Sample Business Contracts

Employment Agreement - The Wackenhut Corp. and George R. Wackenhut

Employment Forms

  • Employment Agreement. Employers can customize an employment agreement that states the salary, benefits, working hours and other important provisions for their new or existing employee.
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                              EMPLOYMENT AGREEMENT

         This EMPLOYMENT AGREEMENT ("Agreement") is entered into as of March 17,
2000, by and between THE WACKENHUT CORPORATION, a Florida corporation, its
successor or successors (the "COMPANY"), and GEORGE R. WACKENHUT (the

         The Executive is presently an executive officer of the Company and the
parties wish to continue their employment relationship on the terms of this

         NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements contained in this Agreement, the parties
hereto agree as follows:

1.       EMPLOYMENT.

         a.       RETENTION. The Company agrees to employ the Executive, and the
                  Executive agrees to accept such employment, subject to the
                  terms and conditions of this Agreement.

         b.       EMPLOYMENT TERM. The period during which the Executive shall
                  serve as an Executive of the Company shall commence on the
                  date hereof and, unless earlier terminated pursuant to Section
                  4 of this Agreement, shall expire on the third anniversary of
                  the date hereof (the "Employment Term"). Thereafter, this
                  Agreement and the Employment Term shall be automatically
                  renewed for successive one year terms, unless either party
                  shall deliver a written notice to the other party during the
                  last calendar month of the initial three-year term or any
                  successive one-year term of this Agreement advising the other
                  party that this Agreement and the Employment period shall be
                  terminated at the end of such term.

         c.       DUTIES AND RESPONSIBILITIES. During the Employment Term, the
                  Executive shall have such authority and responsibility and
                  perform such duties as may be assigned to him from time to
                  time at the direction of the Board of Directors of the Company
                  (the "Board").

2.       LOYALTY. Executive agrees that during the Employment Term, he will
         devote such time that is reasonably necessary to perform his duties and

3.       COMPENSATION. During the Employment Term, the Company agrees to pay,
         and Executive agrees to accept, the amounts set forth below:

         a.       BASE SALARY. As compensation for all services rendered by
                  Executive in performance of his duties or obligations under
                  this Agreement, Company shall pay Executive an annual base
                  salary of one million five hundred eighty-four thousand
                  dollars ($1,584,000) (the "Base Salary"). Such base salary
                  shall be increased (but not decreased) from time to time in
                  the sole discretion of the Board or the Compensation Committee
                  of the Board. Such base salary shall be payable in equal
                  installments, no


<PAGE>   2

                  less frequently than monthly, pursuant to the Company's
                  customary payroll policies in force at the time of payment,
                  less any required or authorized withholding or payroll
                  deductions. In addition, the Executive shall be eligible to
                  receive, on an annual basis a bonus (the "Bonus") in such
                  amounts and subject to such targets and incentives as set
                  forth in the Designated Executive Officer Bonus Plan. In no
                  event shall any such Bonus be less than thirty five percent
                  (35%) of the Executive's Base Salary, subject to satisfaction
                  of applicable targets and incentives.

         b.       EXECUTIVE BENEFITS. In addition to receiving the Base Salary
                  provided for in Section 3a., Executive shall be entitled
                  during the Employment Term to participate in all retirement
                  (subject to any eligibility requirements with respect to any
                  tax-qualified retirement plans), deferred compensation,
                  health, dental, disability, life insurance and fringe benefits
                  or programs now or hereafter established by the Company which
                  cover the Company's executives or its employees.

         c.       VACATION. Executive shall be entitled to receive six weeks of
                  paid vacation for each year during the Employment Term and
                  shall be entitled to receive paid holidays as enjoyed by all
                  other employees of the Company.

         d.       EXPENSES. The Company agrees to reimburse Executive for all
                  reasonable expenses incurred by him in providing services
                  under this Agreement in accordance with its policies and
                  practices regarding expense reimbursement then in effect.

         e.       AUTOMOBILE ALLOWANCE. Executive shall be entitled to receive
                  an automobile allowance in accordance with The Wackenhut
                  Corporation Executive Automobile Policy (the " Executive
                  Automobile Policy") as in effect on the date hereof. Both the
                  Company and Executive shall be responsible for paying the
                  costs related to Executive's automobile in accordance with the
                  terms of the Executive Automobile Policy.

         f.       CLUB MEMBERSHIP. The Company will provide Executive with a
                  corporate membership to a country club mutually acceptable to
                  Executive and to the Company, including initiation fees and
                  monthly dues.

