1
EXHIBIT 10.18
EMPLOYMENT AGREEMENT AND NON-COMPETITION AGREEMENT
EMPLOYMENT AGREEMENT AND NON-COMPETITION AGREEMENT dated December 31,
1996 by and between EYE CARE CENTERS OF AMERICA, INC., a Texas corporation (the
"Company") and ▇▇▇▇ ▇▇▇▇ ("Executive").
WHEREAS, the Company desires to employ Executive and provide severance
pay in the event of termination without case as provided in this Agreement;
WHEREAS, the Company has adopted an enhanced Annual Incentive Plan for
Key Management in which Executive shall be permitted to participate upon
execution of this Agreement; and
WHEREAS, the Company intends to convey confidential information to
facilitate the employment of Executive; and WHEREAS, the Company seeks to
protect its legitimate business interests with regard to the conveyance of
confidential information to Executive in the event of the termination of
Executive's employment for any reason; and
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the parties
agree as follows:
1. Term of Employment. This Agreement shall commence on December 31,
1996 and shall terminate on December 31, 1997 (the "Employment Term"), except as
otherwise provided in this Agreement. The Company, at its sole option and
discretion, may extend the term of this Agreement until December 31, 1998, upon
written notice to Executive on or before November 30, 1997.
2. Duties. During the Employment Term, Executive shall devote
substantially all of his business time and best efforts to the performance of
this duties hereunder and shall not engage in any other business, profession or
occupation for compensation or otherwise.
2
3. Base Salary. During the Employment Term, the Company shall pay
Executive a base salary (the "Base Salary") at the annual rate of not less than
$141,827, payable in arrears, in accordance with the usual payment practices of
the Company. Executive's Base Salary shall be subject to annual review for
possible increase, and the Company's sole discretion, at the end of February or
in March of each year during the Employment Term.
4. Incentive Compensation. The Executive shall be permitted to
participate in the Company's Annual Incentive Plan for Key Management and his
rights are governed solely by the terms of the Plan as it may be in effect from
time to time.
5. Stock Options. The Executive shall be permitted to participate in
the Company's Executive Stock Option Plan, and his rights are governed solely by
the terms of that Plan as it may be in effect from time to time, and his
Executive Stock Option Agreement(s) as in effect from time to time.
6. Employee Benefits. During the Employment Term, Executive shall be
provided employee benefits as shall be maintained by the Company from time to
time on the same basis as the other similarly situated executives of the
Company.
7. Business Expenses and Perquisites. The Company shall reimburse such
of Executive's travel, entertainment and other business expenses as are
reasonably and necessarily incurred by Executive during the Employment Term in
the performance of his duties hereunder, in accordance with the Company's
policies as in effect from time to time. During the Employment Term, Executive
shall be furnished with a car allowance in accordance with the Company's policy
as in effect from time to time.
- 2 -
3
8. Termination. Notwithstanding Section 1, this Agreement shall
terminate automatically upon the death or disability of Executive.
9. Severance Payments on Termination.
(a) Without Cause by the Company. If Executive's employment is
terminated by the Company during the Employment Term without "cause,"
Executive shall receive in lieu of any other compensation, benefits or
payments, continued periodic payment of Base Salary for nine months
following date of termination. "Cause" shall be defined as set forth in
Section 4(f)(i)(A) through (E) of the Eye Care Centers of America
Executive Stock Option Plan effective in September, 1996. Severance pay
shall be forfeited and will cease immediately upon Executive entering
into competition as defined in Section (10)(a)(i) of this Agreement;
however, the Company's right to enforce the non-competition provisions
of this Agreement shall not end upon the Executive's forfeiture by
entering into competition.
(b) Disability. Upon termination of Executive's employment
hereunder for disability, Executive shall receive his Base Salary
through the date on which Executive is first eligible to receive
payment of disability benefits under the Company's employee benefit
plans as then in effect, and if no such plan is in effect, through the
month ending 180 days after onset of disability. "Disability" as used
herein shall mean the inability of Executive, notwithstanding any
reasonable accommodation the Company may make, to perform his customary
duties due to any condition of physical or mental illness, injury,
disease or other incapacity, which condition has existed or may
reasonably be expected to continue for six consecutive months or for an
aggregate of
- 3 -
4
six months in any 24 consecutive months. Any question as to the
existence of the Disability of Executive as to which Executive and the
Company cannot agree shall be determined in writing by a qualified
independent physician mutually acceptable to Executive and the Company.
