EMPLOYMENT AGREEMENT
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AGREEMENT dated as of the 24th day of March, 1993, by and between
WESTERBEKE CORPORATION, a Delaware corporation (the "Company"), and XXXX X.
XXXXXXXXXX, XX. (the "Executive").
W I T N E S S E T H :
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WHEREAS, the Executive has heretofore served in the employ of the
Company and the Company wishes to continue to retain the services of the
Executive, and the Executive wishes to continue to serve in the employ of
the Company, upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth, the parties hereto hereby agree as
follows:
1. Employment, Term, Automatic Extension.
1.1 The Company agrees to employ the Executive, and the Executive
agrees to serve in the employ of the Company, for the term set forth in
Section 1.2, in the position and with the responsibilities, duties and
authority set forth in Section 2 and on the other terms and conditions set
forth in this Agreement.
1.2 The term of the Executive's employment under this Agreement
shall commence on the date hereof and shall terminate on the fifth
anniversary of such date, unless extended or sooner terminated in
accordance with this Agreement.
1.3 As of each anniversary of the date of this Agreement (each, an
"Automatic Renewal Date"), unless either party shall have given a notice of
non-extension not less than two (2) months prior to such Automatic Renewal
Date, the term of this Agreement shall be extended automatically for a
period of one year to the anniversary of the expiration date of the then-
current term of this Agreement. Once a notice of non-extension shall have
been given by either party, there shall be no further automatic extension
of this Agreement.
2. Position, Duties. The Executive shall serve in the position of
Chairman of the Board, President and Chief Executive Officer of the
Company. The Executive shall perform, faithfully and diligently, such
duties, and shall have such responsibilities, appropriate to said
positions, as shall be assigned to him from time to time by the Board of
Directors of the Company. The Executive shall report directly to the Board
of Directors of the Company. The Executive shall devote his time to the
performance of his duties and responsibilities hereunder during the normal
working hours of executive employees of the Company; provided that the
Executive may devote reasonable amounts of time to service as a director,
member of an executive or other committee of a board of directors or member
of an advisory committee of any organization, to charitable and community
activities and to management of his personal investments, provided that
such activities do not involve a conflict of interest with the Company or
interfere with the performance by the Executive of his duties and
responsibilities under this Agreement.
3. Salary, Bonus, Deferral of Compensation.
3.1 Salary. During the term of this Agreement, in consideration of
the performance by the Executive of the services set forth in Section 2 and
his observance of the other covenants set forth herein, the Company shall
pay the Executive, and the Executive shall accept, a base salary at the
rate of $141,750 per annum, payable in accordance with the standard payroll
practices of the Company.
3.2 Increases in Salary. (A) The base salary set forth in Section
3.1 above shall be adjusted annually (but not decreased) on each
anniversary of the date of this Agreement by multiplying such base salary
by a fraction, the numerator of which shall be the Consumer Price Index (as
herein defined) for the month preceding the month in which such adjustment
is to be made, and the denominator of which shall be the Consumer Price
Index for February 1993. As used herein, the term "Consumer Price Index"
shall refer to the Consumer Price Index for Urban Wage Earners and Clerical
Workers - United States - All Items (C.P.I.-W)(1982-1984 = 100) published
by The Bureau of Labor Statistics, U.S. Department of Labor.
(B) In addition to the increases in base salary set forth above in
Section 3.2(A), the Executive shall be entitled to such additional
increases in base salary during the term hereof as shall be determined by
the Board of Directors of the Company in its sole discretion.
3.3 Bonus. The Board of Directors of the Company, in its sole
discretion, may grant the Executive a bonus opportunity in one or more
fiscal years during the term of this Agreement. The grant of a bonus
opportunity shall take into account such factors as the Board of Directors
shall deem appropriate, including performance of the Company and the
Executive in the fiscal year most recently ended and total compensation
paid to chief executive officers of manufacturing concerns with sales and
earnings comparable to that of the Company.
3.4 Deferral of Compensation. (A) The Executive may elect to have
all or any part of his base salary and bonus paid as deferred compensation
by filing a written notice of election with the Company prior to
commencement of the year or other fiscal period with respect to which such
compensation is payable. Any such election shall be irrevocable.
