EXHIBIT 10.01
Xxxxxxx Technology Company, Inc.
0 Xxxx Xxxxx Xxxx
Xxxxx 000
Xxxxxxx, XX 00000
Tel: 000 000-0000
Fax: 000 000-0000
February 22, 2007
Xx. Xxxx X. Xxxxxx
0 Xxxx Xxxx Xxxx
Xxx Xxxxxx, XX 00000
Dear Xx. Xxxxxx:
This Agreement sets forth the terms of your employment with Xxxxxxx Technology
Company, Inc., a Delaware corporation (the "Company"). The term of your
employment hereunder will commence effective as of March 8, 2007, and if not
extended or unless sooner terminated, shall expire on March 8, 2010.
1. DUTIES: During the term of your employment hereunder, you shall be employed
as the Vice President, Chief Financial Officer and Treasurer of the Company, and
you shall direct and manage the financial, accounting, tax, reporting,
budgeting, audit, treasury, investor relations, risk management, insurance,
IT-infrastructure, human resources, legal financial strategic planning, and the
communication of these matters to the Company's Board of Directors and the
Company's Audit Committee, subject to the direction of the President of the
Company. Periodically and from time-to-time, the Company may change your duties
and responsibilities by adding to them or subtracting from them. You shall also
be a member of the Xxxxxxx Executive Team.
2. COMPENSATION: As compensation for your services during the term of your
employment hereunder:
A. Salary: You shall be paid a salary at the annual rate of two hundred
fifty thousand dollars ($250,000) (hereinafter referred to as your "base
salary"), payable in appropriate installments to conform with regular payroll
dates for salaried personnel of the Company.
B. Reviews and Adjustments: Consistent with the anniversary date of your
employment, your performance and attainment of mutually agreed-upon objectives
shall be evaluated by the President of the Company. As an Executive Officer of
the Company your base salary for the ensuing twelve (12) months period may be
increased, subject to approval by the Compensation Committee of the Board of
Directors of the Company and the Board of Directors of Xxxxxxx Technology
Company, Inc., in accordance with your level of performance. In no case,
however, will any such adjustment to your salary ever be a negative amount
unless you expressly agree to such a reduction.
C. Management Incentive Compensation Plan (MICP): You will be eligible to
participate in the Xxxxxxx Technology Company, Inc.'s MICP at a level of 50% of
your base salary. All (100%) of your bonus opportunity will be based on
achievement of corporate (Xxxxxxx Technology Co., Inc.) MICP AOP targets.
Complete terms and payments of the incentive compensation will be in accordance
with the MICP document, which will be provided to you under separate cover. For
fiscal year 2007 your participation and any subsequent bonus payment will be
pro-rated based on your date of hire.
D. Sign-on Bonus: You will be provided a sign-on bonus in the amount of
$50,000, which will be paid at a rate of 50% ($25,000) in August 2007 and 50%
($25,000) in January 2008 provided you are employed by the Company on August 1,
2007 and January 1, 2008, respectively.
E. Equity Compensation: Your position of Vice President, Chief Financial
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Officer and Treasurer is considered at a level that provides for future
consideration for participation in the Xxxxxxx Technology Company, Inc.'s 2005
Equity Compensation Plan. The Compensation Committee of the Board of Directions
of the Company administers this plan and recommendations for equity awards to
the full Board of Directors under the Plan are usually considered at the time of
the Board's November meeting.
F. Supplemental Retirement Benefit: Beginning with your hire date, on the
first day of each month that you are still providing services under the terms of
this Agreement, the Company shall accrue for your benefit a supplemental
retirement benefit in an amount necessary to ensure that, when 100% vested, the
amount accrued would be sufficient to support monthly payments equal to twenty
percent (20%) of your average base salary for the previous three (3) years of
continuous employment with the Company. Following your termination of
employment, these payments (the "Supplemental Retirement Benefit") are to be
paid to you in equal monthly installments over a ten (10) year period beginning
the first month following your 65th birthday or beginning with the first day of
the seventh (7th) month following your termination of employment, whichever is
later. The Supplemental Retirement Benefit will vest in each case assuming you
are then employed by the Company, as follows: as of March 8, 2008 it shall be
vested to the extent of 20%, as of March 8, 2009 it shall be vested to the
extent of 40%, as of March 8, 2010 it shall be vested to the extent of 60%, as
of March 8, 2011 it shall be vested to the extent of 80%, and as of March 8,
2012 it shall be vested to the extent of 100% so that as of the latter date the
full amount of the Aggregate Supplemental Retirement Benefit shall be due and
payable in the instances set forth elsewhere in this Agreement.
