Exhibit 10.1
AGREEMENT
THIS AGREEMENT (this “Agreement”) is entered into as of
                                        , 2007 (the “Effective Date”), between
NCI Building Systems, Inc., a Delaware corporation (the “Company”), and its
wholly-owned subsidiary, NCI Group, L.P., a Texas limited partnership
(“Employer”), and                                         , a resident of the
State of Texas (“Employee”). The Company, Employer and Employee are sometimes
hereinafter collectively referred to as the “Parties.”
BACKGROUND
Employer hires and retains in its employment such personnel as are required by
the Company and its other Affiliates, and makes its employees so retained
available to provide services to the Company and its Affiliates.
This Agreement sets forth the terms and conditions of the employment of Employee
by Employer, and the duties and responsibilities of Employee, on the one hand,
and of Employer and the Company, on the other hand, to each other.
Capitalized terms not defined in the body of this Agreement have the meanings
set forth on the attached Appendix “A.”
AGREEMENT AMONG PARTIES
In consideration of the foregoing and of the mutual covenants and agreements set
forth in this Agreement, and subject to the terms and conditions set forth
herein, the Parties agree as follows:
     1. Employment. Employer hereby agrees to continue Employee in its employ,
and Employee hereby agrees to remain in the employ of Employer, pursuant to the
terms and conditions set forth herein.
     2. Duties and Authority. Employee shall serve as the
                                         of the Company, with those authorities,
duties and responsibilities customary to that position and such other
authorities, duties and responsibilities as the Board of Directors of the
Company (the “Board”) or the Chief Executive Officer or his designee may
reasonably assign Employee from time to time. Employee shall use his best
efforts, including the highest standards of professional competence and
integrity, and shall devote substantially all of his business time and effort,
in and to his employment hereunder, and shall not engage in any other business
activity which would conflict with the rendition of his services hereunder,
except that Employee may hold directorships or related positions in charitable,
educational or not-for-profit organizations, or directorships in business
organizations if expressly approved by the Board, and make passive investments,
which do not unreasonably interfere with Employee’s day-to-day performance of
his responsibilities to the Company.

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     3. Term. This Agreement shall be effective as of the Effective Date, and
shall remain in effect until                     , 2008 subject to earlier
termination or extension as described below. The period from the Effective Date
until this Agreement shall have expired in accordance with this Section or been
terminated in accordance with Section 5 is hereafter referred to as “the term
hereof” or “the term of this Agreement.” The term hereof shall be extended
automatically for an additional year as of                      1, 2008 and as
of each subsequent annual anniversary of such date (each such extension date is
referred to herein as a “Renewal Date”) unless at least one hundred twenty
(120) days prior to any such Renewal Date either Party shall have given notice
to the other Party that the term of this Agreement shall not be so extended.
Notwithstanding any provision of this Agreement to the contrary, if a Change in
Control or Potential Change in Control occurs, the term of this Agreement shall
be extended for a period of two (2) years after the date of the occurrence of
the Change in Control or Potential Change in Control, and the last day of such
extended term shall become the applicable Renewal Date.
     4. Compensation.
     a. Base Salary. Employer shall pay Employee a base salary at his current
annualized rate, payable in accordance with Employer’s normal payroll
procedures. The salary of Employee will be reviewed at least once annually by
the Company and/or, to the extent required, the Compensation Committee of the
Board. In the event that Employee’s salary is required to be approved by the
Compensation Committee of the Board, such review shall be conducted by the
Compensation Committee at the same time as it reviews the salaries of other
senior executives of the Company, and any adjustment shall be solely within the
discretion of the Compensation Committee of the Board.
     b. Annual Bonus. Employee shall participate under the currently existing
NCI Building Systems, Inc. Bonus Program, as amended and restated (the “Bonus
Plan”) or, if the Bonus Plan is amended, replaced or superseded, under any
amended, replacement or successor bonus program adopted for senior executives of
the Company and its Affiliates. Bonuses, if any, paid to Employee pursuant to
the Bonus Plan shall be paid after the end of each fiscal year of the Company at
the same time as bonuses are paid to other participants, but no later than
March 15 of the following calendar year. Employee understands that bonuses
cannot be earned under the Bonus Plan except as specifically set forth therein
based on the level of participation specified by the Compensation Committee in
its discretion and, if the employment of a participant terminates for any reason
prior to certain dates specified in the Bonus Plan, no bonus shall be payable
thereunder. In the event Employee terminates employment, for any reason other
than Cause, after the end of the fiscal year but before payment of the bonus,
Employee shall be entitled to receive the amount of the bonus that would have
otherwise

