Exhibit 10(z)
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into as of this 17th
day of June, 1996, by and between XXXXXX, INC., a Delaware
corporation (the "Company"), and Xxxxxxx X. Xxxx ("Executive").
W I T N E S S E T H:
WHEREAS, effective May 2, 1996, the Company and
Executive entered into an agreement ("Initial Agreement")
providing for Executive's employment by Company and outlining the
terms and conditions of such employment; and
WHEREAS, the Company desires to recognize Executive's
value to the Company and its shareholders by amending certain
provisions of the Initial Agreement and restating such agreement
in a single document as hereinafter provided; and
WHEREAS, Executive desires to commence his employment
with the Company on the terms and conditions provided herein;
NOW, THEREFORE, in consideration of the premises and
the mutual covenants and agreements contained herein, the parties
hereby agree as follows:
1. Purpose. The purpose of this Agreement is to amend
the Initial Agreement to recognize Executive's value to the
success of the Company. In order to provide a single, integrated
document, the Initial Agreement and any amendment(s) (attached
hereto as Exhibit A) are hereby incorporated into this restated
Employment Agreement, which shall provide the basis for
Executive's continued employment by the Company.
2. Employment and Term. (a) Subject to the terms and
conditions of this Agreement, the Company hereby employs
Executive, and Executive hereby accepts employment, as President
of the Sporting Equipment Group of the Company or other similar
positions to which, with his consent, he may be assigned and
shall have such responsibilities, duties and authority that are
consistent with such positions as may from time to time be
assigned to Executive. Executive hereby agrees that during the
Term of this Agreement he will devote substantially all his
working time, attention and energies to the diligent performance
of his duties, provided that the Executive may also serve on
boards of directors or trustees of other companies and
organizations, as long as such service does not materially
interfere with the performance of his duties hereunder and is
with the prior approval of the President and Chief Executive
Officer of Xxxxxx.
(b) Unless earlier terminated as provided herein,
Executive's employment under this Agreement shall be for a
rolling, two year term (the "Term") commencing on June 17, 1996,
and shall be deemed to automatically, without further action by
either the Company or Executive, extend each day for an
additional day, such that the remaining term of the Agreement
shall continue to be two years; provided, however, that (i)
either party may, by written notice to the other, cause this
Agreement to cease to extend automatically and, upon such notice,
the "Term" of this Agreement shall be the two years following the
date of such notice and this Agreement shall terminate upon the
expiration of such Term, and (ii) the Term of this Agreement
shall not extend beyond the date Executive attains age 65, unless
the parties otherwise agree in writing. If no such notice to
cease to extend has been given and this Agreement is terminated
pursuant to Section 5.1 or Section 5.2 hereof, for the purposes
of calculating and assessing the damages to Executive as a result
of such termination, the remaining Term of this Agreement shall
be deemed to be two years from the date of such termination (or,
if earlier, the date Executive attains age 65).
3. Compensation and Benefits. As compensation for his
services during the Term of this Agreement, Executive shall be
paid and receive the amounts and benefits set forth in
subsections (a) through (f) below:
(a) An annual base salary ("Base Salary") of Two
Hundred Fifty Thousand Dollars ($250,000.00), prorated for any
partial year of employment. Executive's Base Salary shall be
subject to annual review for increases at such time as the
Company conducts salary reviews for its executive officers
generally. Executive's salary shall be payable bi-monthly, or in
accordance with the Company's regular payroll practices in effect
from time to time for executive officers of the Company.
(b) Executive shall be eligible to participate in the
Target Incentive Plan and such other annual incentive plans as
may be established by the Company from time to time for its
executive officers. The President and Chief Executive Officer
will establish individual performance goals each year under the
incentive plans, and Executive's annual Target Bonus shall be 45%
of Base Salary; the maximum award for exceeding the performance
goals shall be 90% of Base Salary. For CY 96, Executive would
have a guaranteed bonus of not less than $100,000. The annual
incentive bonus payable under this subsection (b) shall be
payable as a lump sum no later than fifteen (15) business days
after approval of the bonus by the Compensation Committee of the
Board, unless Executive elects to defer all or a portion of such
amount to any deferral plan established by the Company for such
purpose.
