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Ex.10.12
EMPLOYMENT AGREEMENT
AGREEMENT made as of the 29th day of July, 1996 between XXX X. XXXXXX,
INC., (the "Company"), a Pennsylvania corporation with offices at Weston Way,
West Chester, Pennsylvania, and XXX X. XXXXXX ("Xxxxxx"), of Dunwoody Village,
Ch. 000, Xxxxxxx Xxxxxx, Xxxxxxxxxxxx 00000.
WHEREAS, Weston and the Company desire to set forth all terms and
conditions upon which Weston shall continue to be employed by the Company
hereinafter; and
WHEREAS, Weston and the Company desire to replace and supersede all
prior existing agreements between the parties, written and oral;
NOW, THEREFORE, INTENDING TO BE LEGALLY BOUND, in consideration of the
mutual covenants contained herein and other good and valuable consideration the
receipt, adequacy and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
1. (a) EMPLOYMENT: TERM.
The Company agrees to and hereby does continue Weston in its
employ, and Weston agrees to and hereby does continue in the
employ of the Company, as Chairman Emeritus, with the duties
set forth below, subject to the supervision and direction of
the Board of Directors. Such employment shall continue until
terminated by death or disability as provided herein or by
mutual written agreement of the parties. It is the intent of
this Agreement to continue the terms of Weston's current
employment contract, except as modified in certain respects,
all as expressly set forth herein or in the minutes of the
Special Meeting of the Company's Board of Directors held on
July 29, 1996.
(b) DUTIES.
Weston shall serve as Chairman Emeritus of the Company. In
this capacity, Weston shall perform only such duties and
assignments as may from time to time be specifically
prescribed to him by the Board of Directors of the Company.
(c) COMPENSATION.
(i) During the term of Weston's employment as
described in Paragraph 1(a) hereof, he will be
compensated at a base annual rate of not less than 55
percent of the midpoint for the Salary Grade,
Chairman of the Board and CEO, currently designated
Salary Grade 40, plus $18,000 per year payable on a
basis mutually agreeable to the parties, but in no
event less frequently than monthly. If there is no
salary grade for Chairman and CEO combined, the
applicable salary grade shall be the higher of the
two grades.
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(ii) The following shall apply to the terms of
employment: The midpoint salary base shall be
computed in accordance with standard Company practice
for determining job value and setting salary scales,
and shall be kept current to account for changes in
responsibility, performance and adjustments in the
cost of living. In addition, Weston shall be entitled
to participate in all of the Company's benefit
programs generally available to executive employees
of the Company or in comparable programs to the
extent available to persons of Weston's attained age.
During these terms Weston may be awarded additional
compensation by the Company above that specified in
paragraph 1(c)(i), at the discretion of the Company's
Board of Directors.
(iii) The Company will continue to pay the above
salary to Weston's spouse, Xxx. Xxxxxxxx Xxxxxx
(hereafter "his spouse") for her life, should Weston
predecease her. The amount payable to Xxxxxxxx Xxxxxx
under the preceding sentence shall be at the salary
rate payable to Xx. Xxxxxx at the time of his death.
(d) BOARD POSITION.
The Board of Directors shall use its best efforts to nominate
Weston and cause him to be elected to the Board of Directors,
subject to any legal requirements and absent any disability as
defined in paragraph 10 hereof. In the event Xx. Xxxxxx is not
elected to the Board he will become an ex-officio member of
the Board subject to any legal requirements and absent any
disability as defined in paragraph 10 hereof. In all events,
he will continue as Chairman Emeritus during his employment.
Any fees or compensation for serving on the Company's Board of
Directors ("Director's Fees") which would otherwise be payable
to Weston in his role as a member or ex-officio member of the
Board of Directors in any calendar year shall be offset
against the $18,000 additional compensation amount paid during
that year to Weston under paragraph 1(c)(i) above. If the
total amount of any Director's Fees which would otherwise be
payable to Weston in any calendar year exceeds $18,000 he
shall be paid, in addition to the amount payable under
paragraph 1(c)(i) above, the incremental amount by which such
fees exceed $18,000. If the amount of Director's Fees which
would otherwise be payable to Weston in any calendar year is
less than $18,000, Weston shall not be paid such Director's
Fees, but shall be paid the full $18,000 in accordance with
paragraph 1(c)(i).
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2. ADDITIONAL COMPENSATION; FRINGE BENEFITS.
(a) For the benefit and privilege of all full time employees,
the Company has established various policies with regard to
vacation with pay and paid holidays. Weston shall be entitled
to the benefit of these policies as they presently exist or as
they may be modified by the Company from time to time.
(b) During the term of Weston's employment by the Company, as
defined in Paragraph 1 hereof, and after termination of said
employment and until Weston's death, the Company shall pay
necessary insurance premiums for Weston's $500,000 life
insurance policy.