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been payable under the Bonus Plan, as determined by the Compensation Committee,
on the date bonuses are paid to other participants. Employee also understands
that the Bonus Plan may be amended, replaced, superseded or terminated at any
time and from time to time by the Board of Directors in its sole discretion.
     c. Health and Welfare Benefits. Employee shall be entitled to participate
in and receive the health, hospitalization, medical, dental, life insurance,
accidental death, disability and other insurance plans and benefits provided by
Employer and the Company, and to participate in the 401(k) and other qualified
profit-sharing, deferred compensation, pension, savings and other similar plans
of Employer and the Company, as and to the extent Employer and the Company
provide such benefits generally to other employees of Employer and the Company
or to executive employees of the Company. It is understood and agreed that such
benefits may be changed or discontinued from time to time in the sole discretion
of Employer and the Company.
     5. Termination Payments.
     a. Minimum Termination Compensation. Employee shall serve in an at-will
capacity and the Company and/or Employer may terminate the employment of
Employee at any time with or without Cause. Upon any termination of employment
of Employee for any reason other than as set forth in Section 5(b), whether on,
before or after the expiration of the term of this Agreement (including any
extension of the term hereof pursuant to the provisions of this Agreement),
Employee shall be entitled to receive (i) that portion of his annual base
salary, at the rate then in effect, earned by him or accrued for his account
through the date of the termination of his employment hereunder or for which he
is entitled to payment for events or circumstances occurring on or through the
date of termination of his employment, and (ii) any bonus to which he is
entitled under the Bonus Plan pursuant to Section 4(b) for the fiscal year
ending prior to the date of termination.
     b. Payment Following a Change in Control or Potential Change in Control. If
Employee’s employment is terminated by the Company without Cause or by Employee
for Good Reason within twenty-four (24) months after a Change in Control or
during a Potential Change in Control Period, then Employee shall be entitled to
receive (i) ___(___) times his annual base salary at the highest annualized rate
in effect during the one (1) year period immediately preceding the date of the
Change in Control or Potential Change in Control, as applicable, (the “Payment”)
and (ii) medical and dental coverage at the active employee rate for the period
of coverage applicable to Employee (up to a maximum of eighteen (18) months)
under the Consolidated Omnibus Budget Reconciliation Act of 1985, currently
embodied in Section 4980B of the Internal Revenue Code

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of 1986, as amended (the “Code”). The Payment shall be payable in a single lump
sum within thirty (30) days of termination, except as otherwise set forth in
Section 25 hereof.
     c. Parachute Tax Limitation. Notwithstanding anything in this Agreement to
the contrary, if any amounts due to Employee under this Agreement and any other
plan or program or award of Employer, the Company or any Affiliate constitute a
“parachute payment,” as such term is defined in Section 280G(b)(2) of the Code,
and the amount of the parachute payment, reduced by the excise tax imposed
pursuant to Section 4999 of the Code, is less than the amount Employee would
receive if he were paid three times his “base amount,” as defined in
Section 280G(b)(3) of the Code, less one dollar, then the aggregate of the
amounts constituting the parachute payment shall be reduced to an amount that
will equal three times his base amount less one dollar. The calculations to be
made with respect to this subsection shall be made by an accounting firm jointly
selected by the Company and Employee and paid by the Company.
     d. No Duty to Mitigate. Notwithstanding anything in this Agreement to the
contrary, if Employee’s employment is terminated following a Change in Control
of the Company, Employee shall have no duty to seek other employment nor shall
any payments made or to be made to Employee pursuant to this Agreement following
such Change in Control be offset by any amount earned from other employment.
     e. Full Satisfaction of Obligations. Payment by Employer or the Company of
the amounts owed to Employee pursuant to this Section 5 shall fully satisfy all
obligations of Employer and the Company to Employee under this Agreement if the
employment of Employee is terminated hereunder prior to the expiration of the
term of this Agreement, and all obligations of Employer and Employee to each
other set forth in Sections 1 through 4 of this Agreement shall terminate and be
of no further force or effect. No termination of employment hereunder, whether
by Employer or Employee and whether with or without Cause or Good Reason, shall
terminate the provisions of Sections 6 or 7 or any subsequent sections of this
Agreement and each of such sections shall remain in full force and effect as
binding obligations of the Parties in accordance with their express terms or, if
no express term is stated, until the latest to expire of those sections having
express terms.
     6. Business Disclosures. Employee acknowledges that Employee has had and
will have access to and has or will become familiar with all or substantially
all of the Confidential Information of the Company and its Affiliates. As a
material inducement to the Company and Employer to enter into this Agreement and
to pay to Employee the compensation stated herein, Employee covenants and agrees
that Employee will not, at any time during or following the