(c) Executive shall be entitled to participate in, or
receive benefits under, any "employee benefit plan" (as defined
in Section 3(3) of ERISA) or employee benefit arrangement made
available by the Company to its executive officers, including
plans providing retirement, 401(k) benefits, deferred
compensation, health care, life insurance, disability and similar
benefits. A Supplemental Executive Retirement Plan (SERP), as
detailed in Exhibit A, will be provided to the Executive.
(d) The Company will provide membership initiation
fees and dues at a country club and a luncheon club (the specific
clubs to be agreed upon by the Executive and the President &
Chief Executive Officer)for Executive and his family. Executive
will be provided an automobile per company policy, and the
Company will pay all insurance, maintenance, fuel, oil and
related operational expenses for such automobile. Executive is
eligible for vacation under the Company's standard vacation
policy. Executive will be provided an annual physical
examination and a financial/tax consultant for personal financial
and tax planning.
(e) Executive shall participate in the Company's
Executive Life Insurance Program, which will provide a $250,000
death benefit. This insurance policy will be paid-up on the date
Executive attains 65 (assuming his employment continues until
that date) and will be delivered to Executive as a paid-up
insurance policy upon his retirement from the Company at or after
age 65. The life insurance provided to Executive under the
Executive Life Insurance Program shall be in addition to any life
insurance he receives under the Company's group term policy under
subsection (c) above.
(f) Executive will be paid a tax gross-up amount by
the Company to cover any additional federal or state income taxes
he incurs as a result of being required to include in taxable
income the amount of the premiums or costs for, or personal usage
of, the items described in subsections (d) and (e) above.
4. Confidentiality and Noncompetition. (a) Executive
acknowledges that, prior to and during the Term of this
Agreement, the Company has furnished and will furnish to
Executive Confidential Information which could be used by
Executive on behalf of a competitor of the Company to the
Company's substantial detriment. Moreover, the parties recognize
that Executive during the course of his employment with the
Company may develop important relationships with customers and
others having valuable business relationships with the Company.
In view of the foregoing, Executive acknowledges and agrees that
the restrictive covenants contained in this Section are
reasonably necessary to protect the Company's legitimate business
interests and good will.
(b) Executive agrees that he shall protect the
Company's Confidential Information and shall not disclose to any
Person, or otherwise use, except in connection with his duties
performed in accordance with this Agreement, any Confidential
Information; provided, however, that Executive may make
disclosures required by a valid order or subpoena issued by a
court or administrative agency of competent jurisdiction, in
which event Executive will promptly notify the Company of such
order or subpoena to provide the Company an opportunity to
protect its interests. Executive's obligations under this
Section 4(b) shall survive any expiration or termination of this
Agreement, provided that Executive may after such expiration or
termination disclose Confidential Information with the prior
written consent of the Chairman of the Board.
(c) Upon the termination or expiration of his
employment hereunder, Executive agrees to deliver promptly to the
Company all Company files, customer lists, management reports,
memoranda, research, Company forms, financial data and reports
and other documents supplied to or created by him in connection
with his employment hereunder (including all copies of the
foregoing) in his possession or control, and all of the Company's
equipment and other materials in his possession or control.
Executive's obligations under this Section 4(c) shall survive any
expiration or termination of this Agreement.
(d) Upon the termination or expiration of his
employment under this Agreement, Executive agrees that he shall
not enter into or engage in the design, manufacture, marketing or
sale of any products similar to those produced or offered by the
Company or its affiliates in the area of North America, either as
an individual, partner or joint venturer, or as an employee,
agent or salesman, or as an officer, director, or shareholder of
a corporation for a period of two (2) years from the date of his
termination of employment.
(e) Executive acknowledges that if he breaches or
threatens to breach this Section 4, his actions may cause
irreparable harm and damage to the Company which could not be
compensated in damages. Accordingly, if Executive breaches or
threatens to breach this Section 4, the Company shall be entitled
to seek injunctive relief, in addition to any other rights or
remedies of the Company. The existence of any claim or cause of
action by Executive against the Company, whether predicated on
this Agreement or otherwise, shall not constitute a defense to
the enforcement by the Company of Executive's agreement under
this Section 4(d).