3. INSURANCE: During the term of your employment hereunder, the Company, subject
to your insurability, shall (i) pay the premiums on a contract or contracts of
life insurance on your life providing for an aggregate death benefit of five
hundred thousand dollars ($500,000), which contract or contracts will be owned
by you, your spouse or such other party as may be designated by you; and (ii)
purchase key person term life insurance on your life in the aggregate amount of
one million dollars ($1,000,000), which contract or contracts will be owned by
the Company.
4. REIMBURSEMENT OF EXPENSES: In addition to the compensation provided for
herein, the Company shall reimburse to you, or pay directly, in accordance with
the policies of the Company as in effect at the time, all reasonable expenses
incurred by you in connection with the business of the Company, and its
Subsidiaries (as defined in Section 5 of this Agreement) and affiliates, subject
to documentation in accordance with the Company's policy.
5. EXTENT OF SERVICES:
A. In General: During the term of your employment hereunder you shall
devote your best and full-time efforts to the business and affairs of the
Company.
B. Limitation on Other Services: During the term of your employment
hereunder, you shall not undertake employment with, or participate in the
conduct of the business affairs of, any other person, corporation, or entity,
except at the direction or with the written approval of the Board of Directors
of the Company.
C. Personal Investments: Nothing herein shall preclude you from having,
making, or managing personal investments which do not involve your active
participation in the affairs of the entities in which you so invest, but, unless
approved in writing by the Board of Directors of the Company, during the term of
your employment hereunder, you shall not have more than a one percent (1%)
ownership interest in any entity which is directly competitive with any business
conducted by the Company at that time. The phrase "conducted by the Company" as
used in this Xxxxxxxxx 0X and in Paragraph 12 hereof shall mean the business
conducted by the Company or by any corporation or other entity in which the
Company owns fifty percent (50%) or more of the stock or equity interests
(either voting or non-voting) in such other entity (a "Subsidiary").
6. LOCATION: Your office shall be located at the Company's current headquarters
located in Shelton, Connecticut. This location may change in the future. Your
duties hereunder shall be performed for the Company worldwide.
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7. VACATION; OTHER BENEFITS:
A. Vacation: During the term of your employment hereunder, you shall be
entitled to a vacation or vacations, with pay, in accordance with the Company's
vacation policy as in effect at the time. Your yearly vacation accrual will be
three (3) weeks of annual vacation per year in year one and all subsequent years
until your time with the Company eventually triggers, in accordance with the
Company's vacation policy as in effect at the time, a larger annual accrual
beyond three (3) weeks per year. You may accumulate up to twelve (12) weeks
vacation, but not more than three (3) weeks from any single prior year. Any such
accumulated vacation may be used in any subsequent year or years (but no more
than two (2) weeks of such accumulated vacation in any one year) in addition to
the vacation to which you are entitled for each such year.
B. The Company's Benefit Plans: During the term of your employment
hereunder, you shall be eligible for inclusion, to the extent permitted by law,
as a full-time employee of the Company, in any and all (i) pension, profit
sharing, savings, and other retirement plans and programs as in effect at the
time, (ii) life and health (medical, dental, hospitalization, short-term and
long-term disability) insurance plans and programs as in effect at the time,
(iii) equity compensation programs as in effect at the time, (iv) accidental
death and dismemberment protection plans and programs as in effect at the time,
(v) travel accident insurance plans and programs as in effect at the time, and
(vi) other plans and programs at the time sponsored by the Company for employees
or executives of the Company generally as in effect at the time, including any
and all plans and programs that supplement any or all of the foregoing types of
plans or programs.
C. Automobile: During the term of your employment hereunder, the Company
shall provide you an automobile for your use pursuant to the Company's written
policy on company autos as in effect at that time.
