EXHIBIT 10.18
EXECUTION COPY
EMPLOYMENT AGREEMENT
(XXXXXX X. XXXXXX)
EMPLOYMENT AGREEMENT (the "AGREEMENT") dated December 23, 2004 by and
between XXXXXX-STANDARD AUTOMOTIVE INC. (the "COMPANY") and XXXXXX X. XXXXXX
(the "EXECUTIVE").
WHEREAS, the CSA Acquisition Corp. ("CSA"), the parent company of the
Company, has entered into the Stock Purchase Agreement among Xxxxxx Tire &
Rubber Company, Xxxxxx Tyre & Rubber Company UK Limited and the Company dated as
of September 16, 2004 (the "PURCHASE AGREEMENT");
WHEREAS, effective upon, and subject to the occurrence of, the Closing
on the Closing Date (each as defined in the Purchase Agreement), the Company
desires to employ Executive on the terms set forth in this Agreement and the
Executive desires to accept and continue such employment with the Company under
the terms of this Agreement.
NOW THEREFORE, in consideration of the premises and mutual covenants
herein and for other good and valuable consideration, the parties agree as
follows:
1. Effectiveness/Term of Employment.
a. This Agreement constitutes a binding obligation of the
parties as of the date hereof; provided that notwithstanding any other provision
of this Agreement, the operative provisions of this Agreement shall become
effective only upon the occurrence of the Closing on the Closing Date (as each
such term defined in the Purchase Agreement) (such date being hereinafter
referred to as the "EFFECTIVE DATE"). In the event the Purchase Agreement is
terminated for any reason without the Closing having occurred, or if the Closing
fails to occur on or prior to March 31, 2005, this Agreement shall be terminated
without further obligation or liability of either party.
b. Subject to the provisions of Section 7 of this Agreement,
Executive shall be employed by the Company for a period commencing on the
Effective Date and ending on December 31, 2007 (the "EMPLOYMENT TERM") on the
terms and subject to the conditions set forth in this Agreement; provided,
however, that commencing with December 31, 2007 and on each December 31
thereafter (each an "EXTENSION DATE"), the Employment Term shall be
automatically extended for an additional one-year period, unless the Company or
Executive provides the other party hereto 60 days prior written notice before
the next Extension Date that the Employment Term shall not be so extended.
2. Position.
a. During the Employment Term, Executive shall serve as the
Company's President, Global Sealing Division. In such position, Executive shall
have such duties and authority as is customarily associated with such position
at other privately held companies similar to the Company and shall have such
duties, consistent with Executive's
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position, as may be assigned from time to time by the Chief Executive Officer of
the Company (the "CEO") or the Board of Directors of the Company (the "BOARD").
b. During the Employment Term, Executive will devote
Executive's full business time and best efforts to the performance of
Executive's duties hereunder and will not engage in any other business,
profession or occupation for compensation or otherwise which would conflict or
interfere with the rendition of such services either directly or indirectly,
without the prior written consent of the Board; provided that nothing herein
shall preclude Executive, subject to the prior approval of the Board, from
accepting appointment to or continue to serve on any board of directors or
trustees of any business corporation or any charitable organization; provided in
each case, and in the aggregate, that such activities do not conflict or
interfere with the performance of Executive's duties hereunder or conflict with
Section 8.
3. Base Salary. During the Employment Term, the Company shall pay
Executive a base salary at the annual rate of $320,000, payable in regular
installments in accordance with the Company's usual payment practices. Executive
shall be entitled to such increases in Executive's base salary, if any, as may
be determined from time to time by the compensation committee of the Board,
based upon the recommendation of the CEO. Executive's annual base salary, as in
effect from time to time, is hereinafter referred to as the "BASE SALARY."
4. Bonus Incentives. With respect to each full fiscal year during the
Employment Term, Executive shall be eligible to earn an annual bonus award (an
"ANNUAL BONUS") of forty-five percent (45%) of Executive's Base Salary (the
"TARGET") based upon and subject to the achievement of annual performance
targets established by the Board (or a committee thereof) within the first three
months of each fiscal year during the Employment Term. In addition, during the
Employment Term, Executive shall be entitled to participate in such long-term
cash incentive plans and programs of the Company as are generally provided to
the Company's other senior executives.