5. Termination.
5.1 By Executive. Executive shall have the right to
terminate his employment hereunder by Notice of Termination (as
described in Section 7) if (i) the Company materially breaches
this Agreement and such breach is not cured within thirty (30)
days after written notice of such breach is given by Executive to
the Company; or (ii) Executive determines that his termination is
for Good Reason (as defined in Section 6.7). If Executive
terminates his employment hereunder pursuant to clauses (i) or
(ii) of this Section 5.1, Executive shall be entitled to receive,
as damages payable as a result of, and arising from, a breach of
this Agreement, the compensation and benefits set forth in
subsections (a) through (i) below. The time periods in (a)
through (i) below shall be twelve (12) months if termination
occurs before June 17, 1998 and eighteen (18) months if
termination occurs on or after June 17, 1998. If Executive
terminates his employment other than pursuant to clauses (i) or
(ii) of this Section 5.1, the Company's obligations under this
Agreement shall cease as of the date of such termination. Except
as provided in Section 5.4(a), the Company agrees that if
Executive terminates employment and is entitled to benefits under
this Section 5.1, he shall not be required to mitigate damages by
seeking other employment, nor shall any amount he earns reduce
the amount payable by the Company hereunder.
(a) Base Salary - Executive will continue to receive
his Base Salary as then in effect (subject to
withholding of all applicable taxes) for a period, as
determined in Section 5.1, from his date of termination
in the same manner as it was being paid as of the date
of termination; provided, however, that the salary
payments provided for hereunder shall be paid in a
single lump sum payment, to be paid not later than 30
days after his termination of employment; provided,
further, that the amount of such lump sum payment shall
be determined by taking the salary payments to be made
and discounting them to their Present Value (as defined
in Section 5.4(e)) on the date Executive's employment
under this Agreement is terminated.
(b) Bonuses and Incentives - Executive shall receive
bonus payments from the Company for the period, as
determined in Section 5.1, following the month in which
his employment under this Employment is terminated in
an amount for each such month equal to one-twelfth of
the average of the bonuses earned by him, if any, for
the two fiscal years in which bonuses were paid
immediately preceding the year in which such
termination occurs. Any bonus amounts that Executive
had previously earned from the Company but which may
not yet have been paid as of the date of termination
shall not be affected by this provision. Executive
shall also receive a prorated bonus for any uncompleted
fiscal year at the date of termination (assuming the
Target Award level has been achieved), based upon the
number of days that he was employed during such fiscal
year. The bonus amounts determined herein shall be
paid in a single lump sum payment, to be paid not later
than 30 days after termination of employment; provided,
that the amount of such lump sum payment shall be
determined by taking the bonus payments (as of the
payment date) to be made and discounting them to their
Present Value (as defined in Section 5.4(e)) on the
date Executive's employment under this Agreement is
terminated.
(c) Health and Life Insurance Coverage - The health
and group term life insurance benefits coverage
provided to Executive at his date of termination shall
be continued at the same level and in the same manner
as if his employment under this Agreement had not
terminated (subject to the customary changes in such
coverages if Executive retires, reaches age 65 or
similar events), beginning on the date of such
termination and ending on the date, as determined in
Section 5.1, from the date of such termination. Any
additional coverages Executive had at termination,
including dependent coverage, will also be continued
for such period on the same terms, to the extent
permitted by the applicable policies or contracts. Any
costs Executive was paying for such coverages at the
time of termination shall be paid by Executive by
separate check payable to the Company each month in
advance. If the terms of any benefit plan referred to
in this Section, or the laws applicable to such plan,
do not permit continued participation by Executive,
then the Company will arrange for other coverage at its
expense providing substantially similar benefits.
(d) Employee Retirement Plans - To the extent
permitted by the applicable plan, Executive will be
entitled to continue to participate, consistent with
past practices, in all employee retirement plans
maintained by the Company in effect as of his date of
termination, including, to the extent such plans are
still maintained by the Company, the Xxxxxx Retirement
Plan, the Xxxxxx 401(k) Plan, and, if applicable, the
Xxxxxx, Inc. and Subsidiary Supplemental Retirement
Plan. Executive's participation in such retirement
plans shall continue for a period, as determined in
Section 5.1, from the date of termination of his
employment under this Agreement (at which point he will
be considered to have terminated employment within the
meaning of the plans) and the compensation payable to
Executive under (a) and (b) above shall be treated
(unless otherwise excluded) as compensation under the
plan. For purposes of the Xxxxxx 401(k) Plan, he will
receive an amount equal to the Company's contributions
to the plan, assuming Executive had participated in
such plan at the maximum permissible contributions
level. If continued participation in any plan is not
permitted by the plan or by applicable law, the Company
shall pay to Executive and, if applicable, his
beneficiary, a supplemental benefit equal to the
present value on the date of termination of employment
under this Agreement (calculated as provided in the
plan) of the excess of (i) the benefit Executive would
have been paid under such plan if he had continued to
be covered for the period, as determined in Section
5.1, (less any amounts Executive would have been
required to contribute), over (ii) the benefit actually
payable under such plan. The Company shall pay such
additional benefits (if any) in a lump sum.
