Exhibit 10(s)
to the 12/31/2001
Xxxxxx International, Inc.
Form 10k
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into as of this 15th day
of August, 2000, by and between XXXXXX INTERNATIONAL, INC., a
Delaware corporation (the "Company"), and XXXXXX XXXXX
("Executive").
W I T N E S S E T H:
WHEREAS, the Company and Executive desire to enter into an
agreement providing for Executive's employment by the Company and
specifying the terms and conditions of such employment;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements contained herein, the parties
hereby agree as follows:
1. Purpose and Effective Date.
(a) The purpose of this Agreement is to create an
understanding which shall provide the basis for Executive's
employment by the Company;
(b) This Agreement shall become effective as of August
15, 2000 (the "Effective Time") and this Agreement shall
terminate as hereinafter provided.
2. Employment and Term.
(a) Subject to the terms and conditions of this
Agreement, the Company hereby employs Executive, and Executive
hereby accepts employment, as President of the Industrial and
Power Equipment Group and shall have such responsibilities,
duties and authority that are consistent with such position as
may from time to time be assigned to Executive by the President
and Chief Operating Officer, the Chief Executive Officer and the
Board. Executive hereby agrees that during the Term of this
Agreement he will devote substantially all his working time,
attention and energies to the diligent performance of his duties
as President of the Industrial and Power Equipment Group. With
the consent of the Chief Executive Officer, the Executive may
serve as a director on the boards of directors or trustees of
additional companies and organizations.
(b) Unless earlier terminated as provided herein,
Executive's employment under this Agreement shall be for a
rolling, one year term (the "Term") commencing on the Effective
Time, and shall be deemed to automatically, without further
action by either the Company or Executive, extend each day for an
additional day, such that the remaining term of the Agreement
shall continue to be one year; provided, however, that (i) either
party may, by written notice to the other, cause this Agreement
to cease to extend automatically and, upon such notice, the
"Term" of this Agreement shall be the one year period following
the date of such notice and this Agreement shall terminate upon
the expiration of such Term, and (ii) the Term of this Agreement
shall cease on the date Executive attains age 65, unless the
parties otherwise agree in writing. If no such notice to cease
to extend has been given and this Agreement is terminated
pursuant to Section 5.1 or 5.2 hereof, for the purposes of
calculating and assessing the damages to Executive as a result of
such termination, the remaining Term of this Agreement shall be
deemed to be two years from the date of such termination (or, if
earlier, the date Executive attains age 65).
3. Compensation and Benefits. As compensation for his
services during the Term of this Agreement, Executive shall be
paid and receive the amounts and benefits set forth in
subsections (a) through (h) below:
(a) An annual base salary ("Base Salary") of Three
Hundred Thirty Thousand Dollars ($330,000.00), prorated for any
partial year of employment. Executive's Base Salary shall be
subject to annual review for increases at such time as the
Company conducts salary reviews for its executive officers
generally. Executive's salary shall be payable in substantially
equal installments on a bi-monthly basis, or in accordance with
the Company's regular payroll practices in effect from time to
time for executive officers of the Company.
(b) Executive shall be eligible to participate in the
Executive Management Annual Incentive Program ("Incentive
Program") and such other annual incentive plans as may be
established by the Company from time to time for its executive
officers. The Board or a committee of the Board will establish
performance goals each year under the Incentive Program, and
Executive's annual Target Bonus shall be 50% of Base Salary;
provided, that, for fiscal year 2001, Executive's incentive bonus
under the Incentive Program shall not be less than $150,000. The
annual incentive bonus payable under this subsection (b) shall be
payable in accordance with the provisions of the Incentive
Program at the same time bonuses are paid to other senior
executives, after certification by the Compensation Committee of
the Board that the applicable performance objectives have been
met, unless Executive elects to defer all or a portion of such
amount pursuant to any deferral plan established by the Company
for such purpose.
(c) Promptly after Executive commences employment, the
Company will grant Executive 25,000 options to purchase shares of
the Company's Common Stock that will vest over time ("Time
Options") and the Company will grant Executive performance-based
options for 25,000 shares of the Company's Common Stock
("Performance Options") (the Time Options and the Performance
Options are collectively referred to herein as "Options"). The
terms and conditions of the Time Options and the Performance
Options shall be as set forth in the separate Option Agreements
with Executive covering the grant of such Options. The other
terms and conditions applicable to the Options and the shares to
be purchased pursuant to such Options shall be as provided in the
Employee Stockholders Agreement to which Executive will become a
party. Executive will be eligible to participate in such other
stock option programs as may be established from time to time by
the Company for its executive officers. Executive will
participate in any long-term incentive plans established by the
Company for executive officers at his level.