5. Employee Benefits. During the Employment Term, Executive shall be
entitled to participate in the Company's employee benefit plans (other than
annual bonus and long-term incentive programs, which are addressed in Section 4)
as in effect from time to time (collectively "EMPLOYEE BENEFITS"), on the same
basis as those benefits are generally made available to other senior executives
of the Company; provided that in any event, Executive shall be provided health,
life and disability and retirement and fringe benefits that are substantially
comparable in the aggregate to the level of such benefits provided to Executive
by Xxxxxx Tire & Rubber Company, immediately prior to the Effective Date;
provided further that the Company may reduce such level of benefits to the
extent such reduction applies to at least half of the senior executives of the
Company.
6. Business Expenses. During the Employment Term, reasonable business
expenses incurred by Executive in the performance of Executive's duties
hereunder shall be reimbursed by the Company in accordance with Company
policies.
7. Termination. The Employment Term and Executive's employment
hereunder may be terminated by either party at any time and for any reason;
provided that Executive will be
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required to give the Company at least 60 days advance written notice of any
resignation of Executive's employment. Notwithstanding any other provision of
this Agreement, the provisions of this Section 7 shall exclusively govern
Executive's rights upon termination of employment with the Company and its
affiliates.
a. By the Company For Cause or By Executive Resignation
Without Good Reason.
(i) The Employment Term and Executive's employment hereunder may
be terminated by the Company for Cause (as defined in Section 7(a)(ii) and shall
terminate automatically upon Executive's resignation without Good Reason (as
defined in Section 7(c)); provided that Executive will be required to give the
Company at least 60 days advance written notice of a resignation without Good
Reason.
(ii) For purposes of this Agreement, "CAUSE" shall mean:
(A) During the period from the Effective Date through and
including the second anniversary of the Effective Date, the meaning
specified in the Xxxxxx Tire & Rubber Company Change in Control
Severance Pay Plan (as in effect on September 16, 2004); and
(B) During the period after the second anniversary of the
Effective Date, (I) the Executive's willful failure to perform duties
or directives which is not cured following written notice, (II) the
Executive's commission of a (x) felony or (y) crime involving moral
turpitude, (III) the Executive's willful malfeasance or misconduct
which is demonstrably injurious to the Company or its affiliate, or
(IV) material breach by the Executive of the restrictive covenants,
including, without limitation, Sections 8 and 9 hereof and any
non-compete, non-solicitation or confidentiality provisions to which
the Executive is bound.
(iii) If, during the Employment Term, Executive's employment is
terminated by the Company for Cause or Executive resigns without Good Reason,
Executive shall be entitled to receive:
(A) the Base Salary through the date of termination;
(B) any Annual Bonus earned but unpaid as of the date of
termination for any previously completed fiscal year;
(C) reimbursement for any unreimbursed business expenses
properly incurred by Executive in accordance with Company policy prior
to the date of Executive's termination; and
(D) such Employee Benefits, if any, as to which Executive
may be entitled under the employee benefit plans of the Company (the
amounts described in clauses (A) through (D) hereof being referred to
as the "ACCRUED RIGHTS").
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Following such termination of Executive's employment by the Company
for Cause or resignation by Executive without Good Reason, except as set forth
in this Section 7(a)(iii), Executive shall have no further rights to any
compensation or any other benefits under this Agreement.
b. Disability or Death.
(i) The Employment Term and Executive's employment hereunder
shall terminate upon Executive's death and may be terminated by the Company if
Executive becomes physically or mentally incapacitated and is therefore unable
for a period of six (6) consecutive months or for an aggregate of nine (9)
months in any twenty-four (24) consecutive month period to perform Executive's
duties (such incapacity is hereinafter referred to as "Disability"). Any
question as to the existence of the Disability of Executive as to which
Executive and the Company cannot agree shall be determined in writing by a
qualified independent physician mutually acceptable to Executive and the
Company. If Executive and the Company cannot agree as to a qualified independent
physician, each shall appoint such a physician and those two physicians shall
select a third who shall make such determination in writing. The determination
of Disability made in writing to the Company and Executive shall be final and
conclusive for all purposes of the Agreement.
(ii) Upon termination of Executive's employment hereunder during
the Employment Term for either Disability or death, Executive or Executive's
estate (as the case may be) shall be entitled to receive:
(A) the Accrued Rights; and
(B) a pro rata portion of any Annual Bonus, if any, that
Executive would have been entitled to receive pursuant to Section 4
hereof in such year based upon the percentage of the fiscal year that
shall have elapsed through the date of Executive's termination of
employment, payable when such Annual Bonus would have otherwise been
payable had Executive's employment not terminated.
