EXHIBIT 2.I.20
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as of May
16, 2001 (the "Effective Date") by and between AMERICAN CAPITAL STRATEGIES,
LTD., a Delaware corporation (the "Company"), and XXX XXXXXX (the "Employee").
W I T N E S S E T H:
WHEREAS, as of the date hereof Employee has been elected the chief
operating officer ("COO") of the Company; and
WHEREAS, it is in the interests of the Company that Employee's service
continue to be available to the Company.
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and agreements contained herein, and for other
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATIONS
1.1 DEFINITIONS
For purposes of this Agreement, except as otherwise expressly provided
or unless the context otherwise requires, the following terms shall have the
following respective meanings:
"Base Salary" shall have the meaning specified in Section 3.1.
"Board of Directors" shall mean the Board of Directors of the Company.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Compensation Committee" shall mean the Compensation and Compliance
Committee of the Board of Directors or such other entity as may be designated by
the Board of Directors.
"Confidential Information" shall have the meaning specified in Section
5.1(a).
"Disability" shall mean a physical or mental condition of Employee
that, in the good faith judgment of not less than a majority of the Executive
Committee, prevents Employee from being able to perform the services required
under this Agreement and which results in the Employee becoming eligible for
long-term disability benefits (if such benefits are provided by the Company). If
any dispute arises as to whether a Disability
has occurred, or whether a Disability has ceased and the Employee is able to
resume duties, then such dispute shall be referred to a licensed physician
appointed by the president of the Medical Society or similar organization in
Washington, D.C., at the request of either party. The Employee shall submit to
such examinations and provide information as such physician may request and the
determination of such physician as to the Employee's physical or mental
condition shall be binding and conclusive on the parties. The Company shall pay
the cost of any such physician and examination.
"Dispute" shall have the meaning specified in Article VI.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Executive Committee" shall mean the Executive Committee of the Board
of Directors or such other entity as may be designated for a particular function
by the Board of Directors.
"Expiration Date" shall have the meaning specified in Section 2.2.
"ISO Plan" shall mean the Company's stock option plans for employees
including, without limitation, 1997 Stock Option Plan and 2000 Employee Stock
Option Plan.
"Misconduct" shall mean one or more of the following:
(i) the willful and continued failure by Employee to perform
substantially Employee's duties described in Section 2.3 (other than
any such failure resulting from Employee's incapacity due to physical
or mental illness) after two (2) written notices of such failure have
been given to Employee by the Company and Employee has had a reasonable
period (not to exceed 15 days from the second notice) to correct such
failure;
(ii) the commission by Employee of acts that are dishonest and
demonstrably injurious to the Company (monetarily or otherwise) in any
material respect; or
(iii) a material breach or violation by Employee of (a) any
material provision of this Agreement or (b) any material Company
employment policy, including its Code of Ethics, that the Company will
publish from time to time, which, if capable of being remedied, remains
unremedied for more than 15 days after written notice thereof is given
to Employee by the Company.
For purposes of this definition, no act or failure to act on Employee's
part shall be considered "Misconduct" if done or omitted to be done by Employee
in good faith and in the reasonable belief that such act or failure to act was
in the best interest the Company or in furtherance of Employee's duties and
responsibilities described in Section 2.3.
"Notice of Termination" shall mean a notice purporting to terminate
Employee's employment in accordance with Section 4.1 or 4.2. Such notice shall
specify the effective date of such termination, which date shall not be less
than 30 (one (1) day in the case of a
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termination by the Company for Misconduct) or more than 60 days after the date
such notice is given. If such termination is by the Company for Disability or
Misconduct, such notice shall set forth in reasonable detail the reason for such
termination and the facts and circumstances claimed to provide a basis therefor.
"Person" shall mean and include an individual, a partnership, a joint
venture, a corporation, a trust and an unincorporated organization.
"Principal Bonus Plan" shall have the meaning specified in Section 3.2.
"Term" shall have the meaning specified in Section 2.2.
"Termination Date" shall mean the termination date specified in a
Notice of Termination delivered in accordance with this Agreement.
