Exhibit 10.(c)
EMPLOYMENT AGREEMENT
THIS AGREEMENT made as of January 1, 2002 by and between EMCOR
GROUP, INC. (the "Company") and XXXXXX X. XXXXXXX ("Executive").
In order to induce Executive to serve as Executive Vice President
and the Chief Financial Officer of the Company, the Company desires to provide
Executive with compensation and other benefits under the conditions set forth in
this Agreement.
Executive is willing to accept such employment and to perform
services for the Company and its subsidiaries, on the terms and conditions
hereinafter set forth.
It is therefore hereby agreed by and between the parties as
follows:
1. EMPLOYMENT.
1.1 Subject to the terms and conditions of this Agreement, the
Company agrees to employ Executive during the Period of Employment (as
hereinafter defined) as an Executive Vice President and the Chief Financial
Officer of the Company. In his capacity as Executive Vice President and Chief
Financial Officer of the Company, Executive shall have the customary powers,
responsibilities and authorities of executive vice presidents and chief
financial officers of similar corporations of the size, type and nature of the
Company as it may exist from time to time, subject to the direction of the
Chairman of the Board of Directors (the "Board") of the Company and the Chief
Executive Officer of the Company (the "Chairman").
1.2 Subject to the terms and conditions hereof, Executive
hereby agrees to be employed as an Executive Vice President and the Chief
Financial Officer of the Company and shall devote his full working time and
efforts, to the best of his ability, experience and talent, to the performance
of the services, duties and responsibilities in connection therewith. Except
upon the prior written consent of the Chairman, Executive will not during the
Period of Employment (i) accept any other employment or (ii) engage, directly or
indirectly, in any other business activity (whether or not pursued for pecuniary
advantage), whether or not it may be competitive with, or whether or not it
might place him in a competing position to that of, the Company or any
subsidiary thereof. Nothing in this Agreement shall preclude the Executive from
(i) engaging, consistent with his duties and responsibilities hereunder, in
charitable community affairs, (ii) managing his personal investments, (iii)
continuing to serve on the boards of directors on which he presently serves (to
the extent such service is not precluded by federal or state law or by conflict
of interest by reason of his position with the Company), or (iv) serving,
subject to approval of the Chairman, as a member of boards of directors of other
companies, provided, that such activities do not interfere with the performance
of Executive's duties hereunder.
2. PERIOD OF EMPLOYMENT. Executive's period of employment
hereunder shall commence on January 1, 2002 (the "Commencement Date") and shall
continue through the earlier of December 31, 2004 or the date of termination
hereunder (the "Period of Employment"); PROVIDED, HOWEVER, that the Period of
Employment shall automatically be extended for successive one-year periods
unless the Company or Executive, at least six months prior to the end of such
period, provides written notice to the other party of intent not to extend the
Period of Employment. Notwithstanding anything in this Agreement to the
contrary,
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in the event of a Change of Control (as defined in Section 6.1(e)) the Period of
Employment shall be for a period of three years commencing as of the date of
such Change of Control.
3. COMPENSATION.
3.1 SALARY. The Company shall pay Executive a base salary
("Base Salary") at the rate of $410,000 per annum for the Period of Employment.
Base Salary shall be payable in accordance with the ordinary payroll practices
of the Company. Executive's rate of Base Salary shall be increased on the first
day of each calendar year occurring during the Period of Employment, beginning
with January 1, 2003, by the percentage increase for the prior year in the
consumer price index for the area in which the principal office of the Company
is located, as determined by the U.S. Department of Commerce, or the amount
specified by the Board, whichever is greater.
3.2 BONUS. In addition to his Base Salary, Executive shall be
entitled, while he remains employed hereunder, in respect of each calendar year,
to an annual bonus (the "Bonus") payable in cash and at such times as bonuses
are customarily paid to senior executives of the Company; provided that so long
as the Company's Executive Stock Bonus Plan (the "Plan") shall remain in effect
and the Executive shall be designated a participant therein, 25% of the
Executive's Bonus shall be payable in restricted stock units in accordance with
the Plan and the Executive, in accordance with the terms of the Plan, may elect
to receive a greater percentage of his Bonus in restricted stock units. For each
calendar year during the Period of Employment, the amount of the Bonus shall be
determined by the Compensation Committee of the Board of Directors in its sole
discretion.
