EXHIBIT 10.15
[Chart Industries, Inc. Letterhead]
October 17, 2002
Xx. Xxxxxxx X. Xxxxx
0000 Xxxx Xxxxxxx Xxxxx
Xxxxxxxx, Xxxx 00000
Re: Employment Agreement
Dear Xxxxxxx:
This letter agreement (this "Agreement") sets forth the terms under
which you are employed by Chart Industries, Inc. (the "Company") as its Chief
Financial Officer.
1. Term of Employment. The Company agrees to employ you, and you agree to
serve the Company, on the terms and conditions set forth in this Agreement for
the period commencing as of the date hereof and expiring on the first
anniversary of the date hereof (the "Employment Period"). The Employment Period
shall automatically be extended on the first anniversary of the date hereof, and
on each subsequent anniversary of the date hereof, for a period of one year from
such anniversary unless, not later than 60 days before such anniversary, you or
the Company has given written notice to the other party that you or it, as the
case may be, does not wish to have the Employment Period extended.
Notwithstanding the foregoing, in the event of a Change in Control, the
Employment Period shall automatically be extended for a period beginning on the
date of the Change in Control and expiring on the second anniversary of the date
of such Change in Control, but the Employment Period shall not be extended
further after a Change in Control unless expressly agreed to in writing by the
parties. In any case, the Employment Period may be terminated earlier under the
terms and conditions set forth herein.
2. Position and Duties. During the Employment Period, you shall serve as
the Company's Chief Financial Officer and report to the Chief Executive Officer
of the Company. You shall have responsibility for the accounting, financial
reporting, treasury, internal audit, tax and administrative functions of the
Company, and the performance of such other services and duties as shall be
reasonably assigned to and requested of you by the Chief Executive Officer or
the Board of Directors. You agree to devote substantially all your working time
and efforts to the business and affairs of the Company and serve the Company in
its business and perform your duties to the best of your ability.
3. Compensation and Benefits.
(a) Salary. During the Employment Period, you shall receive a base
salary at the rate of Two Hundred Thousand Dollars ($200,000) per year (the
"Base Salary Amount"). Your salary may be adjusted based upon an annual review
by the Board of Directors of the Company or any duly authorized Committee
thereof, although any such adjustment shall be at the sole discretion of the
Board of Directors or such Committee. Notwithstanding the foregoing, in no
Xxxxxxx X. Xxxxx
October 17, 2002
Page 2
event shall your salary be adjusted below the Base Salary Amount. Such salary
shall be payable in bi-weekly installments or otherwise in accordance with the
normal policies of the Company for payment of corporate officers.
(b) Benefits. During the Employment Period, you shall be entitled to
participate in any employee benefits plans which are maintained or established
by the Company for its corporate officers, subject, however, to all of the terms
and conditions thereof, including any eligibility requirements therefor,
including but not limited to: (i) the Management Incentive Compensation Plan or
any other successor plan (the "Incentive Plan"); (ii) any stock option plan of
the Company in which the Company's corporate officers generally are eligible to
participate (the "Option Plan"); (iii) medical, dental and vision insurance
coverage; (iv) life insurance coverage; (v) 401(k) Retirement Plan; (vi) four
weeks of paid vacation annually to be taken at such time or times as are chosen
by you; and (vii) the use of a leased automobile (including insurance).
Notwithstanding the foregoing, you shall not be entitled to participate in the
Company's Severance Benefit Plan or any such successor plan. Payment under the
Incentive Plan shall be determined by, and awarded in the sole discretion of,
the Board of Directors of the Company or any authorized Committee thereof and
shall be dependent upon the Company's financial performance and your performance
toward established goals. There shall be no guaranteed awards under the
Incentive Plan. On an annual basis, the Board of Directors of the Company or any
authorized Committee thereof may in its sole discretion grant you options to
purchase common stock of the Company under the Option Plan in addition to any
option previously granted to you.
(c) Expenses. The Company shall reimburse you for reasonable expenses
incurred by you on behalf of the Company in the performance of your duties
during the Employment Period. You shall furnish the Company with such
documentation as is requested by the Company in order for it to comply with the
Internal Revenue Code of 1986, as amended, and regulations thereunder in
connection with the proper deduction of such expenses.