(d) Executive shall be (i) a participant in the
Xxxxxx, Inc. and Subsidiaries Supplemental Retirement Benefit
Plan ("SERP"), and (ii) covered by a Supplemental Executive
Retirement Plan ("Individual SERP") in the form attached hereto
as Exhibit A.
(e) Executive shall be entitled to participate in, or
receive benefits under, any "employee benefit plan" (as defined
in Section 3(3) of ERISA) or employee benefit arrangement made
generally available by the Company to its executive officers,
including plans providing retirement, 401(k) benefits (including
the Supplemental 401(k) Plan), deferred compensation, health care
(including Exec-U-Care), life insurance, disability and similar
benefits.
(f) The Company will reimburse Executive for
membership dues and assessments at recreational and social clubs
if submitted to and approved by the Chief Executive Officer of
the Company. Executive will be provided an automobile in
accordance with the Company's automobile policy for executives,
and the Company will pay all insurance, maintenance, fuel, oil
and related operational expenses for such automobile. Executive
will be entitled to two weeks vacation after six months of
employment and four weeks vacation after his first full year of
employment. Executive will be provided an annual physical
examination and a financial/tax consultant for personal financial
and tax planning. Executive will be promptly reimbursed by the
Company for all reasonable business expenses he incurs in
carrying out his duties and responsibilities under this
Agreement.
(g) Executive shall participate in the Company's
Executive Life Insurance Program, which will provide a benefit
equal to $250,000. This insurance will be paid-up on the date
Executive attains 65 and will be delivered to Executive as a paid-
up insurance policy upon his retirement from the Company at or
after age 65. The life insurance provided to Executive under the
Executive Life Insurance Program shall be in addition to any life
insurance he receives under the Company's group term policy under
subsection (e) above.
(h) Executive will be paid a tax gross-up amount by
the Company to cover any additional federal or state income taxes
he incurs as a result of being required to include in taxable
income the amount of the premiums or costs for the insurance
described in subsection (g) above.
4. Confidentiality and Noncompetition.
(a) Executive acknowledges that, during the Term of
this Agreement, the Company will furnish to Executive
Confidential Information which could be used by Executive on
behalf of a competitor of the Company to the Company's
substantial detriment. Moreover, the parties recognize that
Executive during the course of his employment with the Company
may develop important relationships with customers and others
having valuable business relationships with the Company. In view
of the foregoing, Executive acknowledges and agrees that the
restrictive covenants contained in this Section are reasonably
necessary to protect the Company's legitimate business interests
and good will.
(b) Executive agrees that he shall protect the
Company's Confidential Information and shall not disclose to any
Person, or otherwise use, except in connection with his duties
performed in accordance with this Agreement, any Confidential
Information at any time, including following the termination of
his employment with the Company for any reason; provided,
however, that Executive may make disclosures required by a valid
order or subpoena issued by a court or administrative agency of
competent jurisdiction, in which event Executive will promptly
notify the Company of such order or subpoena to provide the
Company an opportunity to protect its interests. Executive's
obligations under this Section 4(b) shall survive any expiration
or termination of this Agreement for any reason, provided that
Executive may after such expiration or termination disclose
Confidential Information with the prior written consent of the
Board.
(c) Upon the termination or expiration of his
employment hereunder, Executive agrees to deliver promptly to the
Company all Company files, customer lists, management reports,
memoranda, research, Company forms, financial data and reports
and other documents supplied to or created by him in connection
with his employment hereunder (including all copies of the
foregoing) in his possession or control, and all of the Company's
equipment and other materials in his possession or control.
Executive's obligations under this Section 4(c) shall survive any
expiration or termination of this Agreement.