(e) Effect of Lump Sum Payment. The lump sum payment
under (a) or (b) above shall not alter the amounts
Executive is entitled to receive under the benefit
plans described in this section. Benefits under such
plans shall be determined as if Executive had remained
employed and received such payments over the period, as
determined in Section 5.1, whichever is applicable.
(f) Effect of Death or Retirement. The benefits
payable or to be provided under subsections (c) or (d)
above shall cease or be modified in the event of the
Executive's death or election to commence retirement
benefits under the Company's retirement plan, provided
that nothing in this subsection (f) shall limit
Executive's rights to receive Company benefits as a
retiree.
(g) Executive Life Insurance Program. On Executive's
date of termination, the Company will pay an amount
into the policy as if Executive had continued in
employment for the additional months, as determined in
Section 5.1, at the same total compensation and was
older by the number of months as determined in Section
5.1. At Executive's option, the policy shall be
delivered to Executive or he shall be paid the cash
value thereof (after the payment referred to in the
preceding sentence).
(h) Stock Options. For purposes of the Stock Option
Plan of the Company in which the Executive may
participate, Executive shall be deemed to have
completed the number of additional months of service
with the Company, as determined in Section 5.1.
(i) Office Space; Secretarial. Executive will be
provided appropriate office space, secretarial
assistance and related expenses for a period not to
exceed six (6) months from his date of termination.
5.2 By Company. The Company shall have the right to
terminate Executive's employment under this Agreement at any time
during the Term by Notice of Termination (as described in Section
7), (i) for Cause, as defined herein, (ii) if Executive becomes
Disabled, or (iii) upon Executive's death. If the Company
terminates Executive's employment under this Agreement pursuant
to clauses (i) through (iii) of this Section 5.2, the Company's
obligations under this Agreement shall cease as of the date of
termination; provided, however, that if Executive's employment
terminates as a result of death or Disability, the benefits
payable under this Agreement and the other benefit plans of the
Company upon Executive's death or Disability shall be provided by
the Company. If the Company terminates Executive during the Term
of this Agreement other than pursuant to clauses (i) through
(iii) of this Section 5.2, Executive shall be entitled to
receive, as damages payable as a result of, and arising from, a
breach of this Agreement, the compensation and benefits provided
in subsections (a) through (i) of Section 5.1 above for the time
periods, and subject to the provisions (including the
nonmitigation provision) and limitations therein.
5.3 Additional Agreements Upon Termination. In the
event Executive's employment is terminated by Executive under
clause (ii) of Section 5.1, or by the Company other than under
clauses (i) through (iii) of Section 5.2 within twenty-four (24)
months following the date of a Change in Control or the death of
Xxxxxx X. Xxxxxx, Xx., the provisions set forth below shall
apply, provided that such provisions shall only apply in each
case to the extent that the damages payable to Executive for
termination of his employment under Sections 5.1 or 5.2 do not
already provide such benefits under the plan or program.
(a) Stock Options. As of his date of termination, all
outstanding stock options granted to Executive under any Company
Plan or any other stock option program in which Executive
participates shall become 100% vested and immediately
exercisable. Notwithstanding the other provisions of Executive's
stock options, Executive shall have a period of not less than 3
months from his date of termination to exercise such options.
(b) Executive Life Insurance Program. The life
insurance policy described in Section 3(h) shall be delivered to
Executive as a fully paid-up policy within thirty (30) days after
his date of termination, regardless of Executive's age at such
time.
