1
EXHIBIT 10.32(a)
AMENDED AND RESTATED EMPLOYMENT AGREEMENT, dated as of January 1, 1999
(the "Agreement"), between The X. X. Xxxxxxx Company, Inc., a North
Carolina corporation (the "Employer"), and Xxxxxx X. Xxxxx (the
"Employee").
The Employer and the Employee are parties to an Employment Agreement,
dated as of May 20, 1998, and desire to amend and restate such Employment
Agreement in its entirety. The Employer desires to continue to retain the
Employee to supply services to the Employer, and the Employee desires to
continue provide such services to the Employer, on the terms and subject to the
conditions set forth in this Agreement.
In consideration of (i) the Employee's agreement to supply services
under this Agreement and (ii) the mutual agreements set forth below, the
sufficiency of which is hereby acknowledged, the Employer and the Employee agree
as follows:
SECTION 1. Employment Relationship.
(a) Employment by Employer. The Employer hereby employs the Employee,
and the Employee hereby agrees to be employed by the Employer, as Senior Vice
President-Sales and Marketing of the Employer, and the Employee will devote
all of his business time, attention, knowledge and skills and use his best
efforts during the Employment Period to perform services and duties consistent
with his title and position (the "Services") for the Employer in accordance with
directions given to the Employee from time to time by the Board of Directors of
the Employer.
(b) Employment Period. The period commencing on the date of this
Agreement and ending on the date on which this Agreement is terminated is
referred to herein as the "Employment Period." During the Employment Period, the
Employee will be an at-will employee of the Employer. The Employment Period
shall be freely terminable for any reason by either party at any time.
SECTION 2. Compensation and Benefits. During the Employment Period:
(a) Base Compensation. The Employer shall pay to the Employee a base
salary of $191,000 per annum (the "Base Salary"), payable in accordance with the
Employer's payroll practices and prorated for the period commencing on the date
of this Agreement and ending on December 31, 1998. The Base Salary shall be
increased (but not decreased) for cost of living adjustments, and subject to
additional discretionary increases (but not decreases) as determined by an
annual review by the Board of Directors on or prior to each February 1.
(b) Additional Compensation. As additional compensation for the
Services, the Employer shall pay to the Employee (i) an amount equal to the
greater of (x) annual fixed bonus payments (the "Fixed Bonus") equal to 15% of
the Employee's Base
2
Salary for such year, payable on or around February 1 of the following year, or
(y) annual target bonus payments (as defined in the Employer's Executive Bonus
Plan) (the "Target Bonus"), payable on or around February 1 of the following
year, and (ii) other incentive compensation as the Board of Directors of the
Employer determines in its sole discretion to pay the Employee. The Employee
acknowledges that the Employer may terminate or modify its Executive Bonus Plan
and other incentive plans (excluding the Fixed Bonus payable hereunder) at any
time although no termination or amendment affecting the Employee will be made
effective unless it is consistently applied to other employees participating in
such plans.
(c) Restricted Stock and Stock Options. The Employee purchased shares
of Class A Common Stock of the Employer pursuant to a Securities Purchase and
Stockholders Agreement, dated as of May 28, 1997, between the Employer and the
Employee, and was granted options (pursuant to the Employer's 1997 Stock Option
Plan) to acquire shares of Class A Common Stock of the Employer, pursuant to
Stock Option Agreements between the Employer and the Employee dated as of May
28, 1997 and _________, 1998. Such Securities Purchase and Stockholders
Agreement and Stock Option Agreements are referred to in this Agreement as the
"Other Agreements." The Employee shall be entitled to participate in current or
future equity incentive plans adopted by the Employer on terms no less favorable
than those offered to members of the Employer's Executive Committee or other
division Presidents of the Employer. Such grants may be awarded from time to
time in the sole discretion of the Employer's Executive Committee. In the event
of a Change in Control, the Employee shall become fully vested in all awards
heretofore or hereafter granted to him under all incentive compensation,
deferred compensation, stock option, stock appreciation rights, restricted
stock, phantom stock or similar plans maintained by the Employer, any contrary
provisions of such plans notwithstanding. Any such plans shall be deemed amended
to the extent necessary to carry out the intent expressed in the preceding
sentence.
(d) Benefit Plans. During the Employment Period, the Employee shall be
entitled to receive benefits from the Employer consistent with those currently
in effect for the Employer's senior executives (including deferred compensation
plans and company automobile perquisites), as those benefits are revised from
time to time by the Board of Directors of the Employer. Nothing contained herein
is intended to require the Employer to maintain any existing benefits or create
any new benefits. The Employee will be entitled to participate in the Employer's
deferred compensation program as a Level I Employee. If the Employment Period is
terminated by the Employer or the Employee in connection with a Change in
Control (as defined), the Employee and relevant family members shall be entitled
to continue to participate in the Employer's welfare benefit plans at the
Employer's expense during three year period following the effective date of such
Change in Control (the "Change in Control Period").
(e) Other Benefits. The Employer will provide a vehicle of the
Employee's choice for the Employee's use at a cost (including expenses and
insurance) of up to $40,000. The Employee will be responsible for any costs in
excess of $40,000.
-2-
3
(f) Vacation and Holidays. The Employee shall be entitled to a minimum
of four weeks' vacation each year and paid holidays in accordance with the
Employer's policy.
SECTION 3. Termination.
(a) Death or Disability. If the Employee dies during the Employment
Period, the Employment Period shall terminate as of the date of the Employee's
death. If the Employee becomes unable to perform the Services for 90 consecutive
days due to a physical or mental disability, (i) the Employer may elect to
terminate the Employment Period at any time thereafter, and (ii) the Employment
Period shall terminate as of the date of such election. All disabilities shall
be certified by a physician acceptable to both the Employer and the Employee,
or, if the Employer and the Employee cannot agree upon a physician within 15
days, by a physician selected by physicians designated by each of the Employer
and the Employee. The Employee's failure to submit to any physical examination
by such physician after such physician has given reasonable notice of the time
and place of such examination shall be conclusive evidence of the Employee's
inability to perform his duties hereunder.
(b) Cause. The Employer, at its option, may terminate the Employment
Period and all of the obligations of the Employer under this Agreement for
Cause. The Employer shall have "Cause" to terminate the Employee's employment
hereunder in the event of (i) the Employee's conviction of or plea of guilty or
nolo contendere to a felony, (ii) the Employee's gross negligence in the
performance of the Services, which is not corrected within 15 business days
after written notice, (iii) the Employee's knowingly dishonest act, or knowing
bad faith or willful misconduct in the performance of the Services, which is not
corrected within 15 business days after written notice, or (iv) the Employee's
material breach of any of his obligations under Sections 4 and 5, which is not
corrected within a reasonable period of time (determined in light of the cure,
if any, appropriate to such material breach, but in no event less than 15
business days) after written notice. If the Employee is charged with a felony,
then during the period while such charge or related indictment remains
outstanding and until finally determined, the Employer shall have the right to
suspend the Employee without compensation.
(c) Without Cause. The Employer, at its option, may terminate the
Employment Period without Cause at any time.
(d) Termination by Employee for Good Reason. The Employee may terminate
this Agreement upon 60 days' prior written notice to the Employer for Good
Reason (as defined below) if the basis for such Good Reason is not cured within
a reasonable period of time (determined in light of the cure appropriate to the
basis of such Good Reason, but in no event less than 15 business days) after the
Employer receives written notice specifying the basis of such Good Reason. "Good
Reason" shall mean (i) the failure of the Employer to pay any undisputed amount
due under this Agreement or a substantial diminution in benefits provided under
this Agreement, (ii) a substantial diminution in the status, position and
responsibilities of the Employee or (iii) the
-3-
4
Employer requiring the Employee to be based at any office or location that
requires a relocation or commute greater than 50 miles from the office or
location to which the Employee is currently assigned.
(e) Payments in the Event of Termination. (i) Basic Termination
Payment. Upon the termination of the Employment Period at any time for any
reason, the Employer shall pay to the Employee or his estate the Base Salary and
Target Bonus earned to the date of death or termination for disability or Cause,
as the case may be. Any Target Bonus payments payable under this Section 3(e)(i)
shall be prorated if payable for periods of less than one year and shall be
payable regardless of whether the Employee is still in the employ of the
Employer on the date declared or payable.
(ii) Involuntary Termination Payment. Upon the termination of the
Employment Period at any time by the Employer without Cause or by the Employee
for Good Reason, the Employer shall pay to the Employee or his estate an amount
(in addition to amounts payable under Section 3(e)(i)) equal to one year's Base
Salary and Target Bonus, in each case, at the rate in effect on the date of
termination. Notwithstanding the foregoing, the Employee shall be entitled to no
payment under this Section 3(e)(ii) if he is entitled to receive a payment under
Section 3(e)(iii).
(iii) Change in Control Payment. Upon the termination of the Employment
Period (x) by the Employer upon or prior to a Change in Control, provided that
the Employee reasonably demonstrates that such termination occurred at the
request of a third party participating in, or otherwise in anticipation of or in
connection with, such Change in Control, (y) by the Employee with Good Reason or
by the Employer for any reason within one year after a Change in Control, or (z)
by the Employee for any reason on or after the first anniversary of a Change in
Control but no later than the 30th day after such first anniversary, then the
Employer shall pay to the Employee within five business days of such termination
an amount (in addition to amounts payable under Section 3(e)(i)) equal to the
sum of (A) the higher of (1) the annual Base Salary at the date of such
termination or (2) the annual Base Salary at the time of the Change in Control,
in each case multiplied by the number of years remaining in the Change in
Control Period, and (B) the Target Bonus at the annual rate in effect at the
date of such termination multiplied by the number of years remaining in the
Change in Control Period.