(d) Upon the termination or expiration of his
employment under this Agreement, Executive agrees that for a
period of one (1) year from his date of termination or until the
end of the period for which he is entitled to receive
compensation under Section 5.1(a) below, whichever is longer, he
shall not (i) enter into or engage in the design, manufacture,
marketing or sale of any products similar to those produced or
offered by the Company or its affiliates in the area of North
America, either as an individual, partner or joint venturer, or
as an employee, agent or salesman, or as an officer, director, or
shareholder of a corporation, (ii) divert or attempt to divert
any person, concern or entity which is furnished products or
services by the Company from doing business with the Company or
otherwise change its relationship with the Company, or (iii)
solicit, lure or attempt to hire away any of the employees of the
Company with whom the Executive interacted directly or indirectly
while employed with the Company.
(e) Executive acknowledges that if he breaches or
threatens to breach this Section 4, his actions may cause
irreparable harm and damage to the Company which could not be
compensated in damages. Accordingly, if Executive breaches or
threatens to breach this Section 4, the Company shall be entitled
to seek injunctive relief, in addition to any other rights or
remedies of the Company. The existence of any claim or cause of
action by Executive against the Company, whether predicated on
this Agreement or otherwise, shall not constitute a defense to
the enforcement by the Company of Executive's agreement under
this Section 4(e).
5. Termination.
5.1 By Executive. Executive shall have the right to
terminate his employment hereunder at any time by Notice of
Termination (as described in Section 7). If Executive terminates
his employment because (i) the Company has materially breached
this Agreement, and such breach has not been cured within thirty
(30) days after written notice of such breach is given by
Executive to the Company; or (ii) Executive's termination is for
Good Reason (as defined in Section 6.7), Executive shall be
entitled to receive the compensation and benefits set forth in
subsections (a) through (h) below. If Executive terminates his
employment other than pursuant to clauses (i) or (ii) of this
Section 5.1, the Company's obligations under this Agreement shall
cease as of the date of such termination. Unless specified
otherwise, the time periods in (a) through (h) below shall be the
lesser of eighteen (18) months (twenty-four (24) months effective
August 15, 2002, if Executive is actively employed on that date)
commencing on the date of Executive's termination of employment
or the time period remaining from the date of Executive's
termination until he attains age 65 ("Severance Period"). The
Company agrees that if Executive terminates employment and is
entitled to compensation and benefits under this Section 5.1, he
shall not be required to mitigate damages by seeking other
employment, provided, however, if Executive terminates employment
prior to August 15, 2002, the amount of compensation he earns
from subsequent employment during the 18-month period after his
termination will reduce dollar for dollar the amount of Base
Salary and Bonus payable by the Company under subsections (a) and
(b) below.
(a) Base Salary - Executive will continue to receive
his Base Salary as then in effect (subject to withholding of all
applicable taxes) for the Severance Period in the same manner as
it was being paid as of the date of termination; provided,
however, that, if Executive terminates active employment after
August 15, 2002, the salary payments provided for hereunder shall
be paid in a single lump sum payment, to be paid not later than
30 days after his termination of employment; provided, further,
that the amount of such lump sum payment shall be determined by
taking the salary payments to be made and discounting them to
their Present Value (as defined in Section 6.9) on the date
Executive's employment under this Agreement is terminated.
(b) Bonuses and Incentives - Executive shall receive
bonus payments (subject to withholding of applicable taxes) from
the Company for each month of the Severance Period in an amount
for each such month equal to one-twelfth of the average of the
incentive bonuses earned by him for the two fiscal years
immediately preceding the year in which such termination occurs,
provided that if Executive has only been employed for a period
which has made him eligible to receive one such incentive bonus
the bonus payment under this subsection (b) shall be one-twelfth
of any such bonus payment. Any incentive bonus amounts that
Executive had previously earned from the Company but which may
not yet have been paid as of the date of termination shall be
payable on the date such amounts are payable to other executives
and Executive's termination shall not affect the payment of such
bonus. Executive shall also receive a prorated incentive bonus
for any uncompleted fiscal year at the date of termination
(assuming for this purpose that the Target Award level has been
achieved for such year), based upon the number of days that he
was employed during such fiscal year. If Executive terminates
active employment after August 15, 2002, the bonus amounts
determined herein shall be paid in a single lump sum payment, to
be paid not later than 30 days after termination of employment;
provided, that the amount of such lump sum payment representing
the monthly bonus payments shall be determined by taking the
monthly bonus payments to be made and discounting them to their
Present Value on the date Executive's employment under this
Agreement is terminated.