5.4 Limitation on Benefits Upon Termination. (a)
Notwithstanding anything in this Agreement to the contrary, any
benefits payable or to be provided to Executive by the Company or
its affiliates, whether pursuant to this Agreement or otherwise,
which are treated as Severance Payments shall be modified or
reduced in the manner provided in (b) below to the extent
necessary so that the benefits payable or to be provided to
Executive under this Agreement that are treated as Severance
Payments, as well as any payments or benefits provided outside of
this Agreement that are so treated, shall not cause the Company
to have paid an Excess Severance Payment. In computing such
amount, the parties shall take into account all provisions of
Code Section 280G, and the regulations thereunder, including
making appropriate adjustments to such calculation for amounts
established to be Reasonable Compensation. If Executive becomes
entitled to compensation and benefits under Section 5.1 or
Section 5.2 and such payments are considered to be Severance
Payments contingent upon a Change in Control, Executive shall be
required to mitigate damages (but only with respect to amounts
that would be treated as Severance Payments) by reducing the
amount of Severance Payments he is entitled to receive by any
compensation and benefits he earns from subsequent employment
(but shall not be required to seek such employment) during the
period, as determined in Section 5.1, after termination (or such
lesser period as he is entitled to extended benefits).
(b) In the event that the amount of any Severance
Payments which would be payable to or for the benefit of
Executive under this Agreement must be modified or reduced to
comply with this Section 5.4, Executive shall direct which
Severance Payments are to be modified or reduced; provided,
however, that no increase in the amount of any payment or change
in the timing of the payment shall be made without the consent of
the Company.
(c) This Section 5.4 shall be interpreted so as to
avoid the imposition of excise taxes on Executive under Section
4999 of the Code or the disallowance of a deduction to the
Company pursuant to Section 280G(a) of the Code with respect to
amounts payable under this Agreement or otherwise.
Notwithstanding the foregoing, in no event will any of the
provisions of this Section 5.4 create, without the consent of
Executive, an obligation on the part of Executive to refund any
amount to the Company following payment of such amount.
(d) In addition to the limits otherwise provided in
this Section 5.4, to the extent permitted by law, Executive may
in his sole discretion elect to reduce any payments he may be
eligible to receive under this Agreement to prevent the
imposition of excise taxes on Executive under Section 4999 of the
Code.
(e) For purposes of this Section 5.4, the following
definitions shall apply:
(i) "Excess Severance Payment" - The term "Excess
Severance Payment" shall have the same meaning as the term
"excess parachute payment" defined in Section 280G(b)(1) of the
Code.
(ii) "Severance Payment" - The term "Severance
Payment" shall have the same meaning as the term "parachute
payment" defined in Section 280G(b)(2) of the Code.
(iii) "Reasonable Compensation" - The term
"Reasonable Compensation" shall have the same meaning as provided
in Section 280G(b)(4) of the Code. The parties acknowledge and
agree that, in the absence of a change in existing legal
authorities or the issuance of contrary authorities, amounts
received by Executive as damages under or as a result of a breach
of this Agreement shall be considered Reasonable Compensation.
(iv) "Present Value" - The term "Present Value"
shall have the same meaning as provided in Section 280G(d)(4) of
the Code.
6. Definitions. For purposes of this Agreement the
following terms shall have the meanings specified below:
6.1 "Board" or "Board of Directors" - The Board of
Directors of the Company.
6.2 "Cause" - Either
(a) Any act that constitutes, on the part of
Executive, (i) fraud, a felony or gross malfeasance of duty and
(ii) that results in material injury to the Company; or
(b) Executive's willful and continued failure to
devote his full business time and efforts to the performance of
duties for the Company; provided, however, that in the case of
(b) above, such conduct shall not constitute Cause unless the
notice delivered to Executive pursuant to Section 7 sets forth
with specificity (A) the conduct deemed to qualify as Cause, (B)
reasonable action that would remedy such objection, and (C) a
reasonable time (not less than thirty days) within which
Executive may take such remedial action, and Executive shall not
have taken such specified remedial action within such specified
reasonable time.
