SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
Annual Report Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934 for the twelve months ended
December 31, 1993
Commission File No. 0-13829
PRECISION STANDARD, INC.
Exact name of Registrant as specified in its Charter
Colorado 84-985295
State of other jurisdiction of I.R.S. Employer Identification No.
incorporation or organization
One Pemco Plaza
1943 50th Street
Birmingham, Alabama 35212
Address of principal executive offices Zip Code
Registrant's telephone number, including area code: (205) 591-3009
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.0001 par value
(Title of Class)
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the Registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes x No
The aggregate market value of the Common Stock held by non-
affiliates on February 28, 1994 was approximately $13,882,000.
The number of shares of the Registrant's Common Stock
outstanding as of February 28, 1994 was 12,341,202.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's definitive proxy statement to be
filed pursuant to Regulation 14A not later than 120 days after the
end of the fiscal year (December 31, 1993) are incorporated by
reference in Part III.
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of Registrant's knowledge, in definitive
proxy or information statements incorporated by reference in
Part III of this Form 10-K or any amendment to this Form 10-K.
Yes No
The undersigned Registrant hereby amends the following items,
financial statements, exhibits or other portions of its annual
report on Form 10-K for the period ended December 31, 1993, as set
forth below:
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on
Form 8-K.
C. Exhibits.
2 Not applicable.
3.1 Amended and First Restated Articles of
Incorporation of the Registrant. (1)
3.2 Amended and First Restated Bylaws of the
Registrant. (1)
3.3 Articles of Amendment to the Articles of
Incorporation. (2)
4.1 Asset Sales and Purchase Agreement dated July 19,
1984, among Monarch Equities, Inc., Pemco Engineers, Inc.,
Robert D. Lang, Georgia L. Lang and Monarch Aviation, Inc. (3)
4.2 Promissory Note dated July 17, 1987, from
Monarch Equities, Inc., to Pemco Engineers, Inc. (3)
4.3 Credit Agreement among Precision Standard, Inc.,
the Lenders Named Herein and Bank of America National Trust and
Savings Association, Agent, dated September 5, 1988. (1)
4.4 Amended and Restated U.S. $10,000,000 Senior
Subordinated Loan Agreement dated as of September 9, 1988, among
Precision Standard, Inc., as Borrower, and the Financial
Institutions listed on the Signature Pages hereof as Lender. (1)
4.5 Amended and Restated Credit Agreement among
Precision Standard, Inc., the Lenders Named Herein and Bank of
America National Trust and Savings Association, Agent, dated
November 30, 1988. (1)
4.6 First Amendment to Amended and Restated Credit
Agreement dated as of June 14, 1989. (1)
4.7 First Amendment to Amended and Restated Senior
Subordinated Loan Agreement dated June 14, 1989. (1)
4.8 Specimen Certificate for Common Stock. (4)
Pursuant to Paragraph (b)(4)(iii) of Item 601 of
Regulation S-K, the Registrant has not filed certain instruments
with respect to other long-term debt of the Registrant or its
consolidated subsidiaries. Copies of such documents will be
furnished to the Commission upon request.
9 Not applicable.
10.1 Sale of Assets Agreement dated June 2, 1986 among
Monarch Equities, Inc., Pemco Engineers, Inc., Monarch Aviation,
Inc., Rolando Sablon and Matthew Gold. (3)
10.2 Amendment to Sale of Assets Agreement and Closing
Statement dated June 3, 1986, among Monarch Equities, Inc., Pemco
Engineers, Inc., Monarch Aviation, Inc., and SG Trading Corp. (3)
10.3 Assignment and Assumption Agreement executed
July 30, 1987, effective June 4, 1986, between SG Trading Corp. and
Matthew Gold. (3)
10.4 Purchase Agreement dated December 31, 1986, between
the Registrant and Matthew Gold. (3)
10.5 Purchase Agreement executed August 6, 1987,
effective April 30, 1987, between the Registrant and Matthew Gold.
(3)
10.6 Contract No. N68520-87-0007 between Monarch
Aviation, Inc., and the United States Navy. (3)
10.7 Novation Agreement between Monarch Aviation, Inc.,
and the Registrant dated August 6, 1987. (5)
10.8 Lease dated November 1, 1986, between Monarch
Properties and Pemco Engineers, Inc. (3)
10.9 Amended and Restated Incentive Stock Option and
Appreciation Rights Plan. (6)
10.10 Amended and Restated Nonqualified Stock Option
Plan. (6)
10.11 Amended Executive Employment Agreement between the
Registrant and Walter M. Moede effective June 1, 1993, as amended
March 11, 1994.
10.12 Amended Executive Employment Agreement between the
Registrant and Matthew L. Gold effective June 1, 1993, as amended
March 11, 1994.
10.13 Executive Employment Agreement between the
Registrant and C. Fredrik Groth effective June 1, 1993.
12 Not applicable.
13 Not applicable.
16 Not applicable.
18 Not applicable.
21 Subsidiaries of the Registrant. (7)
22 Not applicable.
23 Consent of Coopers & Lybrand to the incorporation
by reference of their report in Registrant's Form S-8 Registration
Statement (File No. 33-34206).
24 Not applicable.
27 Not applicable.
28 Not applicable.
29 Not applicable.
____________________
(1) Filed as exhibits to the Registrant's Annual Report on
Form 10-K for the fiscal year ended December 31, 1988, and
incorporated by reference herein.
(2) Filed as an exhibit to the Registrant's Registration Statement
on Form S-8 dated June 1, 1994, and incorporated by reference
herein.
(3) Filed as exhibits to the Registrant's Annual Report on
Form 10-K for the fiscal year ended April 30, 1987, and
incorporated by reference herein.
(4) Filed as an exhibit to the Registrant's Annual Report on
Form 10-K for the fiscal year ended December 31, 1989, and
incorporated by reference herein.
(5) Filed as an exhibit to the Registrant's Annual Report on Form
10-K for the fiscal year ended April 30, 1988, and
incorporated by reference herein.
(6) Filed as exhibits to the Registrant's Definitive Proxy
Statement for the 1994 Annual Meeting of Shareholders, and
incorporated by reference herein.
(7) Filed as an exhibit to the Registrant's Annual Report on
Form 10-K for the fiscal year ended December 31, 1993, and
incorporated by reference herein.
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this amendment to be signed on
its behalf by the undersigned, thereto duly authorized.
Date: March 29, 1995 PRECISION STANDARD, INC.