(iv) Change in Control Defined. "Change in Control" means the first to
occur of any of the following: (A) the sale (including by merger, consolidation
or sale of stock of subsidiaries or any other method) of all or substantially
all of the assets of the Employer and its consolidated subsidiaries (taken as a
whole) to any person or entity not directly or indirectly controlled by the
holders of at least 50% of the Combined Voting Power of the then outstanding
shares of capital stock of the Employer, (B) at any time prior to the
consummation of an initial public offering of Class A Common Stock of the
-4-
5
Employer or other common stock of the Employer having the voting power to elect
directors, a transaction (except pursuant to such initial public offering)
resulting in the Principal Shareholders owning, collectively, less than 50% of
the Combined Voting Power of the then outstanding shares of capital stock of the
Employer, (C) at any time after the consummation of an initial public offering
of Class A Common Stock of the Employer or other common stock of the Employer
having the voting power to elect directors, the acquisition (except pursuant to
such initial public offering) by any person or entity not directly or indirectly
controlled by the Employer's stockholders of more than 35% of the Combined
Voting Power of the then outstanding shares of capital stock of the Employer,
(D) individuals serving as directors of the Employer on the date hereof and who
were nominated to serve as directors by one or more Principal Shareholders
(together with any new directors whose election was approved by (x) a vote of
such individuals or directors whose election was previously so approved or (y)
Principal Shareholders holding a majority of the aggregate voting power of the
capital stock of the Employer held by all Principal Shareholders) cease for any
reason to constitute a majority of the Board of Directors of the Employer, (E)
the adoption of a plan relating to the liquidation or dissolution of the
Employer in connection with an equity investment or sale or a business
combination transaction or (F) any other event or transaction that the Board of
Directors of the Employer deems to be a Change in Control. "Combined Voting
Power" with respect to capital stock of the Employer means the number of votes
such stock is normally entitled (without regard to the occurrence of any
contingency) to vote in an election of directors of the Employer. "Principal
Shareholders" means Xxx X. Xxxxxxx, Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxx and
Xxxxxx X. Xxxxx and members of their immediate families and any spouse, parent
or descendant of the foregoing, any trust the beneficiaries of which include
only any of the foregoing, and any corporation, partnership, limited liability
company or other entity all of the capital stock or other ownership interests of
which are owned by any of the foregoing.
(v) Other Provisions Applicable to Payments. Any payment due under
Section 3(e)(iii) shall be limited to the extent the Board of Directors of the
Employer, in its good faith determination, deems necessary to preserve the
deductibility by the Employer of such payment pursuant to Section 280G of the
Internal Revenue Code of 1986, as amended, or any successor provision of any
successor statute. The Employer may elect to make any payments due under Section
3(e)(ii) in a lump sum or as they would have been paid had the Employment Period
not been terminated. Unless otherwise specifically stated to be payable over a
period of time, all amounts due under this Section 3 shall be payable on demand
by the Employee and shall bear interest (compounded annually) for the period
from and including the date payable to but excluding the date paid at a rate per
annum equal to the sum of (x) four percent and (y) the rate publicly announced
by BankBoston, N.A. as its "prime rate."
(f) Termination of Obligations. In the event of termination of the
Employment Period in accordance with this Section 3, all obligations of the
Employer and the Employee under this Agreement shall terminate, except for any
amounts payable by the Employer as specifically set forth in Section 3(e);
provided, however, that notwithstanding anything to the contrary contained in
this Agreement, the provisions of Section 4 and Section 5 shall survive such
termination in accordance with their respective terms and the relevant
provisions of Section 6 shall survive such termination indefinitely. In the
event of termination of the Employment Period in accordance with this Section 3,
the Employee agrees to cooperate with the Employer in order to ensure an orderly
transfer of the Employee's duties and responsibilities.
-5-
6
SECTION 4. Confidentiality; Non-Disclosure.
(a) (i) Non-Disclosure Obligation. Except as provided in this Section
4(a), the Employee shall not disclose any Confidential Information of the
Employer or any of its affiliates or subsidiaries to any person, firm,
corporation, association or other entity (other than the Employer, its
subsidiaries, officers or employees, attorneys, accountants, bank lenders,
agents, advisors or representatives thereof) for any reason or purpose
whatsoever (other than in the normal course of business on a need-to-know basis
after the Employer has received assurances that the confidential or proprietary
information shall be kept confidential), nor shall the Employee make use of any
such confidential or proprietary information for his own purposes or for the
benefit of any person, firm, corporation or other entity, except the Employer.
As used in this Section, the term "Confidential Information" means all
information which is or becomes known to the Employee and relates to matters
such as trade secrets, research and development activities, new or prospective
lines of business (including analysis and market research relating to potential
expansion of the Business), books and records, financial data, customer lists,
marketing techniques, financing, credit policies, vendor lists, suppliers,
purchasers, potential business combinations, distribution channels, services,
procedures, pricing information and private processes as they may exist from
time to time; provided that the term Confidential Information shall not include
information that is or becomes generally available to the public (other than as
a result of a disclosure in violation of this Agreement by the Employee or by a
person who received such information from the Employee in violation of this
Agreement).
(ii) Compulsory Disclosures. If the Employee is requested or (in the
opinion of his counsel) required by law or judicial order to disclose any
Confidential Information, the Employee shall provide the Employer with prompt
notice of any such request or requirement so that the Employer may seek an
appropriate protective order or waiver of the Employee's compliance with the
provisions of this Section 4(a). The Employee will not oppose any reasonable
action by, and will cooperate with, the Employer to obtain an appropriate
protective order or other reliable assurance that confidential treatment will be
accorded the Confidential Information. If, failing the entry of a protective
order or the receipt of a waiver hereunder, the Employee is, in the opinion of
his counsel, compelled by law to disclose a portion of the Confidential
Information, the Employee may disclose to the relevant tribunal without
liability hereunder only that portion of the Confidential Information which
counsel advises the Employee he is legally required to disclose, and each of the
parties hereto agrees to exercise such party's best efforts to obtain assurance
that confidential treatment will be accorded such Confidential Information.
During the Employment Period, and for matters arising from events or
circumstances occurring during the Employment Period, the Employer will provide
for the defense of matters arising under this provision.
(b) Assignment of Inventions. The Employee agrees that he will promptly
and fully disclose to the Employer all inventions, ideas, software, trade
secrets or know-how (whether patentable or copyrightable or not) made or
conceived by the Employee (either solely or jointly with others) during the
Employment Period and for a period of six months thereafter, all tangible work
product derived therefrom (collectively,
-6-
7
the "Ideas"). The Employee agrees that all such Ideas shall be and remain the
sole and exclusive property of the Employer. On the request of the Employer, the
Employee shall, during and after the term of this Agreement, without charge to
the Employer but at the expense of the Employer, assist the Employer in any
reasonable way to vest in the Employer, title to all such Ideas, and to obtain
any related patents, trademarks or copyrights in all countries throughout the
world. In this regard, the parties shall execute and deliver any and all
documents that the Employer may reasonably request.
SECTION 5. Non-Competition; Non-Solicitation. The Employee acknowledges
and recognizes his possession of Confidential Information and acknowledges the
highly competitive nature of the business of the Employer and its affiliates and
subsidiaries and accordingly agrees that, in consideration of the premises
contained herein, he will not, during the Employment Period and for one year
after the date of termination of the Employment Period, for any reason
whatsoever, either individually or as an officer, director, stockholder, member,
partner, agent or principal of another business firm, (x) directly or indirectly
engage in the United States, or any country in which the Employer or any of its
affiliates or subsidiaries actively engages in business during the Employment
Period, in any competitive business, (y) assist others in engaging in any
competitive business in the manner described in clause (x), or (z) induce any
employee of the Employer or any of its affiliates or subsidiaries to terminate
such person's employment with the Employer or such affiliate or subsidiary or
hire any employee of the Employer or any of its affiliates or subsidiaries to
work with any businesses affiliated with the Employee. The Employee's ownership
of not more than 1% of the outstanding capital stock of any public corporation
shall not in itself be deemed to be engaging in any competitive business for
purposes of this Section 5.
SECTION 6. General Provisions.
(a) Enforceability. It is the desire and intent of the parties hereto
that the provisions of this Agreement shall be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in
which enforcement is sought. Accordingly, although the Employee and the Employer
consider the restrictions contained in this Agreement to be reasonable for the
purpose of preserving the Employer's goodwill and proprietary rights, if any
particular provision of this Agreement shall be adjudicated to be invalid or
unenforceable, such provision shall be deemed amended to delete therefrom the
portion thus adjudicated to be invalid or unenforceable, such deletion to apply
only with respect to the operation of such provision in the particular
jurisdiction in which such adjudication is made. It is expressly understood and
agreed that although the Employer and the Employee consider the restrictions
contained in Section 5 to be reasonable, if a final determination is made by a
court of competent jurisdiction that the time or territory or any other
restriction contained in this Agreement is unenforceable against the Employee,
the provisions of this Agreement shall be deemed amended to apply as to such
maximum time and territory and to such maximum extent as such court may
judicially determine or indicate to be enforceable.
(b) Remedies. The parties acknowledge that the Employer's damages at
law would be an inadequate remedy for the breach by the Employee of any
provision
-7-
8
of Section 4 or Section 5, and agree in the event of such breach that the
Employer may obtain temporary and permanent injunctive relief restraining the
Employee from such breach, and, to the extent permissible under the applicable
statutes and rules of procedure, a temporary injunction may be granted
immediately upon the commencement of any such suit. Nothing contained herein
shall be construed as prohibiting the Employer from pursuing any other remedies
available at law or equity for such breach or threatened breach of Section 4 or
Section 5 or for any breach or threatened breach of any other provision of this
Agreement.
(c) Withholding. The Employer shall withhold such amounts from any
compensation or other benefits payable to the Employee under this Agreement on
account of payroll and other taxes as may be required by applicable law or
regulation of any governmental authority.