3.3 STOCK OPTIONS. (a) The Executive is hereby granted an
option with a ten-year term to purchase 17,500 shares of common stock ("Shares")
of the Company at $46.35 per Share. The Executive also shall be granted as of
the first business day of 2003 and 2004 an option with a ten-year term to
purchase Shares at the then fair market value of a Share; the number of Shares
subject to each option granted in 2003 and 2004, respectively, shall be that
number determined by dividing 75% of Executive's base salary for such year by
the value of an option as of the first business day of such year, which value
shall be that computed in accordance with the methodology of valuing options
under the 1997 Non-Employee Directors' Non-Qualified Stock Option Plan. Each
option referred to herein shall be exercisable with respect to the Shares
subject thereto as follows: one-fourth on or after the date of grant, one-fourth
on or after the first anniversary of the date of grant, one-fourth on or after
the second anniversary of the date of grant, and one-fourth on or after the last
business day of the calendar year immediately preceeding the third anniversary
of the date of grant. In the event of the Executive's termination of employment
under Section 6.1, each such option shall become immediately exercisable in full
and shall remain exercisable for the balance of its ten-year term.
(b) In addition, Executive was granted on December 14, 2001 an
option with a ten-year term to purchase 25,900 Shares at $41.70 per share which
option is immediately exercisable in full and remains exercisable for the
balance of its ten-year term.
4. EMPLOYEE BENEFITS.
4.1 EMPLOYEE BENEFIT PLANS AND PROGRAMS. The Company shall
provide Executive during the Period of Employment with coverage under any
employee benefit programs, plans and practices (commensurate with his position
in the Company) in accordance
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with the terms thereof, which the Company currently makes available generally to
its senior executive officers, or which the Company, with Board approval, elects
to make available generally to its senior executive officers hereafter,
including, but not limited to (a) retirement, pension and profit-sharing; and
(b) medical, dental, hospitalization, life insurance, short and long-term
disability, accidental death and dismemberment and travel accident coverage;
provided that Executive shall pay such portion of the premiums therefor as is
customarily paid by senior executives of the Company.
4.2 VACATION, FRINGE AND OTHER BENEFITS. Executive shall be
entitled to the number of vacation days customarily accorded senior executives
of the Company. In addition, during the Period of Employment, the Company shall
pay Executive $870 per month for leasing (plus maintenance, insurance, and
property taxes) of an automobile and shall make the initial capital cost
reduction payment with respect to the leasing of such automobile on Executive's
behalf. The Company shall also reimburse Executive for (a) all initiation fees
and monthly dues for membership in a club suitable for entertaining clients of
the Company and (b) all legal expenses incurred by Executive in connection with
the negotiation and drafting of this Agreement. The Company shall bear the cost
of any increased tax liability of Executive caused by the provisions of this
Section 4.2.
4.3 LIFE INSURANCE. The Company shall obtain, at the Company's
expense, insurance on the life of the Executive in the amount of $2,460,000 for
the first twelve months of the Period of Employment, $1,640,000 for the second
twelve months of the Period of Employment, and $820,000 for the remainder of the
Period of Employment. The proceeds of such life insurance shall be payable to
such beneficiary or beneficiaries as shall be selected by the Executive at any
time or from time to time. The Company shall bear the cost of any increased tax
liability of Executive caused by the provisions of this Section 4.3.
5. DIRECTORS AND OFFICERS LIABILITY. The Company shall keep in
effect during and after the Period of Employment, a policy of directors' and
officers' liability insurance for officers and directors of the Company at such
reasonable amount of coverage as is agreed to by Executive and the Board from
time to time and which insurance policy shall be on a claims-made basis.
6. TERMINATION OF EMPLOYMENT.
6.1 TERMINATION NOT FOR CAUSE OR RESIGNATION FOR GOOD REASON.
(a) The Company may terminate Executive's employment at any time, and Executive
may terminate his employment at any time. If Executive's employment is
terminated by the Company other than for Cause (as hereinafter defined), or
Executive terminates his employment for Good Reason (as hereinafter defined),
Executive shall be entitled to receive a lump sum cash payment (but not in
substitution for compensation already earned) in an amount equal to the sum of:
(i) the product of two times the sum of (A) Executive's Base
Salary at its current annual rate at the time of
termination of employment plus (B) Executive's "Deemed
Bonus" (as defined below);
(ii) an amount equal to Executive's Bonus, for any calendar year
ending before such termination occurs, which would have
been payable had Executive remained in employment until the
date such Bonus would otherwise have been paid; and
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(iii) an amount equal to Executive's Deemed Bonus multiplied by a
fraction, the numerator of which is the number of days in
the calendar year in which the termination of employment
occurs that Executive was an employee of the Company, and
the denominator of which is 365.
