EXECUTIVE EMPLOYMENT AGREEMENT
Exhibit 10.2
This
EXECUTIVE EMPLOYMENT AGREEMENT (the “Agreement”) is effective as of January 1,
2007 (the “Effective Date”) between Kaman Corporation, a Connecticut corporation
(the “Company”), and Xxxxxx X. Xxxxxxx (the “Executive”).
W
I T N E S S E T H:
WHEREAS,
the Executive is currently employed as the Executive Vice President and Chief
Financial Officer of the Company;
WHEREAS,
the Company has offered to continue employing the Executive on the terms set
forth below; and
WHEREAS,
the Executive has agreed to continued employment with the Company on the terms
as set forth below;
NOW
THEREFORE, in consideration of the foregoing, of the mutual promises contained
herein and of other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. EMPLOYMENT
TERM.
The
Executive’s term of employment under this Agreement shall be for a term
commencing on the Effective Date and, unless terminated earlier as provided
in
Section 7 hereof, ending on the planned Retirement Eligibility Date (such term
of employment is herein referred to as the “Employment Term”).
2. POSITION
& DUTIES.
(a) The
Executive shall serve as the Company’s Executive Vice President and Chief
Financial Officer under this Agreement during the Employment Term. As Executive
Vice President and Chief Financial Officer, the Executive shall have such
duties, authorities and responsibilities commensurate with the duties,
authorities and responsibilities of persons in similar capacities in similarly
sized companies, such additional duties as set forth in Appendix B and such
other duties and responsibilities as the Company’s Board of Directors (the
“Board”) shall designate that are consistent with the Executive’s positions as
Executive Vice President and Chief Financial Officer.
(b) During
the Employment Term, the Executive shall use the Executive’s best reasonable
efforts to perform faithfully and efficiently the duties and responsibilities
assigned to the Executive hereunder (including applicable obligations under
state law) and devote substantially all of the Executive’s business time
(excluding periods of vacation and other approved leaves of absence) to the
performance of the Executive’s duties with the Company, provided the foregoing
shall not prevent the Executive from (i) participating in charitable, civic,
educational, professional, community or industry affairs or, with prior written
approval of the Board, serving on the board of directors or advisory boards
of
other companies; and (ii) managing the Executive’s and the Executive’s family’s
personal investments so long as such activities do not materially interfere
with
the performance of the Executive’s duties hereunder or create a potential
business conflict or the appearance thereof. If at any time service on any
board
of directors or advisory board would, in the good faith judgment of the Board,
conflict with the Executive’s fiduciary duty to the Company or create any
appearance thereof, the Executive shall promptly resign from such other board
of
directors or advisory board after written notice of the conflict is received
from the Board.
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(c) The
Executive further agrees to serve without additional compensation as an officer
and director of any of the Company’s subsidiaries and agrees that any amounts
received from any such corporation may be offset against the amounts due
hereunder.
3. BASE
SALARY. The Company agrees to pay the Executive a base salary (the “Base
Salary”) during the Employment Period at an annual rate of $575,000 (subject to
possible increase if the Board, in its sole discretion, so determines), payable
in accordance with the regular payroll practices of the Company, but not less
frequently than monthly.
4. BONUSES.
The Executive shall be eligible to participate in the Company’s bonus and other
short- and long-term incentive compensation plans and programs for the Company’s
senior executives at a level commensurate with the Executive’s position during
the Employment Term. The Executive shall have the opportunity to earn an annual
target bonus measured against performance criteria to be determined by the
Board
(or a committee thereof) of at least 60% of Base Salary as an initial target
bonus opportunity as described in the terms of the Company’s annual bonus plan
as then in effect. Except as provided under Section 8 of the Agreement, the
Executive shall receive payments with respect to the plans and programs
described in this Section 4 in accordance with the terms of such plans and
programs.
5. EQUITY
AWARDS. The Executive shall be eligible to receive additional grants of stock
options, stock appreciation rights, restricted stock and other equity awards
at
the sole discretion of the Board or the Personnel and Compensation Committee
(the “Committee”). The Executive shall be subject to, and shall comply with, the
Company’s stock ownership guidelines (unless waived by the Compensation
Committee) and the Company’s reasonable policies regarding forfeitures of cash
and equity incentive awards due to material financial restatements due to
executive misconduct, as may be in effect from time to time, it being agreed
that any such policies shall only be effective with respect to awards made
on or
after the Effective Date. If there is a Change in Control (as defined in the
Kaman Corporation 2003 Stock Incentive Plan in effect on the date hereof),
all
then outstanding unvested equity awards granted to the Executive (for example,
stock options, stock appreciation rights and restricted stock), whether under
this Agreement or otherwise, will fully vest and become non-forfeitable and
remain exercisable in accordance with the terms of the applicable Company
plans.
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6. EMPLOYEE
BENEFITS.
(a) BENEFIT
PLANS. The Executive shall be entitled to participate in all employee benefit
plans of the Company including, but not limited to, pension, thrift, profit
sharing, medical coverage, education, other retirement or welfare benefits
and
perquisites (as approved by the Committee) that the Company has adopted or
may
adopt, maintain or contribute to for the benefit of its senior executives at
a
level commensurate with the Executive’s positions subject to satisfying the
applicable eligibility requirements.
(b) VACATION.
The Executive shall be entitled to at least 5 weeks paid vacation per year.
Vacation may be taken at such times as the Executive elects with due regard
to
the needs of the Company. Unused vacation at the end of a calendar year shall
be
forfeited according to the Company's vacation policy.
(c) AUTOMOBILE.
The Company shall provide the Executive with a leased automobile as approved
by
the Committee as per the Company’s perquisites policy from time to
time.
(d) BUSINESS
AND ENTERTAINMENT EXPENSES. Upon presentation of appropriate documentation,
the
Executive shall be reimbursed in accordance with the Company’s expense
reimbursement policy for all reasonable and necessary business and entertainment
expenses incurred in connection with the performance of the Executive’s duties
hereunder.
(e) CERTAIN
AMENDMENTS. Nothing herein shall be construed to prevent the Company from
amending, altering, eliminating or reducing any plans, benefits or programs
so
long as the Executive continues to receive compensation and benefits consistent
with Sections 3 through 6.
