EXHIBIT 10.20
Compass International Services Corporation
Xxx Xxxx Xxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
March 4, 1998
Xx. Xxxxxxx X. Xxxxxx
c/o Compass International Services Corporation
Xxx Xxxx Xxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Dear Xx. Xxxxxx:
You are an officer of the undersigned (the "Company"). Pursuant to that
certain letter agreement, dated as of May 28, 1997 with BGL Capital Partners,
L.L.C., you subscribed for and purchased 1,000 shares of common stock of the
Company, par value $.01 per share (the "Shares"), at a purchase price of $10.00
per share (the "Purchase Price").
To induce you to continue to serve as an officer of the Company, and in
consideration of your continued service after the date hereof, the Company
hereby undertakes and agrees to pay or cause to be paid and shall be liable for,
and covenants and agrees to defend, indemnify and hold you harmless on an after-
tax basis from and against, any and all Losses (as defined below) resulting
from, arising out of or otherwise based upon Taxes (as defined below) that are
attributable to, or arise from any claim or determination by the Internal
Revenue Service or other income tax authority that the fair market value of the
Shares on the date you purchased them was greater than the Purchase Price (such
claim or determination an "Indemnified Tax Matter").
As used in this letter, (i) "Losses" means liabilities, obligations,
losses, fines, costs, or deficiencies, including but not limited to out-of-
pocket fees and expenses and reasonable attorneys' and accountants' fees and
expenses incurred in the investigation or defense of any of the same and (ii)
"Taxes" means any income, alternative minimum, employment, payroll, social
security, unemployment, withholding or other similar tax, assessment or other
governmental charge (including all interest and penalties thereon and additions
thereto whether disputed or not) imposed by any federal, state or local
government.
The payment obligation of Company hereunder shall be reduced by any Tax
benefit actually realized by you that would not have been realized but for an
Indemnified Tax Matter (for example, the benefit of an increase in the tax basis
in Shares disposed of by you). If any such Tax benefit is actually realized by
you before any payment is made to you by the Company hereunder, the obligation
of the Company shall be reduced by the amount of any such Tax
Xx. Xxxxxxx X. Xxxxxx
March 4, 1998
Page Two
benefit, and if such Tax benefit is actually realized by you after the date the
Company has made a payment to you hereunder, you shall reimburse the Company for
the amount of such Tax benefit promptly after such Tax benefit is actually
realized, provided that your reimbursement obligation hereunder shall not exceed
the aggregate amount of payments in respect of tax liabilities previously made
to you by the Company hereunder.
The obligation of Company hereunder shall survive any transfer by you of
the Shares and any termination of your employment by the Company.
If you are in agreement with the foregoing, please so indicate by signing
the enclosed copy of this letter where indicated below and return the same to
the Company.
This letter will be governed by and construed in accordance with the laws
of the State of New York.
Very truly yours,
COMPASS INTERNATIONAL SERVICES CORPORATION
By /s/ Xxxxxxx X. Xxxxxxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Chief Executive Officer
Accepted and Agreed as of
the date of this letter:
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