By: /s/Matthew L. Gold
Matthew L. Gold
Chairman, President and Chief
Executive Officer
(Principal Executive Officer)
Date: March 29, 1995 By: /s/Walter M. Moede
Walter M. Moede
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
AMENDED EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT, effective June 1, 1993, as amended March 11,
1994, is made and entered into by and between PRECISION STANDARD,
INC. (the "Company"), a Colorado corporation with offices at One
Pemco Plaza, P.O. Box 1808, Birmingham, Alabama, and WALTER M.
MOEDE ("Employee").
I. Employment. The Company hereby employs Employee, and
Employee hereby accepts employment upon the terms and conditions
hereinafter set forth.
II. Term. Subject to the provisions for termination as
hereinafter provided, the term of this Agreement is for a period
commencing June 1, 1993, and expiring May 31, 1996. On June 1 of
each year after 1993, the term of this Agreement shall be
automatically extended for an additional year without any further
action on the part of the Company or Employee, unless the Company
or Employee gives written notice more than ninety (90) days before
May 31 of any such year of its or his intention not to extend the
term of this Agreement.
III. Duties. Employee is engaged as Executive Vice President
and Chief Financial Officer to have complete responsibility for the
management of the financial and accounting operations of the
Company, and shall have full authority and responsibility, subject
only to the general direction and control of the Chief Executive
Officer and the Board of Directors, for formulating policies and
administering the financial operations of the Company in all
respects. His power shall include authority to hire and fire
personnel and to retain consultants when he deems necessary to
implement the Company's policies. If Employee is elected a
Director of the Company during the term of this Agreement, Employee
shall serve in such capacity with whatever additional compensation
is paid to Directors generally; but nothing herein shall be
construed as requiring the Company, or any other person, to cause
the election or appointment of Employee as a Director.
IV. Extent of Services. Employee shall faithfully,
industriously, and to the best of his ability, experience, and
talents perform all of the duties that may be required of and from
him pursuant to this Agreement. Nothing herein shall be construed
as preventing Employee from (a) investing his assets in such form
or manner as will not require any services on the part of Employee
in the operation of the affairs of the other companies in which
such investments are made or (b) serving as a director, advisor, or
consultant to another company, provided, however, that such
investments or services may not be provided to, or in connection
with a business which is in competition with the Company.
V. Compensation and Employee Benefits.
A. Annual Base Salary. For all services rendered by
Employee under this Agreement, the Company shall pay Employee an
initial annual base salary of $220,000, payable in equal monthly
installments. The amount of such base salary shall be determined
at the beginning of each fiscal year by the Company's Board of
Directors on the basis of merit and the Company's financial success
and progress but in no event shall such base salary be less than
the initial annual base salary indicated above.
B. Bonus Compensation. Employee may receive quarterly
and/or year-end bonuses as determined at the beginning of each
fiscal year of the Company by the Company's Board of Directors in
its sole discretion on the basis of merit and the Company's finan-
cial success and progress. The Company's Board of Directors, or an
authorized committee thereof, may also, as it has in the past,
award Company stock options to Employee.
C. Vacation. Employee shall be entitled to annual
vacations in a manner commensurate with Employee's status as
Executive Vice President and Chief Financial Officer.
D. Employee Benefits. Employee shall be entitled to
receive all of the rights, benefits, and privileges of a principal
executive under any retirement, pension, profit-sharing, insurance,
health and hospital, and other employee benefit plans which may be
now in effect or hereafter adopted by the Company.
E. Working Facilities. Employee shall be furnished
with a private office, a personal secretary, and such other
facilities and services suitable to Employee's position and
adequate for the performance of the duties required by this
Agreement.
F. Expenses. Employee is authorized to incur reason-
able expenses in connection with his responsibilities in conducting
the business of the Company, including expenses for entertainment,
travel, and similar items. The Company will reimburse Employee for
all such expenses upon the presentation by Employee, from time to
time, of an itemized account of such expenditures.
VI. Proprietary Interests of Company. Employee recognizes
and acknowledges that (a) the business of the Company involves
certain confidential and proprietary information as such may exist
from time to time, and which are valuable, special, and unique
assets of the Company's business and (b) Employee may, in the
course of said employment, develop innovations, designs, and other
work product. As a condition to employment of the Employee, the
Company requires, and the Employee hereby agrees to enter into, a
confidentiality agreement between the Company and its key
employees, which agreement is incorporated herein by reference.
VII. Noncompete. During the term of this Agreement and during
any subsequent period wherein Employee is receiving any severance
allowance or consulting fees from the Company, the Employee will
not, directly or indirectly, own, manage, operate, control, be
employed by, participate in, or be connected in any manner with the
ownership, management, operation, or control of any business which
is similar to the type of business conducted by the Company and
which conducts such business or sells its products within and to
the same market as the Company's market at the time of the
termination or expiration of this Agreement. In the event of
Employee's actual or threatened breach of the provisions of this
paragraph, the Company shall be entitled to an injunction
restraining Employee therefrom. Nothing shall be construed as
prohibiting the Company from pursuing any other available remedies
for such breach or threatened breach, including the recovery of
damages, costs, and attorney fees.
The foregoing agreement not to compete shall not be held
invalid because of the scope of the territory or the actions
restricted thereby, or the period of time within which such Agree-
ment is operative; but any judgment by a court of competent
jurisdiction may define the maximum territory and action subject
to, and restricted by, this paragraph and the period of time during
which such agreement is enforceable.
Notwithstanding the foregoing, in the event of a Change
of Control, as hereinafter defined, not recommended by a majority
of the Board of the Company as constituted prior to the date of
such Change of Control, this noncompete agreement shall terminate
upon the Change of Control Date.
VIII. Termination of Employment.
A. Termination by Mutual Agreement. The Company and
Employee may agree to terminate this Agreement on terms and
conditions mutually acceptable to them as of the date of
termination.
B. Death. In the event of Employee's death, the
Company shall pay to any beneficiary designated by Employee or, if
no such beneficiary has been designated, to his estate, an amount
equal to the then annual base salary for the greater of (a) two (2)
years or (b) the remaining term of this Agreement without
additional extensions, together with any bonuses which the Com-
pany's Board of Directors shall determine in its sole discretion to
be due and payable to Employee. If Employee's beneficiary or
estate receives any proceeds from any life insurance policies paid
for by the Company, the payments of annual base salary and bonuses
shall be reduced by the amount of such proceeds from such life
insurance policies.