1.2 INTERPRETATIONS
(a) In this Agreement, unless a clear contrary intention appears, (i)
the words "herein," "hereof" and "hereunder" and other words of similar import
refer to this Agreement as a whole and not to any particular Article, Section or
other subdivision, (ii) reference to any Article or Section, means such Article
or Section hereof, (iii) the words "including" (and with correlative meaning
"include") means including, without limiting the generality of any description
preceding such term, and (iv) where any provision of this Agreement refers to
action to be taken by either party, or which such party is prohibited from
taking, such provision shall be applicable whether such action is taken directly
or indirectly by such party.
(b) The Article and Section headings herein are for convenience only
and shall not affect the construction hereof.
ARTICLE II
EMPLOYMENT: TERM, POSITIONS AND DUTIES, ETC.
2.1 EMPLOYMENT
The Company agrees to employ Employee and Employee agrees to accept
employment with the Company, in each case on the terms and conditions set forth
in this Agreement.
2.2 TERM OF EMPLOYMENT
Unless sooner terminated pursuant to Article IV, the term of Employee's
employment under this Agreement (the "Term") shall commence on the Effective
Date and shall continue until the first anniversary of the Effective Date (the
"Expiration Date"); provided, however, that on each date during the Term, the
Expiration Date shall be reset to the date one year after the date thereof,
except that either party may terminate this Agreement by giving written notice
that such daily extensions of the Term shall be
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discontinued in which case the Expiration Date shall be the date one year after
the delivery of such notice.
2.3 POSITIONS AND DUTIES
(a) While employed hereunder, Employee shall serve as the COO of the
Company. As COO of the Company, Employee shall have the responsibilities and
authorities designated to him by the CEO of the Company.
(b) While employed hereunder, Employee shall (i) report directly to the
Chief Executive Officer ("CEO") of the Company or such other person designated
by the CEO or the Board of Directors of the Company and (ii) observe and comply
with all lawful policies, directions and instructions of the CEO or other person
so designated that are consistent with the foregoing provisions of this
paragraph 2.3.
(c) While employed hereunder, Employee shall (i) devote substantially
all of Employee's business time, attention, skill and efforts to the faithful
and efficient performance of Employee's duties hereunder and (ii) not accept
employment with any Person other than with the Company. Notwithstanding the
foregoing, Employee may engage in the following activities so long as they do
not interfere in any material respect with the performance of Employee's duties
and responsibilities hereunder: (i) serve on corporate, civic, religious,
educational or charitable boards or committees and (ii) manage Employee's
personal investments.
(d) While employed hereunder, Employee shall not knowingly prejudice,
in any material respect, the reputation of the Company in the fields of business
in which it is engaged or with the investment community or the public at large.
ARTICLE III
COMPENSATION AND BENEFITS
3.1 BASE SALARY
(a) For services rendered by Employee under this Agreement, the Company
shall pay to Employee an annual base salary ("Base Salary") of $200,000 evenly
paid twice a month. Subject to paragraph (b) below, the CEO or the Compensation
Committee may adjust the amount of the Base Salary at any time as he may deem
appropriate in his sole discretion.
(b) The amount of the Base Salary may not be decreased without the
prior written approval of the Employee except that if the CEO or the
Compensation Committee increases the Base Salary as provided in the last
sentence of paragraph (a) above, the CEO or the Compensation Committee may
thereafter decrease the Base Salary by an amount not to exceed the aggregate
amount of such increases.
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3.2 PRINCIPAL BONUS PLAN
During the Term, the Company shall maintain and Employee shall be
entitled to participate in an annual incentive bonus plan open to Principals and
the COO and certain other employees of the Company (the "Principal Bonus Plan"),
which will provide for the payment of cash bonuses to participants within 90
days of the end of each fiscal year based on the Company's financial performance
for that year and other appropriate factors. Under the Principal Bonus Plan,
Employee shall be eligible to earn a target bonus (the "Target Bonus") each year
of up to 160% of Employee's Base Salary for such year based on criteria
established by the Compensation Committee, and the performance of the Company
against such criteria. The establishment of such criteria and of the necessary
performance targets for partial or full earning of the Target Bonus shall be at
the sole discretion of the Compensation Committee.
3.3 VACATION
While employed hereunder, Employee shall be entitled to vacation
benefits in accordance with the vacation policy adopted by the Company from time
to time for Principals. Unless changed by the President or the Compensation
Committee in a manner generally applicable to Principals of the Company, the
Employee shall be entitled to three weeks of vacation in each of the first two
years of employment with the Company, three weeks of vacation in each of the
third and fourth years of employment with the Company and four weeks per year in
the fifth and subsequent years of employment. Employee shall not be entitled to
accumulate and carryover unused vacation time from year to year.