If Executive and the Company cannot agree as to a qualified independent
physician, each shall appoint such a physician and those two physicians
shall select a third who shall make such determination in writing. The
determination of disability made in writing to the Company and
Executive shall be final and conclusive for all purposes of the
Agreement.
(c) Death. Upon termination of Executive's employment
hereunder for death, Executive shall receive his Base Salary at the
rate in effect at the time of Executive's death through the end of the
month in which his death occurs.
(d) Executive shall not be entitled to any payment or benefit
upon termination of his employment, except for payments of Base Salary
expressly provided in this Section 9, any rights under the Company's
Executive Stock Option Plan and Agreement(s), and any statutory rights
such as COBRA.
10. Non-Competition. Executive acknowledges and recognizes the highly
competitive nature of the businesses of the Company. Executive and the Company
agree that the Company will, in the course of Executive's employment, provide
Executive with highly confidential and sensitive information, which, if revealed
to the Company's competitors, would provide those competitors with an unfair
advantage over the Company. The Parties agree that the Company would not divulge
this information to Executive were it not for
- 4 -
5
Executive's promise not to disclose this information as set forth in Section 9
of this Agreement. Accordingly, Executive agrees as follows:
(a)(i) During the Employment Term of this Agreement, including
any extension(s), and thereafter while receiving any severance pay
under Section 9(a) of this Agreement, Executive shall not enter into
any competitive endeavors with and shall not undertake any commercial
activity which is in direct competition with the Company, including
becoming an employee, owner, officer, agent or director of any firm or
person in any geographic areas in Texas, Ohio, or Arkansas, which
engages in optical retailing; and
(ii) Except in the event of a termination of employment by the
Company during the Employment Term with or without cause, Executive
shall not without the Company's written consent, for the longer of (a)
one year following termination of his employment or (b) until December
31, 1998, serve as an employee, owner, officer, agent or director of
any firm or person in any geographic areas in Texas, Ohio, or Arkansas
which engages in optical retaining. Nothing in this Section 10(a) shall
prohibit Executive from owning passive investments of not more than 1%
of the outstanding shares of any company or entity listed or traded on
a national securities exchange or in an over-the-counter securities
market.
(b) For the longer of (i) one year following termination of
his employment, with or without cause, including any termination upon
or after expiration of the Employment Term, and (ii) until December 31,
1998, Executive shall not directly or indirectly induce any employee of
the Company to engage in any activity in which
- 5 -
6
Executive is prohibited from engaging by Section 10(a)(i) or (ii) above
or to terminate his employment with the Company, and shall not directly
or indirectly employ or offer employment to any such person unless such
person shall have ceased to be employed by the Company and such
cessation of employment shall have occurred at least 12 months prior
thereto.
11. Confidentiality. Executive shall not, during the Employment term
(including extensions) or thereafter, without the prior written consent of the
Company, use, divulge, disclose or make accessible to any other person, firm,
partnership or corporation any Confidential Information, as hereinafter defined,
except while employed by the Company in the business of and for the benefit of
the Company or when required to do so by a court of law, by any governmental
agency having supervisory authority over the business of the Company or by any
administrative body or legislative body, including a committee thereof, with
jurisdiction to order him to divulge, disclose or make accessible such
Information; provided, that in the case of any such requirement or purported
requirement Executive shall provide written notice to the Company prior to
producing such Information, which notice shall be given at least 10 days prior
to the producing of such Information, if practicable, so that the Company may
seek a protective order or other appropriate remedy. For purposes of this
Agreement, "Confidential Information" shall mean all non-public information
concerning the business of the Company, including, without limitation,
information relating to its product development, customer lists, relationships
with customer, financial information, business and marketing plans and
strategies, operating policies and manuals, and current or prospective
transactions, except for specific items which become publicly available
information other than
- 6 -
7
through a breach by Executive of his fiduciary duty or any confidentiality
agreement, including without limitation this Section 11. Executive agrees that
upon termination of his employment hereunder for any reason, he shall return to
the Company immediately all memoranda, books, papers, plans, information,
letters and other data, and all copies thereof or therefrom, in any way relating
to the business of the Company, except that he may retain personal notes,
notebooks and diaries. Executive further agrees that he shall not retain or use
for his account at any time any trade name, trademark, service ▇▇▇▇ or other
proprietary business designation used or owned in connection with the business
of the Company.