(f) LIFETIME
LIFE INSURANCE. During the Employment Term and thereafter (regardless of the
reason for the termination of the Employment Term), the Company shall continue
to make regular periodic premium payments for life insurance coverage issued
under the Senior Executive Life Insurance Program for the remainder of the
Executive’s life.
(g) PRE-RETIREMENT
SURVIVOR ANNUITY. The Company will provide the Executive with a pre-retirement
survivor annuity under the Kaman Corporation Post-2004 Supplemental Employees’
Retirement Plan in substantially the form set forth in Appendix C.
7. TERMINATION.
The Executive’s employment and the Employment Term shall terminate on the first
of the following to occur:
(a) DISABILITY.
Upon written notice by the Company to the Executive of termination due to
Disability, while the Executive remains Disabled. For purposes of this
Agreement, “Disability” shall be deemed the reason for the termination by the
Company of the Executive’s employment, if, as a result of the Executive
incapacity due to physical or mental illness, the Executive shall have been
absent from fully performing the Executive’s duties with the Company for a
period of 6 consecutive months, the Company shall have provided a notice of
termination under this Section 7(a), and, within thirty days after such notice
being given, the Executive shall not have returned to the fully performing
the
Executive’s duties hereunder.
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(b) DEATH.
Automatically on the date of death of the Executive.
(c) CAUSE.
Immediately upon written notice by the Company to the Executive of a termination
for Cause. “Cause” shall mean (i) Executive’s conviction of (or a plea of guilty
or nolo contendere to) a felony or any crime involving moral turpitude,
dishonesty, fraud, theft or financial impropriety; or (ii) a determination
by a
majority of the Board in good faith that Executive has (A) willfully and
continuously failed to perform substantially the Executive’s duties (other than
any such failure resulting from the Executive’s Disability or incapacity due to
bodily injury or physical or mental illness), after a written demand for
substantial performance is delivered to the Executive by the Board that
specifically identifies the manner in which the Board believes that the
Executive has not substantially performed the Executive’s duties, (B) engaged in
illegal conduct, an act of dishonesty or gross misconduct, in each case which
is
in the course of the Executive’s employment and materially injurious to the
Company, or (C) willfully violated a material requirement of the Company’s code
of conduct or the Executive’s fiduciary duty to the Company. No act or failure
to act on the part of the Executive shall be considered “willful” unless it is
done, or omitted to be done, by the Executive in bad faith and without
reasonable belief that the Executive’s action or omission was in, or not opposed
to, the best interests of the Company. Notwithstanding
the foregoing, Cause shall not include any act or omission of which the Audit
Committee of the Board (or the full Board) has had actual knowledge of all
material facts related thereto for at least 90 days without asserting that
the
act or omission constitutes Cause.
(d) WITHOUT
CAUSE. Upon written notice by the Company to the Executive of an involuntary
termination without Cause and other than due to death or
Disability.
(e) GOOD
REASON. Upon written notice by the Executive to the Company of a termination
for
Good Reason, unless such events are corrected in all material respects by the
Company within 30 days following written notification by the Executive to the
Company, that the Executive intends to terminate the Executive’s employment
hereunder for one of the reasons set forth below. “Good Reason” shall mean,
without the Executive’s express written consent, the occurrence of any of the
following events:
(1) the
Company removing the Executive from the positions of Executive Vice President
and Chief Financial Officer (other
than for Cause);
(2) a
reduction of the Executive’s Base Salary, annual initial target bonus
opportunity or modified bonus opportunity to the extent the modification to
the
initial target bonus opportunity is adverse to the Executive relative to the
modification made to the initial target bonus opportunity of other senior
officers of the Executive’s business unit;
(3) a
failure to pay the Executive’s compensation or benefits provided or referred to
under this Agreement;
(4) the
Executive being required to relocate to a principal place of employment more
than 50 miles from the Executive’s principal place of employment with the
Company as of the Effective Date;
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(5) the
assignment of duties to the Executive that are materially inconsistent with
the
Executive’s positions as
Executive Vice President and Chief Financial Officer;
or
(6) the
Executive no longer being a direct report to the CEO of the
Company.
Notwithstanding
the foregoing, (i) a suspension of the Executive’s title and authority while on
administrative leave due to a reasonable belief that the Executive has engaged
in misconduct, whether or not the suspected misconduct constitutes Cause for
employment termination, shall not be considered “Good Reason”; provided that if
such leave is unpaid and either the Executive returns to full-time employment
under this Agreement or it is subsequently determined the Executive’s employment
is to be terminated without Cause, then the compensation and benefits that
would
have been payable during such leave will be paid as soon as reasonably
practicable with interest at the prime rate beginning as of the date such leave
commenced plus 100 basis points; (ii) an event shall not be considered Good
Reason if the Executive fails to deliver notice of termination for Good Reason
within 90 days of the Executive’s actual knowledge of the event, and (iii)
prospective changes to employee benefits (as defined in Section 6) for future
employment made on an across-the-board basis to all similarly situated
executives of the Company and its subsidiaries shall not be considered Good
Reason.
(f) WITHOUT
GOOD REASON. Upon 60 days’ prior written notice by the Executive to the Company
of the Executive’s termination of employment without Good Reason (which the
Company may, in its sole discretion, make effective earlier than any notice
date).
(g) RETIREMENT.
Upon remaining employed with the Company until at least the attainment of age
65
(the “Retirement Eligibility Date”). Nothing herein shall be construed as
limiting the Executive’s right, if any, to terminate employment prior to the
Retirement Eligibility Date and receive compensation and benefits, as
applicable, provided under the respective terms of the Company’s benefit
plans.
8. CONSEQUENCES
OF TERMINATION. Any termination payments made and benefits provided under this
Agreement to the Executive shall be in lieu of any termination or severance
payments or benefits for which the Executive may be eligible under any of the
plans, policies or programs of the Company or its affiliates as may be in effect
from time to time including but not limited to the Change in Control Agreement.
Except to the extent otherwise provided in this Agreement, all benefits,
including, without limitation, stock options, stock appreciation rights,
restricted stock units and other awards under the Company’s long-term incentive
programs, shall be subject to the terms and conditions of the plan or
arrangement under which such benefits accrue, are granted or are awarded.
