EXHIBIT 10.35
EMPLOYMENT CONTRACT
AGREEMENT made as of April 1, 2000 between XXXXXXX ENTERPRISES, INC., a
Delaware corporation (the "Company"), and XXXXXXX X. XXXX (the "Executive").
WHEREAS, Executive is employed by the Company or by one of its
wholly-owned consolidated subsidiaries; and
WHEREAS, the Company desires to assure itself of the management
services of the Executive by directly engaging the Executive as the Executive
Vice President, General Counsel and Secretary of the Company; and
WHEREAS, the Company wishes to encourage the Executive to remain with
and devote full time and attention to the business affairs of the Company and
wishes to provide income protection to the Executive for a period of time in the
event of an involuntary Termination of Employment not for Cause or a voluntary
Termination of Employment for Good Reason within the Term of this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements and
understandings set forth herein and for other good and valuable consideration,
the receipt and adequacy of which is hereby acknowledged, the Company and the
Executive hereby agree as follows:
1. Definitions.
(a) "Base Salary" shall mean the Executive's regular annual
rate of base pay, as set forth in Paragraph 4(a), as of the date in
question.
(b) The "Benefit Multiplier" shall be equal to 2.0 except that
if Executive's Termination of Employment is pursuant to Paragraphs 6(b)
or 6(c) it shall be equal to 3.0.
(c) The Benefit Period" shall be the period of years equal to
the Benefit Multiplier which follows the Executive's Termination of
Employment.
(d) "Cause" shall mean the Executive's (i) conviction of a
crime involving moral turpitude or theft or embezzlement of property
from the Company or (ii) willful misconduct or willful failure
substantially to perform the duties of his position, but only if such
has continued after receipt of notice from the Company's Board of
Directors and such reasonable cure period as is set forth in such
notice.
(e) A "Change in Control" shall be deemed to have taken place
if: (i) any person, corporation, or other entity or group, including
any "group" as defined in Section l3(d)(3) of the Securities Exchange
Act of 1934, other than any employee benefit plan then maintained by
the Company, becomes the beneficial owner of shares of the Company
having 30 percent or more of the total number of votes that may be cast
for the election of Directors of the Company; (ii) as the result of, or
in connection with, any contested election for the Board of Directors
of the Company, or any tender or exchange offer, merger or other
business combination or sale of assets, or any combination of the
foregoing (a "Transaction"), the persons who were Directors of the
Company before the Transaction shall cease to constitute a majority of
the Board of Directors of the Company or any successor to the Company
or its assets, or (iii) at any time (a) the Company shall consolidate
with, or merge with, any other Person and the Company shall not be the
continuing or surviving corporation, (b) any Person shall consolidate
with, or merge with the Company, and the
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Company shall be the continuing or surviving corporation and in
connection therewith, all or part of the outstanding Company stock
shall be changed into or exchanged for stock or other securities of any
other Person or cash or any other property, (c) the Company shall be a
party to a statutory share exchange with any other Person after which
the Company is a subsidiary of any other Person, or (d) the Company
shall sell or otherwise transfer 50% or more of the assets or earning
power of the Company and its subsidiaries (taken as a whole) to any
Person or Persons; provided, however, that notwithstanding anything to
the contrary herein, a Change in Control shall not include either any
transfer to a consolidated subsidiary, reorganization, spin-off,
split-up, distribution, or other similar or related transaction(s) or
any combination of the foregoing in which the core business and assets
of the Company and its subsidiaries (taken as a whole) are transferred
to another entity ("Controlled") with respect to which (1) the majority
of the Board of Directors of the Company (as constituted immediately
prior to such transaction(s)) also serve as directors of Controlled and
immediately after such transaction(s) constitute a majority of
Controlled's board of directors, and (2) more than 70% of the
shareholders of the Company (immediately prior to such transaction(s))
become shareholders or other owners of Controlled and immediately after
the transaction(s) control more than 70% of the ownership and voting
rights of Controlled.