8. TERMINATION OF EMPLOYMENT: For purposes of this Agreement, "termination of
employment" shall mean a separation from service from the Company and any
affiliates of the Company as defined under Section 409A of the Internal Revenue
Code of 1986, as amended. In the event your employment is terminated for any of
the reasons set forth under this Paragraph 8, the Company shall pay to you or
your legal representatives, estate or heirs, as the case may be, the following
amounts, which are in addition to the amounts stipulated under any subparagraph
of this Paragraph 8:
(i) A single lump sum payment, no later than the last day of your
employment, of:
(a) Any accrued but unpaid salary set forth in Xxxxxxxxx 0X (xx
xxxxxxxx Xx Xxxxxxxxx 0X) hereof, including salary in
respect of any accrued and accumulated vacation, due to you
at the date of such termination; and
(b) Any amounts owing, but not yet paid, pursuant to paragraph 4
hereof.
(ii) Any accrued but unpaid incentive compensation as set forth in
Paragraph 2C hereof due to you at the date of such termination
for the fiscal year ending on or immediately prior to the date of
such termination which shall be paid within three (3) months of
the end of such fiscal year.
A. Termination by the Company Without Cause: The Company may, without
cause, terminate your employment hereunder at any time upon ten (10) or more
days' written notice to you. In the event your employment is terminated under
this Paragraph 8A, the Company shall pay to you the following:
(i) A single lump sum payment, on the first day of the seventh (7th)
month following your termination of employment, of severance pay
in an amount equal to your then current annual base salary as
defined in Xxxxxxxxx 0X (xx xxxxxxxx xx Xxxxxxxxx 0X) hereof;
(ii) A single lump sum payment of any incentive compensation as set
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forth in Paragraph 2C hereof earned in the fiscal year of the
termination of your employment, which incentive compensation
shall be determined on the basis of the Company's operations
through June 30 of such fiscal year, and shall be pro-rated
through the last day of your employment, and shall be paid within
the time period specified under the MICP;
(iii) Continuation of medical benefits for a period of twelve (12)
months; and
(iv) Executive outplacement services for a period of six (6) months
following your termination date not to exceed a total amount of
fifteen thousand dollars ($15,000).
(v) To the extent vested, the monthly Supplemental Retirement Benefit
with the first payment beginning the first month following your
65th birthday or beginning with the first day of the seventh
(7th) month following your termination of employment, whichever
is later.
The Company shall have no further obligation to you under this Agreement and you
shall have no further obligation to the Company under this Agreement except as
provided in Paragraph 11 and Paragraph 12 hereof.
B. Termination by the Company With Cause: The Company may for cause
terminate your employment hereunder at any time by written notice to you. In the
event your employment is terminated under this Paragraph 8B, you shall forfeit
the incentive compensation set forth in Xxxxxxxxx 0X hereof for the fiscal year
in which such termination or resignation occurs. In the event your employment is
terminated under this paragraph 8B, the Company shall pay to you, to the extent
vested, the Monthly Supplemental Retirement Benefit with the first payment
beginning with the first month following your 65th birthday or beginning with
the first day of the seventh (7th) month following your termination of
employment, whichever is later. For purposes of this Agreement, the term "cause"
shall mean (1) a failure by you to remedy, within ten (10) days of the Company's
written notice to you, either (a) a continuing neglect in the performance of
your duties under this Agreement, or (b) any action taken by you that seriously
prejudices the interests of the Company, or (2) your conviction of a felony.
The Company shall have no further obligation to you under this Agreement and you
shall have no further obligation to the Company under this Agreement except as
provided in Paragraphs 11 and Paragraph 12 hereof.
C. Termination by Mutual Consent: You may terminate your employment
hereunder at any time with the written consent of the Company. In the event your
employment is terminated pursuant to this Xxxxxxxxx 0X, the Company shall pay to
you the following:
(i) A single lump sum payment, of any incentive compensation set
forth in paragraph 2C hereof earned in the fiscal year of the
termination of your employment, which incentive compensation
shall be determined on the basis of the Company's operations
through June 30 of such fiscal year, and shall be pro-rated
through the last day of your employment, and shall be paid within
the time period specified under the terms of the MICP.