(d) Assignment; Benefit. This Agreement is personal in its nature and
neither party shall assign or transfer this Agreement or any rights or
obligations hereunder without the prior written consent of the other; provided,
that the Employer may assign this Agreement and its rights and obligations
hereunder to any transferee of all or substantially all of the Business (whether
by merger, consolidation, sale of stock or assets or otherwise) without the
Employee's consent. This Agreement is for the sole benefit of the parties hereto
and their respective successors and permitted assigns and not for the benefit
of, or enforceable by, any third party.
(e) Indemnity. The Employer hereby agrees to indemnify and hold the
Employee harmless consistent with the Employer's policy against any and all
liabilities, expenses (including attorneys' fees and costs), claims, judgments,
fines, and amounts paid in settlement actually and reasonably incurred in
connection with any proceeding arising out of the Employee's employment with the
Employer (whether civil, criminal, administrative or investigative, other than
proceedings by or in the right of the Employer), if with respect to the actions
at issue in the proceeding the Employee acted in good faith and in a manner
Employee reasonably believed to be in, or not opposed to, the best interests of
the Employer, and (with respect to any criminal action) Employee had no reason
to believe Employee's conduct was unlawful. Said indemnification arrangement
shall (i) survive the termination of this Agreement, (ii) apply to any and all
qualifying acts of the Employee which have taken place during any period in
which he was employed by the Employer, irrespective of the date of this
Agreement or the term hereof, including, but not limited to, any and all
qualifying acts as an officer and/or director of any affiliate while the
Employee is employed by the Employer and (iii) be subject to any limitations
imposed from time to time under applicable law.
(f) Dispute Resolution; Attorney's Fees. In making any determination as
to the existence of Cause for termination or the occurrence of a Change in
Control, the Board of Directors shall, subject to its members' fiduciary duties,
abide by the recommendation of a committee comprising only members who were
nominated by one or more Principal Shareholders. The Employer and the Employee
agree that any dispute arising as to the parties' rights and obligations
hereunder shall be resolved by binding arbitration before an arbitrator to be
determined by mutually agreeable means. In such
-8-
9
event, each of the Employer and the Employee shall have the right to full
discovery. The Employer shall bear all costs of the arbitrator in any such
proceeding, and the Employee shall have the right, in addition to any other
relief granted by such arbitrator, to recover reasonable attorneys' fees;
provided, however, that the Employer shall have the right, in any dispute other
than a dispute relating to the occurrence of a Change in Control or the payment
of an amount under Section 3(e)(iii), in addition to any other relief granted by
such arbitrator, to recover reasonable attorneys' fees in the event that a claim
brought by the Employee is definitively decided in the Employer's favor (with
the amount of such fees being limited to those expended defending the claim or
claims decided in favor of the Employer). Any judgment by such arbitrator may be
entered into any court with jurisdiction over the dispute.
(g) Acknowledgment. The Employee acknowledges that he has been advised
by the Employer to seek the advice of independent counsel prior to reaching
agreement with the Employer on any of the terms of this Agreement. The parties
agree that no rule of construction shall apply to this Agreement which construes
ambiguous language in favor of or against any party by reason of that party's
role in drafting the Agreement.
(h) Amendments and Waivers. No modification, amendment or waiver, of
any provision of, or consent required by, this Agreement, nor any consent to any
departure herefrom, shall be effective unless it is in writing and signed by the
parties hereto. Such modification, amendment, waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
(i) Notices. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered personally
or sent by registered or certified mail, postage prepaid, return receipt
requested, sent by overnight courier, or sent by facsimile (with confirmation of
receipt), addressed as follows:
If to the Employer:
The X. X. Xxxxxxx Company, Inc.
0000 Xxxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: President
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx, Xxxxx & Xxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx
Facsimile: (000) 000-0000
-9-
10
If to the Employee:
Xxxxxx X. Xxxxx
00000 Xxxxxx Xxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Facsimile:__________________
or at such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. If such notice
or communication is mailed, such communication shall be deemed to have been
given on the fifth business day following the date on which such communication
is posted.
(j) Descriptive Headings; Certain Interpretations. Descriptive headings
are for convenience only and shall not control or affect the meaning or
construction of any provision of this Agreement. Except as otherwise expressly
provided in this Agreement: (i) any reference in this Agreement to any
agreement, document or instrument includes all permitted supplements and
amendments; (ii) a reference to a law includes any amendment or modification to
such law and any rules or regulations issued thereunder; (iii) the words
"include," "included" and "including" are not limiting; and (iv) a reference to
a person or entity includes its permitted successors and assigns.
(k) Counterparts; Entire Agreement. This Agreement may be executed in
any number of counterparts, and each such counterpart hereof shall be deemed to
be an original instrument, but all such counterparts together shall constitute
one agreement. This Agreement and the Other Agreements contain the entire
agreement among the parties with respect to the transactions contemplated by
this Agreement and the Other Agreements and supersede all other or prior written
or oral agreements or understandings among the parties with respect to the
Employee's employment by the Employer. The Employment Agreement, dated as of May
20, 1998, between the Employer and the Employer is expressly superseded and
hereby amended and restated in its entirety by this Agreement.
(L) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NORTH CAROLINA.
(M) CONSENT TO JURISDICTION. EACH OF THE EMPLOYER AND THE EMPLOYEE
HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF
THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF NORTH CAROLINA
SITTING IN MECKLENBURG COUNTY FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, AND
THE EMPLOYEE AGREES NOT TO COMMENCE ANY LEGAL PROCEEDING RELATING THERETO EXCEPT
IN SUCH COURT. EACH OF THE EMPLOYER AND THE EMPLOYEE IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY
-10-
11
LAW, ANY OBJECTION WHICH HE MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE
OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH
PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
EACH OF THE PARTIES HERETO HEREBY CONSENTS TO SERVICE OF PROCESS BY NOTICE IN
THE MANNER SPECIFIED IN SECTION 6(I) AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE TO SERVICE
OF PROCESS IN SUCH MANNER.
-11-
12
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.
THE X. X. XXXXXXX COMPANY, INC.
By:/s/ Xxxxxxx X. Xxxxxxx
----------------------------
Name: Xxxxxxx X. Xxxxxxx
Title:
/s/ Xxxxxx X. Xxxxx
-------------------------------
Xxxxxx X. Xxxxx
-12-
13
EXHIBIT 10.32(b)
AMENDED AND RESTATED EMPLOYMENT AGREEMENT, dated as of January 1, 1999
(the "Agreement"), between The X. X. Xxxxxxx Company, Inc., a North
Carolina corporation (the "Employer"), and J. Xxxxxxx Xxxxxxx (the
"Employee").
The Employer and the Employee are parties to an Employment Agreement,
dated as of May 20, 1998, and desire to amend and restate such Employment
Agreement in its entirety. The Employer desires to continue to retain the
Employee to supply services to the Employer, and the Employee desires to
continue provide such services to the Employer, on the terms and subject to the
conditions set forth in this Agreement.
In consideration of (i) the Employee's agreement to supply services
under this Agreement and (ii) the mutual agreements set forth below, the
sufficiency of which is hereby acknowledged, the Employer and the Employee agree
as follows:
SECTION 1. Employment Relationship.
(a) Employment by Employer. The Employer hereby employs the Employee,
and the Employee hereby agrees to be employed by the Employer, as Senior Vice
President, General Counsel and Secretary of the Employer, and the Employee will
devote all of his business time, attention, knowledge and skills and use his
best efforts during the Employment Period to perform services and duties
consistent with his title and position (the "Services") for the Employer in
accordance with directions given to the Employee from time to time by the Board
of Directors of the Employer.
(b) Employment Period. The period commencing on the date of this
Agreement and ending on the date on which this Agreement is terminated is
referred to herein as the "Employment Period." During the Employment Period, the
Employee will be an at-will employee of the Employer. The Employment Period
shall be freely terminable for any reason by either party at any time.
SECTION 2. Compensation and Benefits. During the Employment Period:
(a) Base Compensation. The Employer shall pay to the Employee a base
salary of $224,000 per annum (the "Base Salary"), payable in accordance with the
Employer's payroll practices and prorated for the period commencing on the date
of this Agreement and ending on December 31, 1998. The Base Salary shall be
increased (but not decreased) for cost of living adjustments, and subject to
additional discretionary increases (but not decreases) as determined by an
annual review by the Board of Directors on or prior to each February 1.
(b) Additional Compensation. As additional compensation for the
Services, the Employer shall pay to the Employee (i) an amount equal to the
greater of (x) annual fixed bonus payments (the "Fixed Bonus") equal to 15% of
the Employee's Base
14
Salary for such year, payable on or around February 1 of the following year, or
(y) annual target bonus payments (as defined in the Employer's Executive Bonus
Plan) (the "Target Bonus"), payable on or around February 1 of the following
year, and (ii) other incentive compensation as the Board of Directors of the
Employer determines in its sole discretion to pay the Employee. The Employee
acknowledges that the Employer may terminate or modify its Executive Bonus Plan
and other incentive plans (excluding the Fixed Bonus payable hereunder) at any
time although no termination or amendment affecting the Employee will be made
effective unless it is consistently applied to other employees participating in
such plans.