Any deferred compensation will bear interest at a rate equal to the
Prime Rate as published in the Wall Street Journal on the first business
day of each calendar quarter, plus four (4) percentage points, commencing
on January 2 of the year following the year with respect to which such
compensation is earned, compounded quarterly, until paid.
The aggregate amount allocable to the Executive as deferred
compensation shall be payable to the Executive in five (5) annual
installments commencing on the first day of March following the year in
which the Executive retires or otherwise ceases to be actively employed by
the Company, for whatever cause. If the Executive dies before receiving
any or all of the installments of deferred compensation to which he is
entitled, any unpaid installments shall be paid as they become due to such
person or persons and in such proportions as the Executive may have
expressly designated in the last unrevoked written designation of
beneficiary or beneficiaries delivered by him to the Company, or if no such
unrevoked written designation exists, as the Executive may have expressly
designated by his last will and testament, otherwise to the Executive's
estate.
(B) All payments of deferred compensation shall be paid in cash
from the general funds of the Company and no special or separate fund shall
be established and no other segregation of assets shall be made to assure
the payment of any deferred compensation. The Company may make such
investments as it may deem desirable to aid it in meeting its obligations
hereunder. The Executive, however, shall have no right, title, or interest
whatsoever in or to such investments, if any. Nothing contained in this
Section 3.4, and no action taken pursuant to the provisions of this Section
3.4, shall create or be construed to create a trust of any kind, or a
fiduciary relationship between the Company and the Executive or any other
person. To the extent that any person acquires a right to receive payments
from the Company under this Agreement, such right shall be no greater than
the right of an unsecured general creditor of the Company.
4. Benefits, Perquisites.
4.1 Expense Reimbursement. During the term of this Agreement, the
Company shall reimburse the Executive for all reasonable out-of-pocket
expenses incurred by him in connection with the performance of his duties
hereunder, upon the presentation of proper accounts therefor in accordance
with the Company's policies. Such expenses shall include (i) travel
expenses of the Executive's spouse incurred in connection with the
Executive's performance of his duties hereunder, (ii) annual membership
dues for a yacht club of his choice, (iii) tax advice and preparation and
financial counseling and (iv) an annual medical examination.
4.2 Automobile. During the term of this Agreement the Company
shall provide the Executive with use of an automobile and shall pay or
reimburse the Executive for costs of insurance, gasoline, maintenance and
repair of such automobile. A new automobile shall be provided for use by
the Executive not less than every three (3) years.
4.3 Benefits. During the term of this Agreement, the Company will
reimburse the Executive for the premiums for the long-term disability
insurance policy and long-term care insurance policy described in Schedule
A. The Executive will be eligible to participate in all employee benefit
plans and programs offered by the Company from time to time to its
employees of comparable seniority (including any stock option plans and
deferred compensation plans), subject to the provisions of such plans and
programs as in effect from time to time.
5. Split-Dollar Life Insurance.
5.1 In addition to any other insurance which may now or hereafter
be provided by the Company on the life of the Executive under any group
contract or otherwise, the Company shall provide and pay premiums for the
split-dollar life insurance policies on the life of the Executive described
in Schedule A. Such policies shall be owned by the Executive or by a trust
for the benefit of the Executive or members of the immediate family of the
Executive, and shall be obtained immediately upon the execution of this
Agreement. The Company shall be obligated to pay the full annual premiums
on the split-dollar life insurance policies as shown on Schedule A. The
aggregate amount of premiums paid by the Company shall constitute a non-
recourse indebtedness of the Executive to the Company payable only out of
the death benefit or cash value of such policies as hereinafter set forth.
The Executive or the trust, as the case may be, will execute and deliver to
the Company a collateral assignment of the policies on a form approved by
the insurance company which is the issuer. The Company will be entitled to
satisfy the indebtedness owed to it when and to the extent that the
policies are surrendered or the proceeds thereof are paid at death, and
shall release the collateral assignment pro tanto upon such satisfaction.