6.3 "Change in Control" - Either
(i) the acquisition, directly or indirectly, by any
"person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as
amended) of securities of the Company representing an
aggregate of fifty percent (50%) or more of the
combined voting power of the Company's then outstanding
securities (excluding the acquisition by persons who
own such amount of securities on the date hereof, or
acquisitions by persons who acquire such amount through
inheritance); or
(a) the acquisition, directly or indirectly, by any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended) of securities of the
Company representing an aggregate of fifty percent (50%) or more
of the combined voting power of the Company's then outstanding
securities (excluding the acquisition by persons who own such
amount of securities on the date hereof, or acquisitions by
persons who acquire such amount through inheritance); or
(b) Xxxxxx X. Xxxxxx (i) ceases to own at least 50.1%
of the combined voting power of the then outstanding securities
of the sole general partner of Xxxxxx Holding Company, L.P.
("Xxxxxx Partnership"), a limited partnership which holds and
owns voting securities of the Company, or counsel to the Xxxxxx
Partnership is unable at any time to provide a legal opinion that
ownership of at least 50.1% of the combined voting power of the
then outstanding securities is sufficient to control the sole
general partner, or (ii) ceases to direct personally (and not
through a representative) by his ownership of the voting power of
the sole general partner of the Xxxxxx Partnership, the voting
and dispositive power of all of the shares of the Company's
voting securities owned by the Xxxxxx Partnership; or
(c) Xxxxxx X. Xxxxxx personally and the Xxxxxx
Partnership in the aggregate cease to own at least 50.1% of the
combined voting power of the Company's then outstanding
securities; or
(d) During any period of two consecutive years,
individuals who at the beginning of such period constitute the
Board of the Company, cease for any reason to constitute at least
a majority thereof, unless the election of each new director was
approved in advance by a vote of at least a majority of the
directors then still in office who were directors at the
beginning of the period; or
(e) consummation of (i) a merger, consolidation or
other business combination of the Company with any other "person"
(as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended) or affiliate
thereof, other than a merger, consolidation or business
combination which would result in the outstanding common stock of
the Company immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into
common stock of the surviving entity or a parent or affiliate
thereof) at least fifty percent (50%) of the outstanding common
stock of the Company (or such surviving entity or parent or
affiliate thereof) that is outstanding immediately after such
merger, consolidation or business combination, or (ii) a plan of
complete liquidation of the Company or an agreement for the sale
or disposition by the Company of all or substantially all of the
Company's assets; or
(f) the occurrence of any other event or circumstance
which is not covered by (a) through (e) above which the Board of
the Company determines affects control of the Company and adopts
a resolution that such event or circumstance constitutes a Change
in Control for the purposes of this Agreement."
6.4 "Code" - The Internal Revenue Code of 1986, as it
may be amended from time to time.
6.5 "Confidential Information" - All technical,
business, and other information relating to the business of the
Company or its subsidiaries or affiliates, including, without
limitation, technical or nontechnical data, formulae,
compilations, programs, devices, methods, techniques, processes,
financial data, financial plans, product plans, and lists of
actual or potential customers or suppliers, which (i) derives
economic value, actual or potential, from not being generally
known to, and not being readily ascertainable by proper means by,
other Persons, and (ii) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy or
confidentiality. Such information and compilations of
information shall be contractually subject to protection under
this Agreement whether or not such information constitutes a
trade secret and is separately protectable at law or in equity as
a trade secret. Confidential Information does not include
confidential business information which does not constitute a
trade secret under applicable law two years after any expiration
or termination of this Agreement.
6.6 "Disability" or "Disabled". Executive's inability
as a result of physical or mental incapacity to substantially
perform his duties for the Company on a full-time basis for a
period of six (6) months.
6.7 "Good Reason" A "Good Reason" for termination by
Executive of Executive's employment shall mean the occurrence
(without the Executive's express written consent) within the
twenty-four (24) month period following the date of (a) a Change
in Control, or (b) the death of Xxxxxx X. Xxxxxx, Xx., of any one
of the following acts by the Company, or failures by the Company
to act, unless, in the case of any act or failure to act
described in paragraph (i), (v), (vi) or (vii) below, such act or
failure to act is corrected prior to the Date of Termination
specified in the Notice of Termination given in respect thereof:
(i) the assignment to Executive without his consent of
any duties inconsistent with Executive's status as the President
of the Sporting Equipment Group of the Company, or a substantial
adverse alteration in the nature or status of the Executive's
responsibilities from those in effect immediately prior to the
Change in Control or death of Xx. Xxxxxx (other than any such
alteration primarily attributable to the fact that the Company
may no longer be a public company);
(ii) a reduction by the Company in Executive's Base
Salary as in effect on the date hereof or as the same may be
increased from time to time;
(iii) the relocation of Executive without his consent
to a location more than fifty (50) miles from the work location
immediately prior to the Change in Control or death of Xx.
