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EXHIBIT 10.50
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into on
the 10th day of December, 1996, by and between Capital Senior Living, Inc. a
Texas corporation ("CSL" or "the Company"), and Xxx X. Xxxxxxxxxx, an
individual residing in the State of Texas ("Employee"). The term of this
Agreement shall be deemed to have commenced as of December 1, 1996
("Employment Commencement Date").
1. APPOINTMENT, TITLE AND DUTIES. CSL hereby employs Employee to serve
in the position as assigned to him by the Board of Directors. In such capacity,
Employee shall have such powers, duties and responsibilities as are customarily
assigned to said position and as may be otherwise assigned to him. In addition
Employee shall have such other duties and responsibilities as may reasonably be
assigned to him by the Board of Directors, including serving with the consent
or at the request of CSL on the board of directors or as an officer of entities
affiliated with CSL (collectively, the "Affiliates") of affiliated
corporations.
2. TERM OF AGREEMENT. The initial term of this Agreement shall be for
a two (2) year period ending on November 30, 1998, however, the term of this
Agreement shall automatically be extended for a one (1) year term on a
consecutive basis. This Agreement shall terminate upon the earlier of: (i) the
date of the voluntary resignation of Employee, (ii) the date of Employee's
death or determination of Employee's disability (as defined in Xxxxxxxxx 0
xxxxx), (xxx) the date of notice by CSL to Employee that this Agreement is
being terminated by CSL whether "for cause" (as defined in Paragraph 6 below)
or without cause, or (iv) upon the date a notice of intent to resign for "good
reason" (as defined in Paragraph 6 below) is delivered to the Company by
Employee.
3. ACCEPTANCE OF POSITION. Employee hereby accepts the position
assigned by the Board of Directors and agrees that during the term of this
Agreement he will faithfully perform his duties and will devote substantially
all of his business time to the business and affairs of CSL and will not
engage, for his own account or for the account of any other person or entity,
in any other business or enterprise except with the express written approval of
the Board of Directors of CSL. Employee may, at his sole discretion, (i) serve
as a director on the boards of directors of other entities, businesses and
enterprises he currently serves on, and (ii) make personal, passive
investments. Employee agrees to perform his duties faithfully, diligently and
to the best of his ability, to use his best efforts to advance the best
interests of the Company at all times, and to abide by all moral, ethical and
lawful policies, guidelines, procedures, instructions and orders given to him
by the Company from time to time.
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4. SALARY AND BENEFITS. During the term of this Agreement:
A) CSL shall pay to Employee a base salary described in the
Employee's payroll action form, paid in approximately equal
installments no less frequently than semi-monthly. Employee
shall receive a performance and compensation review on
Employee's anniversary hire date. Employee shall be
eligible for an annual bonus, if available, as determined
by the Compensation Committee of the Board of Directors of
CSL or, if there is no Compensation Committee, the Board of
Directors. The Company shall deduct from Employee's
compensation and bonus, if any, all applicable local,
state, Federal or foreign taxes, including, but not limited
to, income tax, withholding tax, social security tax and
pension contributions (if any).
B) Employee shall participate in all health, retirement,
Company-paid insurance, sick leave, disability, expense
reimbursement and other benefit programs, if any, which CSL
makes available, in its sole discretion, to its senior
executives; however, nothing herein shall be construed to
obligate the Company to establish or maintain any employee
benefit program. The Company may purchase and maintain in
force a death and disability insurance policy in an amount
at all times equal to not less than an amount equal to
Employee's annual base salary multiplied by two (2). The
Company would be the beneficiary of said policy and would
use said policy for the purposes described in Paragraph
7(A)(i), below. Reimbursement of Employee's reasonable and
necessary business expenses incurred in the pursuit of the
business of the Company or any of its affiliates shall be
made to Employee upon his presentation to the Company of
itemized bills, vouchers or accountings prepared in
conformance with applicable regulations of the Internal
Revenue Service and the policies and guidelines of the
Company.