Subject to Section 9, the following amounts and benefits shall be due to the
Executive.
(a) DISABILITY.
Upon employment termination due to Disability, the Company shall pay or provide
the Executive (i) any unpaid Base Salary through the date of termination and
any
accrued vacation in accordance with Company policy; (ii) any unpaid bonus or
other short-term and long-term incentive compensation as described in Section
4
above earned with respect to any completed fiscal year; (iii) reimbursement
for
any unreimbursed expenses incurred through the date of termination; (iv) all
other payments and benefits to which the Executive may be entitled under the
terms of any applicable compensation arrangement or benefit, equity or
perquisite plan or program or grant or this Agreement, including but not limited
to any applicable pension, retirement and insurance benefits (collectively,
“Accrued Amounts”). Executive will also be paid a pro-rata portion of the
Executive’s annual bonus for the performance year in which the Executive’s
termination occurs, payable at the time that annual bonuses are paid to other
senior executives (determined by multiplying the amount the Executive would
have
received had employment continued through the end of the performance year by
a
fraction, the numerator of which is the number of days during the performance
year of termination that the Executive is employed by the Company and the
denominator of which is 365).
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(b) DEATH.
In
the event the Employment Term ends on account of the Executive’s death, the
Executive’s estate (or to the extent a beneficiary has been designated in
accordance with a program, the beneficiary under such program) shall be entitled
to any Accrued Amounts, including but not limited to proceeds from any Company
sponsored life insurance programs. Executive’s estate (or beneficiary) will also
be paid a pro-rata portion of the Executive’s annual bonus for the performance
year in which the Executive’s death occurs, payable at the time that annual
bonuses are paid to other senior executives (determined by multiplying the
amount the Executive would have received based upon target performance had
employment continued through the end of the performance year by a fraction,
the
numerator of which is the number of days during the performance year of
termination that the Executive is employed by the Company and the denominator
of
which is 365).
(c) TERMINATION
FOR CAUSE OR WITHOUT GOOD REASON. If the Executive’s employment should be
terminated (i) by the Company for Cause, or (ii) by the Executive without Good
Reason, the Company shall pay to the Executive any Accrued Amounts.
(d) TERMINATION
WITHOUT CAUSE OR FOR GOOD REASON.
If the
Executive’s employment by the Company is terminated by the Company other than
for Cause (other than a termination due to Disability or death) or by the
Executive for Good Reason, then the Company shall pay or provide the Executive
with:
(1) Accrued
Amounts;
(2) a
pro-rata portion of the Executive’s annual bonus for the performance year in
which the Executive’s termination occurs, payable at the time that annual
bonuses are paid to other senior executives (determined by multiplying the
amount the Executive would have received based upon actual financial performance
had employment continued through the end of the performance year by a fraction,
the numerator of which is the number of days during the performance year of
termination that the Executive is employed by the Company and the denominator
of
which is 365);
(3) an
amount
equal to the product of two times the sum of (i) the Executive’s then Base
Salary and (ii) the most recent annual bonus paid to the Executive (or awarded
by the Board or the Committee for the preceding calendar year if not then paid),
payable in a single lump sum commencing on the earliest payroll date that does
not result in adverse tax consequences to Executive under Section 409A of the
Code. Notwithstanding the foregoing, if the Executive terminates employment
within two years of his Retirement Eligibility Date, the lump sum amount
described in the immediately preceding sentence shall be reduced by multiplying
it by a fraction, the numerator of which is the number of days from the
Executive’s employment termination date until the Retirement Eligibility Date,
and the denominator of which is 730;
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(4) each
cash-based long-term performance award for which the performance period has
not
yet been completed as of the date of such termination
shall be
deemed fully vested and fully earned and then shall be cancelled in exchange
for
a cash payment equal to 100% of the target value of such award multiplied by
a
fraction, the numerator which is the number of days the Executive remained
employed with the Company during the award’s performance period and the
denominator of which is the total number of days during the award’s performance
period;
(5) title
to
the Company automobile to the Executive on an “as is” basis, with the
automobile’s fair market value being taxable to the Executive; and
(6) subject
to the Executive’s continued co-payment of premiums, if required under Company
policy, continued participation for 24 months but in no event later than the
Retirement Eligibility Date in all medical, dental and vision plans which cover
the Executive (and eligible dependents) upon the same terms and conditions
(except for the requirements of the Executive’s continued employment) in effect
for active employees of the Company. In the event the Executive obtains other
employment that offers substantially similar or improved benefits, as to any
particular medical, dental or vision plan, such continuation of coverage by
the
Company for such similar or improved benefit under such plan under this
subsection shall immediately cease. The continuation of health benefits under
this subsection shall reduce and count against the Executive’s rights under the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“COBRA”).
(e) RETIREMENT.
If the Executive terminates employment on or following the Executive’s
Retirement Eligibility Date, the Company shall pay to the
Executive:
(1) any
Accrued Amounts;
(2) a
pro-rata portion of the Executive’s annual bonus for the performance year in
which the Executive’s retirement occurs, payable at the time that annual bonuses
are paid to other senior executives (determined by multiplying the amount the
Executive would have received based upon actual financial performance had
employment continued through the end of the performance year by a fraction,
the
numerator of which is the number of days during the performance year of
termination that the Executive is employed by the Company and the denominator
of
which is 365);
(3) each
cash-based long-term performance award for which the performance period has
not
yet been completed as of the date of such termination shall be deemed fully
vested and fully earned and then shall be cancelled in exchange for a cash
payment within 10 business days after the date of the Executive's retirement
with payment equal to 100% of the target value of such award multiplied by
a
fraction, the numerator which is the number of days the Executive remained
employed with the Company during the award’s performance period and the
denominator of which is the total number of days during the award’s performance
period;
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(4) title
to
the Company automobile to the Executive on an “as is” basis, with the
automobile’s fair market value being taxable to the Executive; and
(5) the
Executive shall be considered to have “retired” on the Executive’s date of
termination of employment with the Company on or following the Executive’s
Retirement Eligibility Date for purposes of any plans, programs, agreements
or
arrangements with the Company or its affiliates.