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termination of his employment with the Company, directly or indirectly divulge
or disclose for any purpose whatsoever any Confidential Information that has
been obtained by or disclosed to Employee in connection with his employment with
the Company or any of its Affiliates. If Employee is required in or pursuant to
any legal, judicial or administrative proceeding (by oral questions,
interrogatories, requests for information or documents, subpoena, civil
investigative demand or similar process) to disclose any Confidential
Information, Employee shall notify, as promptly as practicable, the Company of
such request or requirement so that the Company, at its expense, may seek an
appropriate protective order or waive compliance with the provisions of this
Agreement, and/or take any other action deemed appropriate by the Company. If,
in the absence of a protective order or the receipt of a waiver hereunder,
Employee is compelled or required by law or the order of any governmental,
regulatory or self-regulatory body to disclose the Confidential Information,
Employee may disclose only that portion of the requested Confidential
Information which he is compelled or required to disclose, and Employee will
exercise his reasonable efforts to obtain reliable assurance that confidential
treatment will be accorded the Confidential Information.
     7. Non-Competition.
     a. Employee shall not, directly or indirectly and whether on his own behalf
or on behalf of any other person, partnership, association, corporation or other
entity, engage in or be an owner, director, officer, employee, agent, consultant
or other representative of or for, or lend money or equipment to or otherwise
support, any business that manufactures, engineers, markets, sells or provides,
within a 250-mile radius of any then existing manufacturing facility of the
Company and its subsidiaries and affiliates, metal building systems or
components (including, without limitation, primary and secondary framing
systems, roofing systems, end or side wall panels, sectional or roll-up doors,
windows, or other metal components of a building structure), coated or painted
steel or metal coils, coil coating or coil painting services, or any other
products or services that are the same as or similar to those manufactured,
engineered, marketed, sold or provided by the Company or its subsidiaries and
affiliates during the period of employment of Employee. Ownership by Employee of
equity securities of the Company, or of equity securities in other public or
privately-owned companies that compete with the Company constituting less than
1% of the voting securities in such companies, shall be deemed not to be a
breach of this covenant. Employee agrees and stipulates that in any action or
claim brought by him or in any action or claim brought against him involving the
provisions of this Section 7, Employee hereby waives any claim or defense that
the above non-competition covenants are unenforceable, void or voidable, for any
reason, including, but not limited to, fraud, misrepresentation, illegality,
unenforceable restraint of trade, failure of consideration, illusory contract,
mistake, or any other substantive legal defense.

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The foregoing covenant in this Section 7.a shall remain in effect (i) during the
period of employment of Employee by the Company and Employer, and (ii) in the
event that Employee receives payment under Section 5.b hereof, for the period of
years following Employee’s termination that is equal to the multiple of annual
base salary to which Employee is entitled under Section 5.b hereof.
     b. Employee shall not, directly or indirectly and whether on his own behalf
or on behalf of any other person, partnership, association, corporation or other
entity, either (i) seek to hire or solicit the employment or service of any
employee, agent or consultant of the Company or its Affiliates in a commercial
capacity; (ii) in any manner attempt to influence or induce any employee, agent
or consultant of the Company or its Affiliates to leave the employment or
service of the Company or its Affiliates; (iii) use or disclose to any person,
partnership, association, corporation or other entity any information concerning
the names and addresses of any employees, agents or consultants of the Company
or its Affiliates unless such use or disclosure is of a personal nature, is
requested by the Company or is required by due process of law; or (iv) call
upon, solicit, divert or attempt to call upon, solicit or divert the business of
any customer, vendor or acquisition prospect of the Company or any of its
Affiliates with whom Employee dealt, directly or indirectly, during his
engagement with the Company or its Affiliates. Employee shall not be prohibited
from hiring or soliciting the employment or service of an agent or consultant of
the Company for purposes which do not violate Section 7 of this Agreement.
Employee agrees and stipulates that in any action or claim brought by him or in
any action or claim brought against him involving the provisions of this
Section 7, Employee hereby waives any claim or defense that the above
non-solicitation covenants are unenforceable, void or voidable, for any reason,
including, but not limited to, fraud, misrepresentation, illegality,
unenforceable restraint of trade, failure of consideration, illusory contract,
mistake, or any other substantive legal defense.
The foregoing covenant in this Section 7.b shall remain in effect during the
period of employment of Employee by the Company and Employer and, after such
employment terminates for any reason whatsoever, for a period of three (3) years
immediately following the longer of (i) the termination of such employment or
(ii) the period during which Employee is entitled to receive payments under this
Agreement.
     8. Consideration for Covenants; Reasonableness. Employee acknowledges and
agrees as follows:
     a. The Confidential Information of the Company and its Affiliates is unique
and was developed or acquired by them through the expenditure of valuable time
and resources; that Employer, the Company

