EXHIBIT (D)
FORM OF
EMPLOYMENT AGREEMENT
[DATE]
THIS AGREEMENT is by and between HIA, INC., a New York
corporation, located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
hereinafter referred to as "Corporation," and -------------------------
-
----, SSN --------------------------, hereinafter referred to as
"Employee."
The Employee desires to be an employee of the Corporation, and
the
Corporation desires to employ the Employee under the terms of this
Agreement. The Employee and the Corporation desire to set forth their
respective rights, obligations and duties in this Agreement.
Therefore, in consideration of the mutual covenants contained
herein, the parties hereto agree as follows:
ARTICLE 1
EMPLOYMENT DUTIES AND RESPONSIBILITIES
Section 1.1 Employment. The Corporation hereby agrees to
continue to employ the Employee as a Director of the Corporation and
other such officerships, duties and responsibilities as a majority of
the Board of Directors might direct. However, these officerships,
duties and responsibilities shall not be reduced below the level of
officership the Employee holds at the signing of this Agreement with
the Corporation and its subsidiaries. The Employee accepts such
employment and agrees to abide by the Articles of Incorporation, Bylaws
and decisions of the Board of Directors of the Corporation with respect
to all matters not conflicting with the terms of this Agreement.
Section 1.2 Director of the Corporation. The Employee shall,
as elected, serve as a Director of the Corporation. Employee shall
continue to serve as a Director of the Corporation until such a time
his shares of Stock in HIA, Inc., are completely paid for by the
Corporation according to Section 3.7 Purchase of Terminated Employee's
Stock, of this agreement, or for five years after termination,
whichever is longer.
Section 1.3 Duties and Responsibilities. The Employee is
employed pursuant to the terms of this Agreement and agrees to devote
all time and energies necessary to perform his duties under this
Agreement. The Employee shall perform such duties as may be determined
and assigned to him by the Board of Directors of the Corporation.
Section 1.4 Working Facilities. The Employee shall be
furnished with facilities and services suitable to the position and
adequate for the performance of the duties of the Employee under this
agreement.
Section 1.5 Expenses. The Employee is authorized to incur
reasonable expenses for promoting the business of the Corporation,
including expenses for entertainment, travel and similar items. The
Corporation will reimburse the Employee for all such expenses upon the
presentation by the Employee, from time to time, of an itemized account
of such expenditures.
ARTICLE II
COMPENSATION
Section 2.1 Basic Salary. The Corporation shall pay to the
Employee a Basic Salary of -------------- dollars ($-----------) per
year beginning -------------, which shall be payable in installments
twice monthly during the term of this agreement.
As Chairman of the Board, Employee's Salary will be increased $--
------ per annum on top of the Basic Salary stated above.
The Basic Salary amount shall be adjusted for raises in salary by
action of the Board of Directors, and by compliance with the terms
of Article II, Section 2.2 Required Salary Increases of this Agreement.
Section 2.2 Required Salary Increases. On ----------- and on
each successive December first date until the expiration of this
Agreement, Employee's salary shall be increased in a minimum
amount equal to five percent (5%) of the annual salary then in
effect for the Employee. In addition to the five (5%) increase
referenced above, the Employee's salary shall be further increased
by a percentage equal to any cost of living increases for the
preceding twelve month period (in no case will the Employee's
Salary be decreased because the Cost of Living Index decreases).
This component of salary increase (over and above the 5%
increase) shall be calculated by multiplying the percentage
increases in the cost of living by the annual salary then in effect
for the Employee. The percentage increase in the cost of living shall
be computed by reference to the Consumer Price Index-Seasonally
Adjusted United States - City Average for all items for all Urban
Consumers published monthly in the "Monthly Labor Review" of the Bureau
of Labor Statistics of the United States Department of Labor ("CPI-U").