(f) ACCELERATION
OF EQUITY AWARDS
If
the
Executive's employment by the Company is terminated by the Company for
Disability (as defined in Section 7 (a)) or without Cause (as defined in Section
7(c)), or by the Executive for Good Reason (as defined in Section 7(e)),
Retirement (as defined in Section 7(g)) or due to death, all then outstanding
unvested equity awards granted to the Executive (for example, stock options,
stock appreciation rights and restricted stock), whether under this Agreement
or
otherwise, will fully vest and become non-forfeitable and remain exercisable
in
accordance with the terms of the applicable Company plans.
(g) COORDINATION
WITH CHANGE IN CONTROL AGREEMENT.
9. CONDITIONS.
Any payments or benefits made or provided pursuant to Section 8 (other than
Accrued Amounts) are subject to the Executive’s:
(a) compliance
with the provisions of Section 11 hereof;
(b) delivery
to the Company of an executed Agreement and General Release (the “General
Release”), which shall be substantially in the form attached hereto as Appendix
A (with such changes therein or additions thereto as needed under then
applicable law to give effect to its intent and purpose) within 21 days of
presentation thereof by the Company to the Executive; and
(c) delivery
to the Company of a resignation from all offices, directorships and fiduciary
positions with the Company, its affiliates and employee benefit
plans.
For
purposes of any payments or benefits provided under Section 8 (other than
Accrued Amounts) to an Executive’s beneficiary or estate, the beneficiary or
estate shall comply with the provisions of Section 9(b) and Section
11(e).
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Notwithstanding
the due date of any post-employment payments, any amounts due following a
termination under this Agreement (other than Accrued Amounts) shall not be
due
until after the expiration of any revocation period applicable to the General
Release without the Executive having revoked such General Release, and any
such
amounts shall be paid to the Executive within ten (10) days of the expiration
of
such revocation period without the occurrence of a revocation by the Executive
(or such later date as may be required under Section 409A of the Code in
accordance with Section 20 hereof). Nevertheless (and regardless of whether
the
General Release has been executed by the Executive), upon any termination of
Executive’s employment, Executive shall be entitled to receive any Accrued
Amounts, payable within thirty (30) days after the date of termination of
employment or in accordance with the applicable plan, program or policy. In
the
event that the Executive dies before all payments pursuant to this Section
9
have been paid, all remaining payments shall be made to the beneficiary
specifically designated by the Executive in writing prior to the Executive’s
death, or, if no such beneficiary was designated (or the Company is unable
in
good faith to determine the beneficiary designated), to the Executive’s personal
representative or estate.
10. SECTION
4999 EXCISE TAX. The Company shall provide the Executive with a “Gross-Up
Payment”, as defined in the Change in Control Agreement between the Company and
the Executive effective as of January 1, 2007, in the event that any payment
made under this Agreement is subject to excise tax under Section 4999 of the
Code and the Change in Control Agreement does not apply to such
payment.
11. POST-EMPLOYMENT
OBLIGATIONS
(a) CONFIDENTIALITY.
The Executive agrees that the Executive shall not, directly or indirectly,
use,
make available, sell, disclose or otherwise communicate to any person, other
than in the course of the Executive’s employment and for the benefit of the
Company, either during the period of the Executive’s employment or at any time
thereafter, any nonpublic, proprietary or confidential information, knowledge
or
data relating to the Company, any of its subsidiaries, affiliated companies
or
businesses, which shall have been obtained by the Executive during the
Executive’s employment by the Company. The foregoing shall not apply to
information that (i) was known to the public prior to its disclosure to the
Executive; (ii) becomes known to the public subsequent to disclosure to the
Executive through no wrongful act of the Executive or any representative of
the
Executive; or (iii) the Executive is required to disclose by applicable law,
regulation or legal process (provided that the Executive provides the Company
with prior notice of the contemplated disclosure and reasonably cooperates
with
the Company at its expense in seeking a protective order or other appropriate
protection of such information). Notwithstanding clauses (i) and (ii) of the
preceding sentence, the Executive’s obligation to maintain such disclosed
information in confidence shall not terminate where only portions of the
information are in the public domain.
(b) NON-SOLICITATION.
In the event that the Executive receives severance benefits under Section 8(d)
of this Agreement, the Executive agrees that for the two (2) year period
following the date of termination the Executive will not, directly or
indirectly, individually or on behalf of any other person, firm, corporation
or
other entity, knowingly solicit, aid or induce any managerial level employee
of
the Company or any of its subsidiaries or affiliates to leave such employment
in
order to accept employment with or render services to or with any other person,
firm, corporation or other entity unaffiliated with the Company or knowingly
take any action to materially assist or aid any other person, firm, corporation
or other entity in identifying or hiring any such employee (provided, that
the
foregoing shall not be violated by general advertising not targeted at Company
employees nor by serving as a reference for an employee with regard to an entity
with which the Executive is not affiliated). For the avoidance of doubt, if
a
managerial level employee on his or her own initiative contacts the Executive
for the primary purpose of securing alternative employment, any action taken
by
the Executive thereafter shall not be deemed a breach of this Section 11(b).
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(c) NON-COMPETITION.
The Executive acknowledges that the Executive performs services of a unique
nature for the Company that are irreplaceable, and that the Executive’s
performance of such services to a competing business will result in irreparable
harm to the Company. Accordingly, in the event that the Executive receives
severance benefits under Section 8(d) of this Agreement, the Executive agrees
that for a period of two (2) years following the date of termination, but not
later than the Executive's Retirement Eligibility Date, the Executive will
not,
directly or indirectly, become connected with, promote the interest of, or
engage in any other business or activity competing with the business of the
Company within the geographical area in which the business of the Company is
conducted.
(d) NON-DISPARAGEMENT.
Each of the Executive and the Company (for purposes hereof, “the Company” shall
mean only (i) the Company by press release or otherwise and (ii) the executive
officers and directors thereof and not any other employees) agrees not to make
any public statements that disparage the other party, or in the case of the
Company, its respective affiliates, officers, directors, products or services.
Notwithstanding the foregoing, statements made in the course of sworn testimony
in administrative, judicial or arbitral proceedings (including, without
limitation, depositions in connection with such proceedings) or otherwise as
required by law shall not be subject to this Section 11(d).