C. Disability. In the event Employee shall become
disabled during the term of employment, Employee's annual base
salary shall continue at the same rate that it was on the date of
such disability. If such disability continues for twelve (12) or
more consecutive months, the Company, at its option, may
thereafter, upon written notice to Employee or Employee's personal
representative, terminate the employment. If the Company
terminates the employment because of disability, Employee shall
receive the then annual base salary for the greater of (a) two (2)
years or (b) the remaining term of this Agreement without
additional extensions, together with any bonuses which the
Company's Board of Directors shall determine in its sole discretion
to be due and payable to Employee. If Employee receives any
disability payments from any insurance policies paid for by the
Company, the payments of annual base salary and bonuses shall be
reduced by the amount of such disability payments received by
Employee from such disability insurance policies.
D. Voluntary or Involuntary Termination. Upon notice
of any Voluntary or Involuntary Termination as defined herein,
Employee, if requested by the Company, shall continue to render his
services and shall be paid the then annual base salary up to the
date of such Voluntary or Involuntary Termination, any bonuses
which the Company's Board of Directors shall determine in its sole
discretion to be due and payable to Employee, and the Severance
Amount as provided herein. Employee must give the Company six (6)
months prior written notice of any Voluntary Termination. The
Company must give Employee one (1) year written notice of any
Involuntary Termination.
E. Definitions. All the terms defined in this Section
shall have the meanings given below throughout this Agreement.
1. "Change in Duties, Compensation, or Benefits"
shall mean any one or more of the following:
a. a significant change in the nature or
scope of Employee's authorities or duties from those applicable to
him immediately prior to the date on which a Change of Control
occurs;
b. a reduction in Employee's Annual Base
Salary from that provided to him immediately prior to the date on
which a Change of Control occurs;
c. a diminution in Employee's eligibility to
participate in bonus, stock option, incentive award and other
benefit plans which provide opportunities for Employee to receive
compensation from those applicable to him immediately prior to the
date on which a Change of Control occurs;
d. a diminution in Employee's benefits
(including but not limited to medical, dental, life insurance and
long-term disability plans) and perquisites applicable to Employee
from those applicable to him immediately prior to the date on which
a Change of Control occurs;
e. a change in the location of Employee's
principal place of employment by the Company (including its
subsidiaries) by more than ten miles from the location where he was
principally employed immediately prior to the date on which a
Change of Control occurs; or
f. a reasonable determination by the Board of
Directors of the Company that, as a result of a Change in Control
and a change in circumstances thereafter significantly affecting
his position, he is unable to exercise the functions or duties
attached to his position immediately prior to the date on which a
Change of Control occurs.
2. "Change of Control" shall be deemed to have
occurred if:
a. any "person," including a "group" as
determined in accordance with the Section 13(d)(3) of the
Securities Exchange Act of 1934 (the "Exchange Act"), other than
Matthew L. Gold or his "affiliates" as defined in the Exchange Act
becomes the beneficial owner, directly or indirectly, of securities
of the Company representing 20% or more of the combined voting
power of the Company's then outstanding securities;
b. as a result of, or in connection with, any
tender offer or exchange offer, merger or other business
combination, sale of assets or contested election, or any
combination of the foregoing transactions (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;
c. the Company is merged or consolidated with
another corporation and as a result of the merger or consolidation
less than 60% 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, other than affiliates of
the Company within the meaning of the Exchange Act or any party to
the merger or consolidation;
d. a tender offer or exchange offer is made
and consummated for the ownership of securities of the Company
representing 50% or more of the combined voting power of the
Company's then outstanding securities; or
e. the Company transfers all or substantially
all of its assets to another corporation which is not a
wholly-owned subsidiary of the Company.
3. "Disability" shall mean mental or physical
illness or condition rendering Employee incapable of performing
Employee's normal duties with the Company.
4. "Involuntary Termination" shall mean any
termination except:
a. Voluntary Termination;
b. termination by mutual agreement; or
c. any termination as a result of death,
disability, or normal retirement pursuant to a retirement plan to
which Employee was subject prior to any Change of Control.
5. "Severance Amount" is equal to:
a. in the case of an Involuntary Termination,
2.99 times (i) Employee's then Annual Base Salary plus (ii) the
average bonus, if any, awarded to Employee by the Board of
Directors for the three (3) preceding years (the "Average Bonus")
payable in a lump sum or ratably over three (3) years, at the
Company's option; and
b. in the case of a Voluntary Termination,
1.0 times (i) Employee's then Annual Base Salary plus (ii) the
Average Bonus, payable in a lump sum or ratably over one (1) year,
at the Company's option.
6. "Voluntary Termination" shall mean any
termination which results from a resignation by the Employee other
than a resignation following a Change of Duties, Compensation, or
Benefits as defined herein.
F. Medical and Dental Benefits. If Employee's
employment by the Company or any subsidiary or successor of the
Company is terminated because of Disability, Voluntary Termination,
or Involuntary Termination, then to the extent that Employee or any
of Employee's dependents may be covered under the terms of any
medical and dental plans of the Company (or any subsidiary) for
active Employees immediately prior to the termination, the Company
will provide Employee and those dependents with equivalent
coverages until the later of Employee's death or the death of
Employee's spouse, if any, at the time of Employee's death. The
coverages may be procured directly by the Company (or any
subsidiary, if appropriate) apart from, and outside of the terms of
the plans themselves; provided that Employee and Employee's
dependents comply with all of the conditions of the medical or
dental plans. In consideration for these benefits, Employee must
make contributions equal to those required from time to time from
Employees for equivalent coverages under the medical or dental
plans.
IX. Section 162(m) Payment Deferral. If in any year the
compensation payable to Employee exceeds the amount the Company can
deduct as a compensation expense in such year is limited by
Section 162(m) of the Internal Revenue Code, then the Company may
defer amounts otherwise payable in such year to the minimum extent
necessary and for the minimum time necessary (not to exceed two
years) to permit the Company to deduct such amounts as compensation
expense in subsequent tax years. If deferral will not enable the
Company to deduct such amounts in either of the two years following
the year in which such amounts became payable, payment shall be
made in the second year following the year such amounts become
payable under this Agreement. Nothing in this Section shall permit
the Company to reduce the amount payable to the Employee under this
Agreement.
X. Notices. Any notice required or permitted to be given
under this Agreement shall be sufficient if in writing and
delivered in person or sent by registered or certified mail to
Employee's residence in the case of Employee or to its principal
office in the case of the Company.
XI. Waiver. The waiver of any provision of this Agreement
shall not operate or be construed as a waiver of any other
provision of this Agreement. No waiver shall be valid unless in
writing and executed by the party to be charged therewith.