(c) Health and Life Insurance Coverage - The health
(including Exec-U-Care) and group term life insurance benefits
coverage provided to Executive at his date of termination shall
be continued for the Severance Period at the same level and in
the same manner as then provided to actively employed executive
participants as if his employment under this Agreement had not
terminated. Any additional coverages Executive had at
termination, including dependent coverage, will also be continued
for such period on the same terms, to the extent permitted by the
applicable policies or contracts. Any costs Executive was paying
for such coverages at the time of termination shall be paid by
Executive by separate check payable to the Company each month in
advance, or deducted from the monthly payments due under
subsections (a) and (b) above. If the terms of any benefit plan
referred to in this Section, or the laws applicable to such plan,
do not permit continued participation by Executive, then the
Company will arrange for other coverage at its expense providing
substantially similar benefits (including the same deductible and
co-payment levels provided under the Company's policy).
(d) Employee Retirement Plans - To the extent
permitted by the applicable plan, Executive will be entitled to
continue to participate, consistent with past practices, in all
employee retirement and deferred compensation plans maintained by
the Company in effect as of his date of termination, including,
to the extent such plans are still maintained by the Company, the
Xxxxxx Retirement Plan, the Xxxxxx 401(k) Plan, the Xxxxxx Excess
401(k) Plan, the SERP, and the Individual SERP. Executive's
participation in such retirement plans shall continue for the
Severance Period and the compensation payable to Executive under
(a) and (b) above shall be treated (unless otherwise excluded) as
compensation under the plan as if it were paid on a monthly
basis. For purposes of the Xxxxxx 401(k) Plan and the Xxxxxx
Excess 401(k) Plan, he will receive an amount equal to the
Company's contributions to the plan, assuming Executive had
participated in such plan at the maximum permissible
contributions level. If continued participation in any plan is
not permitted by the plan or by applicable law, the Company shall
pay to Executive or, if applicable, his beneficiary a
supplemental benefit equal to the present value on the date of
termination of employment under this Agreement (calculated as
provided in the plan) of the excess of (i) the benefit Executive
would have been paid under such plan if he had continued to be
covered for the Severance Period (less any amounts Executive
would have been required to contribute), over (ii) the benefit
actually payable under such plan. The Company shall pay the
Present Value of such additional benefits (if any) in a lump sum
within 30 days of his termination of employment.
(e) Effect of Lump Sum Payment. Any lump sum payment
under subsections (a) or (b) above shall not alter the amounts
Executive is entitled to receive under the benefit plans
described in this section. For this purpose, benefits under such
plans shall be determined as if Executive had remained employed
and received such payments monthly over the Severance Period.
(f) Executive Life Insurance Program. During the
Severance Period, the Company will continue to pay the premiums
on Executive's policy under the Executive Life Insurance Program.
(g) Stock Options. As of his date of termination, all
of the Time Options and the Performance Options, and any other
outstanding stock options granted to Executive by the Company,
shall become vested and exercisable as provided in the Option
Agreements.
(h) Office Space; Secretarial. Executive will be
provided appropriate office space, and reasonable expenses
related thereto for a period of twelve (12) months from
Executive's date of termination.
5.2 By Company. The Company shall have the right to
terminate Executive's employment under this Agreement at any time
during the Term by Notice of Termination (as described in Section
7). If the Company terminates Executive's employment under this
Agreement (i) for Cause, as defined in Section 6.2, (ii) if
Executive becomes Disabled, or (iii) upon Executive's death, the
Company's obligations under this Agreement shall cease as of the
date of termination; provided, however, that Executive will be
entitled to whatever benefits are payable pursuant to the terms
of any health, life insurance, disability, welfare, retirement or
other plan or program maintained by the Company. If the Company
terminates Executive during the Term of this Agreement other than
pursuant to clauses (i) through (iii) of this Section 5.2,
Executive shall be entitled to receive the compensation and
benefits provided in subsections (a) through (h) of Section 5.1
above for the Severance Period (as defined therein), and in
accordance with the other provisions of Section 5.1, including
any mitigation requirements.