5.2 The Executive agrees that:
(i) upon his death, the portion of such death benefit equal
to the aggregate amount of premiums paid by the Company prior to his
death shall be paid to the Company;
(ii) dividends under such policies shall be applied to
purchase paid-up additional insurance;
(iii) neither the Company, the Executive nor the trust shall
terminate or surrender the policies or any part thereof or withdraw
from or be loaned any part of the cash value of such policies prior
to the Company's receipt of payment of the aggregate amount of
premiums paid by the Company for such policies;
(iv) neither the Executive nor the trust shall transfer legal
or beneficial ownership of the policies or use the policies as
security for any loan;
(v) the Executive shall, to the extent possible, take such
action as is necessary to cause:
(a) the terms of the policies to satisfy the
requirements of this Section 5.2;
(b) the issuer of the policies to pay the amounts in
the manner described above; and
(c) the trust to satisfy and be bound by the provisions
of this Section 5.2.
5.3 Any provision of this Agreement to the contrary
notwithstanding, the Company shall have the right to suspend or defer
payment of premiums in whole or part, or to require the Executive to permit
borrowing against the cash value of the policies for the purpose of paying
such premiums in whole or part, if such suspension, deferral or borrowing
is essential to the liquidity needs of the Company and is approved by the
Board of Directors and the stockholders of the Company.
5.4 The Company, the Executive and the trust shall enter into a
Split Dollar Agreement containing the foregoing terms and other standard
terms.
6. Termination of Employment.
6.1 Death. In the event of the death of the Executive during the
term of this Agreement, the Company shall continue to pay to the estate or
other legal representative of the Executive the base salary provided for in
Section 3 (at the annual rate then in effect) until the expiration of a
period of three (3) months from the date of the Executive's death. The
Company shall also pay to the Executive any bonus payable to the Executive
in accordance with Section 3.3. Rights and benefits of the estate or other
legal representative of the Executive under the benefit plans and programs
of the Company shall be determined in accordance with the provisions of
such plans and programs. Neither the estate or other legal representative
of the Executive nor the Company shall have any further rights or
obligations under this Agreement, except as provided in Section 15.
6.2 Disability. If the Executive shall become incapacitated by
reason of sickness, accident or other physical or mental disability and
shall be unable to perform his normal duties hereunder for a period of six
(6) consecutive months, then, at any time following the conclusion of such
six (6) month period, the employment of the Executive hereunder may be
terminated by the Company or the Executive, upon thirty (30) days notice to
the other. In the event of such termination, the Company shall (i)
continue to pay to the Executive the base salary provided for in Section 3
(at the annual rate then in effect) until the expiration of a period of six
(6) months from the date of such termination and (ii) thereafter, until the
first to occur of (A) the expiration of a period of sixty (60) months
following the end of the period specified in clause (i), (B) the
termination of the Executive's disability or (C) the death of the
Executive, in monthly installments on the first day of each month, an
amount equal to the excess of (x) fifty percent (50%) of the monthly base
salary in effect at the time of the termination of his employment with the
Company over (y) the monthly amount, if any, of benefits actually paid to
the Executive under any disability plan or policy maintained or paid for by
the Company. The Company shall also pay to the Executive any bonus payable
to the Executive in accordance with Section 3.3. The Company shall
continue to carry group life and health insurance coverage for the
Executive from the date of termination of employment through the expiration
of the applicable period referred to in clause (ii) of the preceding
sentence. Rights and benefits of the Executive under the other benefit
plans and programs of the Company shall be determined in accordance with
the terms and provisions of such plans and programs. Neither the Executive
nor the Company shall have any further rights or obligations under this
Agreement, except as provided in Sections 7, 8, 9, and 15.
6.3 Due Cause. The employment of the Executive hereunder may be
terminated by the Company at any time for Due Cause (as hereinafter
defined). In the event of such termination, the Company shall pay to the
Executive the base salary provided for in Section 3 (at the annual rate
then in effect) accrued to the date of such termination and not theretofore
paid to the Executive. The Company shall also pay to the Executive any
bonus payable to the Executive in accordance with Section 3.3. Rights and
benefits of the Executive under the benefit plans and programs of the
Company shall be determined in accordance with the provisions of such plans
and programs. For purposes hereof, "Due Cause" shall mean (i) willful,
gross neglect or willful, gross misconduct in the Executive's discharge of
his duties and responsibilities under this Agreement, or (ii) the
Executive's conviction of a felony; provided, however, with respect to
clause (i) that the Executive shall be given written notice by a majority
of the Board of Directors of the Company that it intends to terminate the
Executive's employment for Due Cause under clause (i), which written notice
shall specify the act or acts upon the basis of which the majority of the
Board of Directors of the Company intends so to terminate the Executive's
employment, and the Executive shall then be given the opportunity, within
fifteen (15) days of his receipt of such notice, to have a meeting with the
Board of Directors of the Company to discuss such act or acts. The
Executive shall be given seven (7) days after such meeting within which to
cease or correct the performance (or nonperformance) giving rise to such
written notice and, upon failure of the Executive within such seven (7)
days to cease or correct such performance (or nonperformance), the
Executive's employment by the Company shall automatically be terminated
hereunder for Due Cause. Neither the Executive nor the Company shall have
any further rights or obligations under this Agreement, except as provided
in Sections 7, 8, 9, and 15.