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and their Affiliates derive independent economic value from this Confidential
Information not being generally known to the public or to other persons who can
obtain economic value from its disclosure or use; that Employer, the Company and
their Affiliates have taken all prudent and necessary measures to preserve the
proprietary and confidential nature of its Confidential Information, and that
the covenants set forth in Sections 6 and 7 are the most reasonable, efficient
and practical means to protect the Confidential Information.
     b. The covenants set forth in Sections 6 and 7 are necessary to protect the
goodwill of the Company and its Affiliates during the employment of Employee
hereunder, and to ensure that such goodwill will be preserved and continued for
the benefit of the Company and its Affiliates after his employment terminates.
     c. Due to the nature of the business as heretofore conducted by the Company
and its Affiliates and as contemplated to be continued and conducted by the
Company and its Affiliates, the scope and the duration of the covenants set
forth in Sections 6 and 7 of this Agreement are in all respects reasonable.
     d. The covenants set forth in Sections 6 and 7 each constitute a separate
agreement independently supported by good and adequate consideration and that
each such agreement shall be severable from the other provisions of this
Agreement and shall survive this Agreement. The existence of any claim or cause
of action of Employee against Employer or the Company, whether predicated on
this Agreement or otherwise, shall not constitute a defense to the enforcement
by Employer and the Company of the covenants and agreements of Employee set
forth in Sections 6 and 7.
     9. Surrender of Books and Records. Employee shall on the termination of his
employment in any manner immediately surrender to the Company all lists, books,
and records and other documents incident to the business of the Company and its
Affiliates, and all other property belonging to any of them, it being understood
that all such lists, books, records and other documents are the property of the
Company and its Affiliates.
     10. Waiver of Breach. The failure of the Company, Employer or Employee at
any time to require performance by the other of any provision hereof shall in no
way affect any of their respective rights thereafter to enforce the same, nor
shall the waiver by the Company, Employer or Employee of any breach of any
provision hereof be taken or held to be a waiver of any succeeding breach of any
provision or as a waiver of the provision itself.
     11. Remedies. In the event of Employee’s breach, or threatened breach, of
any term or provision contained in Section 6 or 7 of this Agreement,

