EXHIBIT 10.89
CHANGE OF CONTROL AGREEMENT
THIS CHANGE OF CONTROL AGREEMENT (the "Agreement"), dated as of July
15, 2003, is by and between WORKFLOW MANAGEMENT, INC., a Delaware corporation
(the "Company"), and MICHAEL L. SCHMICKLE (the "Executive").
Background Statement
The Executive currently serves the Company as Executive Vice President
and Chief Financial Officer. The Board of Directors of the Company (the "Board")
has determined that it is in the best interests of the Company and its
shareholders to assure that the Company to retain Executive and have the
continued dedication of the Executive, notwithstanding the possibility, threat
or occurrence of a Change of Control (as defined in Section 1) of the Company.
Specifically, the Board believes it is imperative to diminish the inevitable
distraction of the Executive by virtue of the personal uncertainties and risks
created by a pending or threatened Change of Control and to encourage the
Executive's full attention and dedication to the Company currently and in the
event of any threatened or pending Change of Control, and to provide the
Executive with compensation and benefits arrangements upon a Change of Control
which ensure that the compensation and benefits expectations of the Executive
will be satisfied and which are competitive with those of other corporations.
Therefore, in order to accomplish these objectives, the Board has caused the
Company to enter into this Agreement with the Executive.
NOW, THEREFORE, in consideration of the promises and of the mutual
covenants and agreements set forth herein, the parties, intending legally to be
bound, hereto agree as follows:
1. Change of Control. For the purpose of this Agreement, a "Change of
Control" shall mean:
(a) The acquisition by any individual, entity (other than the Company, any
Company subsidiary, any Company benefit plan or any underwriter temporarily
holding securities for an offering of such securities) or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) (a "Person") of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than 50%
the undiluted total voting power of the then outstanding securities of the
Company entitled to vote generally in the election of directors (the
"Outstanding Company Voting Securities") or;
(b) Individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the date hereof whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board; or
(c) Approval by the shareholders of the Company of a reorganization, merger
or consolidation, in each case, unless, following such reorganization, merger or
consolidation, no less than 50% of the combined voting power of the then
outstanding voting securities of such corporation entitled to vote generally in
the election of directors is then beneficially owned, directly or indirectly, by
all or substantially all of the individuals and entities who were the beneficial
owners of the Outstanding Company Voting Securities immediately prior to such
reorganization, merger or consolidation in substantially the same proportions as
their ownership, immediately prior to such reorganization, merger or
consolidation, of the Outstanding Company Voting Securities; or
(d) Approval by the shareholders of the Company of (i) a complete
liquidation or dissolution of the Company or the sale or other disposition of
all or substantially all of the assets of the Company, and (ii) the subsequent
consummation of such liquidation, dissolution, sale or disposition.
2. Termination and Severance Compensation
(a) For the purposes of this Section 2, the capitalized terms set forth
below shall have the following meanings:
"Cause" shall mean (i) Executive's material breach of any
written agreement to which the Company and the Executive are parties (including
without limitation this Agreement), which breach is not cured within ten (10)
days of receipt by the Executive of written notice from the Company specifying
the breach; (ii) Executive's gross negligence in the performance of his material
duties as an employee or executive officer of the Company, or the intentional
nonperformance or mis-performance of such duties, which actions continue for a
period of ten (10) days after receipt by the Executive of written notice of the
need to cure or cease; (iii) Executive's failure to abide by or comply with the
directives of the Board or the Company's policies and procedures as determined
by the Board; (iv) Executive's willful dishonesty, fraud or misconduct with
respect to the business or affairs of the Company, and that in the reasonable
judgment of the Company materially and adversely affects the operations or
reputation of the Company; (v) the Executive's conviction of a felony or other
crime involving moral turpitude; or (vi) the Executive's abuse of alcohol or
drugs (legal or illegal) that, in the Company's reasonable judgment,
substantially impairs the Executive's ability to perform his reasonable duties
as an employee or executive officer of the Company. For purposes of this
definition, the term Company shall also include any successor entity to the
Company's business following a Change of Control and the term Board shall
include any board or similar governing body to whom the Executive may report
from time to time following a Change of Control.
"Change of Control Period" shall mean from the date of this
Agreement until May 1, 2004.
"Change of Control Payment" shall mean 100% of Executive's
current annual salary in the aggregate (less applicable tax withholdings).
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"Disability" shall mean a physical or mental illness or
injury, as a result of which the Executive is unable to perform his material
duties as an employee or executive officer of the Company (or any successor to
the Company's business following a Change of Control) for a period of four
consecutive months, or for a total of four months in any six month period.