(f) The "Change in Control Date" shall mean the date
immediately prior to the effectiveness of the Change in Control.
(g) The "Committee" shall mean the Compensation Committee of
the Company's Board of Directors.
(h) The "Competitive Businesses" shall mean any of the health
care businesses in which the Company is engaged on the Effective Date.
(i) The Executive shall have "Good Reason" to terminate
employment if: (i) the Executive is not elected, reelected, or
otherwise continued in the office of the Company or any of its
subsidiaries which he held immediately prior to the Change in Control
Date, or he is removed as a member of the Board of Directors of the
Company or any of its subsidiaries if the Executive was a director
immediately prior to the Change in Control Date; (ii) the Executive's
duties, responsibilities or authority as an employee are materially
reduced or diminished from those in effect on the Change in Control
Date without the Executive's consent; (iii) the Executive's duties,
responsibilities, or authority as an employee are materially reduced or
diminished from those in effect on the Effective Date without the
Executive's consent; (iv) the Executive's compensation or benefits are
reduced without the Executive's consent, unless all Executive-level
officers have their compensation or benefits reduced in the same
percentage amount; (v) the Company reduces the potential earnings of
the Executive under any performance-based bonus or incentive plan of
the Company in effect immediately prior to the Change in Control Date;
(vi) the Company requires that the Executive's employment be based
other than at its location on the Effective Date without his consent;
(vii) any purchaser, assign, surviving corporation, or successor of the
Company or its business or assets (whether by acquisition, merger,
liquidation, consolidation, reorganization, sale or transfer of assets
or business, or otherwise) fails or refuses to expressly assume in
writing this Agreement and all of the duties and obligations of the
Company hereunder pursuant to Section 16 hereof; or (viii) the Company
breaches any of the provisions of this Agreement.
(j) "Person" shall have the meaning ascribed to such term in
Section 3(a)(9) of the Securities Exchange Act of 1934 and used in
Sections 13(d) and 14(d) thereof, including a "group" as defined in
Section 13(d).
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(k) "Target Bonus" shall mean the target bonus (100% level)
established for the Executive for the year in question under the
Company's "Annual Incentive Plan."
(l) "Termination of Employment" shall mean the termination of
the Executive's employment by the Company other than such a termination
in connection with an offer of immediate reemployment by a successor or
assign of the Company or purchaser of the Company or its assets under
terms and conditions which would not permit the Executive to terminate
his employment for Good Reason.
2. Term. The initial term of this Agreement shall be for the period
commencing on the Effective Date and ending on the third anniversary thereof.
The Term shall be automatically extended by one additional day for each day
beyond the Effective Date of this Agreement that the Executive remains employed
by the Company until such time as the Company elects to cease such extension by
giving written notice of such to the Executive. (In such event, the Agreement
shall thus terminate on the third anniversary of the effective date of such
notice).
3. Position and Duties. During the Term, the Executive shall serve, as
an employee, as the Executive Vice President, General Counsel and Secretary of
the Company and shall have such duties, functions, responsibilities and
authority as are consistent with the Executive's position as the senior
executive officer in charge of the Legal functions of the Company.
4. Compensation and Related Matters.
(a) Annual Base Salary. The Executive shall receive a Base
Salary at a rate of $325,000 per annum through March 1, 2001 and
thereafter at any such greater rate as is determined by the Committee.
(b) Benefits. During the Term, the Executive shall be entitled
to all of the following and any other benefits and prerequisites
offered by the Company to executives generally:
(i) Participate in the Company's present and future
stock option, restricted stock, phantom stock and other
similar equity-based incentive plans, pursuant to their terms.