(c) Restricted Stock and Stock Options. The Employee purchased shares
of Class A Common Stock of the Employer pursuant to a Securities Purchase and
Stockholders Agreement, dated as of May 28, 1997, between the Employer and the
Employee, and was granted options (pursuant to the Employer's 1997 Stock Option
Plan) to acquire shares of Class A Common Stock of the Employer, pursuant to
Stock Option Agreements between the Employer and the Employee dated as of May
28, 1997 and _________, 1998. Such Securities Purchase and Stockholders
Agreement and Stock Option Agreements are referred to in this Agreement as the
"Other Agreements." The Employee shall be entitled to participate in current or
future equity incentive plans adopted by the Employer on terms no less favorable
than those offered to members of the Employer's Executive Committee or other
division Presidents of the Employer. Such grants may be awarded from time to
time in the sole discretion of the Employer's Executive Committee. In the event
of a Change in Control, the Employee shall become fully vested in all awards
heretofore or hereafter granted to him under all incentive compensation,
deferred compensation, stock option, stock appreciation rights, restricted
stock, phantom stock or similar plans maintained by the Employer, any contrary
provisions of such plans notwithstanding. Any such plans shall be deemed amended
to the extent necessary to carry out the intent expressed in the preceding
sentence.
(d) Benefit Plans. During the Employment Period, the Employee shall be
entitled to receive benefits from the Employer consistent with those currently
in effect for the Employer's senior executives (including deferred compensation
plans and company automobile perquisites), as those benefits are revised from
time to time by the Board of Directors of the Employer. Nothing contained herein
is intended to require the Employer to maintain any existing benefits or create
any new benefits. The Employee will be entitled to participate in the Employer's
deferred compensation program as a Level I Employee. If the Employment Period is
terminated by the Employer or the Employee in connection with a Change in
Control (as defined), the Employee and relevant family members shall be entitled
to continue to participate in the Employer's welfare benefit plans at the
Employer's expense during three year period following the effective date of such
Change in Control (the "Change in Control Period").
(e) Other Benefits. The Employer will provide a vehicle of the
Employee's choice for the Employee's use at a cost (including expenses and
insurance) of up to $40,000. The Employee will be responsible for any costs in
excess of $40,000.
-2-
15
(f) Vacation and Holidays. The Employee shall be entitled to a minimum
of four weeks' vacation each year and paid holidays in accordance with the
Employer's policy.
SECTION 3. Termination.
(a) Death or Disability. If the Employee dies during the Employment
Period, the Employment Period shall terminate as of the date of the Employee's
death. If the Employee becomes unable to perform the Services for 90 consecutive
days due to a physical or mental disability, (i) the Employer may elect to
terminate the Employment Period at any time thereafter, and (ii) the Employment
Period shall terminate as of the date of such election. All disabilities shall
be certified by a physician acceptable to both the Employer and the Employee,
or, if the Employer and the Employee cannot agree upon a physician within 15
days, by a physician selected by physicians designated by each of the Employer
and the Employee. The Employee's failure to submit to any physical examination
by such physician after such physician has given reasonable notice of the time
and place of such examination shall be conclusive evidence of the Employee's
inability to perform his duties hereunder.
(b) Cause. The Employer, at its option, may terminate the Employment
Period and all of the obligations of the Employer under this Agreement for
Cause. The Employer shall have "Cause" to terminate the Employee's employment
hereunder in the event of (i) the Employee's conviction of or plea of guilty or
nolo contendere to a felony, (ii) the Employee's gross negligence in the
performance of the Services, which is not corrected within 15 business days
after written notice, (iii) the Employee's knowingly dishonest act, or knowing
bad faith or willful misconduct in the performance of the Services, which is not
corrected within 15 business days after written notice, or (iv) the Employee's
material breach of any of his obligations under Sections 4 and 5, which is not
corrected within a reasonable period of time (determined in light of the cure,
if any, appropriate to such material breach, but in no event less than 15
business days) after written notice. If the Employee is charged with a felony,
then during the period while such charge or related indictment remains
outstanding and until finally determined, the Employer shall have the right to
suspend the Employee without compensation.
(c) Without Cause. The Employer, at its option, may terminate the
Employment Period without Cause at any time.
(d) Termination by Employee for Good Reason. The Employee may terminate
this Agreement upon 60 days' prior written notice to the Employer for Good
Reason (as defined below) if the basis for such Good Reason is not cured within
a reasonable period of time (determined in light of the cure appropriate to the
basis of such Good Reason, but in no event less than 15 business days) after the
Employer receives written notice specifying the basis of such Good Reason. "Good
Reason" shall mean (i) the failure of the Employer to pay any undisputed amount
due under this Agreement or a substantial diminution in benefits provided under
this Agreement, (ii) a substantial diminution in the status, position and
responsibilities of the Employee or (iii) the
-3-
16
Employer requiring the Employee to be based at any office or location that
requires a relocation or commute greater than 50 miles from the office or
location to which the Employee is currently assigned.
(e) Payments in the Event of Termination. (i) Basic Termination
Payment. Upon the termination of the Employment Period at any time for any
reason, the Employer shall pay to the Employee or his estate the Base Salary and
Target Bonus earned to the date of death or termination for disability or Cause,
as the case may be. Any Target Bonus payments payable under this Section 3(e)(i)
shall be prorated if payable for periods of less than one year and shall be
payable regardless of whether the Employee is still in the employ of the
Employer on the date declared or payable.
(ii) Involuntary Termination Payment. Upon the termination of the
Employment Period at any time by the Employer without Cause or by the Employee
for Good Reason, the Employer shall pay to the Employee or his estate an amount
(in addition to amounts payable under Section 3(e)(i)) equal to one year's Base
Salary and Target Bonus, in each case, at the rate in effect on the date of
termination. Notwithstanding the foregoing, the Employee shall be entitled to no
payment under this Section 3(e)(ii) if he is entitled to receive a payment under
Section 3(e)(iii).
(iii) Change in Control Payment. Upon the termination of the Employment
Period (x) by the Employer upon or prior to a Change in Control, provided that
the Employee reasonably demonstrates that such termination occurred at the
request of a third party participating in, or otherwise in anticipation of or in
connection with, such Change in Control, (y) by the Employee with Good Reason or
by the Employer for any reason within one year after a Change in Control, or (z)
by the Employee for any reason on or after the first anniversary of a Change in
Control but no later than the 30th day after such first anniversary, then the
Employer shall pay to the Employee within five business days of such termination
an amount (in addition to amounts payable under Section 3(e)(i)) equal to the
sum of (A) the higher of (1) the annual Base Salary at the date of such
termination or (2) the annual Base Salary at the time of the Change in Control,
in each case multiplied by the number of years remaining in the Change in
Control Period, and (B) the Target Bonus at the annual rate in effect at the
date of such termination multiplied by the number of years remaining in the
Change in Control Period.
(iv) Change in Control Defined. "Change in Control" means the first to
occur of any of the following: (A) the sale (including by merger, consolidation
or sale of stock of subsidiaries or any other method) of all or substantially
all of the assets of the Employer and its consolidated subsidiaries (taken as a
whole) to any person or entity not directly or indirectly controlled by the
holders of at least 50% of the Combined Voting Power of the then outstanding
shares of capital stock of the Employer, (B) at any time prior to the
consummation of an initial public offering of Class A Common Stock of the
Employer or other common stock of the Employer having the voting power to elect
directors, a transaction (except pursuant to such initial public offering)
resulting in the Principal Shareholders owning, collectively, less than 50% of
the Combined Voting Power of the then outstanding shares of capital stock of the
Employer, (C) at any time after the consummation of an initial public offering
of Class A Common Stock of the
-4-
17
Employer or other common stock of the Employer having the voting power to elect
directors, the acquisition (except pursuant to such initial public offering) by
any person or entity not directly or indirectly controlled by the Employer's
stockholders of more than 35% of the Combined Voting Power of the then
outstanding shares of capital stock of the Employer, (D) individuals serving as
directors of the Employer on the date hereof and who were nominated to serve as
directors by one or more Principal Shareholders (together with any new directors
whose election was approved by (x) a vote of such individuals or directors whose
election was previously so approved or (y) Principal Shareholders holding a
majority of the aggregate voting power of the capital stock of the Employer held
by all Principal Shareholders) cease for any reason to constitute a majority of
the Board of Directors of the Employer, (E) the adoption of a plan relating to
the liquidation or dissolution of the Employer in connection with an equity
investment or sale or a business combination transaction or (F) any other event
or transaction that the Board of Directors of the Employer deems to be a Change
in Control. "Combined Voting Power" with respect to capital stock of the
Employer means the number of votes such stock is normally entitled (without
regard to the occurrence of any contingency) to vote in an election of directors
of the Employer. "Principal Shareholders" means Xxx X. Xxxxxxx, Xxxxxxx X.
Xxxxxxx, Xxxxx X. Xxxxx and Xxxxxx X. Xxxxx and members of their immediate
families and any spouse, parent or descendant of the foregoing, any trust the
beneficiaries of which include only any of the foregoing, and any corporation,
partnership, limited liability company or other entity all of the capital stock
or other ownership interests of which are owned by any of the foregoing.
(v) Other Provisions Applicable to Payments. Any payment due under
Section 3(e)(iii) shall be limited to the extent the Board of Directors of the
Employer, in its good faith determination, deems necessary to preserve the
deductibility by the Employer of such payment pursuant to Section 280G of the
Internal Revenue Code of 1986, as amended, or any successor provision of any
successor statute. The Employer may elect to make any payments due under Section
3(e)(ii) in a lump sum or as they would have been paid had the Employment Period
not been terminated. Unless otherwise specifically stated to be payable over a
period of time, all amounts due under this Section 3 shall be payable on demand
by the Employee and shall bear interest (compounded annually) for the period
from and including the date payable to but excluding the date paid at a rate per
annum equal to the sum of (x) four percent and (y) the rate publicly announced
by BankBoston, N.A. as its "prime rate."