Xxxxxx, except for required travel on the Company's business to
an extent substantially consistent with Executive's business
travel obligations;
(iv) the failure by the Company, without Executive's
consent, to pay to Executive any portion of Executive's
compensation (including Base Salary and bonus), or to pay to the
Executive any portion of an installment of deferred compensation
under any deferred compensation program of the Company, within
seven (7) days of the date such compensation is due;
(v) the failure by the Company to continue in effect
any compensation plan in which Executive participates immediately
prior to the Change in Control or death of Xx. Xxxxxx, which is
material to Executive's total compensation, including but not
limited to the Company's Target Incentive Plan, stock option
plan, or any substitute plans adopted prior to the Change in
Control or death of Xx. Xxxxxx, unless an equitable arrangement
(embodied in an ongoing substitute or alternative plan) has been
made with respect to such plan, or the failure by the Company to
continue the Executive's participation in such plan (or in such
substitute or alternative plan) on a basis not materially less
favorable, both in terms of the amount of benefits provided and
the level of Executive's participation relative to other
participants, as existed at the time of the Change in Control or
death of Xx. Xxxxxx;
(vi) the failure by the Company to continue to provide
Executive with benefits substantially similar to those enjoyed by
Executive under any of the Company's pension, life insurance
(including the Executive Life Insurance Program), medical, health
and accident or disability plans in which Executive was
participating at the time of the Change in Control or death of
Xx. Xxxxxx, the taking of any action by the Company which would
directly or indirectly materially reduce any of such benefits or
deprive Executive of any material fringe benefit enjoyed by
Executive at the time of the Change in Control or death of Xx.
Xxxxxx, or the failure by the Company to provide Executive with
the number of paid vacation days to which the Executive is
entitled under this Agreement; or
(vii) any purported termination of Executive's
employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of Section 7.1; for
purposes of this Agreement, no such purported termination shall
be effective.
The right to terminate the Executive's employment for
Good Reason shall not be affected by the Executive's incapacity
due to physical or mental illness. The Executive's continued
employment shall not constitute consent to, or a waiver of rights
with respect to, any act or failure to act constituting Good
Reason hereunder.
6.8 "Person". Any individual, corporation, bank,
partnership, joint venture, association, joint-stock company,
trust, unincorporated organization or other entity.
7. Termination Procedures.
7.1 Notice of Termination. During the Term of this
Agreement, any purported termination of Executive's employment
(other than by reason of death) shall be communicated by written
Notice of Termination from one party hereto to the other party
hereto in accordance with Section 11. For purposes of this
Agreement, a "Notice of Termination" shall mean a notice which
shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for
termination of Executive's employment under the provision so
indicated. Further, a Notice of Termination for Cause is
required to include a copy of the written reasons for such
termination (after reasonable notice to Executive and an
opportunity for Executive, together with Executive's counsel, to
be heard) finding that, in good faith opinion, Executive was
guilty of conduct set forth in clause (a) or (b) of the
definition of Cause herein, and specifying the particulars
thereof in detail.
7.2 Date of Termination. "Date of Termination," with
respect to any purported termination of Executive's employment
during the Term of this Agreement, shall mean (i) if Executive's
employment is terminated by his death, the date of his death,
(ii) if Executive's employment is terminated for Disability,
thirty (30) days after Notice of Termination is given (provided
that Executive shall not have returned to the full-time
performance of Executive's duties during such thirty (30) day
period), and (iii) if Executive's employment is terminated for
any other reason, the date specified in the Notice of Termination
(which, in the case of a termination by the Company, shall not be
less than thirty (30) days (except in the case of a termination
for Cause) and, in the case of a termination by the Executive,
shall not be less than fifteen (15) days nor more than sixty (60)
days, respectively, from the date such Notice of Termination is
given).
8. Contract Non-Assignable. The parties acknowledge
that this Agreement has been entered into due to, among other
things, the special skills of Executive, and agree that this
Agreement may not be assigned or transferred by Executive, in
whole or in part, without the prior written consent of the
Company.
