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EXHIBIT 10.8
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement ("Agreement") is made
effective as of January 29, 1997 (the "Effective Date"), between Fiberite, Inc.,
a Delaware corporation, hereinafter referred to as "Fiberite," and Xxxxxx X.
Xxxxxx hereinafter referred to as "Employee."
In consideration of the promises and of the mutual covenants
contained herein, and for other good and valuable consideration, receipt of
which is hereby acknowledged, the parties hereto do hereby agree as follows:
1. Employment. Fiberite hereby affirms its employment of Employee, and
Employee hereby affirms such employment, upon the terms and subject to the
conditions set forth herein.
2. Duties. Employee is engaged in the positions of Vice President and
Chief Financial Officer of Fiberite. Employee shall faithfully and diligently
perform the duties customarily performed by persons in the positions for which
Employee is engaged, together with such other duties the Board of Directors of
Fiberite (the "Board") shall designate from time to time. As part of Employee's
duties, Employee acknowledges and understands that: (a) Employee will devote his
utmost knowledge and best skill to the performance of his duties; (b) Employee
shall devote his full business time to the rendition of such services, subject
to absences for customary vacations and for temporary illness; and (c) Employee
will not engage in any other gainful occupation which requires his personal
attention without prior consent of the Board with the exception that Employee
may personally trade in publicly traded stocks, bonds, commodities or real
estate investments for his own benefit.
3. Compensation.
3.1 Salary. As compensation for the proper and satisfactory
performance of all duties to be performed by Employee hereunder, Fiberite shall
pay Employee a salary of $150,000 per year plus an annual target bonus of
$60,000 during the employment term (as defined in Section 4 below) of this
agreement. The actual bonus paid will be a multiple of the target bonus amount,
with the multiple range from 0.0 to 2.0 as described in the Fiberite, Inc.
Management Incentive Compensation Plan.
3.2 Salary Increase and Bonus Plan. The Board shall develop
and implement a plan under which it, or a committee thereof, will evaluate
Employee's performance on not less than an annual basis and, if warranted, grant
Employee increases in Base Salary and/or additional bonus compensation based on
such evaluations. Any such increases should automatically be incorporated by
reference into this Agreement.
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3.3 Customary Fringe Benefits. Employee shall be entitled to
such fringe benefits as Fiberite customarily makes available to executive
employees of Fiberite ("Fringe Benefits"). Such Fringe Benefits may include
vacation leave, sick leave, and health insurance coverage.
4. Term. The employment term pursuant to this Agreement shall commence
on the Effective Date set forth above, and shall remain in effect until
Employee's employment is terminated in accordance with the provisions of Section
5 below. It is understood that Employee serves at the will of the Board of
Directors of the Company and that he shall be considered an "at will" Employee.
5. Termination. This Agreement and the employment of Employee shall
terminate under the following conditions:
5.1 Death. The death of Employee.
5.2 Disability. The permanent disability of Employee (permanent
disability shall exist when Employee suffers from a condition of mind or body
that indefinitely prevents Employee from satisfactory further performance of his
duties, even with reasonable accommodation, for a cumulative period of 120
business days in any consecutive 12-month period following the commencement of
employment).
5.3 Termination for Good Cause. Upon receipt by Employee of written
notice from Fiberite that Employee's employment is being terminated for "good
cause." Fiberite has "good cause" to terminate Employee's employment if Employee
has engaged in one or more of the following:
5.3.1 Commission of a felony which results in conviction.
5.3.2 Breach of the provisions of Section 8 hereof or of any
material provision of the Employee Inventions and Proprietary Rights Assignment
Agreement entered into between the Company and Employee ("Proprietary Rights
Agreement").
5.3.3 Cause material loss, damage or injury to or otherwise
materially endangered the property, reputation or employees of Fiberite.
5.4 Resignation. At any time during the term of this Agreement,
Employee may provide notice of his intent to resign. Employee is required to
provide two (2) months advance notice of his resignation. Fiberite may require
that Employee work for some or all of that notice period, but Fiberite must pay
Employee for the time he actually continues in the employment of Fiberite.
5.5 Termination for Other Than Good Cause. Fiberite may terminate
Employee's employment at any time without good cause, upon written notice
delivered to Employee that Employee's employment is being terminated for "other
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than good cause." It shall be deemed a termination by Fiberite without good
cause under this Section 5.5 if Employee (i) resigns within 30 days of the date
on which, without his consent, he no longer holds the positions of Vice
President and Chief Financial Officer of Fiberite, Inc., or (ii) resigns due to
his being required to relocate to a workplace outside Arizona.