Following Executive's termination of employment due to death or
Disability, except as set forth in this Section 7(b)(ii), Executive shall have
no further rights to any compensation or any other benefits under this
Agreement.
c. By the Company Without Cause or Resignation by Executive
for Good Reason.
(i) The Employment Term and Executive's employment hereunder may
be terminated by the Company without Cause or by Executive's resignation for
Good Reason.
(ii) For purposes of this Agreement,
(A) "GOOD REASON" shall mean (i) a substantial diminution in
Executive's position or duties; adverse change in reporting lines; or
assignment of duties materially inconsistent with Executive's
position; (ii) any reduction in Executive's Base Salary or Annual
Bonus opportunity; (iii) any reduction in Executive's long-
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term cash incentive compensation opportunities, other than reductions
generally affecting other senior executives participating in the
applicable long-term incentive compensation programs or arrangements;
(iv) the failure of the Company to pay Executive any compensation or
benefits when due hereunder; (v) relocation of Executive's principal
place of work in excess of fifty (50) miles from Executive's current
principal place of work or (vi) any material breach by the Company of
the terms of the Agreement; provided that none of the events described
in this Section 7(c)(ii)(A) shall constitute Good Reason unless the
Company fails to cure such event within 10 calendar days after receipt
from Executive of written notice of the event which constitutes Good
Reason.
(B) "CHANGE OF CONTROL" shall mean the occurrence of any of
the following events after the Effective Date: (i) the sale or
disposition, in one or a series of related transactions, of all or
substantially all of the assets of CSA to any "person" or "group" (as
such terms are defined in Sections 13(d)(3) and 14(d)(2) of the
Exchange Act) other than Permitted Holders or (ii) any person or
group, other than Permitted Holders, is or becomes the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act),
directly or indirectly, of greater than or equal to 50% of the total
voting power of the voting stock of CSA, including by way of merger,
consolidation or otherwise, except where one or more of Cypress
Merchant Banking Partners II L.P., Cypress Merchant Banking II C.V.,
55th Street Partners II L.P., Cypress Side-By-Side LLC, GS Capital
Partners 2000, L.P., GS Capital Partners 2000 Offshore, L.P., GS
Capital Partners 2000 GmbH & Co. Beteiligungs KG, GS Capital Partners
2000 Employee Fund, L.P. and Xxxxxxx Xxxxx Direct Investment Fund
2000, L.P. (collectively, the "SPONSORS") and/or their respective
affiliates, immediately following such merger, consolidation or other
transaction, continue to have the ability to designate or elect a
majority of the Board of Directors of CSA (or the board of directors
of the resulting entity or its parent company). For purposes of this
Agreement, "Permitted Holder" shall mean, as of the date of
determination, any and all of (x) an employee benefit plan (or trust
forming a part thereof) maintained by (A) the Company or its affiliate
or (B) any corporation or other person of which a majority of its
voting power of its voting equity securities or equity interest is
owned, directly or indirectly, by the Company or its affiliate and (y)
the Sponsors and any of their respective affiliates. Notwithstanding
that a transaction or series of transactions does not constitute a
Change of Control, with respect to Executive it shall be deemed to be
a Change of Control for purposes of Executive's entitlement's
hereunder if clause (i), above, is satisfied in respect of the
business or division in which Executive is principally engaged. For
the avoidance of doubt, a Change of Control pursuant to the
immediately preceding sentence shall not apply to Executive if his
employment is not primarily with and for the business or division that
is sold.
