EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") is made as of this 26th
day of February, 2001, by and between BE Aerospace, Inc., a Delaware corporation
(the "Company") and Xxxxxx X. Xxxxxxxxx (the "Employee").
RECITALS
WHEREAS, the Company has entered into Stock Purchase Agreements, dated
as of February 24, 2001 (the "Stock Purchase Agreement"), pursuant to which the
Company will acquire all of the issued and outstanding capital stock of Xxxxx
and Delco (the "Acquisition"); and
WHEREAS, the parties understand that this Agreement is being entered
into in connection with the Acquisition and the parties desire to enter into
this Agreement, to be effective upon the Effective Date; and
WHEREAS, the Company wishes to employ the Employee and the Employee
wishes to accept such employment on the terms and conditions hereafter set
forth; and
WHEREAS, subject to the terms and conditions hereinafter set forth,
the Company wishes to make secure for itself the experience, abilities and
services of the Employee; and
WHEREAS, the Employee has successfully completed drug/substance abuse
testing, and the Company has received the results of such testing;
NOW THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto, each intending to
be legally bound, do hereby agree as follows:
1. Effective Date of the Agreement. This Agreement shall become effective as
of the Closing Date (as defined in the Stock Purchase Agreements the
"Effective Date"). In the event that the Closing is not consummated, this
Agreement shall be null and void.
2. Employment. The Company shall employ the Employee, and the Employee shall
perform services for and continue in the employment of the Company, for an
initial period of one (1) year commencing on February 26, 2001, and ending on
February 25, 2002 whereupon the Employee's employment hereunder shall
automatically be extended from year to year on and after February 26, 2002,
until either the Company or the Employee gives the other party at least ninety
(90) days written notice prior to the then-applicable "Expiration Date" (as
hereinafter defined of its or his desire to terminate this Agreement, unless
such employment shall have been sooner terminated as hereinafter set forth. For
purposes of this Agreement (i) the term "Employment Period" shall mean the
initial one (1) year period and all extensions thereof, if any, as aforesaid,
and (ii) the term "Expiration Date" shall mean February 25 of either calendar
year 2002 or any subsequent calendar year if the Employment Period is extended
on and after February 26, 2002.
3. Position and Duties. The Employee shall serve the Company in the capacity of
Vice President and General Manager Precision Component Manufacturing Products
Group and, shall be accountable to, and shall have such other powers, duties and
responsibilities, consistent with this capacity, as may from time to time be
prescribed by the President of the Company, or his designee. The Employee shall
perform and discharge, faithfully, diligently and to the best of his ability,
such duties and responsibilities. The Employee shall devote all of his working
time and efforts to the business and affairs of the Company.
4. Compensation.
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(a) Salary. During the Employment Period, the Employee shall receive a
salary (the "Salary") payable at the rate of $215,000 per annum. Such rate may
be adjusted from time to time by the President provided, however, that it shall
at no time be adjusted below $215,000. The Salary shall be payable biweekly or
in accordance with the Company's current payroll practices, less all required
deductions. The Salary shall be pro-rated for any period of service less than a
full year.
(b) Incentive Bonus. The Employee may receive a performance bonus of
up to one hundred (100%) percent, as determined by the President after the end
of the 2002 fiscal year and is to be paid as soon as practicable after the close
of the fiscal year. Any subsequent changes to the executive bonus plan after
fiscal year 2002 shall apply to this Agreement.
(c) Expenses. During the Employment Period, the Employee shall be
entitled to receive prompt reimbursement for all reasonable business expenses
incurred by him on behalf of the Company.
(d) Fringe Benefits. During the Employment Period, the Employee shall
be entitled to participate in or receive benefits under any life or disability
insurance, health, pension, retirement and accident plans or arrangements made
generally available by the Company to its employees, subject to and on a basis
consistent with the terms, conditions and overall administration of such plans
and arrangements. In accordance with the Company policy, the Employee shall also
be entitled to paid vacation in any fiscal year during the Employment Period as
well as all paid holidays given by the Company to its employees.
(e) Automobile. Without limiting the generality of the foregoing,
during the Employment period, the Employee shall be furnished with an automobile
allowance of $800 per month.
(f) Stock Options. Initial 25,000 stock options upon approval of the
Company's Board of Directors. Subsequent awards, if any, will be based upon
availability and performance.
5. Termination and Compensation Thereon.
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(a) Termination Date. The term "Termination Date" shall mean the
earlier of (i) the Expiration Date; or (ii) if the Employee's employment is
terminated (x) by his death, the date of his death; or (y) for any other reason,
the date on which such termination is to be effective pursuant to the notice of
termination given by the party terminating the employment relationship.
(b) Death. The Employee's employment hereunder shall terminate upon
his death. In such event, the Company shall pay to such person as the Employee
shall have designated in a notice filed with the Company, or, if no such person
shall have been designated, to this estate, an amount equal to the Salary that
would have been due to the Employee had this Agreement been in effect from the
date of his death until the Expiration Date.
(c) Incapacity. If in the reasonable judgment of the President, as a
result of the Employee's incapacity due to physical or mental illness or
otherwise, the Employee shall for at least six consecutive months during the
term of this Agreement have been unable to perform his duties under this
Agreement on a full-time basis, the Company may terminate the Employee's
employment hereunder by notice to the Employee. In such event, the Company shall
continue to pay the Employee his Salary (at the rate in effect as of the
Termination Date) and (to the extent legally practicable) extend to him the
applicable fringe benefits referred to in Section 4(d) hereof until the
Expiration Date. The Company's obligation to pay the Employee his Salary and
extend to him such benefits shall terminate if the Employee subsequently takes
other employment to the extent of the Employee's salary and benefits from such
other employment. Any dispute between the President and the Employee with
respect to the Employee's incapacity shall be settled by reference to a
competent medical authority mutually agreed to by the President and the
Employee, whose decision shall be binding on all parties.