9. Successors; Binding Agreement.
9.1 In addition to any obligations imposed by law upon
any successor to the Company, the Company will require any
successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company to expressly assume and
agree to perform this Agreement, in the same manner and to the
same extent that the Company would be required to perform it if
no such succession had taken place. Failure of the Company to
obtain such assumption and agreement prior to the effectiveness
of any such succession shall be a breach of this Agreement and
shall entitle the Executive to compensation from the Company in
the same amount and on the same terms as the Executive would be
entitled to hereunder if the Executive were to terminate the
Executive's employment for Good Reason after a Change in Control,
except that, for purposes of implementing the foregoing, the date
on which any such succession becomes effective shall be deemed
the Date of Termination.
9.2 This Agreement shall inure to the benefit of and
be enforceable by Executive's personal or legal representatives,
executors, administrators, successors, heirs, distributees,
devisees and legatees. If Executive shall die while any amount
would still be payable to Executive hereunder (other than amounts
which, by their terms, terminate upon the death of Executive) if
Executive had continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to the executors, personal
representatives or administrators of Executive's estate.
10. Other Agents. Nothing in this Agreement is to be
interpreted as limiting the Company from employing other
personnel on such terms and conditions as may be satisfactory to
the Company.
11. Notices. All notices, requests, demands and other
communications required or permitted hereunder shall be in
writing and shall be deemed to have been duly given if delivered
or seven days after mailing if mailed, first class, certified
mail, postage prepaid:
To the Company: Xxxxxx International, Inc.
0000 Xxxxxxxxx Xxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
Attention: D. Xxxxxx XxXxxxx
To the Executive: Xxxxxxx X. Xxxx
c/x Xxxxxx International, Inc.
0000 Xxxxxxxxx Xxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
Any party may change the address to which notices, requests,
demands and other communications shall be delivered or mailed by
giving notice thereof to the other party in the same manner
provided herein.
12. Provisions Severable. If any provision or
covenant, or any part thereof, of this Agreement should be held
by any court to be invalid, illegal or unenforceable, either in
whole or in part, such invalidity, illegality or unenforceability
shall not affect the validity, legality or enforceability of the
remaining provisions or covenants, or any part thereof, of this
Agreement, all of which shall remain in full force and effect.
13. Waiver. Failure of either party to insist, in one
or more instances, on performance by the other in strict
accordance with the terms and conditions of this Agreement shall
not be deemed a waiver or relinquishment of any right granted in
this Agreement or the future performance of any such term or
condition or of any other term or condition of this Agreement,
unless such waiver is contained in a writing signed by the party
making the waiver.
14. Amendments and Modifications. This Agreement may
be amended or modified only by a writing signed by both parties
hereto.
15. Governing Law. The validity and effect of this
Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Alabama.
16. Arbitration of Disputes; Expenses. All claims by
Executive for compensation and benefits under this Agreement
shall be in writing. Any denial of a claim for benefits under
this Agreement shall be delivered to Executive in writing and
shall set forth the specific reasons for the denial and the
specific provisions of this Agreement relied upon. The Company
shall afford a reasonable opportunity to Executive for a review
of a decision denying a claim and shall further allow Executive
to appeal a decision within sixty (60) days after notification
that Executive's claim has been denied. To the extent permitted
by applicable law, any further dispute or controversy arising
under or in connection with this Agreement shall be settled
exclusively by arbitration in Montgomery, Alabama, in accordance
with the rules of the American Arbitration Association then in
effect. Judgment may be entered on the arbitrator's award in any
court having jurisdiction. In the event the Executive incurs
legal fees and other expenses in seeking to obtain or to enforce
any rights or benefits provided by this Agreement and is
successful, in whole or in part, in obtaining or enforcing any
such rights or benefits through settlement, arbitration or
otherwise, the Company shall promptly pay Executive's reasonable
legal fees and expenses incurred in enforcing this Agreement and
the fees of the arbitrator. Except to the extent provided in the
preceding sentence, each party shall pay its own legal fees and
other expenses associated with any dispute.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
EXECUTIVE:
_____________________________
XXXXXXX X. XXXX
President
Sporting Equipment Group
COMPANY:
XXXXXX INTERNATIONAL, INC. and
XXXXXX, INC.
By: ___________________________
XXXX X. PANETTIERE
President
& Chief Executive Officer
Witness:_____________________
_____________________________
Notary Public