(ii) To the extent vested, the monthly Supplemental Retirement Benefit
with the first payment beginning the first month following your
65th birthday or beginning with the first day of the seventh
(7th) month following your termination of employment, whichever
is later.
The Company shall have no further obligation to you under this Agreement and you
shall have no further obligation to the Company under this Agreement except as
provided in Paragraphs 11 and Paragraph 12 hereof.
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D. Disability: If you should suffer a Permanent Disability at any time, the
Company may terminate your employment hereunder upon ten (10) or more days'
prior written notice to you. For purposes of this Agreement, a "Permanent
Disability" shall be deemed to have occurred only when you are qualified for
benefits under the Company's Long Term Disability Insurance Policy. In the event
of the termination of your employment hereunder by reason of Permanent
Disability, the Company shall pay to you or your legal representative:
(i) In conformity with regular payroll dates for salaried personnel
of the Company, an amount equal to fifty percent (50%) of the
base salary you were receiving at the date of such termination
under Paragraph 2A hereof (as adjusted by Paragraph 2B hereof),
payable until you attain the age of 65 or die, whichever occurs
first; provided, however, that the amount payable under this
Paragraph 8D(i) shall be reduced to the extent of any payments
made to you under any Company-sponsored group long term
disability insurance policy (the "Supplemental LTD Policy") where
the premiums for said Supplemental LTD Policy have either been
paid by the Company or reimbursed to you by the Company. Payment
hereunder shall commence on the first day of the seventh (7th)
month following your termination due to disability and the first
such payment shall include a lump sum payment equal to the
payments that would have been made to you hereunder had such
payments commenced immediately upon your termination.
(ii) Any incentive compensation set forth in Paragraph 2C hereof
earned in the fiscal year in which the termination of your
employment occurs, which incentive compensation shall be
determined on the basis of the Company's operations through June
30 of such fiscal year, and shall be pro-rated through the last
day of your employment, and shall be paid within the time period
specified under the terms of the MICP.
(iii) To the extent vested, the monthly Supplemental Retirement
Benefit with the first payment beginning the first month
following your 65th birthday or beginning with the first day of
the seventh (7th) month following your termination of employment,
whichever is later.
The Company shall have no further obligation to you under this Agreement and you
shall have no further obligation to the Company under this Agreement except as
provided in Paragraphs 11 and Paragraph 12 hereof.
E. Termination by Death: In the event of the termination by your employment
by reason of your death, at any time, the Company shall pay to your legal
representatives, estate or heirs the following:
(i) Any incentive compensation set forth in Paragraph 2C hereof
earned in the fiscal year in which the termination of your
employment occurs, which incentive compensation shall be
determined on the basis of the Company's operations through June
30 of such fiscal year, and shall be pro-rated through the last
day of your employment, and shall be paid within the time period
specified under the terms of the MICP.
(ii) To the extent vested, the monthly Supplemental Retirement Benefit
with the first payment beginning the first month following your
65th birthday or beginning with the first day of the seventh
(7th) month following your termination of employment, whichever
is later.
The Company shall have no further obligation to you under this Agreement and you
shall have no further obligation to the Company under this Agreement except as
provided in Paragraphs 11 and Paragraph 12 hereof.
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F. Termination Upon Expiration of Agreement: If not previously terminated,
this Agreement and your employment with the Company shall be automatically
extended for additional three-year renewal terms, unless and until either party
notifies the other to the contrary, in writing, six (6) months prior to the
expiration of the then-current term or renewal term of this Agreement. In the
event your employment is terminated under this paragraph 8F, the Company shall
pay to you, to the extent vested, the monthly Supplemental Retirement Benefit as
set forth in Paragraph 2F hereof with the first payment beginning with the first
month following your 65th birthday or beginning with the first day of the
seventh (7th) month following your termination of employment, whichever is
later.
The Company shall have no further obligation to you under this Agreement and you
shall have no further obligation to the Company under this Agreement except as
provided in Paragraphs 11 and Xxxxxxxxx 00 xxxxxx.