If the CPI-U is discontinued, the "Consumer Price Index-Seasonally
Adjusted US City Average for All Items for Urban Wage Earners and
Clerical Workers (1967=100), "published monthly in the monthly" Labor
Review" by the Bureau of Labor Statistics of the United States
Department of Labor (CPI-W), shall be used for computing this component
of salary increases. If the CPS-W is discontinued, comparable
statistics on the purchasing power of the Consumer Dollar published by
the Bureau of Labor Statistics of the United States Department of Labor
shall be used for making this computation. If the Bureau of Labor
Statistics shall no longer maintain statistics on the purchasing power
of the consumer dollar, comparable statistics published by a reasonable
financial periodical or recognized authority selected by the Employee
shall be used for making this cost of living computation.
Section 2.3 Directors Compensation.
A Director's Compensation beginning ninety (90) days after his
termination as a full time employee, shall be 33% of his salary prior
to termination and a 3.5% Cash Bonus as outlined in Section 2.4 Bonus
and Travel Incentives. The Corporation will continue Health and
Disability insurance coverages at no cost to the Director. The Board
of Directors shall meet once per calendar quarter or as determined by a
majority of the then present Board. The Corporation shall reimburse
all reasonable expenses connected with traveling to and attending the
Board of Directors Meetings.
However, if a Director goes into direct competition with the
Corporation, this would be cause for immediate dismissal from the Board
of Directors without further Director's compensation.
Section 2.4 Bonus and Travel Incentives. Effective ----------
-----, Employee will be eligible to receive a Cash Bonus from
Corporation based on the following criteria:
A. Cash Bonus period will begin 12/1 of each year and end 11/30
of the succeeding year to coincide with Corporation's fiscal year.
B. Cash Bonus will be calculated as 7-1/2% of net pre-tax income
of Corporation, its subsidiaries and branches. Cash Bonus base will be
calculated before defined contribution plan(s) contributions by the
Corporation.
C. Cash Bonus will be paid in cash or Check as directed by
Employee.
D. The Cash Bonus will be paid no sooner than 15 days after the
Cash Bonus amount is determined to be correct by the auditors and not
later than 60 days after this audit.
E. Applicable Employee withholding taxes will be deducted from
the Cash Bonus.
F. In case of voluntary or involuntary termination, Cash Bonus
will be prorated after final audit according to days of service as
compared to a total of 365 days per year.
G. As an incentive for executives to take time away from the
business, an annual Travel Allowance will be paid to Employee during
December of each year of -------------- dollars ($---------). Normal
withholding taxes will be deducted from this amount.
Section 2.5 Profit Sharing/Retirement Plans. In addition to
the remuneration provided hereinabove, and except as otherwise
specifically provided elsewhere in this Agreement, Employee shall be
entitled to participate fully in any and all Corporation profit sharing
and/or retirement plans, protective insurance coverage, holidays and
other fringe benefits in accordance with the Corporation's health and
disability compensation plans and policies for salaried employees as
the same are from time to time amended. In the event termination of
Employee's employment occurs, pursuant to Section 3.3 hereof
(Termination by the Employee Without Cause), employee's participation
in retirement plans, protective health and life insurance coverage
shall be provided at the Corporation's cost according to Section 1.2
and 2.3.
Section 2.6 Automobile. In addition to the remuneration
provided hereinabove, the Corporation shall acquire for the Employee an
automobile for the exclusive use of Employee. Said automobile shall be
provided at a cost to the Corporation of not more than -------------
dollars ($-------) per month (for --------) lease or installment
payments. This lease or installment amount may be adjusted upward by
six (6%) percent per year to cover the inflation of the cost of
automobiles. The Corporation shall pay all reasonable or necessary
operating and maintenance expenses pertaining to the automobile,
including but not limited to, such automobile insurance coverage, with
said companies, in such amounts and such terms, conditions as shall be
acceptable to the Employee. The Corporation shall pay such expenses
either by reimbursement to the Employee for out-of-pocket costs or by
direct third party payment, in any such case, however, only upon
presentation to the Corporation of an itemized accounting of such
expenses. Upon termination of Employee, the automobile will be sold to
Employee free of encumbrances for twenty-five percent (25%) of the
automobile's adjusted present dealer's blue book value.