(f) Termination of Obligations. In the event of termination of the
Employment Period in accordance with this Section 3, all obligations of the
Employer and the Employee under this Agreement shall terminate, except for any
amounts payable by the Employer as specifically set forth in Section 3(e);
provided, however, that notwithstanding anything to the contrary contained in
this Agreement, the provisions of Section 4 and Section 5 shall survive such
termination in accordance with their respective terms and the relevant
provisions of Section 6 shall survive such termination indefinitely. In the
event of termination of the Employment Period in accordance with this Section 3,
the Employee agrees to cooperate with the Employer in order to ensure an orderly
transfer of the Employee's duties and responsibilities.
-5-
18
SECTION 4. Confidentiality; Non-Disclosure.
(a) (i) Non-Disclosure Obligation. Except as provided in this Section
4(a), the Employee shall not disclose any Confidential Information of the
Employer or any of its affiliates or subsidiaries to any person, firm,
corporation, association or other entity (other than the Employer, its
subsidiaries, officers or employees, attorneys, accountants, bank lenders,
agents, advisors or representatives thereof) for any reason or purpose
whatsoever (other than in the normal course of business on a need-to-know basis
after the Employer has received assurances that the confidential or proprietary
information shall be kept confidential), nor shall the Employee make use of any
such confidential or proprietary information for his own purposes or for the
benefit of any person, firm, corporation or other entity, except the Employer.
As used in this Section, the term "Confidential Information" means all
information which is or becomes known to the Employee and relates to matters
such as trade secrets, research and development activities, new or prospective
lines of business (including analysis and market research relating to potential
expansion of the Business), books and records, financial data, customer lists,
marketing techniques, financing, credit policies, vendor lists, suppliers,
purchasers, potential business combinations, distribution channels, services,
procedures, pricing information and private processes as they may exist from
time to time; provided that the term Confidential Information shall not include
information that is or becomes generally available to the public (other than as
a result of a disclosure in violation of this Agreement by the Employee or by a
person who received such information from the Employee in violation of this
Agreement).
(ii) Compulsory Disclosures. If the Employee is requested or (in the
opinion of his counsel) required by law or judicial order to disclose any
Confidential Information, the Employee shall provide the Employer with prompt
notice of any such request or requirement so that the Employer may seek an
appropriate protective order or waiver of the Employee's compliance with the
provisions of this Section 4(a). The Employee will not oppose any reasonable
action by, and will cooperate with, the Employer to obtain an appropriate
protective order or other reliable assurance that confidential treatment will be
accorded the Confidential Information. If, failing the entry of a protective
order or the receipt of a waiver hereunder, the Employee is, in the opinion of
his counsel, compelled by law to disclose a portion of the Confidential
Information, the Employee may disclose to the relevant tribunal without
liability hereunder only that portion of the Confidential Information which
counsel advises the Employee he is legally required to disclose, and each of the
parties hereto agrees to exercise such party's best efforts to obtain assurance
that confidential treatment will be accorded such Confidential Information.
During the Employment Period, and for matters arising from events or
circumstances occurring during the Employment Period, the Employer will provide
for the defense of matters arising under this provision.
(b) Assignment of Inventions. The Employee agrees that he will promptly
and fully disclose to the Employer all inventions, ideas, software, trade
secrets or know-how (whether patentable or copyrightable or not) made or
conceived by the Employee (either solely or jointly with others) during the
Employment Period and for a period of six months thereafter, all tangible work
product derived therefrom (collectively,
-6-
19
the "Ideas"). The Employee agrees that all such Ideas shall be and remain the
sole and exclusive property of the Employer. On the request of the Employer, the
Employee shall, during and after the term of this Agreement, without charge to
the Employer but at the expense of the Employer, assist the Employer in any
reasonable way to vest in the Employer, title to all such Ideas, and to obtain
any related patents, trademarks or copyrights in all countries throughout the
world. In this regard, the parties shall execute and deliver any and all
documents that the Employer may reasonably request.
SECTION 5. Non-Competition; Non-Solicitation. The Employee acknowledges
and recognizes his possession of Confidential Information and acknowledges the
highly competitive nature of the business of the Employer and its affiliates and
subsidiaries and accordingly agrees that, in consideration of the premises
contained herein, he will not, during the Employment Period and for one year
after the date of termination of the Employment Period, for any reason
whatsoever, either individually or as an officer, director, stockholder, member,
partner, agent or principal of another business firm, (x) directly or indirectly
engage in the United States, or any country in which the Employer or any of its
affiliates or subsidiaries actively engages in business during the Employment
Period, in any competitive business, (y) assist others in engaging in any
competitive business in the manner described in clause (x), or (z) induce any
employee of the Employer or any of its affiliates or subsidiaries to terminate
such person's employment with the Employer or such affiliate or subsidiary or
hire any employee of the Employer or any of its affiliates or subsidiaries to
work with any businesses affiliated with the Employee. The Employee's ownership
of not more than 1% of the outstanding capital stock of any public corporation
shall not in itself be deemed to be engaging in any competitive business for
purposes of this Section 5.
SECTION 6. General Provisions.
(a) Enforceability. It is the desire and intent of the parties hereto
that the provisions of this Agreement shall be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in
which enforcement is sought. Accordingly, although the Employee and the Employer
consider the restrictions contained in this Agreement to be reasonable for the
purpose of preserving the Employer's goodwill and proprietary rights, if any
particular provision of this Agreement shall be adjudicated to be invalid or
unenforceable, such provision shall be deemed amended to delete therefrom the
portion thus adjudicated to be invalid or unenforceable, such deletion to apply
only with respect to the operation of such provision in the particular
jurisdiction in which such adjudication is made. It is expressly understood and
agreed that although the Employer and the Employee consider the restrictions
contained in Section 5 to be reasonable, if a final determination is made by a
court of competent jurisdiction that the time or territory or any other
restriction contained in this Agreement is unenforceable against the Employee,
the provisions of this Agreement shall be deemed amended to apply as to such
maximum time and territory and to such maximum extent as such court may
judicially determine or indicate to be enforceable.
(b) Remedies. The parties acknowledge that the Employer's damages at
law would be an inadequate remedy for the breach by the Employee of any
provision
-7-
20
of Section 4 or Section 5, and agree in the event of such breach that the
Employer may obtain temporary and permanent injunctive relief restraining the
Employee from such breach, and, to the extent permissible under the applicable
statutes and rules of procedure, a temporary injunction may be granted
immediately upon the commencement of any such suit. Nothing contained herein
shall be construed as prohibiting the Employer from pursuing any other remedies
available at law or equity for such breach or threatened breach of Section 4 or
Section 5 or for any breach or threatened breach of any other provision of this
Agreement.
(c) Withholding. The Employer shall withhold such amounts from any
compensation or other benefits payable to the Employee under this Agreement on
account of payroll and other taxes as may be required by applicable law or
regulation of any governmental authority.
(d) Assignment; Benefit. This Agreement is personal in its nature and
neither party shall assign or transfer this Agreement or any rights or
obligations hereunder without the prior written consent of the other; provided,
that the Employer may assign this Agreement and its rights and obligations
hereunder to any transferee of all or substantially all of the Business (whether
by merger, consolidation, sale of stock or assets or otherwise) without the
Employee's consent. This Agreement is for the sole benefit of the parties hereto
and their respective successors and permitted assigns and not for the benefit
of, or enforceable by, any third party.
(e) Indemnity. The Employer hereby agrees to indemnify and hold the
Employee harmless consistent with the Employer's policy against any and all
liabilities, expenses (including attorneys' fees and costs), claims, judgments,
fines, and amounts paid in settlement actually and reasonably incurred in
connection with any proceeding arising out of the Employee's employment with the
Employer (whether civil, criminal, administrative or investigative, other than
proceedings by or in the right of the Employer), if with respect to the actions
at issue in the proceeding the Employee acted in good faith and in a manner
Employee reasonably believed to be in, or not opposed to, the best interests of
the Employer, and (with respect to any criminal action) Employee had no reason
to believe Employee's conduct was unlawful. Said indemnification arrangement
shall (i) survive the termination of this Agreement, (ii) apply to any and all
qualifying acts of the Employee which have taken place during any period in
which he was employed by the Employer, irrespective of the date of this
Agreement or the term hereof, including, but not limited to, any and all
qualifying acts as an officer and/or director of any affiliate while the
Employee is employed by the Employer and (iii) be subject to any limitations
imposed from time to time under applicable law.
(f) Dispute Resolution; Attorney's Fees. In making any determination as
to the existence of Cause for termination or the occurrence of a Change in
Control, the Board of Directors shall, subject to its members' fiduciary duties,
abide by the recommendation of a committee comprising only members who were
nominated by one or more Principal Shareholders. The Employer and the Employee
agree that any dispute arising as to the parties' rights and obligations
hereunder shall be resolved by binding arbitration before an arbitrator to be
determined by mutually agreeable means. In such
-8-
21
event, each of the Employer and the Employee shall have the right to full
discovery. The Employer shall bear all costs of the arbitrator in any such
proceeding, and the Employee shall have the right, in addition to any other
relief granted by such arbitrator, to recover reasonable attorneys' fees;
provided, however, that the Employer shall have the right, in any dispute other
than a dispute relating to the occurrence of a Change in Control or the payment
of an amount under Section 3(e)(iii), in addition to any other relief granted by
such arbitrator, to recover reasonable attorneys' fees in the event that a claim
brought by the Employee is definitively decided in the Employer's favor (with
the amount of such fees being limited to those expended defending the claim or
claims decided in favor of the Employer). Any judgment by such arbitrator may be
entered into any court with jurisdiction over the dispute.
(g) Acknowledgment. The Employee acknowledges that he has been advised
by the Employer to seek the advice of independent counsel prior to reaching
agreement with the Employer on any of the terms of this Agreement. The parties
agree that no rule of construction shall apply to this Agreement which construes
ambiguous language in favor of or against any party by reason of that party's
role in drafting the Agreement.