C) Employee shall be entitled to reasonable vacation time
described in the Employee's payroll action form and
pursuant to the Company's Corporate Policies and Procedures
Manual, provided that not more than two (2) weeks of such
vacation time may be taken consecutively without prior
notice to, and the consent of, the Compensation Committee
of the Board of Directors of CSL or, if there is no
Compensation Committee, the Board of Directors.
5. STOCK OPTIONS. Pursuant to the terms of CSL's 1997 Stock Option
Plan, if adopted, Employee shall be entitled to receive a certain number of
options, if available, to purchase the common stock of the Company. The number
of options to be offered to Employee shall be determined by the Board of
Directors of CSL.
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6. CERTAIN TERMS DEFINED. For purposes of this Agreement:
A) Employee shall be deemed to be disabled if a physical or
mental condition shall occur and persist which, in the
written opinion of two (2) licensed physicians, has
rendered Employee unable to perform his assigned duties for
CSL for a period of ninety (90) consecutive calendar days
or more, and which condition, in the opinion of such
physicians, is likely to continue for an indefinite period
of time, rendering Employee unable to return to his duties
for CSL. One (1) of the two (2) physicians shall be
selected in good faith by the Board of Directors of CSL,
and the other of the two (2) physicians shall be selected
in good faith by Employee. In the event that the two (2)
physicians selected do not agree as to whether Employee is
disabled, as described above, then said two (2) physicians
shall mutually agree upon a third (3rd) physician whose
written opinion as to Employee's condition shall be
conclusive upon CSL and Employee for purposes of this
Agreement.
B) A termination of Employee's employment by CSL shall be
deemed to be "for cause" if it is based upon (i) Employee
is charged with and then convicted of any misdemeanor or
any felony involving personal dishonesty, (ii) disloyalty
by Employee to the Company, including but not limited to
embezzlement, or (iii) Employee's failure or refusal to
perform his duties in accordance with this Agreement based
on a standard of reasonableness.
C) A resignation by Employee shall not be deemed to be
voluntary, and shall be deemed to be a resignation for
"good reason" if it is based upon (i) a material diminution
in Employee's base salary which is not part of an overall
diminution for all executive officers of the Company, or
(ii) a material breach by CSL of the Company's obligations
to Employee under this Agreement or under the Company's
Stock Option Plan, if adopted.
7. CERTAIN BENEFITS AND OBLIGATIONS UPON TERMINATION.
A) In the event that Employee's employment terminates (i)
because of death or disability, (ii) because CSL has
terminated Employee other than "for cause" (as described
above), including a Fundamental Change and if Employee has
been continuously employed by CSL for at least one year
prior to the Fundamental Change as described below, or
(iii) because Employee has voluntarily resigned for "good
reason" as described above, then,
i) CSL shall pay Employee in accordance with its
Corporate Policies and Procedures Manual his base
salary for the balance
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of the term of this Agreement (not including any future
extensions), but not less than one (1) year from the
date of the notice of termination, and Employee shall
retain all his Company stock options that are vested;
provided, however, the benefits described in this
Paragraph 7(A)(i) shall terminate at such time as
Employee materially breaches the provisions of
Paragraphs 7(D), 8, 9, or 10 hereof. A Fundamental
Change shall be defined as a merger, consolidation or
any sale of all or substantially all of the assets of
the Company that requires the consent or vote of the
holders of common stock where the Company is not the
survivor or in control;
ii) All accrued but unpaid or unused vacation, sick pay and
expense reimbursement shall be calculated in accordance
with CSL's Corporate Policies and Procedures Manual.
B) In the event that Employee's employment terminates for any
other cause other than those set forth in Paragraph 7(A),
(which can include voluntary resignation without good reason or
termination by CSL "for cause"), then,
i) CSL shall pay Employee his base salary up to and
through the date of termination;
ii) All accrued but unpaid or unused vacation, sick pay and
expense reimbursement shall be calculated in accordance
with CSL's Corporate Policies and Procedures Manual.