5.3 Limitation on Benefits Upon Termination.
(a) Notwithstanding anything in this Agreement to the
contrary, any benefits payable or to be provided to Executive by
the Company or its affiliates, whether pursuant to this Agreement
or otherwise, which are treated as Severance Payments shall, but
only to the extent necessary, be modified or reduced in the
manner provided in (b) below so that the benefits payable or to
be provided to Executive under this Agreement that are treated as
Severance Payments, as well as any payments or benefits provided
outside of this Agreement that are so treated, shall not cause
the Company to have paid an Excess Severance Payment. In
computing such amount, the parties shall take into account all
provisions of Code Section 280G, and the regulations thereunder,
including making appropriate adjustments to such calculation for
amounts established to be Reasonable Compensation. If Executive
becomes entitled to compensation and benefits under Section 5.1
or Section 5.2 and such payments would cause the Company to pay
an Excess Severance Payment, Executive shall be required to
mitigate damages (but only with respect to amounts that would be
treated as Excess Severance Payments) by reducing the amount of
Excess Severance Payments he is entitled to receive by any
compensation and benefits he earns from subsequent employment
(but shall not be required to seek such employment) during the
Severance Period.
(b) In the event that the amount of any Severance
Payments which would be payable to or for the benefit of
Executive under this Agreement must be modified or reduced to
comply with this Section 5.3, Executive shall direct which
Severance Payments are to be modified or reduced; provided,
however, that no increase in the amount of any payment or change
in the timing of the payment shall be made without the consent of
the Company.
(c) This Section 5.3 shall be interpreted so as to
avoid the imposition of excise taxes on Executive under Section
4999 of the Code or the disallowance of a deduction to the
Company pursuant to Section 280G(a) of the Code with respect to
amounts payable under this Agreement or otherwise.
Notwithstanding the foregoing, in no event will any of the
provisions of this Section 5.3 create, without the consent of
Executive, an obligation on the part of Executive to refund any
amount to the Company following payment of such amount.
(d) In addition to the limits otherwise provided in
this Section 5.3, to the extent permitted by law, Executive may
in his sole discretion elect to reduce any payments he may be
eligible to receive under this Agreement to prevent the
imposition of excise taxes on Executive under Section 4999 of the
Code.
(e) For purposes of this Section 5.3, the following
definitions shall apply:
(i) "Excess Severance Payment" - The term "Excess
Severance Payment" shall have the same meaning as the term
"excess parachute payment" defined in Section 280G(b)(1) of
the Code.
(ii) "Severance Payment" - The term "Severance
Payment" shall have the same meaning as the term "parachute
payment" defined in Section 280G(b)(2) of the Code.
(iii) "Reasonable Compensation" - The term
"Reasonable Compensation" shall have the same meaning as
provided in Section 280G(b)(4) of the Code. The parties
acknowledge and agree that, in the absence of a change in
existing legal authorities or the issuance of contrary
authorities, amounts received by Executive as damages under
or as a result of a breach of this Agreement shall be
considered Reasonable Compensation.
(iv) "Present Value" - The term "Present Value"
shall have the same meaning as provided in Section
480G(d)(4) of the Code.
6. Definitions. For purposes of this Agreement the
following terms shall have the meanings specified below:
6.1 "Board" or "Board of Directors". The Board of
Directors of the Company.
6.2 "Cause" . The involuntary termination of Executive by
the Company for the following reasons shall constitute a
termination for Cause:
(a) If the termination shall have been the result of
an act or acts by Executive which have been found in an
applicable court of law to constitute a felony (other than
traffic-related offenses);
(b) If the termination shall have been the result of
an act or acts by Executive which are in the good faith judgment
of the Board to be in violation of law or of policies of the
Company and which result in demonstrably material injury to the
Company;
(c) If the termination shall have been the result of
an act or acts of proven dishonesty by Executive resulting or
intended to result directly or indirectly in significant gain or
personal enrichment to the Executive at the expense of the
Company; or
(d) Upon the willful and continued failure by the
Executive substantially to perform his duties with the Company
(other than any such failure resulting from incapacity due to
mental or physical illness not constituting a Disability, as
defined herein), after a demand in writing for substantial
performance is delivered by the Board, which demand specifically
identifies the manner in which the Board believes that Executive
has not substantially performed his duties.