4. Termination of Employment.
(a) General. Your employment with the Company shall terminate
automatically upon your death or the expiration of the Employment Period without
extension. In addition, you may terminate your employment with the Company
voluntarily by resigning, and the Company may terminate your employment (i) for
Cause, (ii) without Cause, for any reason or no reason, or (iii) by reason of
your Disability. Any termination by the Company or by you of your employment
hereunder shall be communicated by a written notice to the other party hereto,
which shall indicate the specific termination provision in this Agreement relied
upon, set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of your employment under the provision so
indicated, and specify the effective date of the termination of your employment
(which shall not be earlier than the date on which the notice is given). The
effective date of the termination of your employment is referred to as the
"Termination Date." Notwithstanding Section 1, the Employment Period shall
terminate upon the termination of your employment with the Company.
Xxxxxxx X. Xxxxx
October 17, 2002
Page 3
(b) Expiration of Employment Period, Death, Resignation, Cause or
Disability. If the Employment Period expires without extension or, during the
Employment Period, your employment terminates as a result of your death, you
terminate your employment voluntarily by resigning, or the Company terminates
your employment for Cause or by reason of your Disability, then, in any such
case, Sections 4(c), 4(d) and 4(e) shall not apply and you shall be entitled to
payment of base salary only for the remainder of the month in which such
termination occurs (or only until the Termination Date, if your employment
terminates as a result of the expiration of the Employment Period without
extension) and thereafter such salary shall end and cease to be payable. In
addition, in any such case, and you shall be entitled to receive any benefits
provided for in Section 3(b) which have accrued up to and including the
Termination Date, subject to the terms and conditions of the benefit plans
referenced in Section 3(b), and reimbursement of reasonable expenses incurred up
to and including the Termination Date under the terms of Section 3(c).
(c) Termination Without Cause. If, during the Employment Period, the
Company terminates your employment without Cause, then, in lieu of further base
salary payments hereunder, the Company shall pay to you within 30 calendar days
after the Termination Date an amount equal to your then current annual base
salary. In addition, in such case, you shall be entitled to receive any benefits
provided for in Section 3(b) which have accrued up to and including the
Termination Date, subject to the terms and conditions of the benefit plans
referenced in Section 3(b), and reimbursement of reasonable expenses incurred up
to and including the Termination Date under the terms of Section 3(c).
Notwithstanding the foregoing, you shall not be entitled to any payment or
benefit under this Section 4(c) if you are entitled to any salary continuation
under Section 4(d), and in no case shall you be entitled to any payments and/or
benefits under both Section 4(c) and Section 4(d).
(d) Termination Without Cause Following a Change in Control. If (i) a
Change in Control occurs during the Employment Period and (ii) at any time
during the period commencing on the date of such Change in Control and ending on
the date that is six months after such Change in Control the Company terminates
your employment without Cause, then, in lieu of any payment or benefits under
Section 4(c), the Company shall continue to pay to you, in accordance with its
normal payroll practices, your base salary at the rate in effect immediately
prior to the Termination Date (which shall not be less than the Base Salary
Amount) until the second anniversary of such Termination Date. In addition, in
such case, you shall be entitled to receive any benefits provided for in Section
3(b) which have accrued up to and including the Termination Date, subject to the
terms and conditions of the benefit plans referenced in Section 3(b), and
reimbursement of reasonable expenses incurred up to and including the
Termination Date under the terms of Section 3(c). For purposes of clauses (i)
and (ii) of this Section 4(d), any termination of your employment during the
Employment Period by the Company without Cause after or immediately before the
Company enters into a definitive agreement with a third party that results in a
Change in Control shall be deemed to be a termination of your employment by the
Company without Cause immediately after such Change in Control, and such Change
in Control shall be deemed to occur during the Employment Period.
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October 17, 2002
Page 4
(e) Continuation of Health Benefits. If, during the Employment Period,
the Company terminates your employment without Cause, then for the duration of
the Applicable Continuation Period you shall be eligible to participate in the
Company's medical, dental and vision insurance coverage available to its
employees generally as if you were still employed by the Company, to the extent
and at the level of your participation in that coverage immediately prior to the
Termination Date, but all Company contributions or payments under that coverage
shall be subject to your fulfillment of your contribution requirements under
that coverage, and Company provision of this coverage shall cease if you obtain
comparable coverage from another employer during the Applicable Continuation
Period. If, however, your continued participation in any such insurance coverage
after the Termination Date is not possible under the terms governing such
coverage, the Company may satisfy its obligation to provide such coverage by
providing to you during the Applicable Continuation Period alternative coverage,
comparable to the coverage then available to Company employees generally, on the
terms set forth in the preceding sentence. The "Applicable Continuation Period"
means 12 months after the Termination Date if you are entitled to severance pay
under Section 4(c), and means 24 months after the Termination Date if you are
entitled to severance pay under Section 4(d).