3.4 OTHER BENEFITS
Employee shall be entitled to receive all employee benefits, fringe
benefits and other perquisites that may be offered by the Company to its
Principals as a group, including, without limitation, participation by Employee
and, where applicable, Employee's dependents, in the various employee benefit
plans or programs (including, without limitation, pension plans, profit sharing
plans, stock plans, health plans, life insurance, parking and disability
insurance) generally provided to Principals of the Company, subject to meeting
the eligibility requirements with respect to each of such benefit plans or
programs. However, nothing in this Section 3.4 shall be deemed to prohibit the
Company from making any changes in any of the plans, programs or benefits
described herein, provided such changes apply to all similarly situated
Principals.
ARTICLE IV
TERMINATION OF EMPLOYMENT
4.1 TERMINATION BY EMPLOYEE
Employee may, at any time prior to the Expiration Date, terminate
Employee's employment hereunder for any reason by delivering a Notice of
Termination to the President. Upon such termination, Employee shall be entitled
only to those rights and payments payable under Section 4.3. All options of the
Employee under the ISO Plan
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which have not vested as of employee's Termination Date shall lapse and shall
not be exercisable. All previously vested options shall remain exercisable for
the shorter of 90 days following the Termination Date and their original term.
All loans to the Employee in connection with the prior exercise of any options
under the ISO Plan shall be due the earlier of 60 days following the Employee's
death and their original term.
4.2 TERMINATION BY THE COMPANY
The CEO may, at any time prior to the Expiration Date, terminate
Employee's employment hereunder for any reason by delivering a Notice of
Termination to Employee.
4.3 PAYMENT OF ACCRUED BASE SALARY, VACATION PAY, ETC.
(a) Promptly upon the termination of Employee's employment for any
reason (including death), the Company shall pay to Employee (or Employee's
estate) a lump sum amount for (i) any unpaid Base Salary earned hereunder prior
to the Termination Date, (ii) all unused vacation time accrued by Employee as of
the Termination Date in accordance with Section 3.4, and (iii) all unpaid
benefits earned or vested, as the case may be, by Employee as of the Termination
Date under any and all incentive or deferred compensation plans or programs of
the Company.
(b) A termination of Employee's employment in accordance with this
Agreement shall not alter or impair any of Employee's accrued rights or benefits
as of the Termination Date under any employee benefit plan or program maintained
by the Company, in each case except as provided therein or in any written
agreement entered into between the Company and Employee pursuant thereto.
4.4 ADDITIONAL RIGHTS IN CONNECTION WITH DISABILITY
In the event that the Company terminates Employee by delivering a
Notice of Termination to Employee stating that such Termination is by reason of
a Disability, the Employee shall be entitled to the benefits and payments set
forth in this Section 4.4:
(a) BASE SALARY AND TARGET BONUS. The Company shall continue to pay to
Employee the Base Salary in effect as of the date on which the Notice of
Termination was delivered for one (1) year following the Termination Date (such
period being the "Continuation Period") which amount shall be reduced by any
amount payable to Employee under any disability plan maintained by the Company
for the benefit of Employee. In addition, the Employee shall be entitled to
continue to participate in the Annual Bonus Plan for one (1) year following the
Termination Date with the first anniversary of the Termination Date being the
Expiration Date for purposes of Section 3.2.
(b) INSURANCE BENEFITS, ETC. The Company shall at all times during the
Continuation Period, without charge to Employee or Employee's dependents, cause
Employee and Employee's eligible dependents to be covered by and to participate
in, to
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the fullest extent allowable under the terms thereof, all life, accidental death
and dismemberment and health insurance plans and programs that may be offered to
the Principals of the Company so that Employee will receive, at all times during
the Continuation Period, the same benefits under such plans and programs as
Employee would have been entitled to receive had Employee remained a Principal
of the Company. In no event shall Employee's continuation period for purposes of
Part 6 of Title I of the Employee Retirement Income Security Act of 1974, as
amended ("COBRA"), begin prior to the end of Employee's coverage under the
Company's group health plan as provided in this paragraph (b).