With respect to clauses (b), (c) or (d) above of this
Section, Executive shall not be deemed to have been involuntarily
terminated for Cause unless and until there shall have been
delivered to him a copy of a resolution duly adopted by the
affirmative vote of not less than three-quarters of the entire
membership of the Board at a meeting of the Board (after
reasonable notice to Executive and an opportunity for him,
together with his counsel, to be heard before the Board), finding
that, in the good faith opinion of the Board, Executive was
guilty of conduct set forth above in clauses (b), (c) or (d) and
specifying the particulars thereof in detail. For purposes of
this Agreement, no act or failure to act by Executive shall be
deemed to be "willful" unless done or omitted to be done by
Executive not in good faith and without reasonable belief that
Executive's action or omission was in the best interests of the
Company.
6.3 "Change in Control". Either
(a) the acquisition, directly or indirectly, by any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended), other than LB MBP
II or any of its affiliates, of securities of the Company
representing an aggregate of more than fifty percent (50%) of
the combined voting power of the Company's then outstanding
securities (excluding the acquisition by persons who own such
amount of securities on the date hereof, or acquisitions by
persons who acquire such amount through inheritance), or
(b) during any period of two consecutive years,
individuals who at the beginning of such period constitute the
Board, cease for any reason to constitute at least a majority
thereof, unless the election of each new director was approved in
advance by a vote of at least a majority of the directors then
still in office who were directors at the beginning of the
period; or
(c) consummation of (i) a merger, consolidation or
other business combination of the Company with any other "person"
(as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended) or affiliate
thereof, other than a merger, consolidation or business
combination which would result in the outstanding common stock of
the Company immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into
common stock of the surviving entity or a parent or affiliate
thereof) more than fifty percent (50%) of the outstanding common
stock of the Company, or such surviving entity or parent or
affiliate thereof, outstanding immediately after such merger,
consolidation or business combination, or (ii) a plan of complete
liquidation of Company or an agreement for the sale or
disposition by Company of all or substantially all of Company's
assets;
(d) a Public Offering as defined in the Employee
Stockholder Agreement; or
(e) a sale of more than 50% of the assets of the
Company;
provided that none of the events described in clauses (b) through
(e) shall be deemed a Change in Control if, immediately following
such event, LB MBP II and its affiliates own 50% or more of the
combined voting power of the Company's then outstanding
securities.
6.4 "Code" . The Internal Revenue Code of 1986, as it may
be amended from time to time.
6.5 "Confidential Information" . All technical, business,
and other information relating to the business of the Company or
its subsidiaries or affiliates, including, without limitation,
technical or nontechnical data, formulae, compilations, programs,
devices, methods, techniques, processes, financial data,
financial plans, product plans, and lists of actual or potential
customers or suppliers, which (i) derives economic value, actual
or potential, from not being generally known to, and not being
readily ascertainable by proper means by, other Persons, and (ii)
is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy or confidentiality. Such
information and compilations of information shall be
contractually subject to protection under this Agreement whether
or not such information constitutes a trade secret and is
separately protectable at law or in equity as a trade secret.
Confidential Information does not include confidential business
information which does not constitute a trade secret under
applicable law two years after any expiration or termination of
this Agreement.
6.6 "Disability" or "Disabled". Executive's inability as a
result of physical or mental incapacity to substantially perform
his duties for the Company on a full-time basis for a period of
six (6) months.
6.7 "Good Reason". A "Good Reason" for termination by
Executive of Executive's employment shall mean the occurrence
during the Term (without the Executive's express written
consent) of any one of the following acts by the Company, or
failures by the Company to act, and such act or failure to act
has not been corrected within thirty (30) days after written
notice of such act or failure to act is given by Executive to the
Company:
(i) the assignment to Executive of any duties
inconsistent with Executive's status as President of the
Industrial and Power Equipment Group which causes a material
diminution in Executive's duties or responsibilities, or a
substantial adverse alteration in the nature or status of the
Executive's responsibilities from those on the date hereof;
(ii) a reduction by the Company in Executive's
Base Salary as in effect on the date hereof or as the same may be
increased from time to time;
(iii) the failure by the Company, without
Executive's consent, to pay to Executive any portion of
Executive's current compensation (including Base Salary and
bonus), or to pay to the Executive any other compensation within
seven (7) days of the date such compensation is due;
(iv) the failure by the Company to continue in
effect any compensation plan in which Executive participates on
the date hereof, which is material to Executive's total
compensation, including but not limited to the Company's
Executive Management Annual Incentive Program, any long-term
incentive plan, the SERP, and the Individual SERP, or any
substitute plans, unless an equitable arrangement (embodied in an
ongoing substitute or alternative plan) has been made with
respect to such plan, or the failure by the Company to continue
the Executive's participation in such plan (or in such substitute
or alternative plan) on a basis not materially less favorable in
terms of the amount of benefits provided;
(v) the failure by the Company to continue to
provide Executive with benefits substantially similar to those
enjoyed by Executive on the date hereof under any of the
Company's pension, life insurance (including the Executive Life
Insurance Program), medical, health and accident or disability
plans, the taking of any action by the Company which would
directly or indirectly materially reduce any of such benefits or
deprive Executive of any material fringe benefit enjoyed by
Executive on the date hereof, or the failure by the Company to
provide Executive with the number of paid vacation days to which
the Executive is entitled under this Agreement; or
(vi) any purported termination of Executive's
employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of Section 7.1 (for
purposes of this Agreement, no such purported termination shall
be effective).