4.       TERMINATION OF EMPLOYMENT. At any time during the Employment Term, the
         Executive or the Company shall have the right to terminate the
         Employment Term for any reason effective upon delivery of written
         notice to the other party. Upon any such termination, (i) the Company
         shall pay to the Executive the unpaid portion of his Salary, payable
         through the date of Executive's termination, when and as the same would
         have been due and payable hereunder but for such termination and all of
         the Executive's vested accrued benefits as of the date of termination
         of employment that the Executive is entitled to under the Company's
         benefit plans, (ii) the Company shall transfer all of its interest in
         any automobile used by the Executive pursuant to the Executive
         Automobile Policy and shall pay the balance of any outstanding loans or
         leases on such automobile (whether such obligations are those of the
         Executive or the Company) so that the Executive owns the automobile
         outright (in the event


<PAGE>   3

         such automobile is leased, the Company shall pay the residual cost of
         such lease); and (iii) the Retirement Benefit (as defined in Section 5

5.       RETIREMENT BENEFITS. Upon the termination of the Employment Term for
         any reason, the Company shall provide the Executive and his spouse with
         an annual Retirement Benefit (as defined below). The Retirement Benefit
         shall be provided annually to the Executive and his spouse for the
         remainder of the Executive's life, and upon the Executive's death, the
         Retirement Benefit shall be provided to his spouse for the remainder of
         her life. For purposes of this Agreement, the "Retirement Benefit"
         shall mean any benefits or perquisites requested by the Executive (or
         in the event of his death, his spouse), which shall not exceed $250,000
         per year in total cost to the Company. The Retirement Benefit may
         include, but is not limited to, health and life insurance, office
         space, secretarial services, country club dues, living expenses, travel
         allowances and automobile allowances.

         a.       EQUALIZATION PAYMENT. If any of the Retirement Benefit will be
                  subject to the tax (the "Excise Tax") imposed by Section 4999
                  of the Internal Revenue Code of 1986, as amended (the "Code")
                  (or any similar tax that may hereafter be imposed), the
                  Company shall pay to the Executive in cash an additional
                  amount (the "Gross-Up Payment") to enable the Executive to pay
                  the entire amount of any Excise Tax imposed upon the
                  Retirement Benefit and any federal, state and local income tax
                  and Excise Tax imposed upon the Gross-Up Payment. The Gross-Up
                  Payment is intended to place the Executive in the same
                  economic position he would have been in if the excise tax did
                  not apply. The Gross-Up Payment shall be paid to the Executive
                  within 60 days from the expiration of the Employment Term. For
                  purposes of determining the Gross-Up Payment pursuant to this
                  Section 5.a, the Retirement Benefit shall also include any
                  amounts which would be considered "Parachute Payments" (within
                  the meaning of Section 280G(b)(2) of the Code) to the

         b.       TAX RATES. For purposes of determining the amount of the
                  Gross-Up Payment, the Executive shall be deemed to pay Federal
                  income taxes at the highest marginal rate of Federal income
                  taxation in the calendar year in which the Gross-Up Payment is
                  to be made, and state and local income taxes at the highest
                  marginal rate of taxation in the state and locality of the
                  Executive's residence on the date of termination, net of the
                  maximum reduction in Federal income taxes which could be
                  obtained from deduction of such state and local taxes.

         c.       TAX CALCULATION. Within 30 days from the expiration of the
                  Employment Term, the Company shall deliver to the Executive a
                  written statement (the "Gross-Up Statement") specifying the
                  total amount of the Gross-Up Payment (if any), together with
                  all supporting calculations. If the Executive disagrees with
                  the Company's calculation of said payment, the Executive shall
                  submit to the Company, no later than 30 days after receipt of
                  the Company's calculations, a written notice advising the
                  Company of the disagreement and setting forth his calculation
                  of said payments. The Executive's failure to submit such
                  notice within such period shall be conclusively