(c) OPTIONS. All options of the Employee under the ISO Plan that have
not vested as of Employee's Termination Date and which would vest within one
year of Employee's Termination Date shall vest and shall become immediately
exercisable and shall remain exercisable by the Employee for the shorter of 18
months following the Employee's Termination Date and their original term. All
other options shall expire. All loans to the Employee in connection with the
prior exercise of any options under the ISO Plan shall be due the earlier of 60
days following the Employee's Termination Date and their original term.
Should the Employee's Disability end during the pendency of the Term,
the Company may discontinue the payments contemplated by this Section 4.4 if it
offers to reemploy Employee under the terms of this Agreement, but no such offer
shall affect the terms of Section 4.4(c) above.
4.5 Additional Rights in Connection With Termination by the
COMPANY FOR OTHER THAN MISCONDUCT OR DISABILITY
In the event that the President terminates Employee's employment with
the Company pursuant to Section 4.2 for other than Misconduct or a Disability,
the Employee shall be entitled to the payments and benefits set forth in this
Section 4.5:
(a) SEVERANCE PAYMENT. As a severance payment, the Company shall
continue to pay to Employee the Base Salary in effect as of the date of the
Notice of Termination for a period of 18 months from the Termination Date. In
addition, the Employee shall be entitled to receive any Target Bonus for the
year in which the Employee is entitled for the year in which the Termination
occurs prorated through the Employee's Termination Date. The amount payable to
Employee under this paragraph (a) is in lieu of, and not in addition to, any
severance payment due to or become due to Employee under any separate agreement
or contract between Employee and the Company or pursuant to any severance
payment plan, program or policy of the Company.
(b) OPTIONS. All options of the Employee under the ISO Plan that have
not vested as of Employee's Termination Date shall lapse and shall not be
exercisable. All previously vested options shall remain exercisable for the
shorter of 90 days following the Termination Date and their original term. All
loans to the Employee in connection with the prior exercise of any options under
the ISO Plan shall be due the earlier of 60 days following the Employee's
termination and their original term.
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(c) RELEASE. Notwithstanding anything in this Section 4.5 to the
contrary, as a condition to the receipt of any benefit under this Section 4.5,
Employee must first execute and deliver to the Company a release as set out in
exhibit 4.5(d) hereto, releasing the Company, its officers, Board of Directors,
employees and agents from any and all claims and from any and all causes of
action of any kind or character that Employee may have arising out of Employee's
employment with the Company or the termination of such employment, but excluding
any claims and causes of action that Employee may have arising under or based
upon this Agreement.
4.6 ADDITIONAL RIGHTS IN THE EVENT OF DEATH
In the event that the Employee's employment is terminated as a result
of Employee's death, the Employee's estate or beneficiaries shall be entitled to
the payments and benefits set forth in this Section 4.6:
(a) TARGET BONUS. The Employee's estate shall be entitled to receive
the Target Bonus that the deceased employee would have been entitled to have
received in the year in which the death occurred.
(b) INSURANCE BENEFITS, ETC. The Company shall pay the cost for
dependents of the Employee for insurance coverage that they are entitled to
obtain from the Company following the Employee's death pursuant to COBRA for a
period equal to two months multiplied by the number of full years (not to exceed
nine) during which the Employee was employed by the Company.
(c) OPTIONS. All options of the Employee under the ISO Plan that have
not vested as of Employee's death and which would vest within one year thereof
shall vest immediately upon the Employee's death and shall remain exercisable by
the Employee's estate for the shorter of 18 months following the Employee's
death and their original term. All loans to the Employee in connection with the
prior exercise of any options under the ISO Plan shall be due the earlier of 60
days following the Employee's death and their original term.
4.7 RIGHTS IN THE EVENT OF TERMINATION FOR EMPLOYEE'S MISCONDUCT
In the event that the Company terminates Employee's employment with the
Company pursuant to Section 4.2 for Employee's Misconduct, Employee shall be
entitled to the rights set forth in this Section 4.7.
(a) OPTIONS. All options of the Employee under the ISO Plan which have
not vested as of employee's Termination Date shall lapse and shall not be
exercisable. All previously vested options shall remain exercisable for the
shorter of 90 days following the Termination Date and their original term. All
loans to the Employee in connection with the prior exercise of any options under
the ISO Plan shall be due the earlier of 60 days following the Employee's death
and their original term.