In the event of a termination of Executive's employment by the
Company other than for Cause or by the Executive for Good Reason following a
Change of Control, the factor of two in subsection 6.1(a)(i) shall be increased
to three.
For purposes of subsections 6.1(a)(i) and (iii), 6.2(a) and 6.3,
the amount of the Deemed Bonus shall be the highest Bonus paid to Executive for
any year he has been employed by the Company.
(b) In addition to the amounts described in subsection 6.1(a),
Executive shall be entitled to receive:
(i) until the earlier of the Expiration Date (as that term is
hereafter defined) or 18 months from the date of
termination, Executive (and, to the extent applicable,
Executive's dependents) shall continue to be covered, at
the Company's expense, under the Company's medical, dental
and hospitalization coverage plans, and until the earlier
of the Expiration Date or 6 months from the date of
termination, Executive shall continue to be covered, at the
Company's expense, under the Company's group life, short
and long-term disability, accidental death and
dismemberment and travel accident coverage plans described
in Section 4.1 hereof or the Company will provide for
equivalent coverage (the term "Expiration Date" shall mean
the later of (i) December 31, 2004, (ii) the third
anniversary of a Change of Control of the Company or (iii)
the date that a succeeding one-year Period of Employment
(as provided for under Section 2 hereof) terminates); and
(ii) all payments to which Executive has vested rights as of the
Expiration Date under employee benefit, disability,
insurance and similar plans which provide for payments
beyond the Period of Employment.
(c) For purposes of this Agreement, "Good Reason" shall mean
any of the following (without Executive's express prior written consent):
(i) The assignment to Executive by the Company of duties
inconsistent with Executive's positions, duties,
responsibilities, titles or office as set forth in Section
1 hereof, or any reduction by the Company of his duties or
responsibilities or any removal of Executive from the
position of Executive Vice President and Chief Financial
Officer, except in connection with the termination of
Executive's employment (A) upon the termination of the
Period of Employment on the Expiration Date, (B) for Cause,
(C) as a result of Executive's Permanent Disability (as
hereinafter defined) or death or (D) by Executive other
than for Good Reason;
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(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 during the Period of
Employment;
(iii) The failure by the Company to obtain the specific
assumption of this Agreement by any successor or assign of
the Company or any person acquiring substantially all of
the Company's assets;
(iv) Failure by the Company to perform in any material respect
its obligations under this Agreement, where such failure
shall not have been remedied within 30 days after Executive
shall have notified the Company in writing thereof;
(v) Any material reduction in Executive's compensation or
benefits following a Change of Control or Executive's
principal business location is changed to a location more
than 30 miles from Executive's principal business location
(other than a relocation to the Borough of Manhattan, New
York, New York) immediately prior to a Change of Control;
(vi) The Company shall cease to keep in effect the policy of
directors' and officers' liability insurance for Executive
described in Section 5; or
(vii) The termination of the Indemnity Agreement, effective as of
April 20, 1995, between Executive and the Company.
(d)(i) Anything in this Agreement to the contrary notwithstanding,
if it is determined (as hereafter provided) that any
payment or distribution by the Company to or for the
benefit of the Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this
Agreement or otherwise pursuant to or by reason of any
other agreement, policy, plan, program or arrangement,
including without limitation any stock option, stock
appreciation right or similar right, or the lapse or
termination of any restriction on or the vesting or
exercisability of any of the foregoing (a "Payment") ,
would be subject to the excise tax imposed by Section 4999
of the Internal Revenue Code of 1986, as amended (the
"Code") (or any successor provision thereto) by reason of
being "contingent on a change in ownership or control" of
the Company, within the meaning of Section 28OG of the Code
(or any successor provision thereto) or to any similar tax
imposed by state or local law, or any interest or penalties
with respect to such excise tax (such tax or taxes,
together with any such interest and penalties, are
hereafter collectively referred to as the "Excise Tax") ,
then the Executive shall be entitled to receive an
additional payment or payments (a "Gross-Up Payment") in an
amount such that, after payment by the Executive of all
taxes (including any interest or penalties imposed with
respect to such taxes), including any Excise Tax, imposed
upon the Gross-Up Payment, the Executive retains an amount
of the Gross-Up Payment equal to the Excise Tax imposed
upon the Payments.