(ii) Participate in the Company's Employee Stock
Purchase Plan, pursuant to its terms;
(iii) Participate in the Company's Executive Deferred
Compensation Plan, pursuant to its terms;
(iv) Participate in the Company's Executive Savings
Plus Plan, pursuant to its terms;
(v) $325,000 of individual life insurance coverage
under the Company's Executive Split Dollar Life Insurance
Plan;
(vi) $325,000 (or such greater amount as the Company
may make available to its senior executives generally) of
group term life insurance coverage;
(vii) $100,000 (or such greater amount as the Company
may make available to its senior executives generally) of
business travel accident insurance coverage
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when traveling on Company business;
(viii) Participate in the Company's Medical Plan, and
Dental Plan, pursuant to their terms, except that the premium
cost for such shall be treated as a benefit under the
Company's Executive Medical Reimbursement Plan, described
below, (and therefore at the present time, there shall be no
payroll deduction as a condition of coverage in the Medical
Plan and Dental Plan);
(ix) Participate in the Company's Executive Medical
Reimbursement Plan (with a maximum benefit of $11,500 (or such
greater amount as the Company may make available to its senior
executives generally), a portion of which shall be deemed
applied to the payment of premiums under the Company's Medical
Plan and Dental Plan as described above), pursuant to its
terms;
(x) Participate in the Company's group Long-Term
Disability Plan, at the maximum benefit level, pursuant to its
terms, and participate in the Company's Supplemental Long-Term
Disability Plan, according to its terms;
(xi) 4 weeks of paid vacation;
(xii) Participate in or receive benefits under any
other employee benefit plan or other arrangement made
available by the Company to any of its employees, subject to
and on a basis consistent with the terms, conditions and
overall administration of such plan or arrangement.
(c) Annual Bonus. As additional compensation for services
rendered, the Executive shall be eligible to receive an annual bonus in
cash pursuant to the Company's Annual Incentive Plan.
(d) Expenses. The Company shall promptly reimburse the
Executive for all reasonable travel and other business expenses
incurred by the Executive in the performance of his duties to the
Company hereunder.
(e) Reporting. The Executive shall report directly to the
Chairman and Chief Executive Officer of the Company.
5. Non-Solicitation.
(a) Executive shall not at any time during the period of his
employment with the Company, or during the one (1) year period
immediately following his Termination of Employment with the Company
("Non-Solicitation Period"), without the prior written consent of the
Company, on behalf of himself or any other person, solicit for
employment or employ any of the current officers or employees of the
Company; provided, however, that nothing contained herein shall
prohibit Executive from hiring employees of the Company when such
employment results from general solicitations for employment.
(b) Executive shall not at any time during the period of his
employment with the Company, or during the Non-Solicitation Period,
without the prior written consent of the Company, solicit for his own
use, or for the use of any company or person by whom he is employed, or
for whom he may be acting, any of the current customers of the Company,
nor shall he divulge
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to any other person any information or fact relating to the management,
business (including prospective business), finances, its customers or
the terms of any of the contracts of the Company which has heretofore
or which may hereafter come to the knowledge of Executive which is not
freely available to the public.
(c) Executive shall not, during the Non-Solicitation Period,
in any way defame the Company or disparage its business capabilities,
products, plans or management to any customer, potential customer,
vendor, supplier, contractor, subcontractor of the Company so as to
affect adversely the goodwill or business of the Company.
(d) Executive covenants and agrees that a breach of these
subparagraphs (a), (b) or (c) would immediately and irreparably harm
the Company and that a remedy at law would be inadequate to compensate
the Company for its losses by reason of such breach and therefore that
the Company shall, in addition to any rights and remedies available
under this Agreement, at law or otherwise, be entitled to any
injunction to be issued by any court of competent jurisdiction
enjoining and restraining Executive from committing any violation of
these subparagraphs (a), (b) or (c), and Executive hereby consent to
the issuance of such injunction.
(e) For purposes of this Section 5 and in consideration of
this Agreement, this non-solicitation agreement has been separately
negotiated and bargained for, and constitutes a substantial portion of
the consideration for this Agreement.