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(b) RELEASE. Notwithstanding anything in this Section 4.7 to the
contrary, as a condition to the receipt of any benefit under this Section 4.7,
Employee must first execute and deliver to the Company a release as set out in
exhibit 4.5(d) hereto, releasing the Company, its officers, Board of Directors,
employees and agents from any and all claims and from any and all causes of
action of any kind or character that Employee may have arising out of Employee's
employment with the Company or the termination of such employment, but excluding
any claims and causes of action that Employee may have arising under or based
upon this Agreement.
ARTICLE V
CONFIDENTIAL INFORMATION AND NON-COMPETITION
5.1 CONFIDENTIAL INFORMATION
(a) Employee recognizes that the services to be performed by Employee
hereunder are special, unique, and extraordinary and that, by reason of such
employment with the Company, Employee may acquire Confidential Information
concerning the operation of the Company, the use or disclosure of which would
cause the Company substantial loss and damages which could not be readily
calculated and for which no remedy at law would be adequate. Accordingly,
Employee agrees that Employee will not (directly or indirectly) at any time,
whether during or after Employee's employment hereunder, (i) knowingly use for
an improper personal benefit any Confidential Information that Employee may
learn or has learned by reason of Employee's employment with the Company or (ii)
disclose any such Confidential Information to any Person except (A) in the
performance of Employee's obligations to the Company hereunder, (B) as required
by applicable law, (C) in connection with the enforcement of Employee's rights
under this Agreement, (D) in connection with any disagreement, dispute or
litigation (pending or threatened) between Employee and the Company or (E) with
the prior written consent of the Board of Directors. As used herein,
"Confidential Information" includes information with respect to the Company's
investments, portfolio companies, products, services, facilities, product
methods, research and development, trade secrets and other intellectual
property, systems, patents and patent applications, procedures, manuals,
confidential reports, product price lists, customer lists, financial
information, business plans, prospects or opportunities (including, as
applicable, all of the foregoing information regarding the Company's past,
current and prospective portfolio companies); provided, however, that such term,
shall not include any information that (x) is or becomes generally known or
available other than as a result of a disclosure by Employee or (y) is or
becomes known or available to Employee on a nonconfidential basis from a source
(other than the Company) that, to Employee's knowledge, is not prohibited from
disclosing such information to Employee by a legal, contractual, fiduciary or
other obligation to the Company.
(b) Employee confirms that all Confidential Information is the
exclusive property of the Company. All business records, papers and documents
kept or made by Employee while employed by the Company relating to the business
of the Company shall be and remain the property of the Company at all times.
Upon the request of the Company at any time, Employee shall promptly deliver to
the Company, and shall retain no copies of,
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any written materials, records and documents made by Employee or coming into
Employee's possession while employed by the Company concerning the business or
affairs of the Company other than personal materials, records and documents
(including notes and correspondence) of Employee not containing proprietary
information relating to such business or affairs. Notwithstanding the foregoing,
Employee shall be permitted to retain copies of, or have access to, all such
materials, records and documents relating to any disagreement, dispute or
litigation (pending or threatened) between Employee and the Company.
5.2 NON-COMPETITION
(a) While employed hereunder and for the (i) a period of one (1) year
thereafter or (ii) the period of 18 months after the Termination Date, if this
Agreement is terminated and the Employee is entitled to receive compensation and
benefits under either Section 4.5 or Section 4.7 (the "Restricted Period"),
Employee shall not, unless Employee receives the prior written consent of the
Board of Directors, own a material interest in, manage, operate, join, control,
lend money or render financial or other assistance to or participate in or be
connected with, as an officer, employee, partner, stockholder, consultant or
otherwise, (A) any Person (x) that competes with the Company in investing or
consulting with small and medium sized businesses in the United States with
regard to change of control transactions in which the transaction utilizes
employee stock ownership plans, or (y) that provides or proposes to provide
services to or owns an investment in or proposes to make an investment in any
Person that is a client of the Company as of the Termination Date or to which
the Company has outstanding loans or in which the Company then has investments
(including warrants or options), or (B) any potential client of the Company with
which the Company has discussed a client, loan or investment relationship within
12 months prior to, as applicable, the end of Employee's employment or the
Termination Date.