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(iii) If during the Employment Term Executive's employment is
terminated by the Company without Cause (other than by reason of death or
Disability) or Executive resigns for Good Reason, Executive shall be entitled to
receive, subject to Executive's execution (without subsequent revocation) of a
release of claims substantially in the form of Exhibit A (the "RELEASE"):
(A) Termination On or Prior to the Second Anniversary of the
Effective Date. If such termination of employment occurs on or prior
to the second anniversary of the Effective Date, the Accrued Rights,
but no further payments or benefits pursuant to the terms of this
Agreement; provided, however, that Executive shall be entitled (albeit
without duplication of amounts payable in respect of the Accrued
Rights) to the payments and benefits provided under the Xxxxxx Tire &
Rubber Company Change in Control Severance Pay Plan (the "EXISTING
CHANGE IN CONTROL SEVERANCE PLAN"), subject to the terms thereof;
provided, further, that the Existing Change in Control Severance Plan
shall be deemed amended such that (i) references to the "Company" and
the "Employer" shall be deemed to be references to Xxxxxx-Standard
Automotive Inc., except that references to the "Company" for purposes
of the definition of Change in Control (as defined in the Existing
Change in Control Severance Plan) shall be deemed amended to be
references to CSA Acquisition Corp., (ii) the provisions relating to
accelerated vesting and cash-out of equity securities will not apply
to equity securities of the Company or its affiliates, (iii) the
grantor trust ("RABBI TRUST") funding requirements applicable to the
Change in Control (as defined in the Existing Change in Control
Severance Plan) resulting from the transactions contemplated by the
Purchase Agreement will be satisfied by Xxxxxx & Tire Rubber Company,
rather than the Company, and any claims for severance or termination
benefits will be made against the rabbi trust first and exclusively,
except to the extent there are not sufficient assets in the trust, in
which event the remaining balance will be payable by the Company, (iv)
Executive will waive any claims or rights Executive has to termination
or severance benefits thereunder, other than as a result of the
termination of Executive's employment during the Severance Period (as
defined in the Existing Change in Control Severance Plan) (x) by the
Company without Cause (as defined in the Existing Change in Control
Severance Plan) or (y) by Executive for Good Reason (as defined
herein); and (v) the Existing Change in Control Severance Plan shall
not apply to any Change in Control occurring after the Effective Date
(i.e., "Change in Control" as defined in the Existing Change in
Control Severance Plan shall not include any transaction regarding the
Company which occurs after the Effective Date) (it being understood
that Executive will be covered solely by the New Change of Control
Severance Plan (as defined in Section 7(c)(iii)(C)) with respect to
any Change of Control that occurs after the Effective Date).
(B) Termination Prior to a Change of Control and After the
Second Anniversary of the Effective Date. If such termination of
employment occurs prior to a Change of Control and after the second
anniversary of the Effective Date, then:
(i) the Accrued Rights;
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(ii) a pro rata portion of any Annual Bonus, if any, that
Executive would have been entitled to receive pursuant
to Section 4 hereof in respect of such year based upon
the percentage of the fiscal year that shall have
elapsed through the date of Executive's termination of
employment, payable when such Annual Bonus would have
otherwise been payable had Executive's employment not
terminated;
(iii) a single lump sum cash payment within five (5) days
following the expiration of such revocation period
provided for in the Release equal to two (2) times the
sum of Executive's (i) Base Salary plus (ii) Target
Annual Bonus for the year prior to such termination of
employment;
(iv) a single lump sum cash payment within five (5) days
following the expiration of such revocation period
provided for in the Release equal to the actuarial
equivalent (determined using all of the same mortality,
interest rate and other methods and assumptions as are
used from time to time to determine "actuarial
equivalence" under the applicable Retirement Plan (as
defined below)) of the excess of (A) the retirement
pension (determined as a straight line annuity
commencing at age sixty-five (65)) which Executive
would have accrued under the terms of any tax qualified
defined benefit plan or scheme sponsored by the Company
in which Executive participates in (the "RETIREMENT
PLAN"), determined as if the Executive had accumulated
(after the date of termination) twenty-four (24)
additional months of service credit thereunder at
Executive's then current rate of compensation (but in
no event shall Executive be deemed to have accumulated
additional months of service credit after his
sixty-fifty (65th) birthday), over (B) the retirement
pension (determined as a straight life annuity
commencing at age sixty-five (65)) which Executive had
then accrued pursuant to the provisions of such
Retirement Plan; and
(v) for twenty-four (24) months following his date of
termination, the Company shall arrange to provide
Executive with life, accident and health insurance
benefits on the same basis applicable to active
employees of the Company. Benefits otherwise receivable
by Executive pursuant to this Subsection (v) shall
become secondary to comparable benefits that are
actually received by Executive during the remainder of
such period following his termination, and any such
benefits actually received by Executive shall be
reported to the Company.
(C) Termination Following a Change of Control and After the
Second Anniversary of the Effective Date. If such termination of
employment occurs following a Change of Control and after the second
anniversary of the Effective Date,
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the Accrued Rights, but without further payments or benefits
hereunder, however, Executive shall be entitled (albeit without
duplication of amounts payable in respect of the Accrued Rights) to be
covered by the Company's Change of Control Severance Pay Plan,
substantially in the form of Exhibit B (the "NEW CHANGE OF CONTROL
SEVERANCE PLAN").
Notwithstanding the foregoing, the aggregate amounts payable to
Executive pursuant to this Section 7(c)(iii) shall be reduced by the present
value of any other cash severance or termination benefits payable to Executive
under any other plans, programs or arrangements of the Company or its affiliates
including, without limitation, under the New Change of Control Severance Plan.