(e) RETURN
OF
COMPANY PROPERTY AND RECORDS. The Executive agrees that upon termination of
the
Executive’s employment, for any cause whatsoever, the Executive will surrender
to the Company in good condition (reasonable wear and tear excepted) all
property and equipment belonging to the Company and all records kept by the
Executive containing the names, addresses or any other information with regard
to customers or customer contacts of the Company, or concerning any proprietary
or confidential information of the Company or any operational, financial or
other documents given to the Executive during the Executive’s employment with
the Company.
(f) COOPERATION.
The Executive agrees that, following termination of the Executive’s employment
for any reason, the Executive shall upon reasonable advance notice, and to
the
extent it does not interfere with previously scheduled travel plans and does
not
unreasonably interfere with other business activities or employment obligations,
assist and cooperate with the Company with regard to any matter or project
in
which the Executive was involved during the Executive’s employment, including
any litigation. The Company shall compensate the Executive for any lost wages
(or, if the Executive is not then employed, provide reasonable compensation
as
determined by the Compensation Committee) and expenses associated with such
cooperation and assistance.
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(g) ASSIGNMENT
OF INVENTIONS. The Executive will promptly communicate and disclose in writing
to the Company all inventions and developments including software, whether
patentable or not, as well as patents and patent applications (hereinafter
collectively called “Inventions”), made, conceived, developed, or purchased by
the Executive, or under which the Executive acquires the right to grant licenses
or to become licensed, alone or jointly with others, which have arisen or
jointly with others, which have arisen or which arise out of the Executive’s
employment with the Company, or relate to any matters directly pertaining to,
the business of the Company or any of its subsidiaries. Included herein as
if
developed during the employment period is any specialized equipment and software
developed for use in the business of the Company. All of the Executive’s right,
title and interest in, to, and under all such Inventions, licenses, and right
to
grant licenses shall be the sole property of the Company. As to all such
Inventions, the Executive will, upon request of the Company execute all
documents which the Company deems necessary or proper to enable it to establish
title to such Inventions or other rights, and to enable it to file and prosecute
applications for letters patent of the United States and any foreign country;
and do all things (including the giving of evidence in suits and other
proceedings) which the Company deems necessary or proper to obtain, maintain,
or
assert patents for any and all such Inventions or to assert its rights in any
Inventions not patented.
(h) EQUITABLE
RELIEF AND OTHER REMEDIES. The parties acknowledge and agree that the other
party’s remedies at law for a breach or threatened breach of any of the
provisions of this Section would be inadequate and, in recognition of this
fact,
the parties agree that, in the event of such a breach or threatened breach,
in
addition to any remedies at law, the other party, without posting any bond,
shall be entitled to obtain equitable relief in the form of specific
performance, temporary restraining order, a temporary or permanent injunction
or
any other equitable remedy which may then be available.
(i) REFORMATION.
If it is determined by a court of competent jurisdiction in any state that
any
restriction in this Section 11 is excessive in duration or scope or is
unreasonable or unenforceable under the laws of that state, it is the intention
of the parties that such restriction may be modified or amended by the court
to
render it enforceable to the maximum extent permitted by the law of that
state.
(j) SURVIVAL
OF PROVISIONS. The obligations contained in this Section 11 shall survive the
termination or expiration of the Executive’s employment with the Company and
shall be fully enforceable thereafter.
12. NO
ASSIGNMENT.
(a) This
Agreement is personal to each of the parties hereto. Except as provided in
Section 12(b) below, no party may assign or delegate any rights or obligations
hereunder without first obtaining the written consent of the other party
hereto.
(b) The
Company may assign this Agreement to any successor to all or substantially
all
of the business and/or assets of the Company provided the Company shall require
such successor to expressly assume and agree in writing 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 and shall deliver
a
copy of such assignment to the Executive.
11
13. NOTICE.
For the purpose of this Agreement, notices and all other communications provided
for in this Agreement shall be in writing and shall be deemed to have been
duly
given (a) on the date of delivery if delivered by hand, (b) on the date of
transmission, if delivered by confirmed facsimile, (c) on the first business
day
following the date of deposit if delivered by guaranteed overnight delivery
service, or (d) on the fourth business day following the date delivered or
mailed by United States registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:
If
to the
Executive: at the address (or to the facsimile number) shown on the records
of
the Company
If
to the
Company:
Kaman
Corporation
0000
Xxxx
Xxxxx Xxxxxx, X.X. Xxx 0
Xxxxxxxxxx,
XX 00000
Attention:
Xxxxxxx X. Xxxxx, Esq.
Facsimile
No.: 000 000-0000
or
to
such other address as either party may have furnished to the other in writing
in
accordance herewith, except that notices of change of address shall be effective
only upon receipt.
14. SECTION
HEADINGS; INCONSISTENCY. The section headings used in this Agreement are
included solely for convenience and shall not affect, or be used in connection
with, the interpretation of this Agreement. Except as provided in the last
sentence of Section 15 hereof, if there is any inconsistency between this
Agreement and any other agreement (including but not limited to any option,
stock, long-term incentive or other equity award agreement), plan, program,
policy or practice (collectively, “Other Provision”) of the Company the terms of
this Agreement shall control over such Other Provision.
15. PRIOR
AGREEMENTS. This Agreement supersedes and replaces any and all prior employment
agreements (collectively, the “Prior Agreements”) between the Company and the
Executive. By signing this Agreement, the Executive acknowledges that the Prior
Agreements are terminated and cancelled, and releases and discharges the Company
from any and all obligations and liabilities heretofore or now existing under
or
by virtue of such Prior Agreements, it being the intention of the parties hereto
that this Agreement effective immediately shall supersede and be in lieu of
the
Prior Agreements. It is specifically acknowledged by the Company that this
Agreement does not supersede the Change in Control Agreement or any existing
employee benefits as described in Section 6 above or otherwise provided by
the
Company or its affiliates.
16. SEVERABILITY.
The provisions of this Agreement shall be deemed severable and the invalidity
of
unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof.
12
17. COUNTERPARTS.
This Agreement may be executed in counterparts, each of which shall be deemed
to
be an original but all of which together will constitute one and the same
instruments. One or more counterparts of this Agreement may be delivered by
facsimile, with the intention that delivery by such means shall have the same
effect as delivery of an original counterpart thereof.