C) In the event that Employee's employment terminates by reason of
his death, all benefits provided in this Paragraph 7 shall be
paid to Employee's estate or as his executor or personal
representative shall direct, but payment may be deferred until
Employee's executor or personal representative has been
appointed and qualified pursuant to the law in effect in
Employee's jurisdiction of residence at the time of his death;
D) Following the termination for any reason of Employee's
employment, Employee shall not for himself or any third party,
directly or indirectly (i) divert or attempt to divert from the
Company or its Affiliates any business of any kind in which it
is or has been engaged, including, without limitation, the
solicitation of, interference with, or entering into any
contract with any of its past or then existing customers, and
(ii) employ, solicit for employment, or recommend for
employment any person employed by the Company or its Affiliates
during the period of such person's employment and for a period
of two (2) years thereafter.
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8. CONFIDENTIALITY. Employee hereby acknowledges his understanding
that as a result of his employment by CSL, he will have access to, and
possession of, valuable and important confidential or proprietary data,
documents and information concerning CSL or its Affiliates, its operations and
its future plans. Employee hereby agrees that he will not, either during the
term of his employment with CSL, or at any time before or after the term of his
employment with CSL, divulge or communicate to any person or entity, or direct
any employee or agent of CSL or its Affiliates or of his to divulge or
communicate to any person or entity, or use to the detriment of CSL or its
Affiliates or for the benefit of any other person or entity, or make or remove
any copies of, such confidential information or proprietary data or
information, whether or not marked or otherwise identified as confidential or
secret. Upon any termination of this Agreement for any reason whatsoever,
Employee shall surrender to CSL or its Affiliates any and all materials,
including but not limited to drawings, manuals, reports, documents, lists,
photographs, maps, surveys, plans, specifications, accountings and any and all
other materials relating to the Company or any of its business, including all
copies thereof, that Employee has in his possession, whether or not such
material was created or compiled by Employee, but excluding, however, personal
memorabilia belonging to Employee and notes taken by him as a member of the
Board of Directors. With the exception of such excluded items, materials, etc.,
Employee acknowledges that all such material is solely the property of CSL or
its Affiliates, and that Employee has no right, title or interest in or to such
materials. Notwithstanding anything to the contrary set forth in this Paragraph
8, the Provisions of this Paragraph 8 shall not apply to information which: (i)
is or becomes generally available to the public other than as a result of
disclosure by Employee, or (ii) is already known to Employee as of the date of
this Agreement from sources other than CSL or its Affiliates, or (iii) is
required to be disclosed by law or by regulatory or judicial process.
9. NON-COMPETITION. Employee hereby agrees that for a period of one
(1) year after any termination for any reason whatsoever of this Agreement and
after the last payment to Employee provided for hereunder, he will not,
directly or indirectly, commence doing business, in any manner whatsoever,
which is in competition with all or any portion of the business of CSL or its
Affiliates in any state in which CSL or its Affiliates then operate, own, asset
manage, or is in the process of developing more than two (2) facilities. CSL
hereby acknowledges and agrees that Employee's ownership of a class of
securities listed on a stock exchange or traded on the over-the-counter market
that represents five percent (5%) or less of the number of shares of such class
of securities then issued and outstanding shall not constitute a violation of
this Paragraph 9. Notwithstanding anything to the contrary set forth in this
Paragraph 9, if Employee is terminated from employment by CSL "for cause" as
defined in Paragraph 6(B), Employee shall not be in violation of this Paragraph
9 if Employee accepts and works within the one (1) year period at a position as
an on-site Executive Director or Marketing Director at a nursing or retirement
facility for a salary equal to or less than a comparable position at a
comparable facility in the area.
10. WORK PRODUCT. The Employee agrees that all innovations,
improvements, developments, methods, designs, analyses, reports and all similar
or related information which relates to the Company's or any of its
subsidiaries' or Affiliates' actual or anticipated
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business, or existing or future products or services and which are conceived,
developed or made by the Employee while employed by the Company or its
Affiliates ("Work Product") belong to the Company or such subsidiary or
Affiliate. The Employee will promptly disclose such Work Product to the Board
and perform all actions reasonably requested by the Board (whether during or
after the employment period) to establish and to confirm such ownership
(including, without limitation, assignments, consents, powers of attorney and
other instruments).