6. Eligibility for Severance Benefits. The Executive shall be eligible
for the benefits described in Paragraph 7 (the "Severance Benefits") if:
(a) during the Term, the Executive has a Termination of
Employment initiated (i) by the Company without Cause, or (ii) by the
Executive for Good Reason, and, in either case, subsections (b) or (c)
do not apply,
(b) during the Term there has been a Change in Control and
during the 31 day period commencing on the first day of the 13th
calendar month following the Change in Control Date (e.g. the period
April 1, 1999 - May 1, 1999, inclusive, for a Change in Control which
is effective in the month of March, 1998), the Executive has a
Termination of Employment initiated by the Executive without Good
Reason, or
(c) during the Term either (i) there has been a Change in
Control and during the two year period commencing on the Change in
Control Date the Executive has a Termination of Employment which is
initiated by the Company without Cause or by the Executive for Good
Reason, or (ii) the Executive has a Termination of Employment initiated
by the Company without Cause or by the Executive for Good Reason
following the commencement of any discussion with a third person that
ultimately results in a Change in Control with such third person within
12 months of the commencement of such discussions (in which case, the
date of such discussion shall be substituted for the Change in Control
Date wherever appropriate, including in the definition of "Good Reason"
and in Paragraph 7 hereof).
7. Severance Benefit. Upon satisfaction of the requirements set forth
in Paragraph 6, and subject to Paragraphs 8 and 11, the Executive shall be
entitled to the following Severance Benefits:
(a) Cash Payment. The Executive shall be entitled to receive
an amount of cash equal to the Benefit Multiplier times the greater of:
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(i) the sum of the Executive's Base Salary as in effect upon
the Termination of Employment, and the greater of
(A) the Executive's Target Bonus as in effect upon
the Termination of Employment or,
(B) the Executive's actual bonus under the Company's
"Annual Incentive Plan" for the year prior to the year of the
Executive's Termination of Employment; or
(ii) the sum of the Executive's Base Salary as in effect on
the Change in Control Date, and the greater of
(A) the Executive's Target Bonus as in effect upon
the Change in Control Date or,
(B) the Executive's actual bonus under the Company's
"Annual Incentive Plan" for the year prior to the Change in
Control Date.
The payment shall be made in a single lump sum within ten days following the
Executive's Termination of Employment.
(b) Long-Term Incentive Award; Equity-Based Compensation. The
Executive's interest under the Company's long-term incentive plans
shall be fully vested. Any and all (i) options, phantom units, and
other awards granted to Executive to purchase Company stock or which is
measured by the current market value of Company stock and (ii)
restricted stock of the Company, owned by the Executive shall be fully
vested.
(c) Continuation of Benefits.
(i) For the Benefit Period, the Executive shall be
treated as if he had continued to be an employee for all
purposes under the Company's Medical Plan, Executive Medical
Reimbursement Plan and Dental Plan. Following this period, the
Executive shall be entitled to receive continuation coverage
under Part Six of Title I of ERISA ("COBRA Benefits") treating
the end of this period as a termination of the Executive's
employment (other than for gross misconduct).
(ii) The Company shall maintain in force, at its own
expense, for the remainder of the Executive's life, the vested
life insurance in effect under the Company's Executive Split
Dollar Life Insurance Plan (as described in Paragraph 4(b)) as
of the Change in Control Date or as of the date of Termination
of Employment, whichever is greater.
(d) Relocation Benefit. If, within the Benefit Period after
the Executive's Termination of Employment, the Executive gives the
Company written notice that he desires to relocate within the
continental United States, the Company will reimburse the Executive for
any reasonable relocation expenses (in accordance with the Company's
general relocation policy for executives as then in effect, or, at the
Executive's election, as in effect on the Change in Control Date) in
connection with such relocation.