ARTICLE III
TERM OF EMPLOYMENT AND TERMINATION
Section 3.1 Term. This Agreement shall be for a period of
five (5) years, commencing on its effective date ------------- and
ending ----------, subject, however, to termination during such period
as provided in this Agreement.
This Agreement shall be renewed automatically for succeeding
periods of one year on the same terms and conditions as contained in
this Agreement unless the Employee shall, at least 30 days prior to the
expiration of any one year period, give written notice of the intention
not to renew this Agreement.
Section 3.2 Termination by the Corporation Without Cause. The
Board of Directors, without cause, may terminate this Agreement at any
time upon 30 days' written notice to the Employee. In such event, the
Employee shall be paid the compensation set forth herein and be
provided
the benefits set forth herein for the remainder of the five-year term
(from the date of termination to --------------).
Section 3.3 Termination by the Employee Without Cause. The
Employee, without cause, may terminate this Agreement upon 30 days'
written notice to the Corporation. In such event, the Employee shall
continue to render the services required under this Agreement and shall
be paid the compensation set forth in this Agreement up to the date of
the termination. If this Agreement is terminated by the action of the
Employee under the terms herein provided or if Employee's employment is
not renewed on mutually acceptable terms and conditions on or before
the
expiration date of this agreement, Employee shall be entitled to
severance pay equal to a minimum of six months salary at the rate in
effect as of the date of termination, and the payment thereof, less
such
amounts as are required by law to be withheld and deducted, shall be
paid over three equal monthly installments to Employee with final
payment within three months of termination.
Section 3.4 Termination With Cause. The Board of Directors
of the Corporation may terminate the Employee at any time without
notice by reason of misconduct as an Employee of the Corporation. For
purposes of this Agreement, "misconduct" includes, but is not limited
to, fraudulent activities, knowingly misappropriating funds or property
of the Corporation, dishonesty, willful neglect, misfeasance, and
criminal acts. Misconduct shall be determined in good faith by the
Corporation, and may be the subject of review through the arbitration
provisions provided for in Article V of this Agreement.
Section 3.5 Termination Upon Death of Employee. In addition
to any other provision relating to termination, this Agreement is
terminated in the event of the Employee's death. In this case all
provisions of Section 2.4, 2.6, 2.6, 3.3 (as pertains to Severance Pay)
and 3.7 of this Agreement will apply to his estate. All compensation
and other benefits provided for herein, shall in the event of
Employee's death, be paid and provided to Employee's Wife, ------------
--, or to any person or persons designated in writing by Employee at a
later date as the beneficiary thereof, but in the event Employee fails
to so designate a beneficiary, and his designated beneficiary is
deceased, then to Employee's estate.
Section 3.6 Termination Upon Sale or Dissolutions of
Business.
The Board of Directors may terminate this Agreement upon 10 days'
notice to the Employee upon any of the following events:
A. The sale by the Corporation of substantially all of its assets
to a single purchaser or to a group of associated purchasers;
B. The sale, exchange, or other disposition in one transaction,
of two-thirds of the outstanding corporate shares of HIA, Inc.;
C. A bona fide decision by the Shareholders of HIA, Inc., to
terminate the operations of the Corporation and liquidate its assets;
or
D. The merger or consolidation of the Corporation in a
transaction in which the Shareholders of HIA, Inc., receive less than
50% of the outstanding voting shares of the new or continuing company.
In the event of any termination under this Section 3.6, the
Employee shall be paid the compensation set forth herein and be
provided the benefits set forth herein for one year from the date of
such event.
Section 3.7 Purchase of Terminated Employer's Stock. In the
event of any termination of this Agreement, the Corporation agrees to
purchase any and all stock interest in HIA, Inc., held by Employee.