The Executive's right to terminate the Executive's
employment for Good Reason shall not be affected by the
Executive's incapacity due to physical or mental illness. The
Executive's continued employment shall not constitute consent to,
or a waiver of rights with respect to, any act or failure to act
constituting Good Reason hereunder.
6.8 "Person" . Any individual, corporation, bank,
partnership, joint venture, association, joint-stock company,
trust, unincorporated organization or other entity.
6.9 "Present Value". The term "Present Value" on any
particular date shall have the same meaning as provided in
Section 280G(d)(4) of the Code.
7. Termination Procedures.
7.1 Notice of Termination. During the Term of this
Agreement, any purported termination of Executive's employment
(other than by reason of death) shall be communicated by written
Notice of Termination from one party hereto to the other party
hereto in accordance with Section 11. For purposes of this
Agreement, a "Notice of Termination" shall mean a notice which
shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for
termination of Executive's employment under the provision so
indicated. Further, a Notice of Termination for Cause is
required to include the information set forth in Section 6.2.
7.2 Date of Termination. "Date of Termination," with
respect to any purported termination of Executive's employment
during the Term of this Agreement, shall mean (i) if Executive's
employment is terminated by his death, the date of his death,
(ii) if Executive's employment is terminated for Disability,
thirty (30) days after Notice of Termination is given (provided
that Executive shall not have returned to the full-time
performance of Executive's duties during such thirty (30) day
period), and (iii) if Executive's employment is terminated for
any other reason, the date specified in the Notice of Termination
(which, in the case of a termination by the Company, shall not be
less than thirty (30) days (except in the case of a termination
for Cause) and, in the case of a termination by the Executive,
shall not be less than thirty (30) days nor more than sixty (60)
days, respectively, from the date such Notice of Termination is
given); provided, however, that the "Date of Termination" for
purposes of this Agreement shall not be the last day of the
Company's fiscal year and, in the event the last day of the
fiscal year is designated as the "Date of Termination", the "Date
of Termination" for purposes hereof shall automatically be the
first day of the next following fiscal year.
8. Contract Non-Assignable. The parties acknowledge that
this Agreement has been entered into due to, among other things,
the special skills of Executive, and agree that this Agreement
may not be assigned or transferred by Executive, in whole or in
part, without the prior written consent of the Company.
9. Successors; Binding Agreement.
9.1 In addition to any obligations imposed by law upon any
successor to, or transferor of, the Company, the Company will
require any successor to, or transferor of, all or substantially
all of the business and/or assets of the Company (whether direct
or indirect, by purchase, merger, reorganization, liquidation,
consolidation or otherwise) to expressly assume and agree to
perform this Agreement, in the same manner and to the same extent
that the Company would be required to perform it if no such
succession had taken place. Failure of the Company to obtain
such assumption and agreement prior to the effectiveness of any
such succession shall be a breach of this Agreement and shall
entitle the Executive to compensation from the Company in the
same amount and on the same terms as the Executive would be
entitled to hereunder if the Executive were to terminate the
Executive's employment for Good Reason, except that, for purposes
of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the Date of
Termination.