(c) During the term of Weston's employment by the Company, as
defined in Paragraph 1 hereof, and after termination of said
employment and until Weston's death and until the death of his
spouse, the Company shall include Weston and his spouse in the
hospitalization, surgical, major medical and other health
insurance programs maintained by the Company. Such programs
(or separate policies provided by the Company) will include
reasonable coverage in excess of and supplementing Medicare
coverage. The Company will pay all health insurance premiums
under all such programs and policies (other than Medicare) for
the benefit of Weston and his spouse.
(d) The Company shall continue to provide Weston with a
membership to Overbrook Golf Club, and shall pay all
reasonable expenses associated therewith, until his death,
disability, or termination of this Agreement by mutual written
consent of the parties.
(e) The Company shall continue to pay all reasonable business
expenses incurred by Weston, consistent with Company policy.
(f) The Company shall continue to provide Weston with his
current office space and secretarial and other executive
support until his death, disability, or termination of this
Agreement by mutual written consent of the parties.
3. COMPANY AUTOMOBILE. The Company will continue to provide
Weston with the use of an automobile until his death,
disability, or termination of this Agreement by mutual written
consent of the parties. The automobile shall be a Cadillac
Seville or a comparable model and shall be less than three (3)
years old.
4. EXCLUSIVE SERVICE. During his employment hereunder, Weston
will not engage in any other employment and/or assignment
which conflicts with or impairs his obligations as an employee
of the Company or any subsidiary thereof.
5. DOCUMENTS COMPANY PROPERTY. All memoranda, notes, records,
reports and other documents made, compiled or authored or
co-authored by Weston, or made available to him during his
employment with the Company, concerning any process,
apparatus, method,
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information system, list of clients or product used, developed
or considered by the Company, or any client of the Company,
shall be the Company's confidential property, and shall be
delivered to the Company upon termination of employment or at
any other time requested by the Company, and shall not be
furnished to any person, firm or corporation other than the
Company.
6. CONFIDENTIAL INFORMATION. Weston shall not disclose to others,
or use for his own benefit or the benefit of others, or cause
or induce others to do the same, any proprietary, confidential
or secret information or documents of the Company, including,
but not limited to, any customer lists, records, intellectual
property and business plans of the Company, other than in the
performance of his duties hereunder or unless authorized by
the Company in writing. Any unpublished information and client
reports are considered by the Company secret and confidential.
7. NON-COMPETITION. During the period of his employment by the
Company hereunder, and for a period of three years after the
termination thereof, Weston will not, directly or indirectly,
for his own benefit, or for or with any person, firm or
corporation whatsoever other than the Company, engage in
rendering services in any business in which the Company may be
then engaged.
8. INVENTIONS, METHODS AND PROCESSES. All inventions, methods, or
processes relating to the Company's business created,
conceived or otherwise prepared by Weston while employed by
the Company, shall be assigned to the Company, and shall be
the sole and exclusive property of the Company. Any such
invention or discovery disclosed by Weston within one year
following the termination of such employment by the Company
shall be deemed to fall within this provision, unless proved
to have been conceived and made following such termination.
Upon request of the Company, whether during or after such
employment by the Company, Weston promptly shall execute any
and all applications, assignments or other instruments which
the Company shall deem necessary or advisable in order to
apply for and obtain a copyright, patent, or trademark in the
United States and throughout the world, and will assign to the
Company all right, title and interest in and to such
copyrights, patents, and/or trademarks. The Company shall bear
the cost of preparation and filing of all such applications,
assignments and instruments in the appropriate governmental
offices in the United States and any foreign country. If such
services are performed by Weston at the request of the Company
after termination of such employment, the Company shall pay
reasonable compensation for such post-employment services.
9. FIDELITY BOND. Weston shall furnish the Company, at the
Company's expense, as from time to time it may request, a
fidelity bond or bonds with such limits as it may designate.
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10. DISABILITY.
(a) In the event of Weston's disability, or upon mutual
agreement between Weston and the Company, the salary payments
under Paragraph 1(c) of this Agreement may be terminated by
either party upon thirty (30) days' prior written notice.
Thereafter, the payments in Paragraph 1(c), including the
additional eighteen thousand ($18,000) dollars per year, shall
be continued as disability payments for the first twelve (12)
months of said disability. At the end of the twelve (12) month
period, if Weston is disabled as defined herein, the payments
beginning with the thirteenth (13th) month will be reduced to
41.25 percent of the midpoint of the Salary Grade for the
position of Chairman of the Board and CEO (currently SG 40)
then in effect, plus $7,425 (41.25% of $18,000). If at the end
of twenty four (24) months, Weston is still disabled as
defined herein, all subsequent payments shall be reduced to
27.5 percent of the midpoint of the Salary Grade for the
position of Chairman of the Board and CEO (currently SG 40)
then in effect, plus $4,950 (27.5% of $18,000), and will
continue throughout the balance of the disability for an
additional period not to exceed seventy two (72) months. If
there is no salary grade for Chairman and CEO combined, the
applicable salary grade shall be the higher of the two grades.