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(ii) Subject to the provisions of Section 6(d)(i) hereof, all
determinations required to be made under this Section 6(d),
including whether an Excise Tax is payable by the Executive
and the amount of such Excise Tax and whether a Gross-Up
Payment is required and the amount of such Gross-Up
Payment, shall be made by the nationally recognized firm of
certified public accountants (the "Accounting Firm") used
by the Company prior to the Change of Control (or, if such
Accounting Firm declines to serve, the Accounting Firm
shall be a nationally recognized firm of certified public
accountants selected by the Executive). The Accounting Firm
shall be directed by the Company or the Executive to submit
its determination and detailed supporting calculations to
both the Company and the Executive within 15 calendar days
after the date the Executive's employment is terminated by
the Executive for Good Reason or by the Company other than
for Cause (the "Termination Date"), if applicable, and any
other such time or times as may be requested by the Company
or the Executive. If the Accounting Firm determines that
any Excise Tax is payable by the Executive, the Company
shall pay the required Gross-Up Payment to the Executive
within five business days after receipt of such
determination and calculations. If the Accounting Firm
determines that no Excise Tax is payable by the Executive,
it shall, at the same time as it makes such determination,
furnish the Executive with an opinion that he has
substantial authority not to report any Excise Tax on his
federal, state, local income or other tax return. Any
determination by the Accounting Firm as to the amount of
the Gross-Up Payment shall be binding upon the Company and
the Executive. As a result of the uncertainty in the
application of Section 4999 of the Code (or any successor
provision thereto) and the possibility of similar
uncertainty regarding applicable state or local tax law at
the time of any determination by the Accounting Firm
hereunder, it is possible that Gross-Up Payments that will
not have been made by the Company should have been made (an
"Underpayment") consistent with the calculations required
to be made hereunder. In the event that the Company
exhausts or fails to pursue its remedies pursuant to
Section 6(d)(vi) hereof and the Executive thereafter is
required to make a payment of any Excise Tax, the Executive
shall direct the Accounting Firm to determine the amount of
the Underpayment that has occurred and to submit its
determination and detailed supporting calculations to both
the Company and the Executive as promptly as possible. Any
such Underpayment shall be promptly paid by the Company to,
or for the benefit of, the Executive within five business
days after receipt of such determination and calculations.
If payments required pursuant to this Section 6(d)(ii) to
be made by the Company to the Executive are not made within
such five day period, the Company shall pay the Executive
interest thereon at the rate of 10% per annum.
(iii) The Company and the Executive shall each provide the
Accounting Firm access to and copies of any books, records
and documents in the possession of the Company or the
Executive, as the case may be, reasonably requested by the
Accounting Firm, and otherwise cooperate with the
Accounting Firm in connection with the preparation and
issuance of the determination contemplated by Section
6(d)(ii) hereof.
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(iv) The federal, state and local income or other tax returns
filed by the Executive and the Company (or any filing made
by a consolidated tax group which includes the Company)
shall be prepared and filed on a consistent basis with the
determination of the Accounting Firm with respect to the
Excise Tax payable by the Executive. The Executive shall
make proper payment of the amount of any Excise Tax and, at
the request of the Company, provide to the Company true and
correct copies (with any amendments) of his federal income
tax return as filed with the Internal Revenue Service and
corresponding state and local tax returns, if relevant, as
filed with the applicable taxing authority, and such other
documents reasonably requested by the Company, evidencing
such payment. If prior to the filing of the Executive's
federal income tax return, or corresponding state or local
tax return, if relevant, the Accounting Firm determines
that the amount of the Gross-Up Payment should be reduced,
the Executive shall within five business days pay to the
Company the amount of such reduction.
(v) The fees and expenses of the Accounting Firm for its
services in connection with the determinations and
calculations contemplated by Sections 6 (d)(ii) and (d)(iv)
hereof shall be borne by the Company. If such fees and
expenses are initially advanced by the Executive, the
Company shall reimburse the Executive the full amount of
such fees and expenses within five business days after
receipt from the Executive of a statement therefor and
reasonable evidence of his payment thereof. If such
reimbursement is not made by the Company to the Executive
within such five-day period, the Company shall pay the
Executive interest thereon at the rate of 10% per annum.