XII. Severability/Modification. In the event that any clause
or provision of this Agreement shall be determined to be invalid,
illegal or unenforceable, such clause or provision may be severed
or modified to the extent necessary, and, as severed and/or
modified, this Agreement shall remain in full force and effect.
XIII. Assignment. Except for a transfer by will or by the laws
of descent or distribution, Employee's right to receive payments or
benefits under this Agreement shall not be assignable or
transferable, whether by pledge, creation of a security interest or
otherwise. In the event of any attempted assignment or transfer
contrary to this paragraph, the Company shall have no liability to
pay any amount so attempted to be assigned or transferred.
Employee acknowledges that the services to be rendered
under this Agreement are unique and personal. Accordingly,
Employee may not assign such duties or obligations under this
Agreement.
XIV. Successors. This Agreement shall be binding upon and
inure to the benefit of the Company, its successors and assigns
(including, without limitation, any company into or with which the
Company may merge or consolidate). The Company agrees that it will
not effect the sale or other disposition of all or substantially
all of its assets unless either (i) the person or entity acquiring
the assets or a substantial portion of the assets shall expressly
assume by an instrument in writing all duties and obligations of
the Company under this Agreement or (ii) the Company shall provide,
through the establishment of a separate reserve, for the payment in
full of all amounts which are or may reasonably be expected to
become payable to Employee under this Agreement.
XV. Entire Agreement. This instrument contains the entire
agreement concerning the employment arrangement between the parties
and shall, as of the effective date hereof, supersede all other
such agreements between the parties. It may not be amended except
by an agreement in writing signed by both parties.
XVI. Governing Law and Jurisdiction. This Agreement shall be
interpreted, construed, and enforced under the laws of the State of
Colorado. The courts and authorities of the State of Colorado
shall have sole jurisdiction and venue over all controversies which
may arise with respect to this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement
the date and year indicated below.
PRECISION STANDARD, INC.
Date: July 15, 1994 By: /s/Matthew L. Gold
Matthew L. Gold, President
(Principal Executive Officer)
EMPLOYEE:
Date: July 14, 1994 /s/Walter M. Moede
Walter M. Moede
AMENDED EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT, effective June 1, 1993, as amended March 11,
1994, is made and entered into by and between PRECISION STANDARD,
INC. (the "Company"), a Colorado corporation with offices at One
Pemco Plaza, P. O. Box 1808, Birmingham, Alabama, and MATTHEW L.
GOLD ("Employee").
WITNESSETH:
WHEREAS Company has employed Employee as its President and
Chief Executive Officer since 1986 and strongly desires to continue
such employment in the future, and
WHEREAS, Employee is willing to enter into a multi-year
employment agreement to ensure the Company of continuity over the
coming years and the diligent pursuit of the Company's long-term
plans, and
WHEREAS, the parties believe it is in their mutual interests
that the terms and conditions of Employee's employment be put into
a written employment agreement,
NOW, THEREFORE, in consideration of the mutual promises
contained herein and other good and valuable consideration, the
adequacy and receipt of which is hereby acknowledged by each of the
parties hereto, the parties agree as follows:
I. Employment. The Company hereby employs Employee, and
Employee hereby accepts employment upon the terms and conditions
hereinafter set forth.
II. Term. Subject to the provisions for termination as
hereinafter provided, the term of this Agreement is for a period
commencing June 1, 1993, and expiring May 31, 1998. On June 1 of
each year after 1993, the term of this Agreement shall be
automatically extended for an additional year without any further
action on the part of the Company or Employee, unless the Company
or Employee gives written notice more than ninety (90) days before
May 31 of any such year of its or his intention not to extend the
term of this Agreement.
III. Duties. Employee is engaged as President, Chief
Executive Officer and Chairman of the Board to have complete
responsibility for the management of the operations of the Company,
and shall have full authority and responsibility, subject only to
the general direction and control of the Company's Board of
Directors, for formulating policies and administering the
operations of the Company in all respects. His power shall include
authority to hire and fire personnel of the Company and its
subsidiaries and to retain consultants when he deems necessary to
implement the Company's policies. Employee may also serve, at his
discretion, as President and Chief Executive Officer of one or more
of any subsidiary corporations or divisions of the Company and to
carry out the same responsibilities and duties for each such
corporation as set forth above. If elected by the Shareholders,
Employee is also expected to serve as Chairman of the Board of
Directors of the Company and, if Employee so chooses, of its
subsidiary companies. If Employee is elected a Director of the
Company during the term of this Agreement, Employee shall serve in
such capacity with whatever additional compensation is paid to
Directors generally.
IV. Extent of Services. Employee shall faithfully,
industriously, and to the best of his ability, experience, and
talents perform all of the duties that may be required of and from
him pursuant to this Agreement. Nothing herein shall be construed
as preventing Employee from (a) investing his assets in such form
or manner as will not require any services on the part of Employee
in the operation of the affairs of the other companies in which
such investments are made or (b) serving as a director, advisor, or
consultant to another company, provided, however, that such
investments or services may not be provided to, or in connection
with a business which is in competition with the Company.
V. Compensation and Employee Benefits.
A. Annual Base Salary. For all services rendered by
Employee under this Agreement, the Company shall pay Employee an
initial annual base salary of $440,000, payable in equal bimonthly
installments. The amount of such base salary shall be determined
at the beginning of each fiscal year by the Company's Board of
Directors in its sole discretion on the basis of merit and the
Company's financial success and progress, provided, however, that
each succeeding annual base salary shall be increased by at least
five percent (5%) over the previous annual base salary. The Board
of Directors may at its sole discretion increase such annual base
salary more than such guaranteed minimum increase.
B. Bonus Compensation. Employee may receive quarterly
and/or year-end bonuses as determined at the beginning of each
fiscal year of the Company by the Company's Board of Directors in
its sole discretion on the basis of merit and the Company's finan-
cial success and progress. The Company's Board of Directors, or an
authorized committee thereof, may also, as it has in the past,
award Company stock options to Employee.
C. Vacation. Employee shall be entitled to annual
vacations in a manner commensurate with Employee's status as
President and Chief Executive Officer.
D. Employee Benefits. Employee shall be entitled to
receive all of the rights, benefits, and privileges of a principal
executive under any retirement, pension, profit-sharing, insurance,
health and hospital, and other employee benefit plans which may be
now in effect or hereafter adopted by the Company.