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Employee agrees that the Company and its Affiliates shall suffer irreparable
harm not compensable by damages or other legal remedies, and that accordingly
the Company and/or Employer shall be entitled to both temporary and permanent
injunctive relief without the necessity of independent proof by it as to the
inadequacy of legal remedies or the nature or extent of the irreparable harm
suffered by it. The right of the Company and/or Employer to such relief shall
not be construed to prevent it from pursuing, either consecutively or
concurrently, any and all other legal or equitable remedies available to it for
such breach or threatened breach, specifically including, without limitation,
the recovery of monetary damages.
     12. Severability. It is the desire and intent of the Parties that the
provisions of Sections 6 and 7 be enforced to the fullest extent permissible
under the laws and public policies of each jurisdiction in which enforcement is
sought. If any provision of Sections 6 or 7 relating to the time period, scope
of activities or geographic area of restrictions is declared by a court of
competent jurisdiction to exceed the maximum permissible time period, scope of
activities or geographic area, the same shall be reduced to the maximum which
such court deems enforceable. If any provision of Sections 6 and 7 other than
those described in the preceding sentence are adjudicated to be invalid or
unenforceable, the invalid or unenforceable provisions shall be deemed amended
(with respect only to the jurisdiction in which such adjudication is made) in
such manner as to render them enforceable and to effectuate as nearly as
possible the intentions and agreement of the Parties. Furthermore, if any other
provision contained in this Agreement should be held illegal, invalid or
unenforceable in whole or in part by a court of competent jurisdiction, then it
is the intent of the Parties hereto that the balance of this Agreement be
enforced to the fullest extent permitted by applicable law and, in lieu of such
illegal, invalid or unenforceable provision, there shall be added automatically
as part of this Agreement, a provision as similar in its terms to such invalid
provision as may be possible and be legal, valid, and enforceable.
     13. Attorneys’ Fees. In the event of any suit or judicial proceeding (other
than an arbitration proceeding) between the Parties hereto with respect to this
Agreement, the prevailing Party shall, in addition to such other relief as the
court may award, be entitled to reasonable attorneys’ fees and costs, all as
actually incurred and including, without limitation, attorneys’ fees and costs
incurred in appellate proceedings; provided, however, that following a Change in
Control of the Company, only Employee will be entitled to recover the attorneys’
fees and costs described in this Section.
     14. Survival. Notwithstanding anything to the contrary contained herein,
the provisions of Sections 5, et seq. hereof shall survive the termination of
this Agreement.
     15. Notice. All notices hereunder shall be in writing and shall be
delivered personally, sent by facsimile transmission or sent by certified,
registered or overnight mail, postage prepaid. Such notices shall be deemed to

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have been duly given upon receipt, if personally delivered, upon telephonic
confirmation of receipt if sent by facsimile transmission, and if mailed, five
days after the date of mailing (two days in the case of overnight mail), in each
case addressed to the Parties at the following addresses or at such other
addresses as shall be specified in writing and in accordance with this Section:

      If to Employee:  
Address shown on the employment records of the Company
   
 
If to the Company or Employer  
NCI Building Systems, Inc.
 
10943 North Sam Houston Parkway West
Houston, Texas 77064
Telecopier: (281) 477-9670
Attention: Chief Executive Officer

     16. Entire Agreement. This Agreement, together with the execution copies of
the agreements attached as exhibits hereto, supersedes any and all other
agreements, either oral or written, between the Parties hereto with respect to
the subject matter hereof, and contains all of the covenants and agreements
between the Parties with respect thereto. The specific arrangements referred to
herein are not intended to exclude or limit Employee’s participation in other
benefits available to Employee or personnel of the Company generally, or to
preclude or limit other compensation or benefits as may be authorized by the
Board at any time, or to limit or reduce any compensation or benefits to which
Employee would be entitled but for the Agreement.
     17. Modification. No change or modification of this Agreement shall be
valid or binding upon the Parties hereto, nor shall any waiver of any term or
condition in the future be so binding, unless such change or modification or
waiver shall be in writing and signed by the Parties hereto.
     18. Governing Law and Venue. This Agreement, and the rights and obligations
of the Parties hereunder, shall be governed by and construed in accordance with
the laws of the State of Texas and venue for any action pursuant hereto shall be
in the appropriate state or federal court in Harris County, Texas.
     19. Acknowledgment Regarding Counsel. Each of the Parties to this Agreement
acknowledges that he or it has had the opportunity to seek and has sought
counsel to review this Agreement and to obtain and has obtained the advice of
such counsel relating thereto.
     20. Counterparts. This Agreement may be executed in counterparts, each of
which shall constitute an original, but all of which shall constitute one and
the same document.