(h) Amendments and Waivers. No modification, amendment or waiver, of
any provision of, or consent required by, this Agreement, nor any consent to any
departure herefrom, shall be effective unless it is in writing and signed by the
parties hereto. Such modification, amendment, waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
(i) Notices. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered personally
or sent by registered or certified mail, postage prepaid, return receipt
requested, sent by overnight courier, or sent by facsimile (with confirmation of
receipt), addressed as follows:
If to the Employer:
The X. X. Xxxxxxx Company, Inc.
0000 Xxxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: President
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx, Xxxxx & Xxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx
Facsimile: (000) 000-0000
-9-
22
If to the Employee:
J. Xxxxxxx Xxxxxxx
000 Xxxx 0xx Xxxxxx
Xxxxxx, Xxxxx Xxxxxxxx 00000
Facsimile: (000) 000-0000
or at such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. If such notice
or communication is mailed, such communication shall be deemed to have been
given on the fifth business day following the date on which such communication
is posted.
(j) Descriptive Headings; Certain Interpretations. Descriptive headings
are for convenience only and shall not control or affect the meaning or
construction of any provision of this Agreement. Except as otherwise expressly
provided in this Agreement: (i) any reference in this Agreement to any
agreement, document or instrument includes all permitted supplements and
amendments; (ii) a reference to a law includes any amendment or modification to
such law and any rules or regulations issued thereunder; (iii) the words
"include," "included" and "including" are not limiting; and (iv) a reference to
a person or entity includes its permitted successors and assigns.
(k) Counterparts; Entire Agreement. This Agreement may be executed in
any number of counterparts, and each such counterpart hereof shall be deemed to
be an original instrument, but all such counterparts together shall constitute
one agreement. This Agreement and the Other Agreements contain the entire
agreement among the parties with respect to the transactions contemplated by
this Agreement and the Other Agreements and supersede all other or prior written
or oral agreements or understandings among the parties with respect to the
Employee's employment by the Employer. The Employment Agreement, dated as of May
20, 1998, between the Employer and the Employer is expressly superseded and
hereby amended and restated in its entirety by this Agreement.
(L) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NORTH CAROLINA.
(M) CONSENT TO JURISDICTION. EACH OF THE EMPLOYER AND THE EMPLOYEE
HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF
THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF NORTH CAROLINA
SITTING IN MECKLENBURG COUNTY FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, AND
THE EMPLOYEE AGREES NOT TO COMMENCE ANY LEGAL PROCEEDING RELATING THERETO EXCEPT
IN SUCH COURT. EACH OF THE EMPLOYER AND THE EMPLOYEE IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY
-10-
23
LAW, ANY OBJECTION WHICH HE MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE
OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH
PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
EACH OF THE PARTIES HERETO HEREBY CONSENTS TO SERVICE OF PROCESS BY NOTICE IN
THE MANNER SPECIFIED IN SECTION 6(I) AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE TO SERVICE
OF PROCESS IN SUCH MANNER.
-11-
24
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.
THE X. X. XXXXXXX COMPANY, INC.
By:/s/ Xxxxxxx X. Xxxxxxx
----------------------------
Name: Xxxxxxx X. Xxxxxxx
Title:
/s/ J. Xxxxxxx Xxxxxxx
----------------------------
J. Xxxxxxx Xxxxxxx
-12-
25
EXHIBIT 10.32(C)
AMENDED AND RESTATED EMPLOYMENT AGREEMENT, dated as of January
1, 1999 (the "Agreement"), between The X. X. Xxxxxxx Company,
Inc., a North Carolina corporation (the "Employer"), and
Xxxxxx X. Roof (the "Employee").
The Employer and the Employee are parties to an Employment
Agreement, dated as of July 1, 1998, and desire to amend and restate such
Employment Agreement in its entirety. The Employer desires to continue to retain
the Employee to supply services to the Employer, and the Employee desires to
continue provide such services to the Employer, on the terms and subject to the
conditions set forth in this Agreement.
In consideration of (i) the Employee's agreement to supply
services under this Agreement and (ii) the mutual agreements set forth below,
the sufficiency of which is hereby acknowledged, the Employer and the Employee
agree as follows:
SECTION 1. Employment Relationship.
(a) Employment by Employer. The Employer hereby employs
the Employee, and the Employee hereby agrees to be employed by the Employer, as
Senior Vice President and Chief Financial Officer of the Employer, and the
Employee will devote all of his business time, attention, knowledge and skills
and use his best efforts during the Employment Period to perform services and
duties consistent with his title and position (the "Services") for the Employer
in accordance with directions given to the Employee from time to time by the
Board of Directors of the Employer.
(b) Employment Period. The period commencing on the date
of this Agreement and ending on the date on which this Agreement is terminated
is referred to herein as the "Employment Period." During the Employment Period,
the Employee will be an at-will employee of the Employer. The Employment Period
shall be freely terminable for any reason by either party at any time.
SECTION 2. Compensation and Benefits. During the Employment
Period:
(a) Base Compensation. The Employer shall pay to the
Employee a base salary of $243,000 per annum (the "Base Salary"), payable in
accordance with the Employer's payroll practices and prorated for the period
commencing on the date of this Agreement and ending on December 31, 1998. The
Base Salary shall be increased (but not decreased) for cost of living
adjustments, and subject to additional discretionary increases (but not
decreases) as determined by an annual review by the Board of Directors on or
prior to each February 1.
(b) Additional Compensation. As additional compensation
for the Services, the Employer shall pay to the Employee (i) an amount equal to
the greater of (x) annual fixed bonus payments (the "Fixed Bonus") equal to 28%
of the Employee's Base
26
Salary for such year, payable on or around February 1 of the following year, or
(y) annual target bonus payments (as defined in the Employer's Executive Bonus
Plan) (the "Target Bonus"), payable on or around February 1 of the following
year, and (ii) other incentive compensation as the Board of Directors of the
Employer determines in its sole discretion to pay the Employee. The Employee
acknowledges that the Employer may terminate or modify its Executive Bonus Plan
and other incentive plans (excluding the Fixed Bonus payable hereunder) at any
time although no termination or amendment affecting the Employee will be made
effective unless it is consistently applied to other employees participating in
such plans.
(c) Restricted Stock and Stock Options. The Employee
purchased shares of Class A Common Stock of the Employer pursuant to a
Securities Purchase and Stockholders Agreement, dated as of May 28, 1997,
between the Employer and the Employee, and was granted options (pursuant to the
Employer's 1997 Stock Option Plan) to acquire shares of Class A Common Stock of
the Employer, pursuant to Stock Option Agreements between the Employer and the
Employee dated as of May 28, 1997 and __________, 1998. Such Securities Purchase
and Stockholders Agreement and Stock Option Agreements are referred to in this
Agreement as the "Other Agreements." The Employee shall be entitled to
participate in current or future equity incentive plans adopted by the Employer
on terms no less favorable than those offered to members of the Employer's
Executive Committee or other division Presidents of the Employer. Such grants
may be awarded from time to time in the sole discretion of the Employer's Board
of Directors. In the event of a Change in Control, the Employee shall become
fully vested in all awards heretofore or hereafter granted to him under all
incentive compensation, deferred compensation, stock option, stock appreciation
rights, restricted stock, phantom stock or similar plans maintained by the
Employer, any contrary provisions of such plans notwithstanding. Any such plans
shall be deemed amended to the extent necessary to carry out the intent
expressed in the preceding sentence.
(d) Benefit Plans. During the Employment Period, the
Employee shall be entitled to receive benefits from the Employer consistent with
those currently in effect for the Employer's senior executives (including
deferred compensation plans and company automobile perquisites), as those
benefits are revised from time to time by the Board of Directors of the
Employer. Nothing contained herein is intended to require the Employer to
maintain any existing benefits or create any new benefits. The Employee will be
entitled to participate in the Employer's deferred compensation program as a
Level I Employee. If the Employment Period is terminated by the Employer or the
Employee in connection with a Change in Control (as defined), the Employee and
relevant family members shall be entitled to continue to participate in the
Employer's welfare benefit plans at the Employer's expense during three year
period following the effective date of such Change in Control (the "Change in
Control Period").
(e) Other Benefits. The Employer will provide a vehicle
of the Employee's choice for the Employee's use at a cost (including expenses
and insurance) of up to $40,000. The Employee will be responsible for any costs
in excess of $40,000.
-2-
27
(f) Vacation and Holidays. The Employee shall be entitled
to a minimum of four weeks' vacation each year and paid holidays in accordance
with the Employer's policy.
SECTION 3. Termination.
(a) Death or Disability. If the Employee dies during the
Employment Period, the Employment Period shall terminate as of the date of the
Employee's death. If the Employee becomes unable to perform the Services for 90
consecutive days due to a physical or mental disability, (i) the Employer may
elect to terminate the Employment Period at any time thereafter, and (ii) the
Employment Period shall terminate as of the date of such election. All
disabilities shall be certified by a physician acceptable to both the Employer
and the Employee, or, if the Employer and the Employee cannot agree upon a
physician within 15 days, by a physician selected by physicians designated by
each of the Employer and the Employee. The Employee's failure to submit to any
physical examination by such physician after such physician has given reasonable
notice of the time and place of such examination shall be conclusive evidence of
the Employee's inability to perform his duties hereunder.
(b) Cause. The Employer, at its option, may terminate the
Employment Period and all of the obligations of the Employer under this
Agreement for Cause. The Employer shall have "Cause" to terminate the Employee's
employment hereunder in the event of (i) the Employee's conviction of or plea of
guilty or nolo contendere to a felony, (ii) the Employee's gross negligence in
the performance of the Services, which is not corrected within 15 business days
after written notice, (iii) the Employee's knowingly dishonest act, or knowing
bad faith or willful misconduct in the performance of the Services, which is not
corrected within 15 business days after written notice, or (iv) the Employee's
material breach of any of his obligations under Sections 4 and 5, which is not
corrected within a reasonable period of time (determined in light of the cure,
if any, appropriate to such material breach, but in no event less than 15
business days) after written notice. If the Employee is charged with a felony,
then during the period while such charge or related indictment remains
outstanding and until finally determined, the Employer shall have the right to
suspend the Employee without compensation.