(vi) The Executive shall notify the Company in writing of any
claim by the Internal Revenue Service that, if successful,
would require the payment by the Company of a Gross-Up
Payment. Such notification shall be given as promptly as
practicable but no later than 10 business days after the
Executive actually receives notice of such claim and the
Executive shall further apprise the Company of the nature
of such claim and the date on which such claim is requested
to be paid (in each case, to the extent known by the
Executive). The Executive shall not pay such claim prior to
the earlier of (a) the expiration of the 30-calendar-day
period following the date on which he gives such notice to
the Company and (b) the date that any payment of amount
with respect to such claim is due. If the Company notifies
the Executive in writing prior to the expiration of such
period that it desires to contest such claim, the Executive
shall:
(A) provide the Company with any written records or
documents in his possession relating to such claim
reasonably requested by the Company;
(B) take such action in connection with contesting such
claim as the Company shall reasonably request in
writing from time to time, including without
limitation accepting legal representation with
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respect to such claim by an attorney competent in
respect of the subject matter and reasonably
selected by the Company;
(C) cooperate with the Company in good faith in order
effectively to contest such claim; and
(D) permit the Company to participate in any proceedings
relating to such claim;
provided, however, that the Company shall bear and pay
directly all costs and expenses (including interest and
penalties) incurred in connection with such contest and
shall indemnify and hold harmless the Executive, on an
after-tax basis, for and against any Excise Tax or income
tax, including interest and penalties with respect thereto,
imposed as a result of such representation and payment of
costs and expenses. Without limiting the foregoing
provisions of this Section 6 (d)(vi), the Company shall
control all proceedings taken in connection with the
contest of any claim contemplated by this Section 6 (d)(vi)
and, at its sole option, may pursue or forego any and all
administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such
claim (provided however, that the Executive may participate
therein at his cost and expense) and may, at its option,
either direct the Executive to pay the tax claimed and xxx
for a refund or contest the claim in any permissible
manner, and the Executive agrees to prosecute such contest
to a determination before any administrative tribunal, or a
court of initial jurisdiction and in one or more appellate
courts, as the Company shall determine; provided, however,
that if the Company directs the Executive to pay the tax
claimed and xxx for a refund, the Company shall advance the
amount of such payment to the Executive on an interest-free
basis and shall indemnify and hold the Executive harmless,
on an after-tax basis, from any Excise Tax or income tax,
including interest and penalties with respect thereto,
imposed with respect to such advance; and provided further,
however, that any extension of the statute of limitations
relating to payment of taxes for the taxable year of the
Executive with respect to which the contested amount is
claimed to be due is limited solely to such contested
amount. Furthermore, the Company's control of any such
contested claim shall be limited to issues with respect to
which a Gross-Up Payment would be payable hereunder and the
Executive shall be entitled to settle or contest, as the
case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.
(vii) If, after the receipt by the Executive of an amount
advanced by the Company pursuant to Section 6 (d)(vi)
hereof, the Executive receives any refund with respect to
such claim, the Executive shall (subject to the Company's
complying with the requirements of Section 6 (d)(vi)
hereof) promptly pay to the Company the amount of such
refund (together with any interest paid or credited thereon
after any taxes applicable thereto). If, after the receipt
by the Executive of an amount advanced by the Company
pursuant to Section 6 (d)(vi) hereof, a determination is
made that the Executive is not entitled to any refund with
respect to such claim
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and the Company does not notify the Executive in writing of
its intent to contest such denial or refund prior to the
expiration of 30 calendar days after such determination,
then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall
offset, to the extent thereof, the amount of Gross-Up
Payment required to be made pursuant to this Section 6 (d).
(e) For purposes of this Agreement, a "Change of Control" shall
be deemed to have occurred when:
(i) any person or persons acting in concert (excluding Company
benefit plans) becomes the beneficial owner of securities
of the Company having at least 25% of the voting power of
the Company's then outstanding securities; or
(ii) the shareholders of the Company shall approve any merger or
other business combination of the Company, sale or lease of
the Company's assets or combination of the foregoing
transactions (the "TRANSACTIONS") other than a Transaction
immediately following which the shareholders of the Company
and any trustee or fiduciary of any Company employee
benefit plan immediately prior to the Transaction own at
least 65% of the voting power, directly or indirectly, of
(A) the surviving corporation in any such merger or other
business combination; (B) the purchaser or lessee of the
Company's assets; or (C) both the surviving corporation and
the purchaser or lessee in the event of any combination of
Transactions; or
(iii) within any 24-month period, the persons who were directors
immediately before the beginning of such period (the
"INCUMBENT DIRECTORS") shall cease (for any reason other
than death) to constitute at least a majority of the Board
or the board of directors of a successor to the Company.
