Exhibit 10.1
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT
(“Agreement”) is made and entered into this 2nd day of
November, 2006, by and between AMBASSADORS INTERNATIONAL, INC.
(“Company”), a Delaware corporation, and JOSEPH J.
UEBERROTH (“Executive”), with reference to the
following facts:
A. Executive has been serving
Company as Chairman, President and Chief Executive Officer in a
satisfactory and capable manner.
B. Company has requested that
Executive enter into an employment agreement with Company with
respect to matters relating to continued employment with Company,
and Executive has agreed to do so, upon the terms and conditions
set forth herein.
NOW, THEREFORE, in consideration of
the terms and conditions and the mutual agreements and covenants
set forth herein, the parties hereto agree as follows:
1. SCOPE OF EMPLOYMENT
.
1.1 Capacity . Company hereby
continues to employ Executive, and Executive hereby accepts
continued employment, as Chairman, President and Chief Executive
Officer of Company. Executive shall report to the Board of
Directors of Company (“Board”) and perform the services
and duties customarily incident to such titles unless a change is
agreed to by both parties.
1.2 Devotion of Services .
Executive shall devote his business time, ability and attention to
the business of Company during the Term of Employment (as defined
below), except the Company acknowledges his outside business
activities such as member of private equity or venture capital
funds, as a member of public and private boards, passive
investments, charitable and non-profit enterprises and any other
business investments which do not interfere with his duties
hereunder and which are not competitive with Company’s
activities. Executive shall perform and discharge well and
faithfully those duties assigned him by the Board. Executive shall
perform his services under this Agreement primarily at
Company’s offices in Newport Beach, or such other location as
is acceptable to Executive.
2. TERM OF EMPLOYMENT
. The term of Executive’s employment under this Agreement
shall commence as of the date first set forth above and, unless
sooner terminated pursuant to Section 4 of this Agreement,
shall terminate upon the close of business twelve (12) months
following the date that either party notifies the other in writing
that the notifying party elects to terminate such employment
(“Term of Employment”).
3. COMPENSATION
.
3.1 Salary and Bonus . In
consideration of the services to be rendered by Executive hereunder
including, without limitation, any services rendered as an officer
or director of Company and/or any subsidiary thereof, Company shall
pay to Executive the following during the Term of
Employment:
(a) A base salary in the amount of
$375,000 per annum, which salary shall be reviewed no less frequent
than annually by Company’s Board or Compensation Committee.
The Board or Compensation Committee may increase Executive’s
base salary but, in no event, may Executive’s base salary be
reduced during the Term of Employment unless agreed to by both
parties.
(b) Company intends to continue its
annual cash incentive plan with respect to Executive; provided,
however, the amount of the annual cash incentive shall be at the
discretion of Company’s Board or Compensation
Committee.
(c) All payments to Executive shall
be subject to the applicable withholding requirements of all
appropriate governmental authorities.
(d) Company intends to continue its
annual stock option and restricted stock grants, its Long Term
Incentive (LTI) plan, with respect to Executive; provided, however,
the number of options and/or restricted stock granted shall be at
the discretion of Company’s Board or such committee, but, in
no event, may the Executive’s LTI be less 50% of his total
annual compensation during the Term of Employment unless agreed to
by both parties.
3.2 Other Benefits . During
the Term of Employment, Executive shall be entitled to participate
in all employee pension and welfare benefit plans and programs made
available to Company’s senior members of management, as such
plans or programs may be in effect from time to time including,
without limitation, pension, profit sharing, savings and other
retirement plans or programs, accidental death and dismemberment
protection, and health and medical plans.
3.3 Expenses . Company will
advance to or reimburse Executive for all reasonable travel and
entertainment required by Company and other reasonable expenses
incurred by Executive in connection with the performance of his
services under this Agreement in accordance with Company policy as
established from time to time.
3.4 Vacation . Executive
shall be entitled to not less than twenty-five (25) days of
vacation during each fiscal year of Company, during which time
Executive’s compensation shall be paid in full.
Executive’s vacation allowance shall be applied and extended
under the same terms and conditions as are generally applicable to
other senior members of Company’s management.
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4. TERMINATION OF
EMPLOYMENT .
4.1 Termination by Company for
Cause. Notwithstanding the provisions of Section 2 of this
Agreement, Company may terminate Executive’s employment at
any time for Cause (as defined below) by delivering written notice
to Executive, and such termination shall be effective upon the date
such notice is deemed received by Executive or such later date if
specified in the notice. In the event that Company terminates
Executive’s employment for Cause, then Executive shall only
be entitled to the compensation, unpaid expenses, unpaid vacation
days and other benefits provided for in Section 3 of this
Agreement through the date of such termination. As used herein,
“Cause” shall mean any of the following events if
agreed to in writing by at least 75% of the independent directors
of the board: (a) Executive is convicted, or pleads guilty or
nolo contendre to, a felony or a crime involving moral turpitude;
(b) Executive engages in gross negligence or gross or willful
misconduct in connection with the performance of his
responsibilities under this Agreement; (c) after written
notice to Executive, Executive repeatedly fails to comply
materially with any material Company policy; or (d) Executive
materially breaches any material term or provision of this
Agreement and fails to cure such breach within thirty
(30) days after he receives written notice thereof from
Company.
4.2 Termination by Executive
Without Good Reason . Notwithstanding the provisions of
Section 2 of this Agreement, Executive may terminate his
employment without Good Reason (as defined below) by delivering
written notice to Company. In the event that Executive terminates
his employment without Good Reason and provides the Company at
least 12 months notice, then Company shall pay to Executive all of
the following upon the following terms and conditions:
(i) An amount equal to the projected
cost of Executive’s medical insurance under COBRA for the
eighteen (18) month period immediately following the
termination;
(ii) An amount equal to one
(1) times the average annual base salary plus the average
annual bonus paid to Executive for the two (2) full fiscal
years immediately preceding termination (in determining the annual
bonuses, there shall be included the cash amounts as well as that
value ascribed for financial accounting purposes on the dates of
the grants to any and all option and share grants give to
Executive);
(iii) The payments provided for in
clauses (i) and (ii) of this Section 4.2 shall be
paid in full on the effective date of the termination and all such
payments shall be subject to the applicable withholding
requirements of all appropriate governmental authorities;
and
(vi) Notwithstanding anything to the
contrary contained herein, in the event that any payments and/or
other consideration to be received by Executive under this
Section 4.2 and or other sections within this agreement are
subject to the deduction limitations and tax imposed by Sections
280G and 4999 of the Internal Revenue Code of 1986, as amended
(“Code”), or to any similar tax imposed by state or
local law, or to any interest or penalties with respect to such
taxes (such taxes together with any such interest and penalties
shall hereafter collectively be referred to as “Excise
Tax”), then the total amount of such payments and value of
the other consideration shall be reduced, or refunded, as the case
may be, by the minimum amount necessary so as to avoid the
application of any Excise Tax.
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4.3 Termination by Executive With
Good Reason; Termination by Company Without Cause .
Notwithstanding the provisions of Paragraph 2 of this Agreement,
(i) Exe