X. Change of Control: If any of the following described events occurs
during the term of your employment hereunder, you may terminate your employment
hereunder by written notice to the Company either prior to, or not more than six
(6) months after the happening of such event. In such event, your employment
hereunder will be terminated effective as of the later of ten (10) days after
the notice or ten (10) days after the event, and the Company shall make to you
the same payments that the Company would have been obligated to make to you
under Paragraph 8A hereof if the Company had terminated your employment
hereunder effective on such date. The events, the occurrence of which shall
permit you to terminate your employment hereunder under this Paragraph 8G, are
as follows:
(i) Any merger or consolidation by the Company with or into any other
entity or any sale by the Company of substantially all of its
assets; provided, however, that such event shall be deemed to
have not occurred under this clause if consummation of the
transaction would result in at least fifty (50%) percent of the
total voting power represented by the voting securities of the
Company outstanding immediately after such transaction being
beneficially owned by holders of outstanding voting securities of
the Company immediately prior to the transaction.
(ii) Any change of a majority of the directors of the Company
occurring within any thirteen (13) month period.
(iii) The adoption by the Company of any plan of liquidation providing
for the distribution of all or substantially all of its assets.
(iv) A material diminution in your duties, or the assignment to you of
duties that are materially inconsistent with your duties or that
materially impair your ability to function as the Chief Financial
Officer of the Company if such diminution or assignment has not
been cured within thirty (30) days after written notice thereof
has been given by you to the Company.
9. SOURCE OF PAYMENTS: All payments provided for hereunder shall be paid
from the general funds of the Company. The Company may, but shall not be
required to, make any investment or investments whatsoever, including the
purchase of a life insurance contract or contracts on your life, to provide it
with funds to satisfy its obligations hereunder; provided, however, that neither
you nor your beneficiary or beneficiaries, nor any other person, shall have any
right, title, or interest whatsoever in or to any such investment or contracts.
If the Company shall elect to purchase a life insurance contract or contracts on
your life to provide the Company with funds to satisfy its obligations
hereunder, the Company shall at all times be the sole and complete owner and
beneficiary of such contract or contracts, and shall have the unrestricted right
to use all amounts and to exercise all options and privileges there under
without the knowledge or consent of you, your beneficiary or beneficiaries, or
any other person, it being expressly agreed that neither you, any such
beneficiary or beneficiaries, nor any other person shall have any right, title,
or interest whatsoever in or to any such contract or contracts unless expressly
provided otherwise in this Agreement.
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10. ENFORCEMENT OF RIGHTS: Nothing in this Agreement, and no action taken
pursuant to its terms, shall create or be construed to create a trust or escrow
account of any kind, or a fiduciary relationship between the Company and you,
your beneficiary or beneficiaries, or any other person. You, your beneficiary or
beneficiaries, and any other person or persons claiming a right to any payments
or interests hereunder shall rely solely on the unsecured promise of the
Company, and nothing herein shall be construed to give you, your beneficiary or
beneficiaries, or any other person or persons, any right, title, interest, or
claim in or to any specific asset, fund, reserve, account, or property of any
kind whatsoever owned by the Company or in which it may have any right, title,
or interest now or in the future, but you or your beneficiary or beneficiaries
shall have the right to enforce a claim for benefits hereunder against the
Company in the same manner as any unsecured creditor.
11. INVENTIONS AND CONFIDENTIAL INFORMATION: So long as you shall be
employed by the Company, you agree promptly to make known to the Company the
existence of any and all creations, inventions, discoveries, and improvements
made or conceived by you, either solely or jointly with others, during your
employment by the Company and for three (3) years after the termination of your
employment by the Company , and to assign to the Company the full exclusive
right to any and all such creations, inventions, discoveries, and improvements
relating to any subject matter with which the Company is now or shall become
concerned, or relating to any other subject matter if made with the use of the
Company's time, materials, or facilities. To the fullest extent permitted by
law, any and all of the foregoing creations, inventions, discoveries and
improvements shall be considered as "work-made-for-hire" and the Company shall
be the owner thereof. You further agree, without charge to the Company but at
its expense, if requested to do so by the Company, to execute, acknowledge, and
deliver all papers, including applications or assignments for patents,
trademarks, and copyrights relating thereto, as may be considered by the Company
to be necessary or desirable to obtain or assign to the Company any and all
patents, trademarks, or copyrights for any and all such creations, inventions,
discoveries, and improvements in any and all countries, and to vest title
thereto in the Company in all such creations, inventions, discoveries, and
improvements as indicated above conceived during your employment by the Company,
and for three (3) years thereafter. You further agree that you will not disclose
to any third person any trade secrets or proprietary information of the Company,
or use any trade secrets or proprietary information of the Company in any
manner, except in the pursuit of your duties as an employee of the Company, and
that you will return to the Company all materials (whether originals or copies)
containing any such trade secrets or proprietary information (in whatever
medium) on termination of your employment by the Company. The obligations set
forth in this Paragraph 11 shall survive the termination of your employment by
the Company.