18. ARBITRATION.
Any dispute or controversy arising under or in connection with this Agreement,
other than injunctive relief under Section 11(h) hereof or damages for breach
of
Section 11, shall be settled exclusively by arbitration, conducted before a
single arbitrator in Hartford, Connecticut administered by the American
Arbitration Association (“AAA”) in accordance with its Commercial Arbitration
Rules then in effect. The single arbitrator shall be selected by the mutual
agreement of the Company and the Executive, unless the parties are unable to
agree to an arbitrator, in which case, the arbitrator will be selected under
the
procedures of the AAA. The arbitrator will have the authority to permit
discovery and to follow the procedures that he/she determines to be appropriate.
The arbitrator will have no power to award consequential (including lost
profits), punitive or exemplary damages. The decision of the arbitrator will
be
final and binding upon the parties hereto. Judgment may be entered on the
arbitrator’s award in any court having jurisdiction.
19. MISCELLANEOUS.
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 the
Executive and such officer or director as may be designated by the Board. No
waiver by either party hereto at any time of any breach by the other party
hereto of, or 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. This Agreement together with all exhibits hereto sets forth the entire
agreement of the parties hereto in respect of the subject matter contained
herein. No agreements or representations, oral or otherwise, express or implied,
with respect to the subject matter hereof have been made by either party which
are not expressly set forth in this Agreement. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws
of
the State of Connecticut without regard to its conflicts of law
principles.
20. PAYMENT
OF COMPENSATION. The parties shall revisit this Agreement when the IRS issues
final regulations under Section 409A of the Code for the sole purpose of
determining whether any amendments are required in order to comply with such
regulations. The parties shall promptly agree in good faith on appropriate
provisions to avoid any material risk of noncompliance without materially
changing the economic value (to the Executive) or the cost (to the Company)
of
this Agreement including, if necessary, the deferral of any amount payable
hereunder upon separation from service to the first date such amount may be
paid
without incurring tax under Section 409A of the Code, in which case such payment
shall bear interest at the applicable federal rate under Section 1274 of the
Code. Notwithstanding the foregoing, the Company shall in no event be obligated
to indemnify the Executive for any taxes or interest that may be assessed by
the
IRS pursuant to Section 409A of the Code.
21. MITIGATION
OF DAMAGES. In no event shall the Executive be obliged to seek other employment
or take any other action by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement, nor shall the amount
of
any payment hereunder be reduced by any compensation earned by the Executive
as
a result of employment by another employer, except as set forth in this
Agreement.
13
22. REPRESENTATIONS.
The Executive represents and warrants to the Company that the Executive has
the
legal right to enter into this Agreement and to perform all of the obligations
on the Executive’s part to be performed hereunder in accordance with its terms
and that the Executive is not a party to any agreement or understanding, written
or oral, which could prevent the Executive from entering into this Agreement
or
performing all of the Executive’s obligations hereunder.
23. WITHHOLDING.
The Company may withhold from any and all amounts payable under this Agreement
such federal, state and local taxes as may be required to be withheld pursuant
to any applicable law or regulation.
24. SURVIVAL.
The respective obligations of, and benefits afforded to, the Company and
Executive which by their express terms or clear intent survive termination
of
Executive’s employment with the Company, including, without limitation, the
provisions of Sections 5 and 8 through 25, inclusive of this Agreement, will
survive termination of Executive’s employment with the Company, and will remain
in full force and effect according to their terms.
25. AGREEMENT
OF THE PARTIES. The language used in this Agreement will be deemed to be the
language chosen by the parties hereto to express their mutual intent, and no
rule of strict construction will be applied against any party hereto. Neither
Executive nor the Company shall be entitled to any presumption in connection
with any determination made hereunder in connection with any arbitration,
judicial or administrative proceeding relating to or arising under this
Agreement.
14
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement.
|
|
|
KAMAN
CORPORATION
|
|
By:
|
/s/ Xxxx
X. Xxxx
|
|
|
XXXX
X. XXXX
|
||
|
Its:
|
PRESIDENT
AND CHIEF EXECUTIVE OFFICER
|
|
|
Date:
|
2/20/07
|
|
|
XXXXXX
X. XXXXXXX
|
||
|
By:
|
/s/
Xxxxxx X. Xxxxxxx
|
|
|
Date:
|
February
20, 2007
|
|
15
APPENDIX
A
FORM
OF RELEASE
AGREEMENT
AND GENERAL RELEASE
Kaman
Corporation, its affiliates, subsidiaries, divisions, successors and assigns
in
such capacity, and the current, future and former employees, officers,
directors, trustees and agents thereof (collectively referred to throughout
this
Agreement as “Employer”), and Xxxxxx X. Xxxxxxx (“Executive”), the Executive’s
heirs, executors, administrators, successors and assigns (collectively referred
to throughout this Agreement as “Employee”) agree:
1. Last
Day of Employment.
Executive’s last day of employment with Employer is ______________. In addition,
effective as of DATE, Executive resigns from the Executive’s positions as
Executive Vice President and Chief Financial Officer of Employer and will not
be
eligible for any benefits or compensation after ________, including payments
under the Executive’s Change in Control Agreement, other than as specifically
provided in Sections 6 and 8 of the Executive Employment Agreement between
Employer and Executive effective as of January 1, 2007 (the “Employment
Agreement”).
Executive further acknowledges and agrees that, after DATE, the Executive will
not represent the Executive as being a director, employee, officer, trustee,
agent or representative of Employer for any purpose. In addition, effective
as
of DATE, Executive resigns from all offices, directorships, trusteeships,
committee memberships and fiduciary capacities held with, or on behalf of,
Employer or any benefit plans of Employer. These resignations will become
irrevocable as set forth in Section 3 below.
2. Consideration.
The parties acknowledge that this Agreement and General Release is being
executed in accordance with Section 9 of the Employment Agreement.