(b) Employee has carefully read and considered the provisions of this
Section 5.2 and, having done so, agrees that the restrictions set forth in this
Section 5.2 (including the Restricted Period, scope of activity to be restrained
and the geographical scope) are fair and reasonable and are reasonably required
for the protection of the interests of the Company, its officers, directors,
employees, creditors and shareholders. Employee understands that the
restrictions contained in this Section 5.2 may limit Employee's ability to
engage in a business similar to the Company's business, but acknowledges that
Employee will receive sufficiently high remuneration and other benefits from the
Company hereunder to justify such restrictions.
(c) During the Restricted Period, Employee shall not, whether for
Employee's own account or for the account of any other Person (excluding the
Company), intentionally (i) solicit, endeavor to entice or induce any employee
of the Company to terminate Employee's employment with the Company or accept
employment with anyone else or (ii) interfere in a similar manner with the
business of the Company.
(d) In the event that any provision of this Section 5.2 relating to the
Restricted Period or the areas of restriction shall be declared by a court of
competent jurisdiction to
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exceed the maximum time period or areas such court deems reasonable and
enforceable, the Restricted Period or areas of restriction deemed reasonable and
enforceable by the court shall become and thereafter be the maximum time period
and/or areas.
5.3 INJUNCTIVE RELIEF
Employee acknowledges that a breach of any of the covenants contained
in this Article V may result in material irreparable injury to the Company for
which there is no adequate remedy at law, that it will not be possible to
measure damages for such injuries precisely and that, in the event of such a
breach, any payments remaining under the terms of this Agreement shall cease and
the Company shall be entitled to obtain a temporary restraining order or a
preliminary or permanent injunction restraining Employee from engaging in
activities prohibited by this Article V or such other relief as may be required
to specifically enforce any of the covenants contained in this Article V.
Employee agrees to and hereby does submit to in personam jurisdiction before
each and every such court for that purpose.
ARTICLE VI
DISPUTE RESOLUTION
In the event a dispute shall arise between the parties as to whether
the provisions of this Agreement have been complied with (a "Dispute"), the
parties agree to resolve such Dispute in accordance with the following
procedure:
(a) A meeting shall be held promptly between the parties, attended (in
the case of the Company) by one or more individuals with decision-making
authority regarding the Dispute, to attempt in good faith to negotiate a
resolution of the Dispute.
(b) If, within 10 days after such meeting, the parties have not
succeeded in negotiating a resolution of the Dispute, the parties agree to
submit the Dispute to mediation in accordance with the Commercial Mediation
Rules of the American Arbitration Association except that Disputes with regard
to the existence of a Disability shall be resolved in accordance with the
definition of the term "Disability" above.
(c) The parties will jointly appoint a mutually acceptable mediator,
seeking assistance in such regard from the American Arbitration Association if
they have been unable to agree upon such appointment within 10 days following
the 10-day period referred to in clause (b) above.
(d) Upon appointment of the mediator, the parties agree to participate
in good faith in the mediation and negotiations relating thereto for 15 days.
(e) If the parties are not successful in resolving the Dispute through
mediation within such 15-day period, the parties agree that the Dispute shall be
settled by arbitration in accordance with the Expedited Procedures of the
Commercial Arbitration Rules of the American Arbitration Association.
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(f) The fees and expenses of the mediator/arbitrators shall be borne
solely by the non-prevailing party or, in the event there is no clear prevailing
party, as the mediator/arbitrators deem appropriate.
(g) Except as provided above, each party shall pay its own costs and
expenses (including, without limitation, attorneys' fees) relating to any
mediation/arbitration proceeding conducted under this Article VI.
(h) All mediation/arbitration conferences and hearings will be held in
the greater Washington, D.C. area.
(i) In the event there is any disputed question of law involved in any
arbitration proceeding, such as the proper legal interpretation of any provision
of this Agreement, the arbitrators shall make separate and distinct findings of
all facts material to the disputed question of law to be decided and, on the
basis of the facts so found, express their conclusion of the question of law.