9.2 This Agreement shall inure to the benefit of and be
enforceable by Executive's personal or legal representatives,
executors, administrators, successors, heirs, distributees,
devisees and legatees and by the Company's successors and
assigns. If Executive shall die while any amount would still be
payable to Executive hereunder (other than amounts which, by
their terms, terminate upon the death of Executive) if Executive
had continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the terms of
this Agreement to the executors, personal representatives or
administrators of Executive's estate.
10. Other Agents. Nothing in this Agreement is to be
interpreted as limiting the Company from employing other
personnel on such terms and conditions as may be satisfactory to
the Company.
11. Notices. All notices, requests, demands and other
communications required or permitted hereunder shall be in
writing and shall be deemed to have been duly given if delivered
or seven days after mailing if mailed, first class, certified
mail, postage prepaid:
To the Company: Xxxxxx International, Inc.
0000 Xxxxxxxxx Xxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
ATTN: General Counsel
To the Executive: Xxxxxx Xxxxx
000 Xxxxx'x Xxxxxx Xxx
Xxxx, Xxxxx Xxxxxxxx 00000
Any party may change the address to which notices, requests,
demands and other communications shall be delivered or mailed by
giving notice thereof to the other party in the same manner
provided herein.
12. Provisions Severable. If any provision or covenant, or
any part thereof, of this Agreement should be held by any court
to be invalid, illegal or unenforceable, either in whole or in
part, such invalidity, illegality or unenforceability shall not
affect the validity, legality or enforceability of the remaining
provisions or covenants, or any part thereof, of this Agreement,
all of which shall remain in full force and effect.
13. Waiver. Failure of either party to insist, in one or
more instances, on performance by the other in strict accordance
with the terms and conditions of this Agreement shall not be
deemed a waiver or relinquishment of any right granted in this
Agreement or the future performance of any such term or condition
or of any other term or condition of this Agreement, unless such
waiver is contained in a writing signed by the party making the
waiver.
14. Indemnification. During the term of this Agreement and
after Executive's termination for the period of time set forth in
Section 6.7 of the Recapitalization Agreement, the Company shall
indemnify Executive and hold Executive harmless from and against
any claim, loss or cause of action arising from or out of
Executive's performance as an officer, director or employee of
the Company or any of its subsidiaries or other affiliates or in
any other capacity, including any fiduciary capacity, in which
Executive serves at the Company's request, in each case to the
maximum extent permitted by law and under the Company's Articles
of Incorporation and By-Laws (the "Governing Documents"),
provided that in no event shall the protection afforded to
Executive hereunder be less than that afforded under the
Governing Documents as in effect on the date of this Agreement
except for changes mandated by law. During the Term and for the
period of time set forth in Section 6.7 of the Recapitalization
Agreement, Executive shall be covered by any policy of directors
and officers liability insurance maintained by the Company for
the benefit of its officers and directors.
15. Amendments and Modifications. This Agreement may be
amended or modified only by a writing signed by both parties
hereto.
16. Governing Law. The validity and effect of this
Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Delaware.
17. Arbitration of Disputes; Expenses. All claims by
Executive for compensation and benefits under this Agreement
shall be directed to and determined by the Board and shall be in
writing. Any denial by the Board of a claim for benefits under
this Agreement shall be delivered to Executive in writing and
shall set forth the specific reasons for the denial and the
specific provisions of this Agreement relied upon. The Board
shall afford a reasonable opportunity to Executive for a review
of a decision denying a claim and shall further allow Executive
to appeal to the Board a decision of the Board within sixty (60)
days after notification by the Board that Executive's claim has
been denied. To the extent permitted by applicable law, any
further dispute or controversy arising under or in connection
with this Agreement shall be settled exclusively by arbitration
in Atlanta, Georgia, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered
on the arbitrator's award in any court having jurisdiction. In
the event the Executive incurs legal fees and other expenses in
seeking to obtain or to enforce any rights or benefits provided
by this Agreement and is successful, in whole or in part, in
obtaining or enforcing any material rights or benefits through
settlement, arbitration or otherwise, the Company shall promptly
pay Executive's reasonable legal fees and expenses incurred in
enforcing this Agreement and the fees of the arbitrator. Except
to the extent provided in the preceding sentence, each party
shall pay its own legal fees and other expenses associated with
any dispute.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
EXECUTIVE:
_____________________________
XXXXXX XXXXX
COMPANY:
XXXXXX INTERNATIONAL, INC.
By: ___________________________