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(e) Executive Savings Plus Plan. For the year of the
Executive's Termination of Employment, the Company will make the
contribution to the Executive Savings Plus Plan on behalf of the
Executive that it would have made if the Executive had not had a
Termination of Employment, but in no event less than the percentage
contribution it made for the Executive in the immediately preceding
year (and increased to take account of the additional year of service),
in each case taking account of the Executive's annualized rate of
"Compensation" (as defined in the Executive Savings Plus Plan) and the
percentage of such Compensation that the Executive is contributing to
the Executive Savings Plus Plan, as of the date of Termination of
Employment, and the Company's matching contribution rate for such year
(or, if greater, the preceding year). The portion of the Company's
matching contribution which is based on the preceding year's
contribution percentage shall be contributed to the Executive Savings
Plus Plan on behalf of the Executive immediately upon the Executive's
Termination of Employment and any additional contribution required
shall be paid as soon as the amount is determined.
(f) Executive Deferred Compensation Plan. For the year of the
Executive's Termination of Employment, the Company will make the
contribution to its Executive Deferred Compensation Plan (the "EDC
Plan") that it would have made if the Executive had not had a
Termination of Employment determined based on the Executive's deferral
for such year. At Executive's election, the Company contribution shall
be paid to the Executive immediately upon his Termination of
Employment.
(g) Disability. For the Benefit Period, the Company shall
provide long-term disability insurance benefits coverage to Executive
equivalent to the coverage that the Executive would have had had he
remained employed under the Company's Long-Term Disability Plan and
Supplemental Long-Term Disability Plan applicable to Executive on the
date of Termination of Employment, or, at the Executive's election, the
plan or plans applicable to Executive as of the Change in Control Date.
Should Executive become disabled during such period, Executive shall be
entitled to receive such benefits, and for such duration, as the
applicable plan(s) provide.
(h) Plan Amendments. The Company shall adopt such amendments
to its employee benefit plans and insurance policies as are necessary
to effectuate the provisions of this Agreement. If and to the extent
any benefits under this Paragraph 7 are not paid or payable or
otherwise provided to the Executive or his dependents or beneficiaries
under any such plan or policy (whether due to the terms of the plan or
policy, the termination thereof, applicable law, or otherwise), then
the Company itself shall pay or provide for such benefits.
8. Golden Parachute Gross-Up. If, in the written opinion of a Big 6
accounting firm engaged by either the Company or the Executive for this purpose
(at the Company's expense), or if so alleged by the Internal Revenue Service,
the aggregate of the benefit payments under Paragraph 7 would cause the payment
of one or more of such benefits to constitute an "excess parachute payment" as
defined in Section 280G(b) of the Internal Revenue Code ("Code"), then the
Company will pay to the Executive an additional amount in cash (the "Gross-Up
Payment") equal to the amount necessary to cause the net amount retained by the
Executive, after deduction of any (i) excise tax on the payments under Xxxxxxxxx
0, (xx) federal, state or local income tax on the Gross-Up Payment, and (iii)
excise tax on the Gross-Up Payment, to be equal to the aggregate remuneration
the Executive would have received under Section 7, excluding such Gross-Up
Payment (net of all federal, state and local excise and income taxes), as if
Sections 280G and 4999 of the Code (and any successor provisions thereto) had
not been enacted into law. The Gross-Up Payment provided for in this Paragraph
shall be made within ten (10) days after the termination of Executive's
employment, provided however that if the amount of the payment cannot be finally
determined at the time, the Company shall pay to Executive an estimate as
determined in good faith by the Company of such payments (together
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with interest at the rate provided in section 1274(b)(2)(B) of the Code) as soon
as the amount thereof can be determined but in no event later than the thirtieth
(30th) day after the date of termination. Any dispute concerning the application
of this Paragraph shall be resolved pursuant to Paragraph 10, and if Paragraph
11 applies, any reference in this Paragraph and to Paragraph 7 shall also be
deemed to include a reference to Paragraph 11 as well.