The facts so found shall be conclusive and binding on the parties, but any legal
conclusion reached by the arbitrators from such facts may be submitted by either
party to a court of law for final determination by initiation of a civil action
in the manner provided by law. Such action, to be valid, must be commenced
within 20 days after receipt of the arbitrators' decision. If no such civil
action is commenced within such 20-day period, the legal conclusion reached by
the arbitrators shall be conclusive and binding on the parties. Any such civil
action shall be submitted, heard and determined solely on the basis of the facts
found by the arbitrators. Neither of the parties shall, or shall be entitled to,
submit any additional or different facts for consideration by the court. In the
event any civil action is commenced under this paragraph (b), the party who
prevails or substantially prevails (as determined by the court) in such civil
action shall be entitled to recover from the other party all costs, expenses and
reasonable attorneys' fees incurred by the prevailing party in connection with
such action and on appeal.
(j) Except as limited by paragraph (b) above, the parties agree that
judgment upon the award rendered by the arbitrators may be entered in any court
of competent jurisdiction. In the event legal proceedings are commenced to
enforce the rights awarded in an arbitration proceeding, the party who prevails
or substantially prevails in such legal proceeding shall be entitled to recover
from the other party all costs, expenses and reasonable attorneys' fees incurred
by the prevailing party in connection with such legal proceeding and on appeal.
(k) Except as provided above, (i) no legal action may be brought by
either party with respect to any Dispute and (ii) all Disputes shall be
determined only in accordance with the procedures set forth above.
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ARTICLE VII
MISCELLANEOUS
7.1 NO MITIGATION OR OFFSET
The provisions of this Agreement are not intended to, nor shall they be
construed to, require that Employee mitigate the amount of any payment provided
for in this Agreement by seeking or accepting other employment, nor shall the
amount of any payment provided for in this Agreement be reduced by any
compensation earned by Employee as the result of employment by another employer
or otherwise. Without limitation of the foregoing, the Company's obligations to
make the payments to Employee required under this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any set off,
counterclaim, recoupment, defense or other claim, right or action that the
Company may have against Employee, except that the Company may deduct from any
amount required to be reimbursed to the Company by Employee under Section 4.10
or Article VI(a) the amount of any payment which the Company is then required to
make to Employee hereunder.
7.2 ASSIGNABILITY
The obligations of Employee hereunder are personal and may not be
assigned or delegated by Employee or transferred in any manner whatsoever, nor
are such obligations subject to involuntary alienation, assignment or transfer.
The Company shall have the right to assign this Agreement and to delegate all
rights, duties and obligations hereunder as provided in Section 7.5.
7.3 NOTICES
All notices and all other communications provided for in the Agreement
shall be in writing and addressed (i) if to the Company, at its principal office
address or such other address as it may have designated by written notice to
Employee for purposes hereof, directed to the attention of the President with a
copy to the Secretary of the Company and (ii) if to Employee, at Employee's
residence address on the records of the Company or to such other address as
Employee may have designated to the Company in writing for purposes hereof. Each
such notice or other communication shall be deemed to have been duly given when
delivered or mailed by United States registered mail, return receipt requested,
postage prepaid, except that any notice of change of address shall be effective
only upon receipt.
7.4 SEVERABILITY
The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.
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7.5 SUCCESSORS: BINDING AGREEMENT
(a) The Company will require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or substantially all of
the business or assets of the Company, by agreement in form and substance
reasonable acceptable to Employee, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place. Failure of the
Company to obtain such agreement prior to the effectiveness of any such
succession shall be a breach of this Agreement. As used herein, the term
"Company" shall include any successor to its business and/or assets as aforesaid
which executes and delivers the Agreement provided for in this Section 7.5 or
which otherwise becomes bound by all terms and provisions of this Agreement by
operation of law.
(b) This Agreement and all rights of Employee hereunder shall inure to
the benefit of and be enforceable by Employee's personal or legal
representatives, executors, administrators, successors, heirs, distributes,
devisees and legatees. If Employee should die while any amounts would be payable
to Employee hereunder if Employee had continued to live, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to Employee's devisee, legatee, or other designee or, if there be
no such designee, to Employee's estate.
7.6 TAX MATTERS.
The Company shall withhold from all payments hereunder all applicable
taxes (federal, state or other) which it is required to withhold therefrom
unless Employee has otherwise paid (or made other arrangements satisfactory) to
the Company the amount of such taxes.