12. Specific Performance and Other Remedies. Executive acknowledges and
agrees that the Company has no adequate remedy at law for a breach or threatened
breach of any of the provisions of Sections 10(a)(i), 10(a)(ii), 10(b) or 11
and, in recognition of this fact, Executive agrees that, in the event of such a
breach or threatened breach, in addition to any remedies at law, the Company,
without posting any bond, shall be entitled to obtain equitable relief in the
form of specific performance, temporary restraining order, temporary or
permanent injunction or any other equitable remedy which may then be available.
Nothing in this Agreement shall be construed as prohibiting the Company from
pursuing any other remedies at law or in equity that it may have or any other
rights that it may have under any other agreement.
13. Miscellaneous.
(a) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas without
reference to principles of conflict of laws.
- 7 -
8
(b) Entire Agreement/Amendments. This Agreement contains the
entire understanding of the parties with respect to the subject matter
hereof, and supersedes any prior employment agreements between the
Company and Executive. This Agreement may not be altered, modified, or
amended except by written instrument signed by the parties hereto.
(c) No Waiver. The failure of a party to insist upon strict
adherence to any term of this Agreement on any occasion shall not be
considered a waiver of such party's rights or deprive such party of the
right thereafter to insist upon strict adherence to the term or any
other term of this Agreement. Any such waiver must be in writing and
signed by Executive or any authorized officer of this Company, as the
case may be.
(d) Severability. It is expressly understood and agreed that
although Executive and the Company consider the restrictions contained
in Sections 10 and 11 to be reasonable, if a final judicial
determination is made by a court of competent jurisdiction that the
time or territory restrictions in Section 10 or any other restriction
contained in Section 10 or 11 is an unenforceable restriction against
Executive, such provisions shall not be rendered void but shall be
deemed amended to apply to such maximum time and territory, if
applicable, or otherwise to such maximum extent as such court may
judicially determine or indicate to be enforceable. In the event that
any provision of this Agreement shall nevertheless be or become
invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions of this
Agreement shall not be affected thereby.
- 8 -
9
(e) Assignment. This Agreement shall not be assignable by
Executive. This Agreement shall inure to the benefit of and be binding
upon the personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees of the parties
hereto.
(f) Communications. For the purpose of this Agreement, notices
and all other communications provided for this Agreement shall be in
writing and shall be deemed to have been duly given when faxed or
delivered or two business days after being mailed by the United States
Registered or certified mail, return receipt requested, postage
prepaid, addressed to the Company at its principal place of business,
and to Executive at his last known place of business or his residence.
(g) Withholding Taxes. The Company may withhold from any and
all amounts payable under this Agreement such Federal, state and local
taxes as may be required to be withheld pursuant to any applicable law
or regulation.
(h) Survivorship. The respective rights and obligations of the
parties hereunder shall survive any termination of Executive's
employment to the extent necessary to the agreed preservation of such
rights and obligations.
(i) Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.
(j) Headings. The headings of the sections contained in this
Agreement are for convenience only and shall not be deemed to control
or affect the meaning or construction of any provision of this
Agreement.
- 9 -
10
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
Eye Care Centers of America, Inc.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President/Chief Executive Officer
/s/ ▇▇▇▇ ▇▇▇▇
-------------------------------------------
▇▇▇▇ ▇▇▇▇
Title: Senior Vice President of
Marketing & Real Estate
- 9 -