9. Waiver of Other Severance Benefits. The benefits payable pursuant to
this Agreement are in lieu of any other severance benefits which may otherwise
be payable to the Executive upon termination of employment with the Company,
whether or not in connection with a Change in Control (including without
limitation, any benefits to which Executive might otherwise have been entitled
under any employment, change in control, or severance agreement or other
compensation or employee benefit plan to which the Company was a party or which
was assumed by the Company), except those benefits which are to be made
available to the Executive as required by applicable law.
10. Disputes. Any dispute or controversy arising under, out of, in
connection with or in relation to this Agreement shall, at the election and upon
written demand of either party, be finally determined and settled by binding
arbitration in the city of Fort Xxxxx, Arkansas, using a single arbitrator, in
accordance with the Labor Arbitration rules and procedures of the American
Arbitration Association, and judgment upon the award may be entered in any court
having jurisdiction thereof. The arbitrator shall have the power to order
specific performance, mandamus, or other appropriate legal or equitable relief
to enforce the provisions of this Agreement. The Company shall pay all costs of
the arbitration and all reasonable attorney's and accountant's fees of the
Executive in connection therewith.
11. Additional Payments Due to Dispute. Notwithstanding anything to the
contrary herein, and without limiting the Executive's rights at law or in
equity, if the Company fails or refuses to timely pay to the Executive the
benefits due under Paragraphs 7 and/or 8 hereof, then the benefits under
Paragraph 7(a) shall be increased and the benefits under Paragraphs 7(c), 7(d),
and 7(g) shall each be continued by one additional day for each day of any such
failure or refusal of the Company to pay. In addition, any Gross-Up Payment due
under Paragraph 8 shall be increased to take into account any increased benefits
under this Paragraph.
12. No Set-Off. There shall be no right of set-off or counterclaim in
respect of any claim, debt, or obligation against any payment to or benefit for
the Executive provided for in this Agreement.
13. No Mitigation Obligation. The parties hereto expressly agree that
the payment of the benefits by the Company to the Executive in accordance with
the terms of this Agreement will be liquidated damages, and that the Executive
shall not be required to mitigate the amount of any payment provided for in this
Agreement by seeking other employment or otherwise, nor shall any profits,
income, earnings or other benefits from any source whatsoever create any
mitigation, offset, reduction or any other obligation on the part of the
Executive hereunder or otherwise.
14. Waiver of Rights. Executive hereby waives any rights against the
Company, including without limitation any rights under any employment, change in
control, or severance agreement; under any stock option or long-term incentive
plan or any other compensation or employee benefit plan.
15. Non-disclosure of Proprietary Information, Surrender of Records;
Inventions and Patents.
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(a) Proprietary Information. Executive shall not during the
term of employment or at any time thereafter (irrespective of the
circumstances under which Executive's employment terminates), directly
or indirectly use for his own purpose or for the benefit of any person
or entity other than Company, nor otherwise disclose, any proprietary
information, as defined below, to any individual or entity, unless such
disclosure has been authorized in writing by the Company or is
otherwise required by law. For purposes of this Agreement, the term
"proprietary information" shall include, but is not limited to: (a) the
name or address of any client or affiliate of Company or any
information concerning the transactions or relations of any client or
affiliate of Company with Company or any of its shareholders; (b) any
information concerning any product, service, methodology, analysis,
presentation, technology or procedure employed by Company but not
generally known to its clients or competitors, or under development by
or being tested by Company but not at the time offered generally to
clients; (c) any information relating to Company's computer software,
computer systems, pricing or marketing methods, capital structure,
operating results, borrowing arrangements or business plans; (d) any
information which is generally regarded as confidential or proprietary
in any line of business engaged in by Company; (e) any information
contained in any of Company's written or oral policies and procedures
or employee manuals; (f) any information belonging to clients or
affiliates of Company which Company has agreed to hold in confidence;
(g) any inventions, innovations or improvements covered by subsection
15(c) below; (h) any other information which Company has reasonably
determined to be confidential or proprietary; and (i) all written,
graphic, electronic and other material relating to any of the
foregoing. Information that is not novel or copyrighted or patented may
nonetheless be proprietary information. Proprietary information,
however, shall not include any information that is or becomes generally
known to the industries in which Company competes through sources
independent of Company or Executive or through authorized publication
by Company to persons other than Company's employees.