6. Compensation Upon Termination.
6.1 Payment of Compensation Upon Termination for Good Cause. In the
event Employee is terminated for good cause, as set forth in Section 5.3, he
shall receive two weeks notice that his employment is terminated and Employee
shall be entitled only to the compensation set forth as Base Salary herein,
prorated through the date of said notice. When Employee is terminated for good
cause as defined in Section 5.3, Employee is entitled to no other severance
compensation arising out of this Agreement and out of his employment
relationship with Fiberite, and Employee shall permanently and absolutely
forfeit all rights to all other severance benefits otherwise accruing by reason
of Employee's employment by Fiberite.
6.2 Payment of Compensation Upon Termination Other Than for Good
Cause. In the event Employee's employment is terminated for other than good
cause, Employee shall receive severance compensation in an amount described
below, only if Employee executes a general release of claims, releasing any and
all claims Employee has against Fiberite arising out of his employment or the
termination of said employment. Employee is not entitled to any severance
compensation pursuant to this Section unless he signs the general release
described above. The severance compensation described in this Section shall be
six (6) monthly payments, commencing one (1) month after the effective date of
the termination, in arrears, of the then applicable Base Salary and benefits
plus one-twelfth of his prior year's bonus. Except as provided in Section 6.3,
Employee is entitled to no other severance compensation when his employment is
terminated for other than good cause.
6.3 Payment Upon Change in Control. If within six (6) months of a
Change in Control, as that term is defined herein, Employee's employment is
terminated for other than good cause or Employee refuses to accept or
voluntarily resigns from a position other than a Qualified Position, as that
term is defined herein, Employee shall receive additional severance compensation
in an amount equal to two (2) years of his then current Base Salary plus
applicable target bonus. A "Change in Control" means the acquisition, directly
or indirectly of more than 40% of the outstanding shares of any class of voting
securities of Fiberite by any person or entity that is not an existing
shareholder as of the Effective Date, or a merger, consolidation or sale of all
or substantially all of the assets of Fiberite, such that the individuals
constituting the Board of Fiberite immediately prior to such period shall cease
to constitute a majority the Board, unless the election of each director who was
not a director prior thereto was approved by vote of at least two-thirds of the
directors then in office who were directors prior to such period.
Notwithstanding the foregoing, an acquisition of the requisite percentage of
voting securities in connection
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with a public offering of securities by Fiberite for the primary purpose of
providing capital resources to Fiberite shall not be considered a "Change in
Control" for purposes of this Section 6.3. A "Qualified Position" is an
executive officer position with the entity surviving the Change in Control, with
substantially the same responsibilities as those held by the Vice President and
Chief Financial Officer of Fiberite as of the date of this Agreement, which
position reports directly to the Chief Executive Officer of Fiberite in place
immediately prior to the Change of Control. Also notwithstanding the foregoing,
if Fiberite determines that the amounts payable to Employee under this
Agreement, when considered together with any other amounts payable to Employee
as a result of a Change in Control, cause such payments to be treated as excess
parachute payments within the meaning of Section 280G of the Internal Revenue
Code, Fiberite shall reduce the amount payable to Employee under this Section
6.3 to an amount that will not subject Employee to the imposition of tax under
Section 4999 of the Internal Revenue Code. For purposes of this Section 6.3, the
term "Fiberite" includes both Fiberite, Inc. and Fiberite Holdings, Inc., in
that Employee will receive the aforementioned additional severance compensation
upon: (1) a Change of Control of either Fiberite, Inc. or Fiberite Holdings,
Inc. and (2) the other conditions set forth herein are met.
6.4 Payment Upon Death or Disability. In the event this Agreement
is terminated pursuant to Sections 5.1 or 5.2, Employee (or his estate in the
case of death) shall be entitled to a lump-sum payment equal to two (2) months
of Employee's then current Base Salary.