(c) Without Cause. The Employer, at its option, may
terminate the Employment Period without Cause at any time.
(d) Termination by Employee for Good Reason. The Employee
may terminate this Agreement upon 60 days' prior written notice to the Employer
for Good Reason (as defined below) if the basis for such Good Reason is not
cured within a reasonable period of time (determined in light of the cure
appropriate to the basis of such Good Reason, but in no event less than 15
business days) after the Employer receives written notice specifying the basis
of such Good Reason. "Good Reason" shall mean (i) the failure of the Employer to
pay any undisputed amount due under this Agreement or a substantial diminution
in benefits provided under this Agreement, (ii) a substantial diminution in the
status, position and responsibilities of the Employee or (iii) the
-3-
28
Employer requiring the Employee to be based at any office or location that
requires a relocation or commute greater than 50 miles from the office or
location to which the Employee is currently assigned.
(e) Payments in the Event of Termination. (i) Basic
Termination Payment. Upon the termination of the Employment Period at any time
for any reason, the Employer shall pay to the Employee or his estate the Base
Salary and Target Bonus earned to the date of death or termination for
disability or Cause, as the case may be. Any Target Bonus payments payable under
this Section 3(e)(i) shall be prorated if payable for periods of less than one
year and shall be payable regardless of whether the Employee is still in the
employ of the Employer on the date declared or payable.
(ii) Involuntary Termination Payment. Upon the termination
of the Employment Period at any time by the Employer without Cause or by the
Employee for Good Reason, the Employer shall pay to the Employee or his estate
an amount (in addition to amounts payable under Section 3(e)(i)) equal to one
year's Base Salary and Target Bonus, in each case, at the rate in effect on the
date of termination. Notwithstanding the foregoing, the Employee shall be
entitled to no payment under this Section 3(e)(ii) if he is entitled to receive
a payment under Section 3(e)(iii).
(iii) Change in Control Payment. Upon the termination of
the Employment Period (x) by the Employer upon or prior to a Change in Control,
provided that the Employee reasonably demonstrates that such termination
occurred at the request of a third party participating in, or otherwise in
anticipation of or in connection with, such Change in Control, (y) by the
Employee with Good Reason or by the Employer for any reason within one year
after a Change in Control, or (z) by the Employee for any reason on or after the
first anniversary of a Change in Control but no later than the 30th day after
such first anniversary, then the Employer shall pay to the Employee within five
business days of such termination an amount (in addition to amounts payable
under Section 3(e)(i)) equal to the sum of (A) the higher of (1) the annual Base
Salary at the date of such termination or (2) the annual Base Salary at the time
of the Change in Control, in each case multiplied by the number of years
remaining in the Change in Control Period, and (B) the Target Bonus at the
annual rate in effect at the date of such termination multiplied by the number
of years remaining in the Change in Control Period.
(iv) Change in Control Defined. "Change in Control" means
the first to occur of any of the following: (A) the sale (including by merger,
consolidation or sale of stock of subsidiaries or any other method) of all or
substantially all of the assets of the Employer and its consolidated
subsidiaries (taken as a whole) to any person or entity not directly or
indirectly controlled by the holders of at least 50% of the Combined Voting
Power of the then outstanding shares of capital stock of the Employer, (B) at
any time prior to the consummation of an initial public offering of Class A
Common Stock of the Employer or other common stock of the Employer having the
voting power to elect directors, a transaction (except pursuant to such initial
public offering) resulting in the Principal Shareholders owning, collectively,
less than 50% of the Combined Voting Power of the then outstanding shares of
capital stock of the Employer, (C) at any time after the consummation of an
initial public offering of Class A Common Stock of the
-4-
29
Employer or other common stock of the Employer having the voting power to elect
directors, the acquisition (except pursuant to such initial public offering) by
any person or entity not directly or indirectly controlled by the Employer's
stockholders of more than 35% of the Combined Voting Power of the then
outstanding shares of capital stock of the Employer, (D) individuals serving as
directors of the Employer on the date hereof and who were nominated to serve as
directors by one or more Principal Shareholders (together with any new directors
whose election was approved by (x) a vote of such individuals or directors whose
election was previously so approved or (y) Principal Shareholders holding a
majority of the aggregate voting power of the capital stock of the Employer held
by all Principal Shareholders) cease for any reason to constitute a majority of
the Board of Directors of the Employer, (E) the adoption of a plan relating to
the liquidation or dissolution of the Employer in connection with an equity
investment or sale or a business combination transaction or (F) any other event
or transaction that the Board of Directors of the Employer deems to be a Change
in Control. "Combined Voting Power" with respect to capital stock of the
Employer means the number of votes such stock is normally entitled (without
regard to the occurrence of any contingency) to vote in an election of directors
of the Employer. "Principal Shareholders" means Xxx X. Xxxxxxx, Xxxxxxx X.
Xxxxxxx, Xxxxx X. Xxxxx and Xxxxxx X. Xxxxx and members of their immediate
families and any spouse, parent or descendant of the foregoing, any trust the
beneficiaries of which include only any of the foregoing, and any corporation,
partnership, limited liability company or other entity all of the capital stock
or other ownership interests of which are owned by any of the foregoing.
(v) Other Provisions Applicable to Payments. Any payment
due under Section 3(e)(iii) shall be limited to the extent the Board of
Directors of the Employer, in its good faith determination, deems necessary to
preserve the deductibility by the Employer of such payment pursuant to Section
280G of the Internal Revenue Code of 1986, as amended, or any successor
provision of any successor statute. The Employer may elect to make any payments
due under Section 3(e)(ii) in a lump sum or as they would have been paid had the
Employment Period not been terminated. Unless otherwise specifically stated to
be payable over a period of time, all amounts due under this Section 3 shall be
payable on demand by the Employee and shall bear interest (compounded annually)
for the period from and including the date payable to but excluding the date
paid at a rate per annum equal to the sum of (x) four percent and (y) the rate
publicly announced by BankBoston, N.A. as its "prime rate."
(f) Termination of Obligations. In the event of
termination of the Employment Period in accordance with this Section 3, all
obligations of the Employer and the Employee under this Agreement shall
terminate, except for any amounts payable by the Employer as specifically set
forth in Section 3(e); provided, however, that notwithstanding anything to the
contrary contained in this Agreement, the provisions of Section 4 and Section 5
shall survive such termination in accordance with their respective terms and the
relevant provisions of Section 6 shall survive such termination indefinitely. In
the event of termination of the Employment Period in accordance with this
Section 3, the Employee agrees to cooperate with the Employer in order to ensure
an orderly transfer of the Employee's duties and responsibilities.
-5-
30
SECTION 4. Confidentiality; Non-Disclosure.
(a) (i) Non-Disclosure Obligation. Except as provided in
this Section 4(a), the Employee shall not disclose any Confidential Information
of the Employer or any of its affiliates or subsidiaries to any person, firm,
corporation, association or other entity (other than the Employer, its
subsidiaries, officers or employees, attorneys, accountants, bank lenders,
agents, advisors or representatives thereof) for any reason or purpose
whatsoever (other than in the normal course of business on a need-to-know basis
after the Employer has received assurances that the confidential or proprietary
information shall be kept confidential), nor shall the Employee make use of any
such confidential or proprietary information for his own purposes or for the
benefit of any person, firm, corporation or other entity, except the Employer.
As used in this Section, the term "Confidential Information" means all
information which is or becomes known to the Employee and relates to matters
such as trade secrets, research and development activities, new or prospective
lines of business (including analysis and market research relating to potential
expansion of the Business), books and records, financial data, customer lists,
marketing techniques, financing, credit policies, vendor lists, suppliers,
purchasers, potential business combinations, distribution channels, services,
procedures, pricing information and private processes as they may exist from
time to time; provided that the term Confidential Information shall not include
information that is or becomes generally available to the public (other than as
a result of a disclosure in violation of this Agreement by the Employee or by a
person who received such information from the Employee in violation of this
Agreement).
(ii) Compulsory Disclosures. If the Employee is requested
or (in the opinion of his counsel) required by law or judicial order to disclose
any Confidential Information, the Employee shall provide the Employer with
prompt notice of any such request or requirement so that the Employer may seek
an appropriate protective order or waiver of the Employee's compliance with the
provisions of this Section 4(a). The Employee will not oppose any reasonable
action by, and will cooperate with, the Employer to obtain an appropriate
protective order or other reliable assurance that confidential treatment will be
accorded the Confidential Information. If, failing the entry of a protective
order or the receipt of a waiver hereunder, the Employee is, in the opinion of
his counsel, compelled by law to disclose a portion of the Confidential
Information, the Employee may disclose to the relevant tribunal without
liability hereunder only that portion of the Confidential Information which
counsel advises the Employee he is legally required to disclose, and each of the
parties hereto agrees to exercise such party's best efforts to obtain assurance
that confidential treatment will be accorded such Confidential Information.
During the Employment Period, and for matters arising from events or
circumstances occurring during the Employment Period, the Employer will provide
for the defense of matters arising under this provision.
(b) Assignment of Inventions. The Employee agrees that he
will promptly and fully disclose to the Employer all inventions, ideas,
software, trade secrets or know-how (whether patentable or copyrightable or not)
made or conceived by the Employee (either solely or jointly with others) during
the Employment Period and for a period of six months thereafter, all tangible
work product derived therefrom (collectively,
-6-
31
the "Ideas"). The Employee agrees that all such Ideas shall be and remain the
sole and exclusive property of the Employer. On the request of the Employer, the
Employee shall, during and after the term of this Agreement, without charge to
the Employer but at the expense of the Employer, assist the Employer in any
reasonable way to vest in the Employer, title to all such Ideas, and to obtain
any related patents, trademarks or copyrights in all countries throughout the
world. In this regard, the parties shall execute and deliver any and all
documents that the Employer may reasonably request.