3. Revocation.
Executive may revoke this Agreement and General Release for a period of seven
(7) calendar days following the day Executive executes this Agreement and
General Release. Any revocation within this period must be submitted, in
writing, to Employer and state, “I hereby revoke my acceptance of our Agreement
and General Release.” The revocation must be personally delivered to Employer’s
Chief Legal Officer, or his/her designee, or mailed to Kaman Corporation, 0000
Xxxx Xxxxx Xxxxxx, X.X. Xxx 0, Xxxxxxxxxx, XX 00000, Attention Xxxxxxx Xxxxx,
and postmarked within seven (7) calendar days of execution of this Agreement and
General Release. This Agreement and General Release shall not become effective
or enforceable until the revocation period has expired. If the last day of
the
revocation period is a Saturday, Sunday, or legal holiday in Hartford,
Connecticut, then the revocation period shall not expire until the next
following day which is not a Saturday, Sunday, or legal holiday.
4. General
Release of Claim. Subject to the full satisfaction by the Employer of its
obligations under the Employment Agreement, Employee knowingly and voluntarily
releases and forever discharges Employer from any and all claims, causes of
action, demands, fees and liabilities of any kind whatsoever, whether known
and
unknown, against Employer, Employee has, has ever had or may have as of the
date
of execution of this Agreement and General Release, including, but not limited
to, any alleged violation of:
16
- Title
VII
of the Civil Rights Act of 1964, as amended;
- The
Civil
Rights Act of 1991;
- Sections
1981 through 1988 of Title 42 of the United States Code, as
amended;
- The
Employee Retirement Income Security Act of 1974, as amended;
- The
Immigration Reform and Control Act, as amended;
- The
Americans with Disabilities Act of 1990, as amended;
- The
Age
Discrimination in Employment Act of 1967, as amended;
- The
Older
Workers Benefit Protection Act of 1990;
- The
Worker Adjustment and Retraining Notification Act, as amended;
- The
Occupational Safety and Health Act, as amended;
- The
Family and Medical Leave Act of 1993;
-
Any
wage
payment and collection, equal pay and other similar laws, acts and statutes
of
the State of Connecticut;
-
Any
other
federal, state or local civil or human rights law or any other local, state
or
federal law, regulation or ordinance;
-
Any
public policy, contract, tort, or common law; or
-
Any
allegation for costs, fees, or other expenses including attorneys fees
incurred
in these matters.
Notwithstandinganything
herein to the contrary, the sole matters to which the Agreement and General
Release do not apply are: (i) Employee’s express rights under any pension
(including but not limited to any rights under the Kaman Corporation
Supplemental Retirement Plan) or claims for accrued vested benefits under
any
other employee benefit plan, policy or arrangement maintained by Employer
or
under COBRA and other Accrued Amounts (as such term is defined in the Employment
Agreement); (ii) Employee’s rights under the provisions of the Employment
Agreement which are intended to survive termination of employment; or (iii)
Employee’s rights as a stockholder.
5. No
Claims
Permitted. Employee waives Executive’s right to file any charge or complaint
against Employer arising out of Executive’s employment with or separation from
Employer before any federal, state or local court or any state or local
administrative agency, except where such waivers are prohibited by
law.
17
6. Affirmations.
Employee affirms Executive has not filed, has not caused to be filed, and is
not
presently a party to, any claim, complaint, or action against Employer in any
forum. Employee further affirms that the Executive has been paid and/or has
received all compensation, wages, bonuses, commissions, and/or benefits to
which
Executive may be entitled and no other compensation, wages, bonuses, commissions
and/or benefits are due to Executive, except as provided in Sections 6 and
8 of
the Employment Agreement. Employee also affirms Executive has no known workplace
injuries.
7. Cooperation;
Return of Property. In accordance with Section 11(f) of the Employment
Agreement, Employee agrees to reasonably cooperate with Employer and its counsel
in connection with any investigation, administrative proceeding or litigation
relating to any matter that occurred during Executive’s employment in which
Executive was involved or of which Executive has knowledge and Employer will
reimburse the Employee for any reasonable out-of-pocket travel, delivery or
similar expenses incurred and lost wages (or will provide reasonable
compensation if Executive is not then employed) in providing such service to
Employer. Employee represents that Executive has complied with Section 11(e)
of
the Employee Agreement regarding the return of property.
8. Governing
Law and Interpretation. This Agreement and General Release shall be governed
and
conformed in accordance with the laws of the State of Connecticut without regard
to its conflict of laws provisions. In the event Employee or Employer breaches
any provision of this Agreement and General Release, Employee and Employer
affirm either may institute an action to specifically enforce any term or terms
of this Agreement and General Release. Should any provision of this Agreement
and General Release be declared illegal or unenforceable by any court of
competent jurisdiction and should the provision be incapable of being modified
to be enforceable, such provision shall immediately become null and void,
leaving the remainder of this Agreement and General Release in full force and
effect. Nothing herein, however, shall operate to void or nullify any general
release language contained in the Agreement and General Release.
9. No
Admission of Wrongdoing. Employee agrees neither this Agreement and General
Release nor the furnishing of the consideration for this Release shall be deemed
or construed at any time for any purpose as an admission by Employer of any
liability or unlawful conduct of any kind.
10. Amendment.
This Agreement and General Release may not be modified, altered or changed
except upon express written consent of both parties wherein specific reference
is made to this Agreement and General Release.
11. Entire
Agreement. This Agreement and General Release sets forth the entire agreement
between the parties hereto and fully supersedes any prior agreements or
understandings between the parties; provided, however, that notwithstanding
anything in this Agreement and General Release, the provisions in the Employment
Agreement which are intended to survive termination of the Employment Agreement,
including but not limited to those contained in Section 11 thereof, shall
survive and continue in full force and effect. Employee acknowledges Executive
has not relied on any representations, promises, or agreements of any kind
made
to Executive in connection with Executive’s decision to accept this Agreement
and General Release.
18
EMPLOYEE
HAS BEEN ADVISED THAT EXECUTIVE HAS UP TO TWENTY-ONE (21) CALENDAR DAYS TO
REVIEW THIS AGREEMENT AND GENERAL RELEASE AND HAS BEEN ADVISED IN WRITING TO
CONSULT WITH AN ATTORNEY PRIOR TO EXECUTION OF THIS AGREEMENT AND GENERAL
RELEASE.