<PAGE>   4

                  deemed to be an agreement by the Executive as to the amount of
                  the Gross-Up Payment. If the Company agrees with the
                  Executive's calculations, it shall pay any shortfall to the
                  Executive within 20 days after receipt of such a notice from
                  the Executive, together with interest thereon accruing at the
                  rate of 18 percent per annum, compounded monthly, from the
                  original due date of the Gross-Up Statement through the actual
                  date of payment of said shortfall. If the Company does not
                  agree with the Executive's calculations, it shall provide the
                  Executive with a written notice within 20 days after the
                  receipt of the Executive's calculations advising the Executive
                  that the disagreement is to be referred to an independent
                  accounting firm for resolution. Such disagreement shall be
                  referred to an independent "Big 5" accounting firm which is
                  not the regular accounting firm of the Company and which is
                  agreed to by the Company and the Executive within 10 days
                  after issuance of the Company's notice of disagreement (if the
                  parties cannot agree on the identity of the accounting firm
                  which is to resolve the dispute, the accounting firm shall be
                  selected by means of a coin toss conducted in Palm Beach
                  County, Florida by counsel to the Executive on the first
                  business day after such 10 day period in such manner as such
                  counsel may specify). The accounting firm shall review all
                  information provided to it by the parties and submit a written
                  report setting forth its calculation of the GrossUp Payment
                  within 15 days after submission of the matter to it, and such
                  decision shall be final and binding on all of the parties. The
                  fees and expenses charged by said accounting firm shall be
                  paid by the Company. If the amount of the Gross-Up Payment
                  actually paid by the Company was less than the amount
                  calculated by the accounting firm, the Company shall pay the
                  shortfall to the Executive within 5 days after the accounting
                  firm submits its written report, together with interest
                  thereon accruing at the rate of 18 percent per annum,
                  compounded monthly, from the original due date of the Gross-Up
                  Statement through the actual date of payment of said

         d.       SUBSEQUENT RECALCULATION. In the event the Internal Revenue
                  Service imposes an Excise Tax with respect to the Retirement
                  Benefit that is greater than the Excise Tax calculated
                  hereunder, the Company shall reimburse the Executive for the
                  full amount necessary to make the Executive whole in
                  accordance with the principles set forth above, including any
                  interest and penalties which may be imposed.

6.       NO MITIGATION AND REEMPLOYMENT. Executive shall not be required to
         mitigate the amount of any payment or benefit contemplated by this
         Agreement upon his termination of employment (whether by seeking new
         employment or in any other manner), nor shall any such payment or
         benefit be reduced by any earnings or benefits that Executive may
         receive from any other source. Notwithstanding anything else in this
         Agreement to the contrary, subsequent reemployment of the Executive by
         the Company or any successor of the Company following a Change in
         Control will not cause the Executive to forfeit any payment or benefit
         contemplated by this Agreement upon his termination of employment

7.       RELEASE AND INDEMNITY. The Company hereby fully and forever releases,
         acquits, discharges and holds the Executive harmless from any and all,
         and all manner of, actions and causes of


<PAGE>   5

         action, claims, suits, costs, debts, sums of money, claims and demands,
         presently known or unknown, whatsoever in law or equity or otherwise,
         which the Company ever had, now has or may now have, or will have in
         the future, by reason of any matter, cause or thing whatsoever, from
         the beginning of the world and all times thereafter. The preceding
         sentence does not apply to any matters, events, actions, claims,
         damages or losses arising from, in connection with or relating to (i)
         any intentional illegal conduct of the Executive, or (ii) conduct of
         the Executive after the Executive ceases to be employed by the Company.
         The Company at all times shall indemnify, save harmless and reimburse
         the Executive, from and against any and all demands, claims,
         liabilities, losses, actions, suits or proceedings, or other expenses,
         fees, or charges of any character or nature, which the Executive may
         incur or with which they may be threatened with, arising from, in
         connection with, relating to or arising as a result of Executive's
         employment by the Company or any other relationship that the Executive
         has with the Company as an officer, director, agent shareholder or
         otherwise, including without limitation settlement costs and attorneys'
         fees and court costs at trial and appellate levels which the Executive
         may incur in connection with settling, defending against or resisting
         any of the foregoing. The Company shall pay to the Executive any
         amounts due with respect to said indemnity within 5 business days after
         the Executive issues a written demand therefor to the Company. The
         provisions of this section are an expansion of any rights that the
         Executive may have with respect to the subject matter, and no other
         agreement or arrangement which the Company may have that benefits the
         Executive with respect to the subject matter hereof shall be superseded
         or limited in any way as a result of the parties entering into this