The purchase price for each of the shares purchased from terminated
Employee/Shareholder shall be the greater of the book value of such
shares, plus the per share net profit average over the last three years
prior to termination, or the fair market value of such shares as shall
be determined by Employee/Shareholder and the Corporation. If the
Corporation and the Employee/Shareholder fail to agree upon the fair
market value of each of the shares, then the value of such shares shall
be determined by arbitration in accordance with the arbitration
procedures set forth herein.
The following terms shall apply to the purchase and sale of any
shares of stock of HIA, Inc., stock pursuant to this Section:
A. Downpayment. 33% of the purchase price shall be paid by the
Corporation in cash to the terminating Employee/Shareholder within ten
days of said termination.
B. Payment of Balance. The balance of the purchase price shall
be paid by the Corporation to the Employee/Shareholder in eight (8)
consecutive quarterly installments of principal and interest, the first
installment to be due ninety days after the date of downpayment.
C. Promissory Note. This obligation shall be evidenced by a
negotiable promissory note to the order of the terminating
Employee/Shareholder providing for:
i. Interest at the rate of 10% per year on the unpaid
balance;
ii. The right of prepayment without penalty;
iii. Default and acceleration of entire unpaid balance in
the event of failure to pay principal and interest for
more than 30 days after the due date.
ARTICLE IV
DISABILITY AND ILLNESS
Section 4.1 Disability and Salary Continuation.
A. Definition of Disability. For purrposes of this Agreement,
the terms "totally disabled," "disabled" and "disability" shall mean
continuous disability as defined in, and for the period necessary to
qualify for, benefits under any disability income insurance policies
paid for by the Corporation on the life of the Employee.
If no disability insurance is in effect on the life of the
Employee, the terms "totally disabled," "disabled" and "disability"
shall mean continuous disability which prevents the Employee from
performing his normal duties in the Corporation pursuant to this
Agreement as shall be determined by two physicians, one designated by
the Corporation and the other by the disabled Employee. If these two
physicians cannot agree on whether the Employee is disabled within the
meaning of this Section, they shall appoint a third physician and the
opinion of the majority shall be final, binding and conclusive. The
cost of all examining physicians shall be a cost to the Corporation and
not to the Employee.
B. Salary Continuation. If the Employee becomes totally
disabled during the term of this Agreement, his full salary shall be
continued for a period of time not to exceed 24 consecutive months or
for the period of time for which he remains totally disabled, whichever
is shorter.
If the Corporation pays premiums on a disability income insurance
policy on the life of the Employee, then any proceeds paid to the
Employee by reason of disability under such disability income insurance
policy shall be offset against salary continuation payments due from
the Corporation.
After 24 months of continued disability, the Employee shall be
considered voluntarily terminated as per Section 3.3 Termination by
Employee Without Cause.
ARTICLE V
ARBITRATION
Section 5.1 Agreement to Arbitrate Disputes. The parties
agree to submit all claims, disputes and other controversies between
them arising out of this Agreement or the employment arrangement
contemplated to arbitration in accordance with the provisions below and
the Colorado Uniform Arbitration Act of 1975 or any amendments thereto
applicable upon the date of initiation of arbitration proceedings.
Section 5.2 Initiation of Arbitration. Arbitration pursuant
to this Agreement may be initiated by either party upon written demand,
mailed certified mail, return receipt requested, to the other party.
Such demand shall briefly set forth the nature of the claim, dispute or
controversy and the relief requested. The party upon whom a demand for
arbitration has been made may, in writing and within twenty (20) days
following receipt of the demand, set forth any counter-demand he or it
may have against the other party. Such counter-demand shall likewise
briefly set forth the nature of the claim, dispute or controversy and
the relief requested and be mailed to the other party by certified
mail, return receipt requested. Neither party shall be required to
make a written answer to any demand or counter-demand.
Section 5.3 Appointment of Arbitrator(s). Within thirty (30)
days following the date upon which the arbitration demand was mailed to
the other party, the Corporation and the Employee shall jointly appoint
an arbitrator agreeable to both of them.