For this purpose, any director who was not a director at
the beginning of such period shall be deemed to be an
Incumbent Director if such director was elected to the
Board by, or on the recommendation of or with the approval
of, at least two-thirds of the directors who then qualified
as Incumbent Directors (so long as such director was not
nominated by a person who has expressed an intent to effect
a Change of Control or engage in a proxy or other control
contest).
(f) Except as otherwise specifically provided herein, all cash
payments under this Section 6.1 shall be made by the Company within 30 calendar
days following the event giving rise to such payments. If any such payment shall
not be made within such 30-day period (or any other specifically provided time
period), the Company shall pay interest on the unpaid amount at the rate of 10%
per annum.
6.2 PERMANENT DISABILITY. If as a result of the Executive's
incapacity due to physical or mental illness, the Executive shall have been
absent from his duties with the Company on a full-time basis for six consecutive
months (a "Permanent Disability") during his Period of Employment, the Company
or Executive may terminate his employment on written notice thereof, the Period
of Employment shall terminate on the giving of such notice, and the compensation
to which Executive is entitled pursuant to Section 3.1 shall be paid through the
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last day of the month in which the notice is given. In addition, Executive shall
be entitled to receive:
(a) all unpaid amounts, as of the date of such termination, in
respect of any Bonus for any calendar year ending before the calendar year in
which such termination occurs, which would have been payable had Executive
remained in employment until the date such Bonus would otherwise have been paid,
plus Executive's Deemed Bonus for the calendar year in which his employment
terminates, multiplied by a fraction, the numerator of which is the number of
days in such calendar year the Executive was an employee of the Company, and the
denominator of which is 365;
(b) until the earlier of the Expiration Date or 24 months from
the date of termination for Permanent Disability, Executive (and, to the extent
applicable, Executive's dependents) shall continue to be covered, at the
Company's expense, under the Company's medical, dental, hospitalization, group
life, short and long-term disability, accidental death and dismemberment and
travel accident coverage plans described in Section 4.1 or the Company will
provide for equivalent coverage; provided that if Executive is provided with
comparable coverage by a successor employer any such coverage by the Company
shall cease; and
(c) all amounts payable under the Company's disability plans.
6.3 DEATH. In the event of Executive's death while employed
hereunder, the Period of Employment shall thereupon automatically terminate and
the Executive's estate or designated beneficiaries shall receive (i) payments of
Base Salary for a period of three months after the date of death; (ii) all
unpaid amounts, as of the date of such termination, in respect of any Bonus for
any calendar year ending before the calendar year in which such termination
occurs, which would have been payable had Executive remained in employment until
the date such Bonus would otherwise have been paid, plus Executive's Deemed
Bonus for the calendar year in which his employment terminates, multiplied by a
fraction, the numerator of which is the number of days in such calendar year the
Executive was an employee of the Company, and the denominator of which is 365;
and (iii) any death benefits provided under the employee benefit programs, in
accordance with their terms.
6.4 VOLUNTARY RESIGNATION; DISCHARGE FOR CAUSE. If Executive
resigns voluntarily, other than for Good Reason or Permanent Disability, or the
Company terminates the employment of Executive at any time for Cause, the
Company's obligations under this Agreement to make any further payments to
Executive shall thereupon, to the extent permitted by law, cease and terminate
except with respect to all unpaid amounts, as of the date of such termination,
in respect of any Bonus for any calendar year ending before such termination
occurs, which would have been payable had Executive remained in employment until
the date such Bonus would otherwise have been paid. In addition, Executive shall
remain entitled to all vested amounts and benefits under the Company's employee
benefit programs, plans and practices. The term "Cause" shall be limited to (a)
action by Executive involving willful malfeasance in connection with his
employment which results in material harm to the Company, (b) material and
continuing breach by Executive of the terms of this Agreement which breach is
not cured within 60 days after Executive receives written notice from the
Company of any such breach or (c) Executive being convicted of a felony.
Termination of Executive for Cause pursuant to this Section 6.4 shall be
communicated by a Notice of Termination given within six months after the Board
both (i) had knowledge of conduct or an event allegedly constituting Cause and
(ii) had reason to believe that such conduct or event could be grounds for
Cause.