6.4 Other Termination by the Company. The Company may terminate
the Executive's employment at any time for whatever reason it deems
appropriate; provided, however, that in the event that such termination is
not pursuant to Sections 6.1, 6.2, 6.3 or 6.5, the Company shall pay to the
Executive, on the date of such termination, a lump sum amount in cash and
without discount, equal to the base salary provided for in Section 3 (at
the annual rate then in effect) which would have been payable from the date
of termination through the last day of the term of this Agreement (as in
effect immediately prior to such termination). The Executive shall be
under no obligation to seek subsequent employment and upon obtaining
subsequent employment shall be under no obligation to offset any amounts
earned from such subsequent employment (whether as an employee, a
consultant or otherwise) against such lump sum payments. The Company shall
also pay to the Executive any bonus payable in accordance with Section 3.3.
The Company shall continue to pay any premiums payable on split-dollar life
insurance policies on the life of the Executive in accordance with Section
5.1 during the period from the date of termination through the last day of
the term of this Agreement (as in effect immediately prior to such
termination) and the Company shall continue to carry group life and health
insurance coverage for the Executive for the same period. Rights and
benefits of the Executive under the other benefit plans and programs of the
Company shall be determined in accordance with the provisions of such plans
and programs. Neither the Executive nor the Company shall have any further
rights or obligations under this Agreement, except as provided in Sections
7, 8, 9 and 15.
6.5 Voluntary Termination. The Executive may terminate his
employment with the Company at any time upon thirty (30) days' prior
written notice to the Company. In the event of such termination, the
Company shall pay to the Executive the base salary provided for in Section
3 (at the annual rate then in effect) accrued to the date of such
termination and not theretofore paid to the Executive. The Company shall
also pay to the Executive any bonus payable in accordance with Section 3.3.
Rights and benefits of the Executive under the benefit plans and programs
of the Company shall be determined in accordance with the provisions of
such plans and programs. Neither the Executive nor the Company shall have
any further rights or obligations under this Agreement, except as provided
in Sections 7, 8, 9 and 15.
6.6 Constructive Termination. Anything herein to the contrary
notwithstanding, if the Company:
(A) demotes the Executive to a lesser position than provided
in Section 2;
(B) causes a material change in the nature or scope of the
authorities, powers, functions, duties or responsibilities attached
to the Executive's position as described in Section 2;
(C) decreases the Executive's salary or bonus below the level
provided for in Section 3.1 (taking into account increases in salary
made from time to time in accordance with Section 3.2);
(D) fails to obtain the agreement of a successor company to
assume the obligations of the Company under this Agreement as
required by Section 10.1;
(E) relocates the executive offices of the Company to a
location more than twenty-five (25) miles from Avon, Massachusetts;
or
(F) fails to cause the Executive to be elected to the Board
of Directors of the Company;
then such action (or inaction) by the Company, unless consented to in
writing by the Executive, shall constitute a termination of the Executive's
employment by the Company pursuant to Section 6.4. Notwithstanding the
preceding sentence, within thirty (30) days after learning of the action
(or inaction) constituting the basis for this constructive termination of
employment, the Executive shall (unless he gives written consent thereto)
advise the Company in writing that the action (or inaction) constitutes a
termination of his employment pursuant to Section 6.4, in which event the
Company shall have thirty (30) days in which to correct such action (or
inaction) and if the Company does so correct such action (or inaction) the
Executive shall not be entitled to terminate his employment under this
Section as a result of such action (or inaction).
