11(a) of this
Agreement, no third party shall have any rights hereunder.
12. Confidentiality and Statements to Third Parties.
(a) Except as otherwise required by law and except to the extent,
and only to the extent, that the Company has publicly disclosed the
terms of this Agreement, Employee will not disclose the terms of
Sections 3 through 9 of this Agreement to anyone other than members of
his immediate family, his accountants, or his legal advisors, as
necessary, and Employee will require that they and their agents take
all reasonable steps to maintain the confidentiality hereof, except as
otherwise required by law, and the Company will disclose the terms of
this Agreement only to those persons (including employees of the
Company) with a genuine business interest in learning such
information.
(b) Neither Employee nor the Company shall, directly or
indirectly, make or cause to be made any statements to any third
parties criticizing or disparaging the other or commenting adversely
on the character or business reputation of the other, but this
provision shall not limit the ability or responsibility of either
party to respond to the best of its knowledge to administrative or
regulatory inquiries or to testify to the best of its knowledge in
legal proceedings.
(c) Employee agrees not to disclose, divulge, discuss, copy or
otherwise use or suffer to be used in any manner, in competition with,
or contrary to the interests of, the Company or any of the Company's
subsidiaries, affiliates or related entities, customer lists, product
research, pricing information, the Company's trade secrets or any
other information that would provide the Company's competitors with
information about the Company's methods, goals, or customers, it being
acknowledged by Employee that all such information regarding the
Company's business and the Company's subsidiaries, affiliates and
related entities compiled or obtained by, or furnished to, Employee
while Employee was employed by or associated with the Company is
confidential information and the Company's exclusive property.
13. Notices. For all purposes of this Agreement, all communications
provided for herein shall be in writing and shall be deemed to have been duly
given when delivered, addressed (a) to the Company (to the attention of
Director, Human Resources) at its principal executive offices located at 0000
Xxxxxxxxx Xxxxxxx, Xxxxxxxxxxxx, Xxxx 00000, and (b) to Employee at
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his principal residence, or to such other address as either party may have
furnished to the other in writing and in accordance herewith. Notices of change
of address shall be effective only upon receipt.
14. Governing Law. The validity, interpretation, construction and
performance of this Agreement (and every other issue arising hereunder) shall be
governed by the laws of the State of Ohio, without giving effect to the
principles of conflict of laws of such state.
15. Miscellaneous. The Company and Employee hereby acknowledge and
understand that:
(a) Each was provided with the opportunity to review and consider
the terms of this Agreement for a period of twenty-one (21) days and
Employee has knowingly and voluntarily waived that opportunity;
(b) Each has had the opportunity to receive counsel regarding
their respective rights, obligations and liabilities;
(c) Nothing in this Agreement is or shall be construed as an
admission by the Company of any breach of any agreement or any
intentional or unintentional wrongdoing of any nature;
(d) Neither Employee nor the Company have made any
representations concerning the terms or effects of this Agreement
other than those contained in this Agreement and this Agreement may
not be modified or terminated orally;
(e) The terms of this Agreement are not effective or enforceable
until seven (7) days after its execution, during which period Employee
may revoke this Agreement;
(f) The benefits provided Employee herein are in excess of the
benefits as to which he would otherwise be entitled;
(g) The death or disability of Employee following the execution
of this Agreement shall not affect or revoke this Agreement or any of
the obligations of the parties hereto, except for obligations of
Employee under Section 10(a) hereof. No provision of this Agreement
may be modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing signed by Employee and the
Company. No waiver by either party hereto at any time of any breach by
the other party hereto or compliance with any condition or provision
of this Agreement to be performed by such other party shall deemed a
waiver of similar or dissimilar provisions or conditions at the same
or at any prior or subsequent time. No agreements or representations,
oral or otherwise, expressed or implied, with respect to the subject
matter hereof have been made by any of the parties that are not set
forth expressly in this Agreement and every one of them (if, in fact,
there have been any) is hereby terminated without liability or any
other legal effect whatsoever; and
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(h) Except as provided for in this Agreement, all compensation
and other payments due Employee as a result of his employment with the
Company have been paid in full and Employee is not entitled to any
additional salary, bonus or other payments whatsoever.
16. Entire Agreement. This Agreement (together with the other documents and
supporting information delivered simultaneously herewith) shall constitute the
entire agreement among the parties hereto with respect to the subject matter
hereof and shall supersede all prior verbal or written agreements, covenants,
communications, understandings, commitments, representations or warranties,
whether oral or written, by any party hereto or any of its representatives
pertaining to such subject matter.
17. Validity. The validity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement which shall nevertheless remain in full force and effect.
18. 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 shall constitute one and the same Agreement.
19. Captions and Section Headings. Captions and section headings used
herein are for convenience and are not part of this Agreement and shall not be
used in construing it.
20. Further Assurances. Each party hereto shall execute such additional
documents, and do such additional things, as may reasonably be requested by the
other party to effectuate the purposes and provisions of the Agreement.