E. Working Facilities. Employee shall be furnished
with a private office, a personal secretary, and such other
facilities and services suitable to Employee's position and
adequate for the performance of the duties required by this
Agreement.
F. Expenses. Employee is authorized to incur reason-
able expenses in connection with his responsibilities in conducting
the business of the Company, including expenses for entertainment,
travel, and similar items. The Company will reimburse Employee for
all such expenses upon the presentation by Employee, from time to
time, of an itemized account of such expenditures.
VI. Proprietary Interests of Company. Employee recognizes
and acknowledges that (a) the business of the Company involves
certain confidential and proprietary information as such may exist
from time to time, and which are valuable, special, and unique
assets of the Company's business and (b) Employee may, in the
course of said employment, develop innovations, designs, and other
work product. As a condition to employment of the Employee, the
Company requires, and the Employee hereby agrees to enter into, a
confidentiality agreement between the Company and its key
employees, which agreement is incorporated herein by reference.
VII. Noncompete. During the term of this Agreement and during
any subsequent period wherein Employee is receiving any severance
allowance or consulting fees from the Company, the Employee will
not, directly or indirectly, own, manage, operate, control, be
employed by, participate in, or be connected in any manner with the
ownership, management, operation, or control of any business which
is similar to the type of business conducted by the Company and
which conducts such business or sells its products within and to
the same market as the Company's market at the time of the
termination or expiration of this Agreement. In the event of
Employee's actual or threatened breach of the provisions of this
paragraph, the Company shall be entitled to an injunction
restraining Employee therefrom. Nothing shall be construed as
prohibiting the Company from pursuing any other available remedies
for such breach or threatened breach, including the recovery of
damages, costs, and attorney fees.
The foregoing agreement not to compete shall not be held
invalid because of the scope of the territory or the actions
restricted thereby, or the period of time within which such Agree-
ment is operative; but any judgment by a court of competent
jurisdiction may define the maximum territory and action subject
to, and restricted by, this paragraph and the period of time during
which such agreement is enforceable.
Notwithstanding the foregoing, in the event of a Change
of Control, as hereinafter defined, not recommended by a majority
of the Board of the Company as constituted prior to the date of
such Change of Control, this noncompete agreement shall terminate
upon the Change of Control Date.
VIII. Termination of Employment.
A. Termination by Mutual Agreement. The Company and
Employee may agree to terminate this Agreement on terms and
conditions mutually acceptable to them as of the date of
termination.
B. Death. In the event of Employee's death, the
Company shall pay to any beneficiary designated by Employee or, if
no such beneficiary has been designated, to his estate, an amount
equal to the then annual base salary for the greater of (a) two (2)
years or (b) the remaining term of this Agreement without
additional extensions, together with any bonuses which the Com-
pany's Board of Directors shall determine in its sole discretion to
be due and payable to Employee. If Employee's beneficiary or
estate receives any proceeds from any life insurance policies paid
for by the Company, the payments of annual base salary and bonuses
shall be reduced by the amount of such proceeds from such life
insurance policies.
C. Disability. In the event Employee shall become
disabled during the term of employment, Employee's annual base
salary shall continue at the same rate that it was on the date of
such disability. If such disability continues for twelve (12) or
more consecutive months, the Company, at its option, may
thereafter, upon written notice to Employee or Employee's personal
representative, terminate the employment. If the Company
terminates the employment because of disability, Employee shall
receive the then annual base salary for the greater of (a) two (2)
years or (b) the remaining term of this Agreement without
additional extensions, together with any bonuses which the
Company's Board of Directors shall determine in its sole discretion
to be due and payable to Employee. If Employee receives any
disability payments from any insurance policies paid for by the
Company, the payments of annual base salary and bonuses shall be
reduced by the amount of such disability payments received by
Employee from such disability insurance policies.
D. Voluntary or Involuntary Termination. Upon notice
of any Voluntary or Involuntary Termination as defined herein,
Employee, if requested by the Company, shall continue to render his
services and shall be paid the then annual base salary up to the
date of such Voluntary or Involuntary Termination, any bonuses
which the Company's Board of Directors shall determine in its sole
discretion to be due and payable to Employee, and the Severance
Amount as provided herein. Employee must give the Company six (6)
months prior written notice of any Voluntary Termination. The
Company must give Employee one (1) year written notice of any
Involuntary Termination.
E. Definitions. All the terms defined in this Section
shall have the meanings given below throughout this Agreement.
1. "Change in Duties, Compensation, or Benefits"
shall mean any one or more of the following:
a. a significant change in the nature or
scope of Employee's authorities or duties from those applicable to
him immediately prior to the date on which a Change of Control
occurs;
b. a reduction in Employee's Annual Base
Salary from that provided to him immediately prior to the date on
which a Change of Control occurs;
c. a diminution in Employee's eligibility to
participate in bonus, stock option, incentive award and other
benefit plans which provide opportunities for Employee to receive
compensation from those applicable to him immediately prior to the
date on which a Change of Control occurs;
d. a diminution in Employee's benefits
(including but not limited to medical, dental, life insurance and
long-term disability plans) and perquisites applicable to Employee
from those applicable to him immediately prior to the date on which
a Change of Control occurs;
e. a change in the location of Employee's
principal place of employment by the Company (including its
subsidiaries) by more than ten miles from the location where he was
principally employed immediately prior to the date on which a
Change of Control occurs; or
f. a reasonable determination by the Board of
Directors of the Company that, as a result of a Change in Control
and a change in circumstances thereafter significantly affecting
his position, he is unable to exercise the functions or duties
attached to his position immediately prior to the date on which a
Change of Control occurs.
2. "Change of Control" shall be deemed to have
occurred if:
a. any "person," including a "group" as
determined in accordance with the Section 13(d)(3) of the
Securities Exchange Act of 1934 (the "Exchange Act"), other than
Employee and his "affiliates" defined in the Exchange Act becomes
the beneficial owner, directly or indirectly, of securities of the
Company representing 20% or more of the combined voting power of
the Company's then outstanding securities;
b. as a result of, or in connection with, any
tender offer or exchange offer, merger or other business
combination, sale of assets or contested election, or any
combination of the foregoing transactions (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;
c. the Company is merged or consolidated with
another corporation and as a result of the merger or consolidation
less than 60% 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, other than affiliates of
the Company within the meaning of the Exchange Act or any party to
the merger or consolidation;
d. a tender offer or exchange offer is made
and consummated for the ownership of securities of the Company
representing 50% or more of the combined voting power of the
Company's then outstanding securities; or
e. the Company transfers all or substantially
all of its assets to another corporation which is not a
wholly-owned subsidiary of the Company.