7.7 AMENDMENTS AND WAIVERS
No provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing and signed by Employee
and the President. No waiver by either party hereto at any time of any breach by
the other party hereto of, or in compliance with, any condition or provision of
this Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time.
7.8 ENTIRE AGREEMENT, TERMINATION OF OTHER AGREEMENTS
This Agreement is an integration of the parties' agreement and no
agreement or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party which are
not set forth expressly in this Agreement.
7.9 GOVERNING LAW
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THE VALIDITY, INTERPRETATION, CONSTRUCTION AND PERFORMANCE OF THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF MARYLAND WITHOUT REGARD
TO ITS CONFLICT OF LAWS PROVISION.
7.10 COUNTERPARTS
This Agreement may be executed in or more counterparts, each of which
shall be deemed to be an original, but all of which together will constitute one
and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date first above written.
AMERICAN CAPITAL STRATEGIES, LTD.
By:
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Xxxxx Xxxxxx, Chief Executive Officer
EMPLOYEE:
------------------------------------------
Xxx Xxxxxx
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EXHIBIT 4.5(D)
RELEASE AGREEMENT
THIS RELEASE AGREEMENT (the "Agreement"), is made as of the ____
day of ______, _____, by and between AMERICAN CAPITAL STRATEGIES, LTD., a
Delaware corporation with its principal place of business at 2 Bethesda Metro
Center, 14th Floor, Bethesda, Maryland (the "Corporation"), and XXX XXXXXX, an
individual ("Xxxxxx").
W I T N E S S E T H:
WHEREAS, the parties hereto are parties to a certain Employment
Agreement dated as of May 16, 2001 (the "Employment Agreement"); and
WHEREAS, the execution and delivery of this Release Agreement as of
the date hereof is a requirement of Section 4.5(d) thereof.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
agreements and covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
1. MUTUAL RELEASE.
(a) Xxxxxx, on his own behalf and on behalf of his heirs,
representatives and assigns, hereby waives, releases, and forever and
irrevocably discharges the Corporation, and its agents, attorneys, officers,
directors, employees, successors and assigns (collectively, the "Corporation
Released Parties") from any and all obligations, debts, demands, claims and
liabilities of every kind and nature, either in law or in equity, that Xxxxxx
may now have, may in the future have or may ever have had, against the
Corporation Released Parties arising in any manner from or in any manner
related, directly or indirectly, to Xxxxxx'x service or employment as a
director, officer and/or an employee of the Corporation including, without
limitation, the circumstances relating to the termination thereof.
(b) The Corporation, on its own behalf and on behalf of its
successors and assigns, hereby waives, releases, and forever and irrevocably
discharges Xxxxxx, and his agents, attorneys, heirs, representatives and assigns
(collectively, the "Xxxxxx Released Parties") from any and all obligations,
debts, demands, claims and liabilities of every kind and nature, either in law
or in equity, that the Corporation may now have, may in the future have or may
ever have had against the Xxxxxx Released Parties arising in any manner from or
in any manner related to, directly or indirectly, Xxxxxx'x service or employment
as a director, officer and/or an employee of the Corporation including, without
limitation, the circumstances relating to the termination thereof.
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2. MISCELLANEOUS. This Agreement constitutes the entire agreement
between the parties hereto with regard to the subject matter hereof and
supersedes all prior negotiations, representations and agreements, either
written or oral, between them except for the Surviving Agreements. There are no
conditions, agreements, or representations between the parties except those
expressed herein. This Agreement may be altered, modified, amended, or repealed
only by a duly executed written instrument signed by the parties hereto. This
Agreement shall be governed by the law of the State of Maryland, without giving
effect to the conflicts of laws provisions thereof. Each party binds himself or
itself and his or its heirs, successors, legal representatives and assigns in
respect to all covenants and agreements contained herein. Except as specifically
contemplated herein, nothing herein shall be construed as giving any right or
benefit hereunder to anyone other than the parties hereto.
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IN WITNESS WHEREOF, the parties have executed this Agreement under
seal as of the date first hereinabove written.
XXXXXX:
WITNESS:
(Seal)
------------------------- --------------------------------
Xxx Xxxxxx
AMERICAN CAPITAL STRATEGIES, LTD.,
A Delaware Corporation
By: (Seal)
------------------------------
Name:
---------------------
Title
---------------------
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