Exhibit 10.37
[Xxxxxxxx.xxx, Inc. Letterhead]
March 8, 2003
Re: Change in Control Voluntary Termination Benefits
Dear [Employee]:
The Board of Directors of Xxxxxxxx.xxx, Inc. (the "Company") recognizes
your importance to the Company and would like to alleviate any distractions you
may suffer in the event of a Change in Control of the Company. Accordingly, in
order to allay some of the uncertainty that you may be experiencing, the Company
has provided you with this agreement (the "Agreement"), which provides for a
lump-sum payment upon your voluntary termination of employment in connection
with a Change in Control, subject to the terms below. Only a select group of
employees has been offered this Agreement. Capitalized terms not otherwise
defined in this Agreement are defined in Exhibit A to this Agreement and, unless
otherwise indicated, the term "Company" shall also include the subsidiaries and
affiliates of Xxxxxxxx.xxx, Inc.
If a Change in Control occurs on or prior to May 31, 2004 and your
employment terminates upon your voluntary termination (or as a result of your
death or Disability) during the 90-day period commencing seventy-five (75) days
after such Change in Control, the Company shall pay to you, within ten (10) days
following such termination of employment, a lump-sum cash payment equal to five
(5) months of your Monthly Base Salary (the "Payment").
The Company reserves the right to terminate your employment at any time
with Cause or without Cause, subject to the terms of any other written
employment, consulting or similar agreement between you and the Company, and
subject to the terms of any severance plan or arrangement then in effect.
Non-Exclusivity of Rights. Nothing in this Agreement shall prevent or
limit your continuing or future participation in any benefit, bonus, incentive
or other plan, program, arrangement or policy provided by the Company for which
you and/or your dependents may qualify, including without limitation any Change
in Control severance program or individual agreement ("Change in Control Plan")
in which you are entitled to participate. Amounts that are vested benefits or
that you and/or your family are otherwise entitled to receive under any plan,
program, arrangement, or policy of the Company or any of its subsidiaries shall
be payable in accordance with such plan, program, arrangement or policy.
Notwithstanding anything herein to the contrary, if you are eligible to receive
a severance payment under the Change in Control Plan, you will not be eligible
for a Payment, and if you receive a Payment you will not receive payments under
a Change in Control Plan (unless you terminate your employment for "good reason"
as defined in a Change in Control Plan, in which event the Change in Control
Plan shall control and you shall receive in the aggregate, the greater of the
Payment and the amount provided under the Change in Control Plan).
No Set-Off; No Duty to Mitigate. The Company's obligation to make the
payments provided for in 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 which the Company may have against you
or others. In no event shall you be obligated to seek other employment or take
any other action by way of mitigation of the amounts payable to you under any of
the provisions of this Agreement.
[Employee]
March 8, 2003
Page -2-
Assumption. This letter shall be binding upon any successor of the Company
or its businesses (whether direct or indirect, by purchase, merger,
consolidation or otherwise), in the same manner and to the same extent that the
Company would be obligated under this Agreement if no succession had taken
place. In the case of any transaction in which a successor would not by the
foregoing provision or by operation of law be bound by this Agreement, the
Company shall require such successor expressly and unconditionally to assume and
agree to perform the Company's obligations under this Agreement, in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place. The term "Company," as used in this
Agreement, shall mean the Company as hereinbefore defined and any successor or
assignee to the business or assets which by reason hereof becomes bound by this
Agreement.
Miscellaneous. This letter agreement shall be governed by, and construed
in accordance with, the laws of the State of New York, without reference to its
conflict of law rules. All payments hereunder are subject to withholding for
applicable income and payroll taxes or otherwise as required by law.
XXXXXXXX.XXX, INC.
By:
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Title:
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Accepted and Acknowledged:
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Dated:
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EXHIBIT A
The following terms shall have the meaning set forth below when used in the
attached letter Agreement:
"Change in Control" means the occurrence of any of the following events on or
prior to May 31, 2004:
(i) The acquisition by any individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) (a "Person") of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of
either (x) the then outstanding shares of common stock of the Company (the
"Outstanding Company Common Stock") or (y) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the "Outstanding Company Voting Securities"); provided,
however, that for purposes of this subsection (i), the following acquisitions
shall not constitute a Change in Control: (A) any acquisition directly from the
Company, (B) any acquisition by the Company, (C) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company, or (D) any acquisition by any corporation
pursuant to a transaction which complies with clauses (A), (B) and (C) of
paragraph (iii) below; or
(ii) Individuals who, as of the Effective Date, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the Effective Date whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or
(iii) Consummation of a reorganization, merger, consolidation, sale or
other disposition of all or substantially all of the assets of the Company or an
acquisition of the assets of another entity (a "Business Combination"), in each
case, unless, following such Business Combination, (A) all or substantially all
of the individuals and entities who were the beneficial owners, respectively, of
the Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to consummation of such Business Combination beneficially own,
directly or indirectly, more than 50% of, respectively, the then outstanding
shares of Common stock and the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors (or
other governing body, if applicable), as the case may be, of the entity
resulting from such Business Combination (including, without limitation, an
entity which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to consummation of such Business Combination of the
Outstanding Company Common Stock and Outstanding Company Voting Securities, as
the case may be, (B) no Person (excluding any corporation resulting from such
Business Combination or any employee benefit plan (or related trust))
beneficially owns, directly or indirectly, 50% or more of, respectively, the
then outstanding shares of common stock of the entity resulting from such
Business Combination or of the combined voting power of the then outstanding
voting securities of such entity, except to the extent that such ownership
existed prior to consummation of the Business Combination, and (C) at least a
majority of the members of the board of directors (or other governing body, if
applicable) of the entity resulting from such Business Combination were members
of the Incumbent Board at the time of the execution of the initial agreement, or
of the action of the Board, providing for such Business Combination; or
(iv) Approval by the shareholders of the Company of a complete liquidation
or dissolution of the Company.
For purposes of this definition, "Company" shall be limited to Xxxxxxxx.xxx,
Inc.
"Disability" means your physical or mental injury which has prevented you from
performing your duties (as they existed immediately prior to the illness or
injury) on a full-time basis for one hundred eighty (180) consecutive days.
"Effective Date" means the date of this Agreement.
"Monthly Base Salary" means the higher of (i) your monthly base salary as in
effect immediately prior to the Change in Control and (ii) your highest monthly
base salary in effect at any time thereafter.