SECTION 5. Non-Competition; Non-Solicitation. The Employee
acknowledges and recognizes his possession of Confidential Information and
acknowledges the highly competitive nature of the business of the Employer and
its affiliates and subsidiaries and accordingly agrees that, in consideration of
the premises contained herein, he will not, during the Employment Period and for
one year after the date of termination of the Employment Period, for any reason
whatsoever, either individually or as an officer, director, stockholder, member,
partner, agent or principal of another business firm, (x) directly or indirectly
engage in the United States, or any country in which the Employer or any of its
affiliates or subsidiaries actively engages in business during the Employment
Period, in any competitive business, (y) assist others in engaging in any
competitive business in the manner described in clause (x), or (z) induce any
employee of the Employer or any of its affiliates or subsidiaries to terminate
such person's employment with the Employer or such affiliate or subsidiary or
hire any employee of the Employer or any of its affiliates or subsidiaries to
work with any businesses affiliated with the Employee. The Employee's ownership
of not more than 1% of the outstanding capital stock of any public corporation
shall not in itself be deemed to be engaging in any competitive business for
purposes of this Section 5.
SECTION 6. General Provisions.
(a) Enforceability. It is the desire and intent of the
parties hereto that the provisions of this Agreement shall be enforced to the
fullest extent permissible under the laws and public policies applied in each
jurisdiction in which enforcement is sought. Accordingly, although the Employee
and the Employer consider the restrictions contained in this Agreement to be
reasonable for the purpose of preserving the Employer's goodwill and proprietary
rights, if any particular provision of this Agreement shall be adjudicated to be
invalid or unenforceable, such provision shall be deemed amended to delete
therefrom the portion thus adjudicated to be invalid or unenforceable, such
deletion to apply only with respect to the operation of such provision in the
particular jurisdiction in which such adjudication is made. It is expressly
understood and agreed that although the Employer and the Employee consider the
restrictions contained in Section 5 to be reasonable, if a final determination
is made by a court of competent jurisdiction that the time or territory or any
other restriction contained in this Agreement is unenforceable against the
Employee, the provisions of this Agreement shall be deemed amended to apply as
to such maximum time and territory and to such maximum extent as such court may
judicially determine or indicate to be enforceable.
(b) Remedies. The parties acknowledge that the Employer's
damages at law would be an inadequate remedy for the breach by the Employee of
any provision
-7-
32
of Section 4 or Section 5, and agree in the event of such breach that the
Employer may obtain temporary and permanent injunctive relief restraining the
Employee from such breach, and, to the extent permissible under the applicable
statutes and rules of procedure, a temporary injunction may be granted
immediately upon the commencement of any such suit. Nothing contained herein
shall be construed as prohibiting the Employer from pursuing any other remedies
available at law or equity for such breach or threatened breach of Section 4 or
Section 5 or for any breach or threatened breach of any other provision of this
Agreement.
(c) Withholding. The Employer shall withhold such amounts
from any compensation or other benefits payable to the Employee under this
Agreement on account of payroll and other taxes as may be required by applicable
law or regulation of any governmental authority.
(d) Assignment; Benefit. This Agreement is personal in
its nature and neither party shall assign or transfer this Agreement or any
rights or obligations hereunder without the prior written consent of the other;
provided, that the Employer may assign this Agreement and its rights and
obligations hereunder to any transferee of all or substantially all of the
Business (whether by merger, consolidation, sale of stock or assets or
otherwise) without the Employee's consent. This Agreement is for the sole
benefit of the parties hereto and their respective successors and permitted
assigns and not for the benefit of, or enforceable by, any third party.
(e) Indemnity. The Employer hereby agrees to indemnify
and hold the Employee harmless consistent with the Employer's policy against any
and all liabilities, expenses (including attorneys' fees and costs), claims,
judgments, fines, and amounts paid in settlement actually and reasonably
incurred in connection with any proceeding arising out of the Employee's
employment with the Employer (whether civil, criminal, administrative or
investigative, other than proceedings by or in the right of the Employer), if
with respect to the actions at issue in the proceeding the Employee acted in
good faith and in a manner Employee reasonably believed to be in, or not opposed
to, the best interests of the Employer, and (with respect to any criminal
action) Employee had no reason to believe Employee's conduct was unlawful. Said
indemnification arrangement shall (i) survive the termination of this Agreement,
(ii) apply to any and all qualifying acts of the Employee which have taken place
during any period in which he was employed by the Employer, irrespective of the
date of this Agreement or the term hereof, including, but not limited to, any
and all qualifying acts as an officer and/or director of any affiliate while the
Employee is employed by the Employer and (iii) be subject to any limitations
imposed from time to time under applicable law.
(f) Dispute Resolution; Attorney's Fees. In making any
determination as to the existence of Cause for termination or the occurrence of
a Change in Control, the Board of Directors shall, subject to its members'
fiduciary duties, abide by the recommendation of a committee comprising only
members who were nominated by one or more Principal Shareholders. The Employer
and the Employee agree that any dispute arising as to the parties' rights and
obligations hereunder shall be resolved by binding arbitration before an
arbitrator to be determined by mutually agreeable means. In such
-8-
33
event, each of the Employer and the Employee shall have the right to full
discovery. The Employer shall bear all costs of the arbitrator in any such
proceeding, and the Employee shall have the right, in addition to any other
relief granted by such arbitrator, to recover reasonable attorneys' fees;
provided, however, that the Employer shall have the right, in any dispute other
than a dispute relating to the occurrence of a Change in Control or the payment
of an amount under Section 3(e)(iii), in addition to any other relief granted by
such arbitrator, to recover reasonable attorneys' fees in the event that a claim
brought by the Employee is definitively decided in the Employer's favor (with
the amount of such fees being limited to those expended defending the claim or
claims decided in favor of the Employer). Any judgment by such arbitrator may be
entered into any court with jurisdiction over the dispute.
(g) Acknowledgment. The Employee acknowledges that he has
been advised by the Employer to seek the advice of independent counsel prior to
reaching agreement with the Employer on any of the terms of this Agreement. The
parties agree that no rule of construction shall apply to this Agreement which
construes ambiguous language in favor of or against any party by reason of that
party's role in drafting the Agreement.
(h) Amendments and Waivers. No modification, amendment or
waiver, of any provision of, or consent required by, this Agreement, nor any
consent to any departure herefrom, shall be effective unless it is in writing
and signed by the parties hereto. Such modification, amendment, waiver or
consent shall be effective only in the specific instance and for the purpose for
which given.
(i) Notices. All notices or other communications which
are required or permitted hereunder shall be in writing and sufficient if
delivered personally or sent by registered or certified mail, postage prepaid,
return receipt requested, sent by overnight courier, or sent by facsimile (with
confirmation of receipt), addressed as follows:
If to the Employer:
The X. X. Xxxxxxx Company, Inc.
0000 Xxxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: President
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx, Xxxxx & Xxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx
Facsimile: (000) 000-0000
-9-
34
If to the Employee:
Xxxxxx X. Roof
0000 Xxxxx Xxxxx Xxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Facsimile: (000) 000-0000
or at such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. If such notice
or communication is mailed, such communication shall be deemed to have been
given on the fifth business day following the date on which such communication
is posted.
(j) Descriptive Headings; Certain Interpretations.
Descriptive headings are for convenience only and shall not control or affect
the meaning or construction of any provision of this Agreement. Except as
otherwise expressly provided in this Agreement: (i) any reference in this
Agreement to any agreement, document or instrument includes all permitted
supplements and amendments; (ii) a reference to a law includes any amendment or
modification to such law and any rules or regulations issued thereunder; (iii)
the words "include," "included" and "including" are not limiting; and (iv) a
reference to a person or entity includes its permitted successors and assigns.
(k) Counterparts; Entire Agreement. This Agreement may be
executed in any number of counterparts, and each such counterpart hereof shall
be deemed to be an original instrument, but all such counterparts together shall
constitute one agreement. This Agreement and the Other Agreements contain the
entire agreement among the parties with respect to the transactions contemplated
by this Agreement and the Other Agreements and supersede all other or prior
written or oral agreements or understandings among the parties with respect to
the Employee's employment by the Employer. The Employment Agreement, dated as of
July 1, 1998, between the Employer and the Employer is expressly superseded and
hereby amended and restated in its entirety by this Agreement.
(L) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NORTH
CAROLINA.
(M) CONSENT TO JURISDICTION. EACH OF THE EMPLOYER AND THE
EMPLOYEE HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF
NORTH CAROLINA SITTING IN MECKLENBURG COUNTY FOR PURPOSES OF ALL LEGAL
PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY, AND THE EMPLOYEE AGREES NOT TO COMMENCE ANY LEGAL
PROCEEDING RELATING THERETO EXCEPT IN SUCH COURT. EACH OF THE EMPLOYER AND THE
EMPLOYEE IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
-10-
35
LAW, ANY OBJECTION WHICH HE MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE
OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH
PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
EACH OF THE PARTIES HERETO HEREBY CONSENTS TO SERVICE OF PROCESS BY NOTICE IN
THE MANNER SPECIFIED IN SECTION 6(I) AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE TO SERVICE
OF PROCESS IN SUCH MANNER.
-11-
36
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first written above.
THE X. X. XXXXXXX COMPANY, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Name:
Title:
/s/ Xxxxxx X. Roof
--------------------------------------
Xxxxxx X. Roof
-12-