12. RESTRICTIVE COVENANT: For a period of three (3) years after the
termination of your employment by the Company, you shall not, in any
geographical location in which there is at that time business conducted by the
Company which was conducted by the Company at the date of such termination,
directly or indirectly, own, manage, operate, control, be employed by,
participate in, or be connected in any manner with, the ownership, management,
operation, or control of, any business similar to or competitive with such
business conducted by the Company without the written consent of the Company;
provided, however, that you may have an ownership interest of up to one percent
(1%) in any entity, notwithstanding that such entity is directly competitive
with any business conducted by the Company at the date of such termination.
13. ARBITRATION: Any controversy or claim arising out of or relating to
this Agreement, or the breach or asserted breach thereof, shall be settled by
arbitration to be held in New York, New York in accordance with the rules then
obtaining of the American Arbitration Association, and the judgment upon the
award rendered may be entered in any court having jurisdiction thereof. The
arbitrator shall determine which party shall bear the costs of such arbitration,
including attorneys' fees.
14. NON-ASSIGNABILITY: Your rights and benefits hereunder are personal to
you, and shall not be alienated, voluntarily or involuntarily, assigned or
transferred.
15. BINDING EFFECT: This Agreement shall be binding upon the parties
hereto, and their respective assigns, successors, executors, administrators, and
heirs. In the event the Company becomes a party to any merger, consolidation, or
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reorganization, this Agreement shall remain in full force and effect as an
obligation of the Company or its successors in interest. None of the payments
provided for by this Agreement shall be subject to seizure for payment of any
debts or judgments against you or your beneficiary or beneficiaries, nor shall
you or any such beneficiary or beneficiaries have any right to transfer or
encumber any right or benefit hereunder.
16. ENTIRE AGREEMENT: This Agreement contains the entire agreement relating
to your employment by the Company. It may only be changed by written agreement
signed by the party against whom enforcement of any waiver, change,
modification, extension, deletion, or revocation is sought.
17. NOTICES: All notices and communications hereunder shall be in writing,
sent by certified or registered mail, return receipt requested, postage prepaid;
by facsimile transmission, time and date of receipt noted thereon; or by
hand-delivery properly receipted. The actual date of receipt as shown by the
receipt therefore shall determine the time at which notice was given. All
payments required hereunder by the Company to you shall be sent postage prepaid,
or, at your election, shall be transferred to you electronically to such bank as
you designate in writing to the Company, including designation of the applicable
electronic address. The foregoing items (other than any electronic transfer to
you) shall be addressed as follows (or to such other address as the Company or
you may designate in writing from time to time):
To you: To the Company:
Xxxx X. Xxxxxx Xxxxxxx Technology Company, Inc.
0 Xxxx Xxxx Xxxx 0 Xxxx Xxxxx Xx., Xxxxx 000
Xxx Xxxxxx, XX 00000 Xxxxxxx, XX 00000
18. LAW TO GOVERN: This Agreement shall be governed by, and construed and
enforced according to, the domestic laws of the State of Connecticut without
giving effect to the principles of conflict of laws.
Very truly yours,
XXXXXXX TECHNOLOGY COMPANY, INC. AGREED TO AND ACCEPTED:
/s/ Xxxx X. Xxxxxxxxxx /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxxxxxx Xxxx X. Xxxxxx
Its President & Chief Operating Officer
Duly Authorized
Date: 2/23/07 Date: 3/8/07
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