11. LEGAL ACTION. In the event that any action or proceeding is
brought to enforce the terms and provisions of this Agreement, the prevailing
party shall be entitled to recover reasonable attorneys' fees and costs. In the
event of a breach or threatened breach by Employee of the provisions of
Paragraph 7(D), 8, 9, or 10, Employee and the Company agree that the Company,
shall, in addition to any other available remedies, be entitled to an
injunction restraining Employee from violating the terms of the applicable
Paragraph and that said injunction is appropriate and proper relief for such
violation.
12. NOTICES. All notices and other communications provided to either
party hereto under this Agreement shall be in writing and delivered by hand
delivery, overnight courier service or certified mail, return receipt
requested, to the party being notified at said party's address set forth
adjacent to said party's signature on this Agreement, or at such other address
as may be designated by a party in a notice to the other party given in
accordance with this Agreement. Notices given by hand delivery or overnight
courier service shall be deemed received on the date of delivery shown on the
courier's delivery receipt or log. Notices given by certified mail shall be
deemed received three (3) days after deposit in the U.S. Mail.
13. CONSTRUCTION. In construing this Agreement, if any portion of this
Agreement shall be found to be invalid or unenforceable, the remaining terms
and provisions of this Agreement shall be given effect to the maximum extent
permitted without considering the void, invalid or unenforceable provision. In
construing this Agreement, the singular shall include the plural, the masculine
shall include the feminine and neuter genders, as appropriate, and no meaning
or effect shall be given to the captions of the paragraphs in this Agreement,
which are inserted for convenience of reference only.
14. CHOICE OF LAW; SURVIVAL. This Agreement shall be governed and
construed in accordance with the internal laws of the State of Texas without
resort to choice of law principles. The provisions of Paragraphs 7(A), (B),
(C), (D), 8, 9, and 10 shall survive the termination of this Agreement for any
reason whatsoever.
15. INTEGRATION; AMENDMENTS. This is an integrated Agreement. This
Agreement constitutes and is intended as a final expression and a complete and
exclusive statement of the understanding and agreement of the parties hereto
with respect to the subject matter of this Agreement. All negotiations,
discussions and writings between the parties hereto relating to the subject
matter of this Agreement are merged into this Agreement, and there are no
rights conferred, nor promises, agreements, conditions, undertakings,
warranties
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or representations, oral or written, expressed or implied, between the
undersigned parties as to such matters other than as specifically set forth
herein. No amendment or modification of or addendum to, this Agreement shall be
valid unless the same shall be in writing and signed by the parties hereto. No
waiver of any of the provisions of this Agreement shall be valid unless in
writing and signed by the party against whom it is sought to be enforced.
16. BINDING EFFECT. This Agreement is binding upon and shall inure to
the benefit of the parties hereto and their respective heirs, personal
representatives, successors and assigns; PROVIDED, HOWEVER, that Employee shall
not be entitled to assign his interest in this Agreement (except for an
assignment by operation of law to his estate), or any portion hereof, or any
rights hereunder, to any party. Any attempted assignment by Employee in
violation of this Paragraph 16 shall be null, void, ab initio and of no effect
of any kind or nature whatsoever.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date set forth above to be effective as of the date specified in the preamble
of this Agreement.
CAPITAL SENIOR LIVING, INC.
a Texas corporation
Address:
00000 Xxxxxx Xxxxxxx, #000
Xxxxxx, XX 00000 By: /s/ XXXXX X. XXXXXXXXXXX
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Xxxxx X. Xxxxxxxxxxx, President
EMPLOYEE
Address:
000 Xxxxxx Xxxxx
Xxxxxx Xxxx, XX 00000 /s/ XXX X. XXXXXXXXXX
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Xxx X. Xxxxxxxxxx
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