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For purposes of this Agreement a "Notice of Termination" shall mean delivery to
Executive of a copy of a resolution duly adopted by the Board at a meeting of
the Board called and held for that purpose (after not less than 10 days notice
to Executive ("Preliminary Notice") and reasonable opportunity for Executive,
together with the Executive's counsel, to be heard before the Board prior to
such vote) finding, that in the good faith opinion of the Board, Executive was
guilty of conduct set forth in the third sentence of this Section 6.4 and
specifying the particulars thereof in detail. The Board shall no later than 30
days after the receipt of the Preliminary Notice by Executive communicate its
findings to Executive. A failure by the Board to make its finding of Cause or to
communicate its conclusions within such 30-day period shall be deemed to be a
finding that Executive was not guilty of the conduct described in the third
sentence of this Section 6.4.
6.5 TERMINATION ON OR AFTER EXPIRATION DATE. In the event the
Period of Employment shall not be extended and Executive's employment shall be
terminated by the Company on or after the Expiration Date or Executive shall
terminate his employment on or after the Expiration Date, the Executive shall be
paid (a) his Base Salary through the last day of the month in which the
termination of employment occurs, (b) all unpaid amounts in respect of any Bonus
for any calendar year ending before such termination date occurs, which Bonus
would have been payable had Executive remained in employment until the date such
Bonus would otherwise have been paid, and (c) Executive's Deemed Bonus for the
calendar year in which his employment terminates, multiplied by a fraction, the
numerator of which is the number of days in such calendar year the Executive was
an employee of the Company, and the denominator of which is 365. In addition,
Executive shall remain entitled to all vested amounts, benefits, and rights
under the Company's employee benefit programs, plans and practices, all rights
to which he is entitled under Company severance plans, practices and/or policies
and all other benefits to which he is entitled by law or contract.
6.6 TERMINATION OBLIGATIONS. (a) Executive hereby acknowledges
and agrees that all personal property, including, without limitation, all books,
manuals, records, reports, notes, contracts, lists, and other documents, and
equipment furnished to or prepared by Executive in the course of or incident to
his employment, belong to the Company and shall be promptly returned to the
Company upon termination of the Period of Employment.
(b) Upon termination of the Period of Employment, the Executive
shall be deemed to have resigned from all offices and directorships then held
with the Company or any subsidiary or affiliate thereof.
7. CONFIDENTIAL INFORMATION. During and after the Period of
Employment, Executive shall not disclose to any person (other than an employee
or agent of the Company or any affiliate of the Company entitled to receive the
same) any confidential information relating to the business of the Company and
obtained by him while providing services to the Company, without the consent of
the Board, or until such information ceases to be confidential.
8. NON-COMPETITION. In the event Executive's employment is
terminated by the Company for Cause or Executive terminates his employment with
the Company without Good Reason, Executive shall not, for a period ending on the
earlier of (i) 18 months from the date of such termination or (ii) the
Expiration Date, accept any other employment or engage, directly or indirectly,
in any other business activity which is competitive with that of the Company or
any subsidiary thereof.
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9. EXPENSES. Executive is authorized to incur reasonable
expenses in carrying out his duties and responsibilities under this Agreement,
including expenses for travel and similar items related to such duties and
responsibilities. The Company will reimburse Executive for all such expenses
upon presentation by Executive from time to time of an itemized account of such
expenditures.
10. NO OBLIGATION TO MITIGATE DAMAGES. Executive shall not be
required to mitigate damages or the amount of any payment provided for under
this Agreement by seeking (and no payment otherwise required hereunder shall be
reduced on account of) other employment or otherwise, nor will any payments
hereunder be subject to offset in respect of any claims which the Company may
have against Executive.
11. NOTICES. All notices or communications hereunder shall be
in writing, addressed as follows:
to Executive:
Xxxxxx X. Xxxxxxx
00 Xxxxxxx Xxxx
Xxx Xxxxxxx, XX 00000
to Company:
Xxxxxxx X. Xxxxxxxx, Esq.
Executive Vice President and General Counsel
EMCOR Group, Inc.
000 Xxxxxxx Xxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000
with a copy to:
Xxxxxxx X. Xxxxx, Xx., Esq.
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Any such notice or communication shall be delivered by hand or sent certified or
registered mail, return receipt requested, postage prepaid, addressed as above
(or to such other address as such party may designate in a notice duly delivered
as described above), and the actual date of delivery or mailing shall determine
the time at which notice was given.