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     21. Assignment. Subject to compliance with the provisions of this
Agreement, each of the Company and Employer shall have the right to assign this
Agreement and its obligations hereunder to any of their Affiliates. No such
assignment shall operate to relieve Employer, the Company or any successor
assignor from liability hereunder, and this Agreement shall remain an
enforceable obligation of Employer, the Company and each such successor. The
rights, duties and benefits to Employee hereunder are personal to him, and no
such right or benefit may be assigned by him. For purposes of this Agreement,
all references herein to Employer and the Company is deemed to be also a
reference to any Affiliate of Employer or the Company that either has or is
required to assume the obligations of the Company pursuant to this section.
     22. Tax Withholding. The Company and/or Employer, as appropriate, may
withhold from any payments or benefits payable under this Agreement all federal,
state, city or other taxes that will be required pursuant to any law or
governmental regulation or ruling.
     23. Joint and Several Obligations. The duties and obligations of Employer
and the Company set forth herein shall be the joint and several obligations of
each of them.
     24. Estate. If Employee dies prior to termination of employment, any monies
that may be due him under this Agreement as of the date of his death will be
paid to his estate.
     25. Section 409A.
     a. If Employee is a “specified employee,” as such term is defined in
Section 409A and determined as described below in this Section 25(a), and if the
Payment under Section 5(b) hereof is subject to Section 409A, the character and
timing of the Payment shall be as determined in this Section 25(a). It is hereby
specified that the amount of the Payment under Section 5(b) that does not exceed
the limit specified in Treasury Regulation Section 1.409A-1(b)(9)(iii)(A) is
considered a separate payment and shall be paid at the time specified in
Section 5(b). To the extent that the Payment under Section 5(b) exceeds the
limit specified in Treasury Regulation Section 1.409A-1(b)(9)(iii)(A), such
excess amount shall not be payable before the earlier of (i) the date that is
six months after Employee’s termination, (ii) the date of Employee’s death, or
(iii) the date that otherwise complies with the requirements of Section 409A.
Employee shall be a “specified employee” for the twelve-month period beginning
on April 1 of a year if Employee is a “key employee” as defined in Section
416(i) of the Code (without regard to Section 416(i)(5)) as of December 31 of
the preceding year or using such dates as designated by the Compensation
Committee of the Board in accordance with Section 409A and in a manner that is
consistent with respect to all of the Company’s nonqualified deferred
compensation plans. For purposes

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of determining the identity of specified employees, the Compensation Committee
of the Board may establish procedures as it deems appropriate in accordance with
Section 409A.
     b. Employee and the Company agree that this Agreement is intended to comply
with Section 409A and that any ambiguous provisions will be construed in a
manner that is compliant with or exempt from the application of Section 409A.
     26. Captions. The captions, headings, and arrangements used in this
Agreement are for convenience only and do not in any way affect, limit, amplify,
or modify the terms and provisions hereof.
     27. Binding Effect. This Agreement shall be binding upon the Parties
hereto, together with their respective executors, administrators, successors,
personal representatives, heirs and assigns.
IN WITNESS WHEREOF, the undersigned have executed this Agreement effective as of
the date set forth herein.
EMPLOYEE

         
By:
       
 
 
 
   

Date:____________, 2007
NCI BUILDING SYSTEMS, INC.

         
By:
       
 
 
 
Norman C. Chambers    
 
  Chief Executive Officer    

NCI GROUP, L.P.

         
By:
       
 
 
 
Norman C. Chambers    
 
  Chief Executive Officer    

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APPENDIX A
DEFINITIONS
The following terms have the indicated meanings for purposes of this Agreement:
(a) “Affiliate” means any entity controlled by, controlling or under common
control with a person or entity.
(b) “Bonus Plan” means the Company’s Bonus Program, as amended and restated and
as may be amended, restated, extended, supplemented or otherwise modified in
writing from time to time in the sole discretion of the Board of Directors of
the Company or the Compensation Committee of the Board of Directors of the
Company.
(c) “Cause” shall mean: (i) Employee’s willful and continued failure to
substantially perform his duties and other obligations under this Agreement and
such failure continues for a period of thirty (30) days after written notice by
the Company of the existence of such failure; provided, however, that only one
such notice by the Company need be sent and, if such failure re-occurs
thereafter, no further notice and opportunity to cure such failure shall be
required; (ii) the willful engaging by Employee in gross misconduct materially
and demonstrably injurious to the Company, as determined by the Company; or
(iii) Employee’s conviction for committing an act of fraud, embezzlement, theft
or other act constituting a felony (which shall not include any act or offense
involving the operation of a motor vehicle); provided, however, that the Board
of Directors of the Company or the then current Chairman of the Board must first
provide to Employee written notice clearly and fully describing the particular
acts or omissions which the Board or the then current Chairman of the Board
reasonably believes in good faith constitutes Cause hereunder and an
opportunity, within thirty (30) days following the receipt of such notice, to
meet in person with the Board of Directors or the then current Chairman of the
Board to explain the alleged acts or omissions relied upon by the Board of
Directors and, to the extent practicable, to cure such acts or omissions. For
purposes of this Agreement, any termination of Employee’s employment for Cause
shall be effective only upon delivery to Employee of a certified copy of a
resolution of the Board of Directors of the Company, adopted by the affirmative
vote of a majority of the entire membership of the Board of Directors following
a meeting at which Employee was given an opportunity to be heard on at least
five (5) business days’ advance written notice, finding that Employee was guilty
of the conduct constituting Cause, and specifying the particulars thereof.
Further, for the purposes of this Agreement, no act or failure to act on
Employee’s part shall be considered willful unless done, or omitted from being
done, by Employee not in good faith and without reasonable belief that his
action or omission was in the best interest of the Company.
(d) “Change in Control” of the Company means the occurrence of any of the
following events:

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     (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934) is or becomes the “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 20 percent or more of the combined voting
power of the Company’s then outstanding securities;
     (ii) as a result of, or in connection with, any tender offer or exchange
offer, merger, or other business combination (a “Transaction”), the persons who
were directors of the Company immediately before the Transaction shall cease to
constitute a majority of the Board of Directors of the Company or any successor
to the Company;
     (iii) the Company is merged or consolidated with another corporation or
transfers substantially all of its assets to another corporation and as a result
of the merger, consolidation or transfer less than 50 percent of the outstanding
voting securities of the surviving or resulting corporation shall then be owned
in the aggregate by the former stockholders of the Company; or
     (iv) a tender offer or exchange offer is made and consummated for the
ownership of securities of the Company representing 30 percent or more of the
combined voting power of the Company’s then outstanding voting securities.
(e) “Common Stock” means the common stock, $.01 par value, of the Company.
(f) “Confidential Information” means all information, whether oral or written,
previously or hereafter developed, that relates to the business as heretofore
conducted by the Company, or which is hereafter otherwise acquired or used by
the Company or its subsidiaries and Affiliates that is not generally known to
others in the Company’s area of business or, if known, was obtained wrongfully
by such other person or entity or with knowledge that it was proprietary or
confidential information of or relating to the business as heretofore conducted
by the Company or of or relating to the business of the Company or its
subsidiaries and Affiliates. Confidential Information shall include, without
limitation, trade secrets, methods or practices, financial results or plans,
customer or client lists, personnel information, information relating to
negotiations with clients or prospective clients, proprietary software,
databases, programming or data transmission methods, or copyrighted materials
(including without limitation, brochures, layouts, letters, art work, copy,
photographs or illustrations). It is expressly understood that the foregoing
list shall be illustrative only and is not intended to be an exclusive or
exhaustive list of Confidential Information.

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(g) “Good Reason” means any of the following events that occurs after a Change
in Control or within thirty (30) days prior to a Change in Control without
Employee’s prior written consent:
     (i) any reduction in the amount of Employee’s then current base salary in
excess of ten percent (10%) in any twelve month period;
     (ii) a significant reduction of Employee’s duties, position, or
responsibilities relative to Employee’s duties, position or responsibilities in
effect immediately prior to such reduction;
     (iii) breach or failure by the Company or Employer to perform any of its
material covenants contained in this Agreement;
     (iv) any relocation of Employee’s principal place of employment outside the
Houston, Texas metropolitan area;
provided, however, that no act or omission shall constitute “Good Reason” for
purposes of this Agreement unless Employee provides to the Board of Directors of
the Company or the Chairman of the Board a written notice clearly and fully
describing the particular acts or omissions which Employee reasonably believes
in good faith constitutes “Good Reason” within ninety (90) days of the first
date of such acts or omissions, and an opportunity, within thirty (30) days
following its receipt of such notice, to cure such acts or omissions.
(h) “Potential Change in Control” of the Company shall be deemed to have
occurred, if:
     (i) the Company enters into an agreement, the consummation of which would
result in the occurrence of a Change in Control of the Company;
     (ii) any person (including the Company) publicly announces an intention to
take or to consider taking actions which if consummated would constitute a
Change in Control of the Company; or
     (iii) the Board adopts a resolution to the effect that, for purposes of
this Agreement, a Potential Change in Control has occurred.
(i) “Potential Change in Control Period” means the period beginning on the date
the Potential Change in Control occurs and ending as of the earlier of (i) the
end of the month in which a Change in Control occurs or (ii) the date the Board
makes a good faith determination that the risk of a Change in Control has
terminated.
(j) “Section 409A” means Section 409A of the Internal Revenue Code of 1986, as
amended, and the regulations promulgated thereunder.

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