IN WITNESS WHEREOF, the undersigned parties have hereunto executed this
Severance Agreement and Mutual Release as of the day and date first above
written.
CARDINAL REALTY SERVICES, INC.
By: /s/ Xxxx X. Xxxxxxxx, Xx.
-------------------------
Print Name: Xxxx X. Xxxxxxxx, Xx.
Its: President and
Chief Executive Officer
/s/ Xxxxx X. Xxxxxxxxx
------------------
XXXXX X. XXXXXXXXX
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CARDINAL REALTY SERVICES, INC.
0000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxxxx, Xxxx 00000
September 4, 1996
Dear Xxxxx:
In connection with your resignation from employment effective October 31,
1996, attached is a Severance Agreement and Mutual Release which includes a
severance package providing for salary and benefit continuation. However, in
order to receive the enhanced severance package outlined, you will be required
to execute the Severance Agreement and Mutual Release.
By entering into the Severance Agreement and Mutual Release, you will be
specifically waiving and releasing all rights you may have against Cardinal
Realty Services, Inc. Before entering into the Severance Agreement and Mutual
Release, you are advised to consult with an attorney. By law you must be
afforded 21 days in which to consider the Severance Agreement and Mutual
Release. Thus, the opportunity to enter into the Severance Agreement and Mutual
Release shall remain available to you through 21 days from the date of this
letter.
If you have any questions, please do not hesitate to contact me.
Sincerely yours,
/s/ Xxxx X. Xxxxxxxx, Xx.
-------------------------
Xxxx X. Xxxxxxxx, Xx.
Chief Executive Officer
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Cardinal Realty Services, Inc.
0000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxxxx, Xxxx 00000
Attention: Xxxx X. Xxxxxxxx, Xx.
Dear Xxxx:
I understand I have 21 days to consider the severance offer made by
Cardinal Realty Services, Inc. (the "Company"), but I wish to waive the right to
consider its offer for this period of time. I have thoroughly reviewed the
offer, understand it, and wish to accept it immediately.
Acceptance is based on the following conditions:
(i) I have been advised by legal counsel of the Company that
shares subject to the awards defined in the Severance
Agreement and Mutual Release between the Company and me (the
"Agreement") will be promptly registered with the Securities
and Exchange Commission; and
(ii) I have been advised by legal counsel of the Company that the
Irrevocable Proxy attached as an exhibit to the Agreement
ceases to apply ipso facto to any shares immediately upon any
permitted dispositions.
Sincerely,
/s/ Xxxxx X. Xxxxxxxxx
----------------------
Xxxxx X. Xxxxxxxxx
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EXHIBIT A
IRREVOCABLE PROXY
The undersigned hereby irrevocably appoints________________________________
and ______________________________ or either of them, each with the power to
appoint h___ substitute, as proxies of the undersigned to vote and give consents
with respect to all shares of the Common Stock, without par value, of Cardinal
Realty Services, Inc., an Ohio corporation ("Cardinal"), which the undersigned
would be entitled to vote now or hereafter, as fully as the undersigned could
vote and give consents in person at any annual or special meeting of
shareholders of Cardinal or with respect to any actions taken by the written
consent of shareholders of Cardinal, upon any and all matters to come before the
shareholders of Cardinal.
The undersigned hereby acknowledges that this proxy is irrevocable and is
given for consideration and is coupled with an interest, to-wit: Cardinal and
the undersigned have on this date entered into a Severance Agreement providing
for the payment of monies and other benefits to the undersigned in exchange for,
inter alia, this proxy.
This proxy has been made and given at Columbus, Ohio and shall be
interpreted in accordance with the laws of the State of Ohio. This proxy shall
be in effect irrevocably until the earlier of (i) a sale of all of the
undersigned's shares of Cardinal Common Stock (at a time when the undersigned
has no unexercised or unexpired options or other rights to purchase Cardinal
Common Stock) in good faith to a bona fide purchaser in a manner described in
paragraph (f) of Rule 144 under the Securities Act of 1933 and the expiration of
a one (1) year period following such sale during which the undersigned has not
acquired any additional shares of Cardinal Common Stock in excess of the
undersigned's shares of Cardinal Common Stock held on the date hereof; or (ii)
the later of three (3) years from the date hereof or the date of the final
adjournment of Cardinal's annual meeting of shareholders held in 1999.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this 4th day
of September, 1996.
/s/ Xxxxx X. Xxxxxxxxx
------------------
XXXXX X. XXXXXXXXX
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EXHIBIT B
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("Agreement") is made this 4th day of September,
1996, by and between CARDINAL REALTY SERVICES, INC., an Ohio corporation (the
"Company") and XXXXX X. XXXXXXXXX ("Consultant").
WHEREAS, the Company desires to secure for itself the services of
Consultant by retaining Consultant as a consultant to the Company, under the
terms and conditions set forth herein; and
WHEREAS, the Company and Consultant are contemporaneously entering into a
Severance Agreement and Mutual Release, for which the payments hereunder shall
serve as partial consideration;
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, the parties hereto agree as follows:
1. Consulting Services; Availability. For a nine-month period beginning on
the November 1, 1996, unless mutually extended by the parties in writing (the
"Consulting Period"), the Company shall retain Consultant as a part-time,
independent consultant with respect to the Company's finances and business.
