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EXHIBIT 10.4
NEN HOLDING INC,
000 Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
December 15, 1997
Ms., Xxxxxxxx X. Xxxxxx
000 Xxxxx 00
Xxxx Xxxxxxx, XX 120
Dear Xxxxxxxx:
This letter extends, an offer to you to become the Senior Vice President Human
Resources of NEN Life Science Products (NEN or "the Company"). It is clear that
you bring the scope, talent and experience necessary to lead the HR function of
our company in the years ahead. Please consider this document a conveyance of
the basic terms and agreements of our offer.
POSITION RESPONSIBILITY
Senior Vice President Human Resources with full responsibility and
accountability for Organizational Development, all human resources programs and
procedures, and internal/external communications.
Your official start date of these duties will be January 5, 1998.
SALARY
The minimum base salary of your position will be $165,000 per annum, which shall
be paid in installments on a bi-weekly basis. The Company shall review your
performance on each anniversary of your date of hire and at its sole discretion
may increase your base salary for the position based on your performance and die
financial condition of the Company at that time.
BONUS AND INCENTIVE COMPENSATION
A copy of the executive bonus plan entitled "Annual Incentive Plan" will be sent
to you in the next few days and I will be pleased to review it with you. Central
to that discussion will be the Company's budgeted EBITDA, a performance
measurement on which the incentive plan is based. In 1998, the EBITDA budget is
approximately $20.0 million. The design of our plan contains the following key
elements:
(1) Threshold for payment of any bonuses is corporate performance of 85%
of the EBITDA budget.
(2) Target bonuses are paid upon achieving 110% of the EBITDA budget.
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December 15, 1997
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(3) Bonuses are not capped.
(4) The plan incorporates an increasing percentage of payout as Company
performance progresses from threshold to budget to 110% of budget and
beyond.
(5) At 110% of budget, your bonus would be 40% of salary,
(6) The bonus for each individual will be split between corporate
performance and personal objectives, with the greatest weight given to
corporate performance.
Your minimum guaranteed bonus for 1998 will be $25,000. If your performance and
payout as measured by the annual incentive plan exceed the guaranteed amount you
will receive the higher of the two figures for your payout.
EQUITY PARTICIPATION
You are invited to co-invest with myself and Genstar Capital Partners II, L.P.
("Genstar") in NEN. We offer you the opportunity to invest up to $150,000 in the
Company. We will enter into a Stockholders' Agreement outlining the rights and
responsibilities of the shareholders. All shareholders will be subject to
dilution for such things as the proposed stock option plan.
STOCK OPTIONS
The Board of Directors of NEN has established a Stock Option Plan setting aside
ten percent (10%) of the stock of the Company on a fully diluted basis.
Coincident with your employment, the Company will grant you an option of 250
shares at a xxxxx xxxxx to be determined by the Board. The plan has a ten (10)
year life and a five (5) year vesting schedule in equal twenty percent (20%)
increments on each anniversary date of the grant. Further grants of stock
options to you would be made annually at the Board's discretion based upon your
and the Company's performance.
Should there be a significant change whereby Genstar's nominees no longer
control the Board of Directors ("Change of Control") and you are subsequently
terminated without Cause (see "Severance Agreement" below for definition of
Cause) by the Board of Directors, or you terminate with good reason, within
eighteen (18) months of the Change of Control, all stock options that have been
granted to you will vest immediately.
BENEFITS
You shall be entitled to participate in the Company's benefit plans, including
group health and medical insurance plans, as they are adopted from time to time
beginning on the first day of your employment. Description of these plans will
be sent under separate cover and someone will be available to provide further
explanation. You shall be entitled to four (4) weeks paid vacation per year.
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PENSION AND 401K SAVINGS PLAN
You will be eligible to join the pension plan and 401K savings plan of NEN. Both
of these plans are similar to those provided to the employees of NEN by DuPont.
NEN has contractually agreed with DuPont to maintain a benefits package
"substantially similar" to the current DuPont benefits package for a period of
three (3) years from the date of closing.
SEVERANCE AGREEMENT
NEN will provide protection for you in the event of your termination for reasons
other than Cause. If you are terminated without Cause or if you resign for good
reason, you will receive one (1) year's base salary and eighteen (18) months
continuation of benefits. Attached as Schedule A is a definition of Cause and
Resignation without Good Reason.
EXPENSE REIMBURSEMENT
The Company will reimburse you for reasonable and necessary business expenses
incurred while performing your duties as described in this letter, subject to
the policies, procedures and controls that the Company may from time to time
adopt. Expense reimbursement will be subject to the approval of the CEO. The
Company will pay your relocation expenses according to policy. If, in addition,
NEN fails to perform according to our agreement, NEN will reimbursement you for
your legal fees and expenses in connection with resolution of the dispute.
SUCCESSORS: BINDING AGREEMENT
This agreement shall not be terminated by any merger or consolidation of the
transfer of all or substantially all of the assets of NEN. In the event of such
transaction, the provisions of the agreement shall be binding on the surviving
entity. NEN will cause any successor to assume all of the obligations of the
agreements. Failure to obtain such assumption prior to the effective date of the
merger or consolidation shall constitute Good Reason hereunder and entitle you
to terminate your employment and receive the compensation and benefits as
contained in this agreement.
If you should die while any amounts payable to you were owing had you continued
to live, those amounts will be payable to such persons as you appoint in
writing, or if no such persons are appointed, to your estate.
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INDEMNIFICATION
The Company will indemnify you to the fullest extent permitted by law for any
liability incurred as a result of the conduct of your duties as an officer of
NEN.
Xxxxxxxx, I believe that NEN will provide an excellent opportunity for your next
challenge. I am extending this offer to you to become our Vice President Human
Resources in good faith, and I look forward to a long and close working
relationship with you.
Sincerely,
/s/ Xxxx X. Xxxxxxxxx
Xxxx X. Xxxxxxxxx
Chairman, President and Chief Executive Officer
Attachment
Accepted this 16th day of December, 1997.
/s/ Xxxxxxxx X. Xxxxxx
______________________________________
Xxxxxxxx X. Xxxxxx
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SCHEDULE A
SECTION 1. Termination of Employment. (a) Termination for Cause;
Resignation Without Good Reason. (i) If the Executive's employment is terminated
by the Company for Cause (as defined below), or if the Executive resigns from
his employment hereunder, other than for Good Reason (as defined below), the
Executive shall be entitled to only (A) severance benefits as provided by the
Company's general procedures and practices applicable to all employees
terminated in like circumstances, if any, and (B) payment of the pro rata
portion of the Executive's salary through and including the date of termination
or resignation.
(ii) For purpose of this Agreement, termination for "Cause" shall mean
termination of the Executive's employment by the company because of (A) the
Executive's conviction for, or guilty plea to, a felony or a crime involving
moral turpitude; (B) the Executive's commission of an act of willful gross
misconduct resulting in material harm to the Company; or (C) the executive's
willful and repeated failure, after written notice, to follow the written
policies of the Company as established by the board of the directors of the
Company ("the Board").
(iii) For purposes of this Agreement, resignation for "Good Reason " shall
mean the resignation of the Executive after (A) notice in writing is given him
of his relocation, without the Executive's consent, to a place of business more
than 35 miles outside of the Boston Metropolitan Statistical Area (B) A
reduction in the Executive's benefits or pay or (C) a substantial adverse
alternation occurs in the nature or status of the Executive's responsibilities
from those in effect on the date hereof.
(iv) The date of termination for Cause shall be the date of receipt by the
Executive of written notice of such termination. The date of resignation without
Good Reason shall be the date of receipt by the Company of a written notice of
such resignation.