8.       NOTICES. Notices and all other communications contemplated by this
         Agreement shall be in writing and shall be deemed to have been duly
         given when received at the address specified herein. In the case of
         Executive, notices shall be delivered to him at the home address which
         he has most recently communicated to the Company in writing. In the
         case of the Company, notices shall be delivered to the Company's
         corporate headquarters, and all notices shall be directed to the
         attention of the Company's Chief Executive Officer, with a copy to the
         Company's General Counsel.

9.       MODIFICATION AND WAIVER. This Agreement shall not be canceled,
         rescinded or revoked, nor may any provision of this Agreement be
         modified, waived or discharged unless the cancellation, rescission,
         revocation, modification, waiver or discharge is agreed to in writing
         and signed by Executive and by the President or Chairman of the Board
         of the Company. No waiver by either party of any breach of, or of
         compliance with, any condition or provision of this Agreement by the
         other party shall be considered a waiver of any other condition or
         provision or of the same condition or provision at another time.

10.      COMPLETE AGREEMENT. This Agreement supersedes all previous employment
         agreements entered into by Executive and the Company. This Agreement
         does not affect any deferred compensation agreements, nonqualified
         retirement plans or any other agreements entered into by the parties.


<PAGE>   6

11.      NO ASSIGNMENT. No right, benefit or interest hereunder, shall be
         subject to anticipation, alienation, sale, assignment, encumbrance,
         charge, pledge, hypothecation, or set-off in respect of any claim, debt
         or obligation, or to execution, attachment, levy or similar process, or
         assignment by operation of law. Any attempt, voluntary or involuntary,
         to effect any action specified in the immediately preceding sentence
         shall, to the full extent permitted by law, be null, void and of no
         effect. This Agreement is binding on all successors of the Company,
         whether by merger, consolidation, purchase or otherwise, and all
         references to the Company shall also include references to any such

12.      GOVERNING LAW. This Agreement shall be governed by, and construed and
         enforced in accordance with and subject to, the laws of the State of
         Florida applicable to Agreements made and to be performed entirely
         within such State, as to all matters governed by state law or, if
         controlling, by applicable federal law.

13.      SEVERABILITY. The invalidity or unenforceability of any provision or
         provisions of this Agreement shall not affect the validity or
         enforceability of any other provision hereof, which shall remain in
         full force and effect.

14.      LITIGATION; VENUE. Any action at law or in equity under this Agreement
         shall be brought in the courts of Palm Beach County, Florida, and in no
         other court (whether or not jurisdiction can be established in another
         court). Each party hereto waives the right to argue that venue is not
         appropriate in the courts of Palm Beach County, Florida. THE PARTIES

15.      EXPENSES. The Company shall reimburse the Executive for all legal
         and/or accounting expenses he incurs in connection with the execution,
         delivery and enforcement of his rights under this Agreement.

16.      WITHHOLDING. All payments made pursuant to this Agreement will be
         subject to withholding of applicable taxes.

17.      COUNTERPARTS. This Agreement may be executed in one or more
         counterparts, each of which shall be deemed to be an original but all
         of which together will constitute one and the same instrument.

                          [Signatures on the Next Page]


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         IN WITNESS WHEREOF, each of the parties has executed this Agreement as
of the date first above written.


/s/ Rey Ramirez                               /s/ GEORGE R. WACKENHUT
-----------------------------------           ---------------------------------

Rey Ramirez
/s/ Victor Stebnicki
---------------------------------                  ----------------------------
Victor Stebnicki
                                              THE WACKENHUT CORPORATION

/s/ Patricia Delinois                         By: /s/ RICHARD R. WACKENHUT
-----------------------------------           ---------------------------------
PRINT NAME OF WITNESS BELOW:                  Name: Richard R. Wackenhut
Patricia Delinois                                   Title: President and Chief
-----------------------------------                  Executive Officer

/s/ JC Tissot


JC Tissot                                      Date:       3/17/00
---------------------------------                    --------------------------