February 27, 1998
[NAME]
c/o Environment One Corporation
0000 Xxxxxxxx Xxxx
Xxxxxxxxx, Xx 00000-0000
RE: EMPLOYMENT AGREEMENT
Dear [FIRST NAME]:
This Employment Agreement (this "Agreement") sets forth our agreement
concerning the terms of your employment by Environment One Corporation ("E/One"
or the "Company") following its acquisition by Precision Castparts Corp. ("PCC")
pursuant to an Agreement and Plan of Merger dated February 24, 1998 (the "Merger
Agreement") to become effective on the Tender Offer Acceptance Date as defined
in the Merger Agreement (the "Effective Date").
1. EMPLOYMENT OFFER.
1.1 EMPLOYMENT.
(a) You will assume the position of [INSERT TITLE] at E/One beginning
on the Effective Date and perform those duties as are generally associated with
such a position. You also agree to perform such acts and duties as the President
of the Company may reasonably direct, to comply with all reasonable applicable
policies and procedures of E/One and, as reasonably applicable, its parent and
affiliates, and to devote such time, energy and skill to your assignment as the
President and the Board of Directors of the Company considers reasonably
necessary for the performance of your duties, provided that you will not be
required to relocate from the Albany, New York area without your consent during
the term of this Agreement.
(b) Your employment with E/One will continue under this Agreement
from the Effective Date through the second anniversary of the Effective Date,
unless earlier terminated by you or E/One as expressly provided in paragraph
2.1, below. Your last day of employment with E/One is referred to herein as your
Separation Date.
[NAME]
February 27, 1998
Page 2
1.2 SALARY.
During the term of this Agreement, you will be paid a base salary at
an annual rate of $_____________, payable in installments on regular Company
paydays. Base salary increases during the first year of employment shall be
approved by the Company and the President of PCC Flow Technologies, Inc. in a
manner consistent with the Company's practice of considering salary increases in
April of each year. Thereafter, base salary increases shall be set annually by
the Company, as approved by the Board of Directors.
1.3 BENEFITS.
In addition to your base compensation, you will be entitled to
participate through December 31, 1998 in the E/One bonus plan as in effect
immediately prior to the Effective Date. For the three-month period January 1,
1999 through March 28, 1999 you will be entitled to participate in a bonus
program similar to the E/One bonus program in effect for calendar year 1998,
except that bonus targets will be determined by the Company's Board of Directors
in its sole discretion and will be keyed to 1999 objectives established by the
Company's Board of Directors. Thereafter, any bonus program provided will be
consistent with the bonus programs provided by PCC Flow Technologies to the
executives of its operating companies subject to approval by PCC. You will also
continue to receive the same or comparable non-bonus employee benefits as
provided by E/One during your employment immediately prior to the Effective
Date, provided that (i) the E/One stock option plans will be eliminated, and
(ii) the E/One Deferred Compensation Plan will be amended to eliminate the E/One
stock investment provisions and to provide for alternate investment options.
Amounts received under the bonus plan in respect of calendar year 1998 will be
eligible for deferral under the E/One Deferred Compensation Plan, but no other
future deferrals will be permitted under that plan. You will also be eligible
to participate in PCC's stock option and stock purchase programs in accordance
with the terms of those programs.
2. TERMINATION OF AGREEMENT.
2.1 TERMINATION. The term of this Agreement shall be as stated in
subparagraph 1.1(b) (the "natural expiration date"), unless terminated earlier
as follows:
[NAME]
February 27, 1998
Page 3
(a) This Agreement may be terminated by you for any reason upon 30
days' written notice to E/One.