(b) Confidentiality and Surrender of Records. Executive shall
not during the term of employment or at any time thereafter
(irrespective of the circumstances under which Executive's employment
terminates), except as required by law, directly or indirectly give or
disclose any "confidential records" (as hereinafter defined) to, or
permit any inspection or copying of confidential records by, any
individual or entity other than in the ordinary course and scope of
such individual's or entity's employment or retention by Company, nor
shall he use or retain any of the same following termination of his
employment. Executive shall promptly return to Company all
"confidential records" upon the termination of Executive's employment
with Company. For purposes hereof, "confidential records" means all
correspondence, memoranda, files, analyses, studies, reports, notes,
documents, manuals, books, lists, financial, operating or marketing
records, computer software, magnetic tape, or electronic or other media
or equipment of any kind which may be in Executive's possession or
under his control or accessible to him which contain any proprietary
information as defined in subsection 15(a) above. All confidential
records shall be and remain the sole property of Company during the
term of employment and thereafter.
(c) Inventions, Patents, and Copyrights. All inventions,
innovations or improvements in Company's method of conducting its
business (including policies, procedures, products, improvements,
software, ideas and discoveries, whether or not patentable or
copyrightable) conceived or made by Executive, either alone or jointly
with others, during the term of employment belong to Company. Executive
will promptly disclose in writing such inventions, innovations or
improvements to Company and perform all actions reasonably requested by
Company to establish and confirm such ownership by Company, including,
but not limited to, cooperating with and assisting Company in obtaining
patents and copyrights for Company in the
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United States and in foreign countries. Any patent or copyright
application filed by Executive within a year after termination of his
employment hereunder shall be presumed to relate to an invention or
work of authorship which was made during the term of employment unless
Executive can provide conclusive evidence to the contrary.
16. Successors; Binding Agreement.
(a) This Agreement shall not be terminated by the voluntary or
involuntary dissolution of the Company or by any merger or
consolidation where the Company is not the surviving corporation, or
upon any transfer of all or substantially all of the Company's assets,
or any other Change in Control. The Company shall require any
purchaser, assign, surviving corporation or successor (whether direct
or indirect, by purchase, merger, consolidation, reorganization or
otherwise) to all or substantially all of the business and/or assets of
the Company, by agreement in form and substance satisfactory to the
Executive, expressly to assume and agree to perform this Agreement in
the same manner and to the same extent the Company would be required to
perform if no such succession had taken place. This Agreement shall be
binding upon and inure to the benefit of the Company and any purchaser,
assign, surviving corporation or successor to the Company, including
without limitation any persons acquiring directly or indirectly all or
substantially all of the business and/or assets of the Company whether
by purchase, merger, consolidation, reorganization, transfer of all or
substantially all of the business or assets of the Company, or
otherwise (and such purchaser, assign, surviving corporation or
successor shall thereafter be deemed the "Company" for the purposes of
this Agreement), but this Agreement shall not otherwise be assignable,
transferable or delegable by the Company.
(b) This Agreement shall inure to the benefit of and be
enforceable by the Executive's personal or legal representatives,
executors, administrators, successors, heirs, distributees and/or
legatees.
(c) This Agreement is personal in nature and neither of the
parties hereto shall, without the consent of the other, assign,
transfer or delegate this Agreement or any rights or obligations
hereunder except as expressly provided in this Section 16. Without
limiting the generality of the foregoing, the Executive's right to
receive payments hereunder shall not be assignable, transferable or
delegable, whether by pledge, creation of a security interest or
otherwise, or otherwise subject to anticipation, alienation, sale,
encumbrance, charge, hypothecation, or set-off in respect of any claim,
debt, or obligation, or to execution, attachment, levy or similar
process, or assignment by operation of law, other than by a transfer by
his will or by the laws of descent and distribution. Any attempt,
voluntarily or involuntarily, to effect any action prohibited by this
Paragraph shall be null, void, and of no effect.