5. Binding Agreement; Successors. This Agreement shall inure to the
benefit of and be binding upon your personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees. If you should die while any amounts would still be payable to you
hereunder, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to your spouse, or if your spouse
does not survive you, to your estate. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of the Company, including,
without limitation, any person acquiring directly or indirectly all or
substantially all of the assets of the Company, whether by merger,
consolidation, sale or otherwise (and such successor shall thereafter be deemed
the "Company" for the purposes of this Agreement). The Company shall require any
such successor to assume and agree to perform this Agreement.
6. Withholding. The Company may withhold from any amounts payable under or
in connection with this Agreement all federal, state, local and other taxes as
may be required to be withheld by the Company under applicable law or
governmental regulation or ruling.
7. Headings; Definitions. The headings contained herein are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement. Certain terms used in this Agreement are defined on Appendix A
attached hereto.
8. Entire Agreement. This Agreement contains the entire agreement between
the parties with respect to your employment and supersedes any and all other
agreements (including the letter agreement, dated July 25, 2001, between the
Company and you relating to severance pay, which is hereby terminated, but
excluding any existing stock option granted to you and any rights you may have
to indemnity), either oral or in writing, with respect to your employment.
9. General. No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in
writing, and is signed by you and by another officer of the Company. You may not
assign this Agreement without the consent of the Company.
Xxxxxxx X. Xxxxx
October 17, 2002
Page 5
This Agreement shall be governed by and construed in accordance with the laws of
the State of Ohio, without giving effect to conflict of law principles.
If the foregoing correctly reflects our understanding with respect to
the matters described in this letter, please sign this letter below and return
one copy to the undersigned.
CHART INDUSTRIES, INC.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Xxxxxx X. Xxxxxx
Chairman and Chief Executive Officer
Agreed to and Accepted as of
the date set forth above:
/s/ Xxxxxxx X. Xxxxx
-------------------------------
Xxxxxxx X. Xxxxx
Appendix A
Certain Definitions
As used in this Agreement, the following terms shall have the following
meanings:
"Cause" means a determination by the Board of Directors of the Company (without
your participation), pursuant to the exercise of its business judgment, that any
one of the following events has occurred:
i) You have been indicted by a state or federal grand jury of
committing a felony;
ii) The Board receives proof satisfactory to it of your commission
of theft or embezzlement from the Company, or any other crime
against the Company;
iii) You, for yourself or any other person, firm, corporation or
other entity, (a) solicit business from customers of the
Company, (b) divert or attempt to divert any business from the
Company, or otherwise interfere with the business or
employment relationship between the Company or any customer,
employee or sales representative thereof, or (c) disclose or
furnish to any competitor or any person, firm, corporation or
other entity, or use on your own behalf, any confidential or
secret information or data of or relating to the Company; or
iv) You fail or refuse or are unable to perform your services and
duties for the Company as Chief Financial Officer, or as
reasonably assigned to you by the Chief Executive Officer or
the Board of Directors, or commit any act of gross negligence,
corporate waste, disloyalty, or unfaithfulness to the Company
which adversely affects the business of the Company, any
material breach of your employment obligations hereunder, or
any other act or course of conduct which could reasonably be
expected to have an adverse effect on the Company's business
such as, by way of example only, intentionally causing the
Company to violate federal, state or local environmental,
labor, antitrust, or other similar laws, or sexual or other
illegal harassment of employees.
"Change in Control" means the occurrence at any time of any of the following
events:
i) The Company is merged or consolidated or reorganized into or
with another corporation or other legal person or entity,
other than a Related Person, and as a result of such merger,
consolidation or reorganization less than 60% of the combined
voting power of the then-outstanding securities of such
corporation, person or entity immediately after such
transaction is held in the aggregate by the holders of Voting
Stock immediately prior to such transaction;
ii) The Company sells or otherwise transfers all or substantially
all of its assets to any other corporation or other legal
person or entity, other than a Related Person, and less than
60% of the combined voting power of the then-outstanding
securities of such corporation, person or entity immediately
after such sale or transfer is held in the aggregate by the
holders of Voting Stock immediately prior to such sale or
transfer;
iii) There is a report filed on Schedule 13D or Schedule TO (or any
successor schedule, form or report), each as promulgated
pursuant to the Exchange Act, disclosing that any person (as
the term "person" is used in Section 13(d)(3) or Section
14(d)(2) of the Exchange Act) other than a Related Person has
become the beneficial owner (as the term "beneficial owner" is
defined under Rule l3d-3 or any successor rule or regulation
promulgated under the Exchange Act) of securities representing
40% or more of the Voting Power;
iv) The Company files a report or proxy statement with the
Securities and Exchange Commission pursuant to the Exchange
Act disclosing in response to Form 8-K or Schedule 14A (or any
successor schedule, form or report or item therein) that a
change in control of the Company has or may have occurred or
will or may occur in the future pursuant to any then-existing
contract or transaction other than a contract or transaction
with a Related Person; or
v) If during any period of two consecutive years, individuals,
who at the beginning of any such period, constitute the
Directors cease for any reason to constitute at least a
majority thereof, unless the nomination for election by the
Company's shareholders of each new Director was approved by a
vote of at least a majority of the Directors then in office
who were Directors at the beginning of any such period.