6.7 Termination of Employment Following a Change in Control. The
Executive may terminate his employment with the Company during the one (1)
year period following a Change in Control, and in the event of such
termination, the Company shall pay to the Executive, on the date of such
termination, a lump sum amount in cash equal to three (3) times the
Executive's average annual cash compensation (salary and bonus) during the
most recent five (5) taxable years of the Company ending before the date of
such termination (or during such portion of such period as the Executive
was employed by, or rendered services for, the Company), less $1,000. The
Executive shall be under no obligation to seek subsequent employment and
upon obtaining subsequent employment shall be under no obligation to offset
any amounts earned from such subsequent employment (whether as an employee,
a consultant or otherwise) against such lump sum payment. The Company
shall continue to carry group life and health insurance coverage for the
Executive for a three (3) year period following termination of employment.
The Company shall also pay to the Executive any bonus payable to the
Executive in accordance with Section 3.3. The Company shall continue to
pay any premiums payable on split-dollar life insurance policies on the
life of the Executive in accordance with Section 5.1 for a three (3) year
period following termination of employment. Rights and benefits of the
Executive under the other benefit plans and programs of the Company shall
be determined in accordance with the terms and provisions of such plans and
programs. Such termination of employment shall be deemed to constitute a
termination of the Executive's employment by the Company other than for Due
Cause pursuant to Section 6.4. For purposes of this Agreement, a Change in
Control of the Company shall be deemed to have occurred if:
(A) a "person" (meaning an individual, a partnership, or
other group or association as defined in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, other than the Executive or a
group including the Executive), acquires more than fifty percent
(50%) of the combined voting power of the outstanding securities of
the Company having a right to vote in elections of directors and such
acquisition shall not have been approved within sixty (60) days
following such acquisition by a majority of the Continuing Directors
(as hereinafter defined) then in office; or
(B) Continuing Directors shall for any reason cease to
constitute a majority of the Board of Directors of the Company; or
(C) the business of the Company is disposed of by the Company
to a party or parties other than a subsidiary or other affiliate of
the Company, in which the Company owns less than a majority of the
equity, pursuant to a partial or complete liquidation of the Company,
sale of assets (including stock of any subsidiary of the Company) or
otherwise, and such disposition shall not have been approved in
advance by a majority of the Continuing Directors then in office.
For purposes of this Agreement, the term "Continuing Director" shall
mean a member of the Board of Directors of the Company who either was a
member of the Board of Directors on the date hereof or who subsequently
became a Director and whose election, or nomination for election, was
approved by a vote of at least two-thirds of the Continuing Directors then
in office.
7. Confidential Information.
7.1 The Executive shall, during the term of this Agreement and at
all times thereafter, treat as confidential and, except as required in the
performance of his duties and responsibilities under this Agreement, not
disclose, publish or otherwise make available to the public or to any
individual, firm or corporation any confidential material (as hereinafter
defined). The Executive agrees that all confidential material, together
with all notes and records of the Executive relating thereto, and all
copies or facsimiles thereof in the possession of the Executive, are the
exclusive property of the Company and the Executive agrees to return such
material to the Company promptly upon the termination of the Executive's
employment with the Company.
7.2 For purposes hereof, the term "confidential material" shall
mean all information acquired by the Executive in the course of the
Executive's employment with the Company in any way concerning the products,
projects, activities, business or affairs of the Company or the Company's
customers, including, without limitation, all information concerning trade
secrets and the products or projects of the Company and/or any improvements
therein, all sales and financial information concerning the Company, all
customer and supplier lists, all information concerning projects in
research and development or marketing plans for any such products or
projects, and all information in any way concerning the products, projects,
activities, business or affairs of customers of the Company which is
furnished to the Executive by the Company or any of its agents or
customers, as such; provided, however, that the term "confidential
material" shall not include information which (a) becomes generally
available to the public other than as a result of a disclosure by the
Executive, (b) was available to the Executive on a non-confidential basis
prior to his employment with the Company or (c) becomes available to the
Executive on a non-confidential basis from a source other than the Company
or any of its agents or customers provided that such source is not bound by
a confidentiality agreement with the Company or any of such agents or
customers.