(b) This Agreement may be terminated by E/One with or without cause
upon 30 days' written notice to you, subject only to the obligation of E/One,
(i) if you are teminated by E/One for reasons other than that specified in
paragraph 2.2 at any time before the first anniversary of the Effective Date, to
pay as a severance payment the remaining balance of your base salary for the
portion of the year from the Separation Date until the first anniversary date of
the Effective Date, plus 100 percent of any calendar year 1998 bonus to which
you would have been entitled had you remained employed by E/One through December
31, 1998, plus the Severance Payment (as defined below), or (ii) if you are
terminated for reasons other than those specified in paragraph 2.2 at any time
after the first anniversary of the Effective Date and prior to the second
anniversary of the Effective Date, to pay severance pay equal to ten month's pay
at the then current salary level (the "Severance Payment"). In addition, if you
are terminated by E/One for reasons other than specified in paragraph 2.2, E/One
shall waive for the remainder of the unexpired term of this Agreement any
required premium payment due from you to allow you to continue your coverage and
E/One's group health plan pursuant to Public Law 99-272, Title 10 (i.e,
"COBRA"), provided that this benefit shall terminate in any case upon the
earlier of 18 months after the Separation Date or upon your employment by a
successor employer. Subject to 2.1(e) below, any severance payment payable
under this paragraph 2.1(b) shall be paid in a lump sum within ten (10) days
following the Separation Date, and shall be subject to applicable withholding,
except that any amounts relating to the 1998 bonus shall be paid at the same
time that 1998 bonuses are paid to continuing employees.
(c) This Agreement shall automatically terminate in the event of your
death or disability prior to the natural expiration date. For purposes of this
Agreement, "disability" shall mean inability to perform all or substantially all
of your responsibilities for a period of more than six (6) months.
(d) Your employment shall not be deemed terminated under this
Agreement if you are assigned additional or different titles, and/or tasks and
responsibilities from those then-currently held or assigned with E/One, provided
that any such changes leave you with responsibilities consistent with your area
of professional expertise and your compensation is not decreased.
[NAME]
February 27, 1998
Page 4
(e) Payment of the severance pay under paragraph 2.1(b) is subject to
your execution of a Release of Claims in a form provided by the Company
releasing any claims related to termination of your employment and rights to
payment under this Agreement.
2.2 INELIGIBILITY FOR SEVERANCE PAY OR ADDITIONAL COMPENSATION. With
respect to subparagraph 2.1, you will not be eligible for severance pay under
this Agreement and your compensation and benefits will end on your Separation
Date if:
(a) if you voluntarily resign or retire from your employment at any
time and for any reason;
(b) if your employment terminates due to the natural expiration of
this Agreement;
(c) if E/One terminates your employment at any time for cause (as
defined in paragraph 2.3, below) or your employment terminates due to death or
disability (as defined in paragraph 2.1(c));
(d) if you breach the terms of paragraph 3;
(e) if you are offered and accept reasonably comparable employment
with any business entity related to or affiliated with PCC; or
(f) you fail or refuse to sign the Release of Claims form described
in paragraph 2.1(e).
2.3 DEFINITION OF CAUSE. For purposes of this Agreement, "cause" for
termination shall be defined as termination of your employment with E/One for
(i) willful and continuous failure by you, in the judgment of the Company, to
substantially perform your reasonably assigned duties, responsibilities and
objectives with E/One, after a written demand for substantial performance is
made by the Company which identifies the manner in which you have not
substantially performed your duties or responsibilities or met your objectives,
as applicable and failure to correct such performance within 30 days following
the notice; (ii) commission by you of any act of fraud or dishonesty or any
felonious act; (iii) commission by you of any act of willful misconduct that, in
the judgment of the
[NAME]
February 27, 1998
Page 5
Company, materially and adversely affects the financial condition of the
Company; or (iv) breach of any material provision of this Agreement.
3. CONFIDENTIALITY, NON-SOLICITATION AND NON-COMPETITION.
3.1 PRESERVATION AND NON-USE OF CONFIDENTIAL INFORMATION. You acknowledge
that you have a fiduciary duty as an officer and employee of the Company not to
discuss Confidential Information obtained during your employment with the
Company. For purposes of this Agreement, "Confidential Information" means any
and all confidential or proprietary information concerning the Company or its
affiliates, joint venturers or other related entities (the "E/One Group"), the
disclosure of which could disadvantage the E/One Group. Confidential
Information includes trade secrets as defined under the Uniform Trade Secrets
Act.
You agree not to use Confidential Information, during the term of this
Agreement or after its termination, for any personal or business purpose, either
for your own benefit or that of any other person, corporation, government or
other entity.
You also agree that you will not disclose or disseminate any Confidential
Information, directly or indirectly, at any time during the term of this
Agreement or after its termination, to any person, agency, or court unless
compelled to do so pursuant to legal process (E.G., a summons or subpoena) or
otherwise required by law and then only after providing the Company with prior
notice and a copy of the legal process.