"Good Reason" shall mean a material change in the Executive's
working conditions, duties or functions from those traditionally performed by
the Executive Vice President and Chief Financial Officer. Additionally, should
the Company's corporate headquarters be physically relocated more than 25 miles
from Palm Beach, Florida, during the "Change of Control Period or within the 180
days period following a Change in Control, such relocation, at Executive's
option, shall constitute "Good Reason" for Executive's resignation.
(b) The Executive shall be entitled to receive the Change of Control
Payment if, and only if, (i) a Change of Control occurs during the Change of
Control Period and (ii) during the forty five (45) days preceding or one hundred
eighty (180) days following the Change of Control, the Executive's employment
with the Company (or any successor to the Company's business as a result of the
Change of Control) is terminated either (x) by the Executive for Good Reason or
(y) by the Company (or any successor to the Company's business as a result of
the Change of Control) for any reason other than Cause, Disability or death.
Such Change of Control Payment shall be made within 30 days of a termination of
employment as set forth above.
3. Employment. Notwithstanding anything contained in this Agreement, (a)
Executive is and shall continue to be employed by the Company on an at-will
basis, or, alternatively, if Executive is already party to an Employment
Agreement with the Company or one of its subsidiaries that is currently in
effect, pursuant to the terms of that Employment Agreement; and (b) this
Agreement shall in no way void, alter, change or modify any terms and conditions
contained in any Employment Agreement between the Company and Executive
currently in effect, except to the extent such terms are specific subject matter
of this Agreement.
4. Assignment; Binding Effect. This Agreement shall be binding upon, inure
to the benefit of, and be enforceable by the parties hereto and their respective
heirs, legal representatives, successors, and assigns; provided, however, that
in no event shall Executive have the right to assign his rights or obligations
under this Agreement. If the Company is merged with or into another entity, such
action shall not be considered to cause an assignment of this Agreement and the
surviving or successor entity shall become the beneficiary of this Agreement and
all references to the "Company" shall be deemed to refer to such surviving or
successor entity. No other Person shall be a third-party beneficiary under this
Agreement.
5. Complete Agreement; Waiver; Amendment. This Agreement is not a promise
of future employment. Executive has no oral representations, understandings, or
agreements with the Company or any of its officers, directors, or
representatives covering the same subject matter as this Agreement. This
Agreement is the final, complete, and exclusive statement and expression of the
agreement between the Company and Executive with respect to the subject matter
hereof and cannot be varied, contradicted, or supplemented by evidence of any
prior or contemporaneous oral or written agreements. This written Agreement may
not be later modified except by a further writing signed by a duly authorized
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officer of the Company and Executive, and no term of this Agreement may be
waived except by a writing signed by the party waiving the benefit of such term.
6. Notice. Whenever any notice is required hereunder, it shall be given in
writing addressed as follows:
To the Company: Workflow Management, Inc.
240 Royal Palm Way
Palm Beach, FL 33480
Attention: Chief Executive Officer
Fax: (561) 659-7793
with a copy to: T. Richard Litton, Jr., Esq.
Kaufman & Canoles, P.C.
P. O. Box 3037
Norfolk, VA 23514
Fax: (757) 624-3169
To Executive: Michael Schmickle
581 Cypress Crossing
Wellington, FL 33414
Notice shall be deemed given and effective three (3) days after the deposit in
the U.S. mail of a writing addressed as set forth above and sent first class
mail, certified return receipt requested, or, if sent by express delivery, hand
delivery, or facsimile, when actually received. Either party may change the
address for notice by notice to the other party of such change in accordance
with this Section 6.
8. Severability; Headings. If any portion of this Agreement is held invalid
or inoperative, the other portions of this Agreement shall be deemed valid and
operative and, so far as is reasonable and possible, effect shall be given to
the intent manifested by the portion held invalid or inoperative. The paragraph
headings herein are for reference purposes only and are not intended in any way
to describe, interpret, define or limit the extent or intent of the Agreement or
of any part hereof.
9. Arbitration. Any unresolved dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration
conducted in accordance with the rules of the American Arbitration Association
then in effect. The arbitrator shall not have the authority to add to, detract
from, or modify any provision hereof nor to award punitive damages to any
injured party. The decision by the arbitrator shall be final and binding.
Judgment may be entered on the arbitrator's award in any court having
jurisdiction. The direct expense of any arbitration proceedings shall ultimately
be borne by the non-prevailing party in any such proceeding; provided, however,
the Company shall pay the initial filing fees for any such proceeding. The
arbitration proceeding shall be held in the city or county where the Company's
principal office is then located.
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10. Governing Law. This Agreement shall in all respects be construed
according to the laws of the State of Florida, without regard to its conflict of
laws principles.
11. Counterparts. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.
WORKFLOW MANAGEMENT, INC.
By: /s/ Gary W. Ampulski
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Name: Gary W. Ampulski
Title: President and CEO
EXECUTIVE
/s/ Michael L. Schmickle
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Michael L. Schmickle
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