Consultant shall perform such consulting services in such a manner and on such
dates as Consultant and Company agree. During the Consulting Period, within
reason, Consultant shall make himself available to the Company no less than
twelve (12) hours each thirty (30) day period (the "Minimum Service
Requirement") to render such advice and assistance regarding financial and
business matters as may be reasonably requested of Consultant by the Company.
For each hour of service in excess of the Minimum Service Requirement, the
Company shall pay Consultant One Hundred Fifty ($150) per hour; provided,
however, Consultant shall not perform any services in excess of the Minimum
Service Requirement without the prior written instruction of the Company's Chief
Executive Officer.
2. Consulting Payments. In consideration of the services to be performed by
Consultant pursuant to the provisions of Paragraph 1 above, the Company shall
pay to Consultant the sum of Fifty Thousand Dollars ($50,000), payable in (i) a
lump sum on January 2, 1997 or (ii) nine (9) equal monthly installments,
commencing November 1, 1996.
3. Expense Reimbursement. During the Consulting Period, Consultant shall be
entitled to reimbursement of all expenses reasonably incurred by Consultant in
connection with Consultant's performance of consulting services hereunder (but
no expenses under paragraph 2(b) hereof shall be incurred without first
obtaining Company's written approval), provided that Consultant submits to the
Company invoices or other documentary verifications of the amounts thereof.
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4. Termination.
(a) The engagement of Consultant under this Consulting Agreement,
and the term hereof, may be terminated by Company for cause at any
time by action of the Board of Directors. For purposes hereof, the
term "cause" shall mean:
(i) any act of fraud, dishonesty, willful misconduct, or
other intentional act that is wrongful and detrimental to the
interests of Company; or
(ii) Consultant's material breach of this Consulting
Agreement.
(b) The engagement of Consultant under this Consulting Agreement,
and the term hereof, shall be terminated on the death or permanent
disability of Consultant. For these purposes, permanent disability
shall be deemed to occur after ninety (90) days in the aggregate
during any consecutive twelve (12) month period, or after sixty (60)
consecutive days, during which, as the case may be, Consultant shall
have been unable to discharge his duties under this Consulting
Agreement by reason of his physical or mental disability or illness.
(c) Upon any such termination Consultant or his estate or
personal representative, as the case may be, shall be entitled only to
accrued but unpaid compensation up to the date of such termination and
Company shall have no further obligation to Consultant under this
Consulting Agreement.
5. Assignment. Without the written consent of the Company, Consultant shall
have no right to assign or otherwise transfer any rights created under this
Agreement. This Agreement shall be binding upon, and shall inure to the benefit
of, the Company and its successors and assigns, and Consultant and Consultant's
legal representatives, heirs, successors and permitted assigns.
6. Relationship. The Company and Consultant expressly acknowledge and agree
that the consulting services to be provided by Consultant under this Agreement
shall be performed as an independent contractor, and not as an agent or employee
of the Company. The parties also expressly acknowledge and agree that with
respect to any payments made to Consultant hereunder, the Company shall not: (i)
withhold or pay FICA or other Federal, state, or local income or other taxes; or
(ii) comply with or contribute to state worker's compensation, unemployment or
other funds or programs. Consultant also acknowledges that as an independent
contractor Consultant will not be given the right to participate in any employee
benefit or insurance plan or any other plan or other fringe benefit which is
maintained, established or provided by the Company for its employees.
7. Arbitration. Any controversy or claim arising out of or relating to this
Agreement, or the breach thereof, shall be settled by arbitration in accordance
with the Rules of the American Arbitration Association then pertaining in the
City of Columbus, Ohio and judgment upon the award rendered by the Arbitrator or
Arbitrators may be entered in any Court having jurisdiction
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thereof. The Arbitrator or Arbitrators shall be deemed to possess the powers to
issue mandatory orders and restraining orders in connection with such
arbitration.
8. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Ohio.
9. Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof, and
supersedes all prior and contemporaneous written or oral conversations,
agreements or discussions concerning the subject matter hereof.
10. Validity. The validity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement which shall nevertheless remain in full force and effect.
11. 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 shall constitute one and the same agreement.
12. Captions and Section Headings. Captions and section headings used
herein are for convenience and are not part of this Agreement and shall not be
used in construing it.
13. Further Assurances. Each party hereto shall execute such additional
documents, and do such additional things, as may reasonably be requested by the
other party, to effectuate the purposes and provisions of the Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
CARDINAL REALTY SERVICES, INC.
By: /s/ Xxxx X. Xxxxxxxx, Xx.
------------------------------
Print Name: Xxxx X. Xxxxxxxx, Xx.
Its: President
/s/ Xxxxx X. Xxxxxxxxx
----------------------
XXXXX X. XXXXXXXXX
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