If the Corporation and the Employee cannot agree upon an
arbitrator mutually acceptable to them, each party shall designate an
arbitrator and the two arbitrators so selected shall, within thirty
(30) days following the date upon which the last of the arbitrators is
selected, designate a third arbitrator. All three arbitrators shall be
present at all hearings and participate in deliberations, but the
decision of the majority of the arbitrators will be final and binding.
Section 5.4 Place of Hearings. Arbitration hearings shall be
conducted at a place mutually agreeable to the parties and the
arbitrators at Denver, Colorado, unless the parties and the arbitrators
otherwise mutually select a different place for the hearings or any
portion of the hearings.
Section 5.5 Attendance at Hearings. Arbitration hearings
shall be scheduled by the arbitrator(s) at the earliest date mutually
convenient to the arbitrators and the parties. Notice of such hearing
dates shall be given in writing by certified mail, return receipt
requested, to each party. Arbitration hearings may proceed in the
absence of any party if notice of the proceedings has been given to
such party.
Section 5.6 Awards. The arbitrator(s) shall make his or their
award in writing and within thirty (30) days after completion of the
arbitration hearings. Copies of the award shall be mailed to each of
the parties and their attorneys, if any, by certified mail, return
receipt requested.
The award entered by the arbitrator(s) shall be final and binding
upon the parties to the extent and in the manner provided by the
Colorado Uniform Arbitration Act of 1975, as amended.
Section 5.7 Venue for Court Proceedings. Any court
proceedings relative to these arbitration provisions shall be initiated
and conducted in the District Court in and for the City and County of
Denver and State of Colorado.
Section 5.8 Effect of Pendency of Arbitration Proceedings. No
party shall be considered in default with respect to any obligation
under the terms of this Agreement which is the subject matter of any
pending arbitration proceedings but the pendency of such proceedings
shall not otherwise affect the other rights and obligations of the
parties to this Agreement.
Section 5.9 Exception. This Article shall not apply with
respect to any action which the Corporation may wish to take pursuant
to
Article V of this Agreement.
ARTICLE VI
GENERAL MATTERS
Section 6.1 Colorado Law. This Agreement shall be governed by
the laws of the State of Colorado and shall be construed in accordance
therewith.
Section 6.2 No Waiver. No provision of this Agreement may be
waived except by an agreement in writing signed by the waiving party.
A waiver of any term or provision shall not be construed as a waiver
of
any other term or provision.
Section 6.3 Amendment. This Agreement may be amended, altered
or revoked at any time, in whole or in part, by filing with this
Agreement a written instrument setting forth such changes, signed by
all of the parties.
Section 6.4 Effect of Agreement. The terms of this Agreement
shall be binding upon and inure to the benefit of the Employee and the
Corporation and their heirs, personal representatives, successors and
assigns to the extent that any such benefits survive or may be assigned
under the terms of this agreement.
Section 6.5 Construction. Throughout this Agreement the
singular shall include the plural, and the plural shall include the
singular, and the masculine and neuter shall include the feminine,
wherever the context so requires.
Section 6.6 Text to Control. The headings of articles and
sections are included solely for the convenience of reference. If any
conflict between any heading and the text of this Agreement exists, the
test shall control.
Section 6.7 Severability. If any provision of this Agreement
is declared by any court of competent jurisdiction to be invalid for
any reason, such invalidity shall not affect the remaining provisions.
On the contrary, such remaining provisions shall be fully severable,
and this Agreement shall be construed and enforced as if such invalid
provisions never had been inserted in the Agreement.
Section 6.8 Stock Redemption Agreement. Notwithstanding
anything to the contrary contained in this Agreement, any Stock
Redemption Agreement between the Employee and the Corporation shall
control wherever applicable.
The effective date of this Agreement shall be -----------------.
The parties have executed this Agreement on this ----- day of ----
-----------, -----------.
CORPORATION/EMPLOYER
HIA Inc.
[SPECIMEN - NOT FOR EXECUTION]Title:-------------------------------
Title:-------------------------------
EMPLOYEE:
[SPECIMEN - NOT FOR EXECUTION]
ATTEST:-------------------------------