3. "Disability" shall mean mental or physical
illness or condition rendering Employee incapable of performing
Employee's normal duties with the Company.
4. "Involuntary Termination" shall mean any
termination except:
a. Voluntary Termination;
b. termination by mutual agreement; or
c. any termination as a result of death,
disability, or normal retirement pursuant to a retirement plan to
which Employee was subject prior to any Change of Control.
5. "Severance Amount" is equal to:
a. in the case of an Involuntary Termination,
2.99 times (i) Employee's then Annual Base Salary plus (ii) the
average bonus, if any, awarded to Employee by the Board of
Directors for the three (3) preceding years (the "Average Bonus")
payable in a lump sum or ratably over three (3) years, at the
Company's option; and
b. in the case of a Voluntary Termination,
1.0 times (i) Employee's then Annual Base Salary plus (ii) the
Average Bonus, payable in a lump sum or ratably over one (1) year,
at the Company's option.
6. "Voluntary Termination" shall mean any
termination which results from a resignation by the Employee other
than a resignation following a Change of Duties, Compensation, or
Benefits as defined herein.
F. Medical and Dental Benefits. If Employee's
employment by the Company or any subsidiary or successor of the
Company is terminated because of Disability, Voluntary Termination,
or Involuntary Termination, then to the extent that Employee or any
of Employee's dependents may be covered under the terms of any
medical and dental plans of the Company (or any subsidiary) for
active Employees immediately prior to the termination, the Company
will provide Employee and those dependents with equivalent
coverages until the later of Employee's death or the death of
Employee's spouse, if any, at the time of Employee's death. The
coverages may be procured directly by the Company (or any
subsidiary, if appropriate) apart from, and outside of the terms of
the plans themselves; provided that Employee and Employee's
dependents comply with all of the conditions of the medical or
dental plans. In consideration for these benefits, Employee must
make contributions equal to those required from time to time from
Employees for equivalent coverages under the medical or dental
plans.
IX. Section 162(m) Payment Deferral. If in any year the
compensation payable to Employee exceeds the amount the Company can
deduct as a compensation expense in such year is limited by
Section 162(m) of the Internal Revenue Code, then the Company may
defer amounts otherwise payable in such year to the minimum extent
necessary and for the minimum time necessary (not to exceed two
years) to permit the Company to deduct such amounts as compensation
expense in subsequent tax years. If deferral will not enable the
Company to deduct such amounts in either of the two years following
the year in which such amounts become payable, payment shall be
made in the second year following the year such amounts become
payable under this Agreement. Nothing in this Section shall permit
the Company to reduce the amount payable to the Employee under this
Agreement.
X. Notices. Any notice required or permitted to be given
under this Agreement shall be sufficient if in writing and
delivered in person or sent by registered or certified mail to
Employee's residence in the case of Employee or to its principal
office in the case of the Company.
XI. Waiver. The waiver of any provision of this Agreement
shall not operate or be construed as a waiver of any other
provision of this Agreement. No waiver shall be valid unless in
writing and executed by the party to be charged therewith.
XII. Severability/Modification. In the event that any clause
or provision of this Agreement shall be determined to be invalid,
illegal or unenforceable, such clause or provision may be severed
or modified to the extent necessary, and, as severed and/or
modified, this Agreement shall remain in full force and effect.
XIII. Assignment. Except for a transfer by will or by the laws
of descent or distribution, Employee's right to receive payments or
benefits under this Agreement shall not be assignable or
transferable, whether by pledge, creation of a security interest or
otherwise. In the event of any attempted assignment or transfer
contrary to this paragraph, the Company shall have no liability to
pay any amount so attempted to be assigned or transferred.
Employee acknowledges that the services to be rendered
under this Agreement are unique and personal. Accordingly,
Employee may not assign such duties or obligations under this
Agreement.
XIV. Successors. This Agreement shall be binding upon and
inure to the benefit of the Company, its successors and assigns
(including, without limitation, any company into or with which the
Company may merge or consolidate). The Company agrees that it will
not effect the sale or other disposition of all or substantially
all of its assets unless either (i) the person or entity acquiring
the assets or a substantial portion of the assets shall expressly
assume by an instrument in writing all duties and obligations of
the Company under this Agreement or (ii) the Company shall provide,
through the establishment of a separate reserve, for the payment in
full of all amounts which are or may reasonably be expected to
become payable to Employee under this Agreement.
XV. Entire Agreement. This instrument contains the entire
agreement concerning the employment arrangement between the parties
and shall, as of the effective date hereof, supersede all other
such agreements between the parties. It may not be amended except
by an agreement in writing signed by both parties.
XVI. Governing Law and Jurisdiction. This Agreement shall be
interpreted, construed, and enforced under the laws of the State of
Colorado. The courts and authorities of the State of Colorado
shall have sole jurisdiction and venue over all controversies which
may arise with respect to this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement
the date and year indicated below.
PRECISION STANDARD, INC.
Date: July 14, 1994 By: /s/Walter M. Moede
Walter M. Moede
Executive Vice President
(Principal Financial Officer)
EMPLOYEE:
Date: July 15, 1994 /s/Matthew L. Gold
Matthew L. Gold
EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT effective June 1, 1993, is made and entered into
by and between PRECISION STANDARD, INC. (the "Company")
and C. FREDRIK GROTH ("Employee").
I. Employment. The Company hereby employs Employee, and
Employee hereby accepts employment upon the terms and conditions
hereinafter set forth.
II. Term. Subject to the provisions for termination as
hereinafter provided, the term of this Agreement is for a period
commencing June 1, 1993, and expiring May 31, 1996. The term of
this Agreement shall be automatically extended for additional one-
year periods without any further action on the part of the Company
or Employee, unless the Company or Employee gives written notice of
its or his intention not to extend the term of this Agreement more
than ninety (90) days before May 31, 1996 or May 31 of any
subsequent year for which this Agreement has been extended.
III. Duties. Employee is engaged as Vice President -
Corporate Development to have complete responsibility for the
management of the sales and marketing operations of the Company,
and shall have full authority and responsibility, subject only to
the general direction and control of the Chief Executive Officer
and the Board of Directors, for formulating policies and
administering the sales and marketing operations of the Company in
all respects. His power shall include authority to hire and fire
personnel in the sales and marketing departments and to retain
consultants when he deems necessary to implement the Company's
policies.