12. AGREEMENT TO PERFORM NECESSARY ACTS. Each party agrees to
perform any further acts and to execute and deliver any further documents that
may be reasonably necessary to carry out the provisions of this Agreement.
13. SEPARABILITY; LEGAL ACTIONS; LEGAL FEES. If any provision
of this Agreement shall be declared to be invalid or unenforceable, in whole or
in part, such invalidity or unenforceability shall not affect the remaining
provisions hereof, which shall remain in full force and effect. Any controversy
or claim arising out of or relating to this Agreement or the
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breach of this Agreement that cannot be resolved by Executive and the Company,
including any dispute as to the calculation of Executive's benefits or any
payments hereunder, shall be submitted to arbitration in New York, New York in
accordance with the laws of the State of New York and the procedures of the
American Arbitration Association, except that if Executive institutes an action
relating to this Agreement, Executive may, at Executive's option, bring that
action in any court of competent jurisdiction. Judgment may be entered on an
arbitrator(s)' award in any court having jurisdiction.
In addition to all other amounts payable to the Executive under
this Agreement, the Company shall pay or reimburse the Executive for legal fees
(including without limitation, any and all court costs and attorneys' fees and
expenses) incurred by the Executive in connection with or as a result of any
claim, action or proceeding brought by the Company or the Executive with respect
to or arising out of this Agreement or any provision hereof, unless, in the case
of an action brought by the Executive, it is determined by an arbitrator or by a
court of competent jurisdiction that such action was frivolous and was not
brought in good faith. Such legal fees shall be paid or reimbursed by the
Company to the Executive from time to time within five business days following
receipt by the Company of copies of bills for such fees and if the Company fails
to make such payment within such five day period, the Company shall pay the
Executive interest thereon at the rate of 10% per annum. All other expenses
relating to any arbitration or court proceedings shall be paid by the Company.
14. ASSIGNMENT. This Agreement shall be binding upon and inure
to the benefit of the heirs and representatives of Executive and the assigns and
successors of the Company, but neither this Agreement nor any rights hereunder
shall be assignable or otherwise subject to hypothecation by Executive (except
by will or by operation of the laws of intestate succession) or by the Company
(any such purported assignment by either shall be null and void), except that
the Company may assign this Agreement to any successor (whether by merger,
purchase or otherwise) to all or substantially all of the stock, assets or
business of the Company.
15. AMENDMENT; WAIVER. The Agreement may be amended at any
time, but only by mutual written agreement of the parties hereto. Any party may
waive compliance by the other party with any provision hereof, but only by an
instrument in writing executed by the party granting such waiver.
16. ENTIRE AGREEMENT. Except as otherwise provided in a
Continuity Agreement dated as of June 22, 1998 between the Company and the
Executive, as amended by agreement dated May 4, 1999, and the agreements setting
forth in detail the terms of the options referred to in Section 3.3 hereof, and
as may be amended from time to time hereafter, the terms of this Agreement (i)
are intended by the parties to be the final expression of their agreement with
respect to the employment of Executive by the Company, (ii) may not be
contradicted by evidence of any prior or contemporaneous agreement and (iii)
shall constitute the complete and exclusive statement of its terms, and no
extrinsic evidence whatsoever may be introduced in any judicial, administrative
or other legal proceeding involving this Agreement.
17. DEATH OR INCOMPETENCE. In the event of Executive's death or
a judicial determination of his incompetence, reference in this Agreement to
Executive shall be deemed, where appropriate, to refer to his estate or other
legal representative.
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18. SURVIVORSHIP. The respective rights and obligations of the
parties hereunder shall survive any termination of this Agreement to the extent
necessary to the intended preservation of such rights and obligations. The
provisions of this Section are in addition to the survivorship provisions of any
other section of this Agreement.
19. GOVERNING LAW. This Agreement shall be construed,
interpreted, and governed in accordance with the laws of the State of New York
without reference to rules relating to conflicts of law.
20. WITHHOLDINGS. The Company shall be entitled to withhold
from payment any amount of withholding required by law.
21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original.
IN WITNESS WHEREOF, the parties hereto have executed this amended
and restated employment agreement as of the date first above written.
EMCOR GROUP, INC.
By:
--------------------------------------
EXECUTIVE
-----------------------------------------
Xxxxxx X. Xxxxxxx
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