The Company's payments in the event of Weston's disability
will be offset by any disability insurance he may receive
directly from any insurance company or companies for which
premiums are paid by the Company.
(b) Weston shall be deemed to be "disabled" for purposes of
this Agreement if the Company determines, on the basis of
medical evidence satisfactory to the Company in its sole
discretion, that Weston is disabled, mentally or physically,
so as to be prevented from continuing to render services to
the Company on the basis for which payments are being made in
accordance with Paragraph 1(c) of this Agreement. Following
any such determination of disability by the Company, certain
medical evidence will be required by the Company at least
semi-annually in order to enable the Company to determine
whether Weston remains disabled. Less frequent medical
evidence may be required at the Company's reasonable
discretion. In the event that a dispute arises between Weston
and the Company concerning disability as defined herein, the
dispute shall be settled by a physician approved by both
Weston and the Company. In the event that Weston and the
Company cannot agree on a physician, a physician selected by
Weston and a physician selected by the Company shall appoint a
physician who will make the determination concerning whether
or not Weston is disabled for purposes of this Agreement. Both
Weston and the Company agree to be bound by the determination
of said physician.
11. REMEDIES AND BREACH. It is agreed that, money damages for
breach of this Agreement being difficult to determine, the
Company shall be entitled to an injunction upon any such
breach by Weston, to be issued by any competent court of
equity, enjoining and restraining Weston and each and every
person concerned therein, from any further or continued
violation of this Agreement.
12. MERGER. The Company will not consolidate or merge into or with
any other corporation, or transfer all or substantially all of
its assets of business to another corporation or firm, unless
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such other entity (the "Successor Corporation") shall assume
this Agreement. Upon such assumption, Weston and the Successor
Corporation shall become obligated to perform the terms and
conditions hereof, and the term "Company" as used in this
Agreement shall be deemed to refer to such Successor
Corporation. However, although Weston shall be employed by the
Successor Corporation, he need not be designated as the
Chairman Emeritus of the Successor Corporation but shall be of
the Successor Corporation's subsidiary or division which
conducts the Company's business if any, and his duties shall
be prescribed by the Board of Directors of the Successor
Corporation, subject to paragraph 1(b) hereof.
13. RIGHT OF FIRST REFUSAL. Weston agrees that in the event Weston
determines to sell or otherwise transfer all or substantially
all of his shares of the capital stock (the "Shares") of the
Company to any third party (other than to or in trust for the
benefit of his spouse; his issue or the spouses of his issue
or his grandchildren) Weston will first offer (for a period of
thirty (30) days) such Shares to the Company at a price and
under terms and conditions no less favorable to the Company
than Weston may have received in any offer from any third
party to buy such Shares. If there is no offer from a third
party to purchase the Shares, the Company and Weston may
independently agree upon appropriate terms and conditions for
the Company's purchase of the Shares. However, under no
circumstances will Weston participate in any determination by
the Company of whether or not it will purchase the Shares or
the price it will pay therefor. The provisions of this
paragraph will be binding on Weston's transferees, and on
Weston's heirs, executors and legal representatives, for a
period of one year following Weston's death. This Right of
First Refusal will expire on July 29, 1998.
14. HEADQUARTERS. If the Company moves its headquarters from West
Chester, Pennsylvania, during the period of Weston's
employment under this Agreement, the Company will reimburse
Weston for reasonable travel and living expenses incurred in
connection therewith and Weston will not be required to change
his residence.
15. SCOPE OF AGREEMENT. This Agreement constitutes the entire
understanding between the parties with reference to the
subject matter hereof. This Agreement specifically modifies
and replaces all prior written or oral agreements between the
parties with respect to the subject matter hereof, including
but not limited to the 1973 agreement, the August 19, 1985
agreement, and the August 6, 1991 and February, 1992
amendments thereto. This Agreement may only be modified in
writing, executed by both parties.
16. GOVERNING LAW. This agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of
Pennsylvania.
17. GOVERNMENT CONTROLS. To the extent that the compensation
provided to be paid to Weston hereunder represents an
increased salary or wage which may not lawfully be paid to him
at the time and in the manner provided for herein by reason of
any statute, ordinance, executive order, rule or regulation of
any governmental body or agency thereof, such increased amount
of compensation shall be paid to Weston only as, and to the
extent permitted by such applicable law. In that event,
however, Weston's compensation shall be increased to the
amount set forth
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herein as quickly as permitted by law. The failure of the
Company to pay compensation in the amounts and at the time
provided herein which, if paid would violate any such
applicable law, rule, ordinance, etc., shall not be deemed a
breach by the Company of any obligation hereunder, and this
Agreement shall be deemed to have been modified to require
payment only of such legal amount as may be paid without
violation of law.
18. EFFECTIVE DATE. This Agreement shall become effective having
been approved by the Company's Board of Directors, when
executed by the parties.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
(CORPORATE SEAL) XXX X. XXXXXX, INC.
Attest:
_________________________ By__________________________________________
_____________________________(SEAL)
Xxx X. Xxxxxx
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