8. Interference with the Company. The Executive acknowledges
that the services to be rendered by him to the Company are of a special and
unique character. The Executive agrees that, in consideration of his
employment hereunder, the Executive will not, during the term of this
Agreement and thereafter for a period of one (1) year commencing on the
date of termination of his employment with the Company, (i) solicit or
entice or endeavor to solicit or entice away from the Company any person
who was an officer, employee or consultant of the Company, either on his
own account or for any person, firm, corporation or other organization,
whether or not such person would commit any breach of his contract of
employment by reason of leaving the service of the Company, and the
Executive agrees not to employ, directly or indirectly, any person who was
an officer or employee of the Company or who by reason of such position at
any time is or may be likely to be in possession of any confidential
information or trade secrets relating to the businesses or products of the
Company or (ii) solicit or entice or endeavor to solicit or entice away
from the Company any present or prospective customer of the Company. For
purposes hereof, "prospective customer" shall refer to a customer with whom
the Company has had significant contact regarding the provision of products
or services during the three (3) month period preceding the termination of
the Executive's employment hereunder.
9. Equitable Relief. In the event of a breach or threatened
breach by the Executive of any of the provisions of Sections 7 or 8 of this
Agreement, the Executive hereby consents and agrees that the Company shall
be entitled to an injunction or similar equitable relief from any court of
competent jurisdiction restraining the Executive from committing or
continuing any such breach or threatened breach or granting specific
performance of any act required to be performed by the Executive under any
of such provisions, without the necessity of showing any actual damage or
that money damages would not afford an adequate remedy and without the
necessity of posting any bond or other security. Nothing herein shall be
construed as prohibiting the Company from pursuing any other remedies at
law or in equity which it may have.
10. Successors and Assigns.
10.1 Assignment by the Company. The Company shall require any
successors (whether direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the business and/or assets of
the Company to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform
if no such succession had taken place. As used in this Section, the
"Company" shall mean the Company as hereinbefore defined and any successor
to its business and/or assets as aforesaid which otherwise becomes bound by
all the terms and provisions of this Agreement by operation of law and this
Agreement shall be binding upon, and inure to the benefit of, the Company,
as so defined.
10.2 Assignment by the Executive. The Executive may not assign this
Agreement or any part thereof without the prior written consent of a
majority of the Board of Directors of the Company; provided, however, that
nothing herein shall preclude one or more beneficiaries of the Executive
from receiving any amount that may be payable following the occurrence of
his legal incompetency or his death and shall not preclude the legal
representative of his estate from receiving such amount or from assigning
any right hereunder to the person or persons entitled thereto under his
will or, in the case of intestacy, to the person or persons entitled
thereto under the laws of intestacy applicable to his estate. The term
"beneficiaries", as used in this Agreement, shall mean a beneficiary or
beneficiaries so designated to receive any such amount or, if no
beneficiary has been so designated, the legal representative of the
Executive (in the event of his incompetency) or the Executive's estate.
11. Governing Law. This Agreement shall be deemed a contract made
under, and for all purposes shall be construed in accordance with, the laws
of the Commonwealth of Massachusetts applicable to contracts to be
performed entirely within such State.
12. Entire Agreement. This Agreement contains all the
understandings and representations between the parties hereto pertaining to
the subject matter hereof and supersedes all undertakings and agreements,
whether oral or in writing, if any there be, previously entered into by
them with respect thereto.
13. Amendment, Modification, Waiver. No provision of this
Agreement may be amended or modified unless such amendment or modification
is agreed to in writing and signed by the Executive and by a duly
authorized representative of the Company other than the Executive. Except
as otherwise specifically provided in this Agreement, no waiver by either
party hereto of any breach by the other party hereto of any condition or
provision of this Agreement to be performed by such other party shall be
deemed a waiver of a similar or dissimilar provision or condition at the
same or any prior or subsequent time, nor shall the failure of or delay by
either party hereto in exercising any right, power or privilege hereunder
operate as a waiver thereof to preclude any other or further exercise
thereof or the exercise of any other such right, power or privilege.
14. Arbitration. Any controversy or claim arising out of or
relating to this Agreement, or any breach thereof, shall, except as
provided in Section 9, be settled by arbitration in accordance with the
rules of the American Arbitration Association then in effect and judgment
upon such award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. The arbitration shall be held in the area
where the Company then has its principal place of business. The
arbitration award shall include attorneys' fees and costs to the prevailing
party.