3.2 NON-SOLICITATION AND NON-COMPETITION. You agree that you will not,
without the express written consent of the Board, for a period of one (1) year
following your Separation Date, directly or indirectly (by yourself or in
conjunction with any other person, company or organization), solicit or divert
any employee, customer or vendor of the Company or any of its affiliates, joint
venturers or other related entities. You further agree that you will not,
without the express written consent of the Board, for a period of one (1) year
following your Separation Date, directly or indirectly, accept employment with
any person or entity involved in, or enter into any business relationship that
involves, the business of manufacturing or selling low pressure sewage systems
or grinder pumps (including, but not limited to, as a consultant, vendor,
partner, officer or director). The foregoing shall not preclude your employment
by a distributor of the Company's products in the case of your voluntary
termination of employment with the Company. You
[NAME]
February 27, 1998
Page 6
specifically acknowledge and agree that the terms of this provision are
reasonable in every respect and, in particular, because of the competitive and
specialized nature of the Company's business, that it is reasonable not to
include any geographic limitation in this provision.
4. RETURN OF PROPERTY.
On or before your Separation Date, except as agreed to by the Company, you
will return all property belonging to E/One, including, but not limited to, all
documents, business machines, computers, computer hardware and software
programs, computer data, telephones (cellular, mobile or otherwise), pagers,
keys, card keys, credit cards and other Company-owned property.
5. ASSISTANCE IN DEFENSE OF LITIGATION OR CLAIMS.
In the event E/One requests assistance during the one year period following
your Separation Date, you agree to provide reasonable assistance in defense of
ongoing or future litigation or claims about which you have knowledge without
additional compensation. Thereafter, you agree to provide reasonable assistance
and will be paid for your assistance at an hourly rate equal to your hourly
equivalent rate of pay as of your Separation Date (for up to seven (7) hours in
one day) or per diem rate equal to eight (8) times your hourly equivalent rate
of pay as of your Separation Date (for more than seven (7) hours in one day).
You will be reimbursed for any reasonable expenses incidental to this assistance
approved in advance by the Company. The Company will reasonably accommodate
your scheduling needs.
6. RIGHT TO CONSULT WITH ATTORNEY.
You have the right to consult with an attorney or financial advisor at your
own expense regarding this Agreement.
7. DISPUTE RESOLUTION.
You agree that any dispute (1) concerning the interpretation or
construction of this Agreement, (2) arising from your employment with or
termination of employment from E/One, (3) relating to any compensation or
benefits you may claim, or (4) relating in any
[NAME]
February 27, 1998
Page 7
way to any claim by you for reinstatement or reemployment by E/One after
execution of this Agreement shall be submitted to final and binding confidential
arbitration. Except as specifically provided herein, the arbitration shall be
governed by the rules of the American Arbitration Association or such other
rules as agreed to by the parties with such arbitration to occur in Albany, New
York. Each party shall be responsible for its or his own costs and attorneys'
fees relating to arbitration. Both parties agree that the procedures outlined
in this paragraph are the exclusive methods of dispute resolution.
8. ENTIRE AGREEMENT. This Agreement contains the entire agreement between
you and E/One concerning the subject matters discussed herein and supersedes any
other discussions, agreements, representations or warranties of any kind,
including but not limited to the Change of Control Agreement between you and
E/One dated January 5, 1998. Any modification of this Agreement shall be
effective only if in writing and signed by each party or its duly authorized
representative. This Agreement supersedes all prior employment agreements
between you and E/One or any corporation affiliated with or related to E/One.
The terms of this Agreement are contractual and not mere recitals. If for any
reason any provision of this Agreement shall be held invalid in whole or in
part, such invalidity shall not affect the remainder of this Agreement.
This Agreement shall be construed in accordance with the laws of the state
of New York (without regard to the conflicts of laws provisions thereof).
In order to reflect your voluntary acceptance and agreement with these
terms, please sign and return the enclosed copy of this letter.
Sincerely,
Environment One Corporation
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
[NAME]
February 27, 1998
Page 8
ACKNOWLEDGMENT AND AGREEMENT:
I have read this Employment Agreement and voluntarily enter into this Employment
Agreement after careful consideration and the opportunity to review it with
financial or legal counsel of my choice.
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