EMPLOYEE
AGREES ANY MODIFICATIONS, MATERIAL OR OTHERWISE, MADE TO THIS AGREEMENT AND
GENERAL RELEASE DO NOT RESTART OR AFFECT IN ANY MANNER THE ORIGINAL TWENTY-ONE
(21) CALENDAR DAY CONSIDERATION PERIOD.
HAVING
ELECTED TO EXECUTE THIS AGREEMENT AND GENERAL RELEASE, TO FULFILL THE PROMISES
SET FORTH HEREIN, AND TO RECEIVE THE SUMS AND BENEFITS SET FORTH IN THE
EMPLOYMENT AGREEMENT, EMPLOYEE FREELY AND KNOWINGLY, AND AFTER DUE
CONSIDERATION, ENTERS INTO THIS AGREEMENT AND GENERAL RELEASE INTENDING TO
WAIVE, SETTLE AND RELEASE ALL CLAIMS EXECUTIVE HAS OR MIGHT HAVE AGAINST
EMPLOYER.
IN
WITNESS WHEREOF, the parties hereto knowingly and voluntarily executed this
Agreement and General Release as of the date set forth below:
00
XXXXXXXX
X
ADDITIONAL
DUTIES
As
of the
Effective Date, Xx. Xxxxxxx’x duties include oversight responsibility for all
functions performed at corporate headquarters, including the information
systems, finance and tax, internal audit, treasury, shareholder relations,
public relations, human resources, risk management, and legal department
functions.
20
APPENDIX
C
PROVISIONS
REGARDING THE PRE-RETIREMENT SURVIVOR ANNUITY UNDER THE KAMAN CORPORATION
POST-2004 SUPPLEMENTAL EMPLOYEES’ RETIREMENT PLAN
2.22 Surviving
Annuitant
means
the individual or individuals entitled to receive payment under this Plan upon
the Participant's death, including any beneficiary designated by Xxxxxx X.
Xxxxxxx under Section 10.3 below.
4.5 Death
Benefit.
In the
event that a Participant dies before receiving payment of the benefits otherwise
payable under Article 4, the death benefit payable under this Plan shall be
the
same amount as if the Participant had Separated from Service the day immediately
before the Participant's death and been entitled to receive a payment with
respect to the amount calculated under Sections 4.1 through 4.4 under this
Plan
and the Prior Plan. The amount of the death benefit as determined under this
Section 4.5 shall be paid as provided in Article 5.
5.1 Benefits
Commencing before 2008.
Benefits payable under the Plan that commence before 2008 shall be paid in
the
same form and at the same time in which the Pension Benefit is actually paid
in
accordance with the terms of the Prior Plan as in effect on October 3, 2004.
Notwithstanding the foregoing, death benefits payable under Section 4.5 due
to a
Participant’s death at any time prior to receiving payment hereunder shall be
payable under Section 5.2 below.
5.2 Benefits
Commencing after 2007
(c) In
the
case of a Participant who dies before commencing benefits under the Plan but
with respect to whom a benefit is to be paid to the Participant’s surviving
Spouse, the surviving Spouse (or, in the case of Xx. Xxxxxxx, his then current
beneficiary under Section 10.3, if applicable) shall receive his or her benefit
under the Plan as of whichever of the following dates is
applicable:
(i) If
the
Participant dies on or after becoming eligible to have begun to receive a
benefit under the Plan, the surviving Spouse (or, in the case of Xx. Xxxxxxx,
his then current beneficiary under Section 10.3, if applicable) shall receive
his or her benefit under the Plan on the first day of the month next following
such Participant’s date of death.
(ii) If
the
Participant was not eligible to receive a benefit under the Plan on his or
her
date of death, the surviving Spouse (or, in the case of Xx. Xxxxxxx, his then
current beneficiary under Section 10.3, if applicable) shall receive his or
her
benefit under the Plan on the first day of the month on or next following the
first date on which the Participant could have begun to receive his or her
benefits under the Plan.
If
a
Participant’s Spouse (or in the case of Xx. Xxxxxxx, his then current
beneficiary under Section 10.3, if applicable) predeceases the Participant,
and
the Participant has not previously received payment of benefits under Article
4,
the benefits that would have been payable to the Participant’s Spouse (or in the
case of Xx. Xxxxxxx, his then current beneficiary under Section 10.3, if
applicable) under Section 5.2(c) as described above shall be payable to the
Participant’s estate.
5.3 Form
of Payment.
(b) In
the
event of a Participant’s death prior to a distribution of a lump sum payment
under this Plan, the Participant’s surviving Spouse (or in the case of Xx.
Xxxxxxx, his beneficiary under Section 10.3 below, if applicable) or the
Participant’s estate if there is no surviving Spouse (or in the case of Xx.
Xxxxxxx, his then current beneficiary under Section 10.3, if applicable,
predeceases him) shall receive the death benefit as described in Section 4.5
above in a single lump sum payment. Notwithstanding the foregoing, a change
of
beneficiary by Xx. Xxxxxxx under Section 10.3 after February 20, 2007 shall
not
impact the amount of the lump sum payable to Xx. Xxxxxxx during his lifetime.
10.3 Provisions
Relating Solely to Xxxxxx X. Xxxxxxx.
(a) If
Xxxxxx
X. Xxxxxxx dies without a surviving Spouse before commencing payment of his
benefits under the Plan, the Prior Plan or both, the Company shall pay a
pre-retirement death benefit in the form of a single lump sum payment to his
beneficiary.
(b) “Beneficiary”
for purposes of this Section 10.3 shall mean any individual or trust (other
than
an individual who is Xx. Xxxxxxx’x surviving Spouse at the date of his death)
designated by Xx. Xxxxxxx in accordance the rules of the Administrator as in
effect from time to time to receive the pre-retirement death benefit provided
hereunder. A beneficiary designated by Xx. Xxxxxxx shall be considered a
“Surviving Annuitant” for purposes of the Plan.
(c) Xx.
Xxxxxxx may change a beneficiary designation at any time by giving written
notice to the Administrator. Any change shall not be effective until received
by
the Administrator and the Administrator shall be fully protected in making
distributions in accordance with the latest beneficiary designation on file.
If
Xx. Xxxxxxx designates more than one beneficiary, the amount of the
pre-retirement death benefit, if any, to be divided among the beneficiaries
shall be determined based solely on the life of the oldest beneficiary.
21