IV. Extent of Services. Employee shall faithfully,
industriously, and to the best of his ability, experience, and
talents perform all of the duties that may be required of and from
him pursuant to this Agreement. Nothing herein shall be construed
as preventing Employee from (a) investing his assets in such form
or manner as will not require any services on the part of Employee
in the operation of the affairs of the other companies in which
such investments are made or (b) serving as a director, advisor, or
consultant to another company, provided, however, that such
investments or services may not be provided to, or in connection
with a business which is in competition with the Company.
V. Compensation and Employee Benefits.
A. Annual Base Salary. For all services rendered by
Employee under this Agreement, the Company shall pay Employee an
initial annual base salary of $100,000, payable in equal monthly
installments. The amount of such base salary shall be determined
at the beginning of each fiscal year by the Chief Executive Officer
and approved by the Board of Directors on the basis of merit and
the Company's financial success and progress but in no event shall
such base salary be less than the initial annual base salary
indicated above.
B. Bonus Compensation. Employee may receive quarterly
and/or year-end bonuses as determined at the beginning of each
fiscal year of the Company by the Chief Executive Officer and
approved by the Board of Directors on the basis of merit and the
Company's financial success and progress.
C. Vacation. Employee shall be entitled to annual
vacations in a manner commensurate with Employee's status as Vice
President-Corporate Development.
D. Employee Benefits. Employee shall be entitled to
receive all of the rights, benefits, and privileges of an employee
of the Company under any retirement, pension, profit-sharing,
insurance, health and hospital, and other employee benefit plans
which may be now in effect or hereafter adopted by the Company.
E. Working Facilities. Employee shall be furnished with
a private office, stenographic help, and such other facilities and
services suitable to Employee's position and adequate for the
performance of the duties required by this Agreement.
F. Expenses. Employee is authorized to incur reasonable
expenses in connection with his responsibilities in conducting the
business of the Company, including expenses for entertainment,
travel, and similar items. The Company will reimburse Employee for
all such expenses upon the presentation by Employee, from time to
time, of an itemized account of such expenditures.
VI. Proprietary Interests of Company. Employee recognizes
and acknowledges that (a) the business of the Company involves
certain confidential and proprietary information as such may exist
from time to time, and which are valuable, special, and unique
assets of the Company's business and (b) Employee may, in the
course of said employment, develop innovations, designs, and other
work product. As a condition to employment of the Employee, the
Company requires, and the Employee hereby agrees to enter into, a
confidentiality agreement between the Company and its key
employees, which agreement is incorporated herein by reference.
VII. Noncompete. During the term of this Agreement and for a
period of the greater of (a) one (1) year after termination or
expiration of this Agreement or (b) the period covered by a sever-
ance allowance, the Employee will not, directly or indirectly, own,
manage, operate, control, be employed by, participate in, or be
connected in any manner with the ownership, management, operation,
or control of any business which is similar to the type of business
conducted by the Company and which conducts such business or sells
its products within and to the same market as the Company's market
at the time of the termination or expiration of this Agreement. In
the event of Employee's actual or threatened breach of the
provisions of this paragraph, the Company shall be entitled to an
injunction restraining Employee therefrom. Nothing shall be
construed as prohibiting the Company from pursuing any other
available remedies for such breach or threatened breach, including
the recovery of damages, costs, and attorney fees.
The foregoing agreement not to compete shall not be held
invalid because of the scope of the territory or the actions
restricted thereby, or the period of time within which such Agree-
ment is operative; but any judgment by a court of competent
jurisdiction may define the maximum territory and action subject
to, and restricted by, this paragraph and the period of time during
which such agreement is enforceable.
Notwithstanding the foregoing, in the event of a Change of
Control, as hereinafter defined, not recommended by a majority of
the Board of the Company as constituted prior to the date of such
Change of Control, this noncompete agreement shall terminate upon
the Change of Control Date.
VIII. Termination of Employment.
A. Termination by Mutual Agreement. The Company and
Employee may agree to terminate this Agreement on terms and
conditions mutually acceptable to them as of the date of
termination.
B. Death. In the event of Employee's death, the Company
shall pay to any beneficiary designated by Employee or, if no such
beneficiary has been designated, to his estate, an amount equal to
the then annual base salary for the greater of (a) two (2) years or
(b) the remaining term of this Agreement without additional
extensions, together with any bonuses which the Company's Board of
Directors shall determine in its sole discretion to be due and
payable to Employee. If Employee's beneficiary or estate receives
any proceeds from any life insurance policies paid for by the
Company, the payments of annual base salary and bonuses shall be
reduced by the amount of such proceeds from such life insurance
policies.
C. Disability. In the event Employee shall become
disabled during the term of employment, Employee's annual base
salary shall continue at the same rate that it was on the date of
such disability. If such disability continues for twelve (12) or
more consecutive months, the Company, at its option, may
thereafter, upon written notice to Employee or Employee's personal
representative, terminate the employment. If the Company
terminates the employment because of disability, Employee shall
receive the then annual base salary for the greater of (a) six
months or (b) the remaining term of this Agreement without
additional extensions, together with any bonuses which the
Company's Chief Executive Officer with the approval of the Board of
Directors shall determine to be due and payable to Employee. If
Employee receives any disability payments from any insurance
policies paid for by the Company, the payments of annual base
salary and bonuses shall be reduced by the amount of such
disability payments received by Employee from such disability
insurance policies.
D. Voluntary or Involuntary Termination. If prior
notice is given of any Voluntary or Involuntary Termination as
defined herein, Employee, if requested by the Company, shall
continue to render his services and shall be paid the then annual
base salary up to the date of such Voluntary or Involuntary
Termination, any bonuses which the Company's Chief Executive
Officer with the approval of the Board of Directors shall determine
to be due and payable to Employee, and the Severance Amount as
provided herein.
E. Definitions. All the terms defined in this Section
shall have the meanings given below throughout this Agreement.