Notwithstanding the foregoing provisions of paragraphs (iii) and (iv)
of this definition, a "Change in Control" shall not be deemed to have
occurred for purposes of this Agreement (A) solely because (1) the
Company, (2) a Related Person, (3) a Subsidiary, or (4) any
Company-sponsored employee stock ownership plan or other employee
benefit plan of the Company or any Subsidiary, or any entity holding
shares of Voting Stock for or pursuant to the terms of any such plan,
either files or becomes obligated to file a report or proxy statement
under or in response to Schedule 13D, Schedule TO, Form 8-K or Schedule
14A (or any successor schedule, form or report or item therein) under
the Exchange Act, disclosing beneficial ownership by it of shares of
Voting Stock or because the Company reports that a change in control of
the Company has or may have occurred or will or may occur in the future
by reason of such beneficial ownership, (B) solely because the Company
or any other person, group or entity directly involved in the
restructuring of the Company's capital and debt arrangements related to
the Company's Credit Agreement, dated as of April 12, 1999, as amended,
either files or becomes obligated to file a report on Schedule 13D,
Schedule TO, Form 8-K or Schedule 14A (or any successor schedule, form
or report) under the Exchange Act, disclosing beneficial ownership by
it of shares of Voting Stock acquired from the Company in connection
with such restructuring or because the Company reports that a change in
control of the Company has or may have occurred or will or may occur in
the future by reason of such transaction, but only if both (1) the
transaction giving rise to such filing or obligation is approved in
advance of consummation thereof by the Company's Board of Directors and
(2) at least a majority of the Voting Power immediately after such
transaction is held in the aggregate by the holders of Voting Stock
immediately prior to such transaction, or (C) solely because of a
change in control of any Subsidiary.
A-2
For purposes of this definition of "Change in Control", the following
capitalized terms shall have the following meanings:
"Director" means a member of the Board of Directors of the
Company.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder, as such law,
rules and regulations may be amended from time to time.
"Related Person" means (i) Xxxxxx X. Xxxxxx (ii) Xxxxxxx X.
Xxxxxx, (iii) any person, group or entity controlled directly, or
indirectly through one or more intermediaries, by Xxxxxx X.
Xxxxxx or Xxxxxxx X. Xxxxxx or both of them, and (iv) any of the
foregoing acting alone or in concert.
"Subsidiary" means a corporation, company or other entity (i)
more than 50 percent of whose outstanding shares or securities
(representing the right to vote for the election of directors or
other managing authority) are, or (ii) which does not have
outstanding shares or securities (as may be the case in a
partnership, joint venture or unincorporated association), but
more than 50 percent of whose ownership interest representing the
right generally to make decisions for such other entity is, now
or hereafter, owned or controlled, directly or indirectly, by the
Company.
"Voting Power" means, at any time, the total votes relating to
the then-outstanding securities entitled to vote generally in the
election of Directors.
"Voting Stock" means, at any time, the then-outstanding
securities entitled to vote generally in the election of
Directors.
"Disability" means your inability for a continuous period of six months to
perform the essential functions of your position hereunder on an active
full-time basis with or without reasonable accommodations by reason of a
disability condition. A certificate from a physician acceptable to both the
Company and you to the effect that you are or have been disabled and incapable
of performing the essential functions of your position with or without
reasonable accommodations for the Company as previously performed shall be
conclusive of the fact that you are incapable of performing such services and
are, or have been, disabled for the purposes of this Agreement. The Company and
you acknowledge and agree that the essential functions of your position are
unique and critical to the Company and that a disability condition that causes
you to be unable to perform the essential functions of your position under the
circumstances described above will constitute an undue hardship on the Company.
"You," "your" and similar derivations of "you" mean and refer to Xxxxxxx X.
Xxxxx.
A-3