(d) Termination by the Company. The Company may terminate the
Employee's employment hereunder for "cause". For purposes of this Agreement,
"cause" shall mean (i) the Employee's material failure, refusal or neglect to
perform and discharge his duties and responsibilities hereunder (including
duties prescribed by the President pursuant to Section 3, other material breach
of the terms hereof, or breach of any fiduciary duties he may have because of
any position he holds with the Company or any subsidiary or affiliate thereof;
or (ii) a felony conviction or a conviction for any crime involving the
Employee's personal dishonesty or moral turpitude. If the Employee's employment
is terminated pursuant to this Section 5(d), the Company shall have no further
obligations to the Employee hereunder after the Termination Date, except for
unpaid Salary and benefits accrued through the Termination Date.
(e) Change of Control. If a "Change of Control" (as that term is
defined in that certain Indenture dated as of March 3, 1993, by and between the
Company and United States Trust Company of New York, as trustee, in connection
with the Company's 9 3/4% Senior Notes due 2003) occurs during the Employment
Period and, as a result of such Change of Control, this Agreement or the
Employee's employment is terminated for any reason, or the Employee resigns his
employment because any of the Employee's position, powers, duties or
responsibilities under Section 2 above are changed without his agreement, or any
compensation or benefit payable or otherwise extended to the Employee hereunder
(including without limitation Salary, incentive bonus, expenses, fringe benefits
and automobile set forth in Section 3 above) is eliminated or reduced, the
Company or its successor in interest shall:
(i) give prompt notice to the Employee of any such
termination, change, elimination or reduction;
(ii) within thirty (30) days after the Termination Date, pay
to the Employee (or in the event of the Employee's subsequent death, such person
as the Employee shall have designated in a notice filed with the Company, or, if
no such person shall have been designated, to his estate) a lump sum amount
equal to the Employee's Salary in effect as of the Termination Date, which lump
sum amount shall not be pro-rated and shall be paid in addition to the Salary
due and payable under (iii) below;
(iii) until the Expiration Date, continue to pay to the
Employee (or in the event of the Employee's subsequent death, such person as the
Employee shall have designated in a notice filed with the Company, or, if no
such person shall have been designated, to his estate) his Salary (in effect as
of the date of the Change of Control), and to extend to him the incentive bonus,
expenses, fringe benefits and automobile set forth in Section 3 above.
The obligations of the Company pursuant to this Section 5 (e)
shall survive any termination of this Agreement or the Employee's employment or
any resignation of such employment by the Employee pursuant to this Section
5(e).
(f) Consulting Period Upon Termination. If the Company fails to extend
the Employee's employment hereunder for a period of at least one year beyond
Expiration Date at his then current Salary and otherwise on the terms and
conditions set forth herein, then the Company shall have the option, at its sole
discretion, of retaining the Employee as a consultant to perform such services
as the Company may reasonably request, in consideration for which services the
Company shall continue to pay the Executive the same Salary and (to the extent
legally practicable) extend to him the applicable fringe benefits referred to in
Section 3(d), as in effect on the Termination Date for the period commencing on
the Termination Date and ending on the date two years after the Termination Date
or on such earlier date as the Company may otherwise specify by at least two
weeks' prior written notice.
(g) Severance Pay. In the event the Company does not retain the
Employee as a Consultant as provided in Section 5(f) hereof, the Employee shall
be entitled to continuation of his then current Salary and medical and dental
benefits as in effect at the expiration of the Employment Period, or any
extension thereof, for a period equal to 12 months; provided, however, that the
Employee's employment was not terminated for cause as set forth in Section 5(d)
hereof.
6. Amendments. No amendment to this Agreement or any schedule hereto shall
be effective unless it shall be in writing and signed by each party hereto.
7. Notices. All notices and other communications hereunder shall be in writing
and shall be deemed given when delivered personally or sent by telecopy or three
days after being mailed by registered or certified mail (return receipt
requested) to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
If to the Company, to it at:
BE Aerospace, Inc.
0000 Xxxxxxxxx Xxxxxx Xxx
Xxxxxxxxxx, XX 00000
Attention: President
with a copy to:
BE Aerospace, Inc.
0000 Xxxxxxxxx Xxxxxx Xxx
Xxxxxxxxxx, XX 00000
Attention: General Counsel
If to the Employee, to him at:
000 Xxxxx Xxxx Xxxx
Xxxxx Xxxxx, Xxxxxxxx 00000
8. Entire Agreement. This Agreement and the Proprietary Rights and Consulting
Agreement of even date herewith constitute the entire agreement among the
parties hereto pertaining to the subject matter hereof and supersede all prior
and contemporaneous agreements, understandings, negotiations and discussions,
whether oral or written, of the parties.
9. Miscellaneous. The invalidity and unenforceability of any term or provision
hereof shall not affect the validity or enforceability of any other term or
provision hereof. The headings in this Agreement are for convenience of
reference only and shall not alter or otherwise affect the meaning hereof. This
Agreement may be executed in any number of counterparts which together shall
constitute one instrument and shall be governed by and construed in accordance
with the laws (other than the conflict of laws rules) of the State of Florida
and shall bind and inure to the benefit of the parties hereto and their
respective successors and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
EMPLOYEE
/s/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxxxxx
BE AEROSPACE, INC.
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
President and Chief Executive Officer