17. Notices. Any notice, request, claim, demand, document and other
communication hereunder to any party shall be effective upon receipt (or refusal
of receipt) and shall be in writing and delivered personally or sent by telex,
telecopy, or certified or registered mail, postage prepaid, or other similar
means of communication, as follows:
(a) If to the Company, addressed to its principal executive
offices to the attention of its Secretary;
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(b) If to the Executive, to him at the address set
forth below under the Executive's signature, or at any such other
address as either party shall have specified by notice in writing to
the other.
18. Amendments; Waivers. This Agreement may not be modified, amended,
or terminated except by an instrument in writing, signed by the Executive and by
a duly authorized representative of the Company. By an instrument in writing
similarly executed, either party may waive compliance by the other party with
any provision of this Agreement that such other party was or is obligated to
comply with or perform; provided, however, that such waiver shall not operate as
a waiver of, or estoppel with respect to, any other or subsequent failure. No
failure to exercise and no delay in exercising any right, remedy, or power
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, or power hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, or power provided
herein or by law or in equity.
19. Entire Agreement. This Agreement sets forth the entire agreement of
the parties hereto in respect of the subject matter contained herein and
supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto. The parties further
intend that this Agreement shall constitute the complete and exclusive statement
of its terms and that no extrinsic evidence whatsoever may be introduced in any
judicial, administrative, or other legal proceeding involving this Agreement.
20. Severability; Enforcement. If any provision of this Agreement, or
the application thereof to any person, place, or circumstance shall be held by a
court of competent jurisdiction to be invalid, unenforceable or void, the
remainder of this Agreement and such provisions as applied to other persons,
places and circumstances shall remain in full force and effect.
21. Indemnification. The Company shall indemnify, defend, and hold the
Executive harmless from and against any liability, damages, costs, or expenses
(including attorney's fees) in connection with any claim, cause of action,
investigation, litigation, or proceeding involving him by reason of his having
been an officer, director, employee, or agent of the Company, unless it is
judicially determined, in a final, nonappealable order that the Executive was
guilty of gross negligence or willful misconduct. The Company also agrees to
maintain adequate directors and officers liability insurance for the benefit of
Executive for the term of this Agreement and for at least three years,
thereafter, to the extent such insurance is reasonably available and provided to
all executives of the Company.
22. ERISA. This Agreement is pursuant to the Company's Severance Plan
for Executives (the "Plan") which is unfunded and maintained by the Company
primarily for the purpose of providing deferred compensation for a select group
of management or highly compensated employees. The Plan constitutes an employee
welfare benefit plan ("Welfare Plan") within the meaning of Section 3(1) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"). Any
payments pursuant to this Agreement which could cause the Plan not to constitute
a Welfare Plan shall be deemed instead to be made pursuant to a separate
"employee pension benefit plan" within the meaning of Section 3(2) of ERISA as
to which the applicable portions of the document constituting the Plan shall be
deemed to be incorporated by reference. None of the benefits hereunder may be
assigned in any way.
23. Governing Law. This Agreement shall be interpreted, administered
and enforced in accordance with the law of the State of Arkansas, except to the
extent pre-empted by Federal law.
The parties have duly executed this Agreement to be effective as of the
date first written above.
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XXXXXXX ENTERPRISES, INC. EXECUTIVE
By:
--------------------------------------- --------------------------------
Xxxxx X. Xxxxx Xxxxxxx X. Xxxx
Chairman and Chief Executive Officer 000 Xx. Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
By:
--------------------------------------
Xxxx X. XxxXxxxxx
Vice President, Deputy General Counsel
and Assistant Secretary
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