1. "Change in Duties, Compensation, or Benefits"
shall mean any one or more of the following:
a. a significant change in the nature or
scope of Employee's authorities or duties from those applicable to
him immediately prior to the date on which a Change of Control
occurs;
b. a reduction in Employee's Annual Base
Salary from that provided to him immediately prior to the date on
which a Change of Control occurs;
c. a diminution in Employee's eligibility to
participate in bonus, stock option, incentive award and other
benefit plans which provide opportunities for Employee to receive
compensation from those applicable to him immediately prior to the
date on which a Change of Control occurs;
d. a diminution in Employee's benefits
(including but not limited to medical, dental, life insurance and
long-term disability plans) and perquisites applicable to Employee
from those applicable to him immediately prior to the date on which
a Change of Control occurs;
e. a change in the location of Employee's
principal place of employment by the Company (including its
subsidiaries) by more than ten miles from the location where he was
principally employed immediately prior to the date on which a
Change of Control occurs; or
f. a reasonable determination by the Board of
Directors of the Company that, as a result of a Change in Control
and a change in circumstances thereafter significantly affecting
his position, he is unable to exercise the functions or duties
attached to his position immediately prior to the date on which a
Change of Control occurs.
2. "Change of Control" shall be deemed to have
occurred if:
a. any "person," including a "group" as
determined in accordance with the Section 13(d)(3) of the
Securities Exchange Act of 1934 (the "Exchange Act"), other than
Matthew L. Gold or his "affiliates" as defined in the Exchange Act
becomes the beneficial owner, directly or indirectly, of securities
of the Company representing 20% or more of the combined voting
power of the Company's then outstanding securities;
b. as a result of, or in connection with, any
tender offer or exchange offer, merger or other business
combination, sale of assets or contested election, or any
combination of the foregoing transactions (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;
c. the Company is merged or consolidated with
another corporation and as a result of the merger or consolidation
less than 60% 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, other than affiliates of
the Company within the meaning of the Exchange Act or any party to
the merger or consolidation;
d. a tender offer or exchange offer is made
and consummated for the ownership of securities of the Company
representing 50% or more of the combined voting power of the
Company's then outstanding securities; or
e. the Company transfers all or substantially
all of its assets to another corporation which is not a
wholly-owned subsidiary of the Company.
3. "Disability" shall mean mental or physical
illness or condition rendering Employee incapable of performing
Employee's normal duties with the Company.
4. "Involuntary Termination" shall mean any
termination except:
a. Voluntary Termination;
b. termination by mutual agreement; or
c. any termination as a result of death,
disability, or normal retirement pursuant to a retirement plan to
which Employee was subject prior to any Change of Control.
5. "Severance Amount" is equal to:
a. in the case of an Involuntary Termination,
1.0 times Employee's Annual Base Salary paid ratably over one (1)
year or in a lump sum, at the Company's option; and
b. in the case of a Voluntary Termination,
$1,000 in a lump sum, payable in thirty (30) days.
6. "Voluntary Termination" shall mean any
termination which results from a resignation by the Employee other
than a resignation following a Change of Duties, Compensation, or
Benefits as defined herein.
F. Medical and Dental Benefits. If Employee's
employment by the Company or any subsidiary or successor of the
Company is terminated because of Disability, Voluntary Termination,
or Involuntary Termination, then to the extent that Employee or any
of Employee's dependents may be covered under the terms of any
medical and dental plans of the Company (or any subsidiary) for
active Employees immediately prior to the termination, the Company
will provide Employee and those dependents with equivalent
coverages for a period not to exceed thirty (30) months from the
termination. The coverages may be procured directly by the Company
(or any subsidiary, if appropriate) apart from, and outside of the
terms of the plans themselves; provided that Employee and
Employee's dependents comply with all of the conditions of the
medical or dental plans. In consideration for these benefits,
Employee must make contributions equal to those required from time
to time from Employees for equivalent coverages under the medical
or dental plans.
IX. Section 162(m) Payment Deferral. If in any year the
compensation payable to Employee exceeds the amount the Company can
deduct as a compensation expense in such year is limited by
Section 162(m) of the Internal Revenue Code, then the Company may
defer amounts otherwise payable in such year to the minimum extent
necessary and for the minimum time necessary to permit the Company
to deduct such amounts as compensation expense in subsequent tax
years. If deferral will not enable the Company to deduct such
amounts in either of the two years following the year in which such
amounts became payable, payment shall be made in the second year
following the year such amounts became payable under this
Agreement. Nothing in this Section shall permit the Company to
reduce the amount payable to the Employee under this Agreement.
X. Notices. Any notice required or permitted to be given
under this Agreement shall be sufficient if in writing and
delivered in person or sent by registered or certified mail to
Employee's residence in the case of Employee or to its principal
office in the case of the Company.
XI. Waiver. The waiver of any provision of this Agreement
shall not operate or be construed as a waiver of any other
provision of this Agreement. No waiver shall be valid unless in
writing and executed by the party to be charged therewith.
XII. Severability/Modification. In the event that any clause
or provision of this Agreement shall be determined to be invalid,
illegal or unenforceable, such clause or provision may be severed
or modified to the extent necessary, and, as severed and/or
modified, this Agreement shall remain in full force and effect.
XIII. Assignment. Except for a transfer by will or by the laws
of descent or distribution, Employee's right to receive payments or
benefits under this Agreement shall not be assignable or
transferable, whether by pledge, creation of a security interest or
otherwise. In the event of any attempted assignment or transfer
contrary to this paragraph, the Company shall have no liability to
pay any amount so attempted to be assigned or transferred.
Employee acknowledges that the services to be rendered under
this Agreement are unique and personal. Accordingly, Employee may
not assign such duties or obligations under this Agreement.
XIV. Successors. This Agreement shall be binding upon and
inure to the benefit of the Company, its successors and assigns
(including, without limitation, any company into or with which the
Company may merge or consolidate). The Company agrees that it will
not effect the sale or other disposition of all or substantially
all of its assets unless either (i) the person or entity acquiring
the assets or a substantial portion of the assets shall expressly
assume by an instrument in writing all duties and obligations of
the Company under this Agreement or (ii) the Company shall provide,
through the establishment of a separate reserve, for the payment in
full of all amounts which are or may reasonably be expected to
become payable to Employee under this Agreement.
XV. Entire Agreement. This instrument contains the entire
agreement concerning the employment arrangement between the parties
and shall, as of the effective date hereof, supersede all other
such agreements between the parties. It may not be amended except
by an agreement in writing signed by both parties.
XVI. Governing Law and Jurisdiction. This Agreement shall be
interpreted, construed, and enforced under the laws of the State of
Colorado. The courts and authorities of the State of Colorado
shall have sole jurisdiction and venue over all controversies which
may arise with respect to this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement
the date and year indicated below.
PRECISION STANDARD, INC.
Date: July 15, 1994 By: /s/Matthew L. Gold
Matthew L. Gold, President
(Principal Executive Officer)
EMPLOYEE:
Date: July 20, 1994 /s/Fredrik Groth
C. Fredrik Groth