7. Arbitration/Sole Remedy for Breach of Agreement. In the event of any
dispute between Fiberite and Employee concerning any aspect of the employment
relationship, including any disputes upon termination, all such disputes shall
be resolved by binding arbitration before a single neutral arbitrator. The
arbitrator shall be selected from the American Arbitration Association. The
arbitrator is bound to rule only on whether or not there has been a violation of
the terms of this Agreement and to render an award, if any, that is consistent
with the terms of this Agreement. Neither party to this Agreement is entitled to
any legal recourse or rights or remedies other than those provided within this
Agreement. The Employee's sole remedies for claims arising out of his
employment, with the exception of workers' compensation remedies, are those set
forth in this Agreement. In the event of a termination of employment, the
arbitrator is limited to a determination of whether or not the discharge was for
good cause or for other than good cause. If an arbitration is brought for
something other than a termination of employment, the arbitrator is limited to
award contract damages. Fiberite shall bear the costs of the arbitration,
including arbitrator's fees and the reasonable fees of one counsel for Employee.
8. Covenant Not to Compete. Employee agrees that, during Employee's
employment, and during any period with respect to which payments to Employee are
made pursuant to Section 5.4, Employee will not directly or indirectly compete
with Fiberite in any way, or prepare to compete or assist any other person or
entity to compete with Fiberite in any way, and that Employee will not act as an
officer,
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director, employee, consultant, more than one-percent shareholder, significant
lender, or agent of any other entity which is engaged in any business of the
same nature as, or in competition with, the business in which Fiberite is now
engaged or in which Fiberite becomes engaged during the term of Employee's
employment.
9. General Provisions.
9.1 Payments. All payments due pursuant to the terms of this
Agreement shall be delivered in person, or by first-class mail, postage prepaid
to the last known address of the other party. Payments may be in lawful money of
the United States, or may be made by check, draft or warrant of the paying
entity. Any payments made pursuant to Section 5.4 or Section 6 hereof shall be
made by certified or cashier's check and shall be delivered pursuant to the
terms of Section 9.2.
9.2 Notices and Delivery. Any notices to be given hereunder by
either party to the other may be effected by either personal delivery in
writing, or by mail, registered or certified, postage prepaid with a return
receipt requested. Mailed notices shall be addressed to the other party to the
address appearing beneath the party's signature on this Agreement, but each
party may change its address by written notice in accordance with this
paragraph. Notices shall be deemed communicated as of the date of delivery.
9.3 Complete Agreement. Employee acknowledges receipt of this
Agreement and agrees that this Agreement, along with the Proprietary Rights
Agreement, represents the entire Agreement with Employer concerning the subject
matter hereof. This Agreement supersedes any and all other agreements, either
oral or in writing, between the parties hereto with respect to the matters
discussed herein of Employee and contains all of the covenants and agreements
between the parties with respect to the terms and conditions of Employee's
employment. Each party to this Agreement acknowledges that no representations,
inducements, promises or agreements, orally or otherwise, have been made by any
party or anyone acting on behalf of any party which are not embodied herein.
9.4 Severability. If any provision of this agreement is held
by a court of competent jurisdiction to be invalid, void or unenforceable, the
remaining provisions shall nevertheless continue in full force without being
impaired or invalidated in any way.
9.5 Other Benefits. Any amounts payable under this Agreement,
other than Base Salary, shall not be deemed salary or other compensation for the
purpose of computing benefits under any pension plan or other arrangement of
Fiberite for the benefit of its employees.
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9.6 No Waiver. Either party's failure to enforce any provision of this
Agreement shall not in any way be construed as a waiver of any such provision,
or prevent that party from thereafter enforcing each and every other provision,
or prevent that party from thereafter enforcing each and every other provision
of this Agreement.
9.7 Successors and Assigns. The rights and obligations of Fiberite
under this Agreement shall enure to the benefit of and shall be binding upon the
successors and assigns of Fiberite. Employee shall not be entitled to assign any
of his rights or obligations under this Agreement.
9.8 Applicable Law. This Agreement shall be interpreted, construed,
governed and enforced in accordance with the laws of the State of Delaware.
9.9 Amendments. No amendment or modification of the terms or conditions
of this Agreement shall be valid unless in subsequent writing and signed by the
parties thereto.
IN WITNESS WHEREOF, the parties hereto execute this Agreement,
effective as of the date first above written.
EMPLOYEE: FIBERITE, INC.
a Delaware corporation
/s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx Xxxxx X. Xxxxxx, Chief Executive Officer
Address: Address:
0000 Xx. Xxxxxx Xxxxx 0000 Xxxx Xxxxxxxxxx Xxxxxx
Xxx Xxxxx, XX 00000 Xxxxx, XX 00000
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