15. Advance of Defense Expenses. In the event of any action,
proceeding or claim against the Executive arising out of his serving or
having served in his capacity as an officer and/or director of the Company,
which in the Executive's sole judgment requires him to retain counsel (such
choice of counsel to be made in his sole and absolute discretion) or
otherwise expend his personal funds for his defense in connection
therewith, the Company shall be obligated to advance to the Executive (or
pay directly to his counsel) counsel fees and other costs associated with
the Executive's defense of such action, proceeding or claim; provided,
however, that in such event the Executive shall first agree in writing,
without posting bond or collateral, to repay all sums paid or advanced to
him pursuant to this Section 15 in the event that the final disposition of
such action, proceeding or claim is one for which the Executive would not
be entitled to indemnification pursuant to the provisions of the laws of
the State of Delaware or the Certificate of Incorporation or By-laws of the
Company.
16. Notices. Any notice to be given hereunder shall be in writing
and delivered personally or sent by certified mail, postage prepaid, return
receipt requested, addressed to the party concerned at the address
indicated below or at such other address as such party may subsequently
designate by like notice:
If to the Company:
Westerbeke Corporation
41 Xxxxx Drive
Avon Industrial Park
Xxxx, Xxxxxxxxxxxxx 00000
If to the Executive:
Xxxx X. Xxxxxxxxxx, Xx.
000 Xxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
17. Severability. Should any provision of this Agreement be held
by a court or arbitration panel of competent jurisdiction to be enforceable
only if modified, such holding shall not affect the validity of the
remainder of this Agreement, the balance of which shall continue to be
binding upon the parties hereto with any such modification to become a part
hereof and treated as though originally set forth in this Agreement. The
parties further agree that any such court or arbitration panel is expressly
authorized to modify any such unenforceable provision of this Agreement in
lieu of severing such unenforceable provision from this Agreement in its
entirety, whether by rewriting the offending provision, deleting any or all
of the offending provision, adding additional language to this Agreement,
or by making such other modifications as it deems warranted to carry out
the intent and agreement of the parties as embodied herein to the maximum
extent permitted by law. The parties expressly agree that this Agreement
as so modified by the court or arbitration panel shall be binding upon and
enforceable against each of them. In any event, should one or more of the
provisions of this Agreement be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions hereof, and if such
provision or provisions are not modified as provided above, this Agreement
shall be construed as if such invalid, illegal or unenforceable provisions
had never been set forth herein.
18. Withholding. Anything to the contrary notwithstanding, all
payments required to be made by the Company hereunder to the Executive or
his beneficiaries, including his estate, shall be subject to withholding of
such amounts relating to taxes as the Company may reasonably determine it
should withhold pursuant to any applicable law or regulation. In lieu of
withholding such amounts, in whole or in part, the Company, may, in its
sole discretion, accept other provision for payment of taxes as permitted
by law, provided it is satisfied in its sole discretion that all
requirements of law affecting its responsibilities to withhold such taxes
have been satisfied.
19. 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.
20. Titles. Titles of the sections of this Agreement are intended
solely for convenience and no provision of this Agreement is to be
construed by reference to the title of any section.
* * *
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first above written.
WESTERBEKE CORPORATION
By: /s/ Xxxx X. Xxxxxxxxxx, Xx.
---------------------------
Xxxx X. Xxxxxxxxxx, Xx.
President
By: /s/ Xxxxxx X. Xxxxxx
--------------------
Xxxxxx X. Xxxxxx
Assistant Secretary
BY: /s/ Xxxx X. Xxxxxxxxxx, Xx.
---------------------------
Xxxx X. Xxxxxxxxxx, Xx.
SCHEDULE A
----------
Long-Term Disability Insurance
------------------------------
To Be Agreed Upon
Long-Term Care Insurance
------------------------
To Be Agreed Upon
Split Dollar Life Insurance
---------------------------
Policy
Issuer Number
-----------------------------------------------------------
New York Life Insurance Company 44 823 379
Massachusetts Mutual Life Insurance
Company 8 858 303
Northwestern Mutual Life Insurance
Company 12 445 394
Guardian Life Insurance Company of
America 372 8105
12
19456.3
00735-09999
19456.3
00735-09999