Following Executive's termination of employment by the Company without Cause (as
defined herein or under the Existing Change in Control Severance Plan) (other
than by reason of Executive's death or Disability) or by Executive's resignation
for Good Reason (or resignation pursuant to Section 4(c) of the Existing Change
in Control Severance Plan), except as set forth in this Section 7(c), Executive
shall have no further rights to any compensation or any other benefits under
this Agreement.
d. Expiration of Employment Term.
(i) Election Not to Extend the Employment Term. In the event
either party elects not to extend the Employment Term pursuant to Section 1,
unless Executive's employment is earlier terminated pursuant to paragraphs (a),
(b) or (c) of this Section 7, Executive's termination of employment hereunder
(whether or not Executive continues as an employee of the Company thereafter)
shall be deemed to occur on the close of business on the day immediately
preceding the next scheduled Extension Date and Executive shall be entitled to
receive the Accrued Rights.
Following such termination of Executive's employment hereunder as a
result of either party's election not to extend the Employment Term, except as
set forth in this Section 7(d)(i), Executive shall have no further rights to any
compensation or any other benefits under this Agreement.
(ii) Continued Employment Beyond the Expiration of the Employment
Term. Unless the parties otherwise agree in writing, continuation of Executive's
employment with the Company beyond the expiration of the Employment Term in
accordance with Section 1(b) shall be deemed an employment at-will and shall not
be deemed to extend any of the provisions of this Agreement and Executive's
employment may thereafter be terminated at will by either Executive or the
Company; provided that the provisions of Sections 8, 9, 10 and 11 of this
Agreement shall survive any termination of this Agreement or Executive's
termination of employment hereunder.
e. Notice of Termination. Any purported termination of
employment by the Company or by Executive (other than due to Executive's death)
shall be communicated by written Notice of Termination to the other party hereto
in accordance with Section 11(h) hereof. For purposes of this Agreement, a
"NOTICE OF TERMINATION" shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of employment under the provision so indicated.
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f. Board/Committee Resignation. Upon termination of
Executive's employment for any reason, Executive agrees to resign, as of the
date of such termination and to the extent applicable, from the Board (and any
committees thereof) and the Board of Directors (and any committees thereof) of
any of the Company's affiliates.
8. Non-Competition.
a. Executive acknowledges and recognizes the highly
competitive nature of the businesses of the Company and its affiliates and
accordingly agrees as follows:
(i) During the Executive's employment with the Company and for a
period of two years following the date Executive ceases to be employed by the
Company, Executive will not:
(A) engage in any Competitive Activity (as defined in
Section 8(b)); or
(B) induce or attempt to induce customers, business
relations or accounts of the Company or any of its affiliates to
relinquish their contracts or relationships with the Company or any
its affiliates; or
(C) solicit, entice, assist or induce other employees,
agents or independent contractors to leave the employ of the Company
or any of its affiliates or to terminate their engagements with the
Company and/or any of its affiliates or assist any competitors of the
Company or any of its affiliates in securing the services of such
employees, agents or independent contractors.
b. Definitions. For purposes of this Agreement, "COMPETITIVE
ACTIVITY" means Executive's participation, without the written consent of any
one of the Chief Executive Officer, or Chief Operating Officer (except where
Executive holds any of such positions, in which case the Board shall be required
to provide such written consent), if any, of the Company, in the management of
any business enterprise if such enterprise engages in substantial and direct
competition with the Company or any of its affiliates and such enterprise's
sales of any product or service competitive with any product or service of the
Company or any of its affiliates amounted to 5% of such enterprise's net sales
for its most recently completed fiscal year and if the Company's net sales of
said product or service amounted to 5% of, as applicable, the Company's or its
affiliate's net sales for its most recently completed fiscal year. "Competitive
Activity" will not include (i) the mere ownership of 5% or more of securities in
any such enterprise and the exercise of rights appurtenant thereto or (ii)
participation in the management of any such enterprise other than in connection
with the competitive operations of such enterprise.
9. Confidentiality; Intellectual Property.
a. Confidentiality.
(i) Executive acknowledges and agrees that in the performance of
his duties as an employee of the Company or an affiliate thereof, he was and
will continue to be brought into frequent contact with, had and will continue to
have access to, and became and will continue
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to become informed of confidential and proprietary information of the Company
and its affiliates and/or information which is a trade secret of the Company
and/or its affiliates (collectively, "CONFIDENTIAL INFORMATION"), as more fully
described in Subsection (ii) of this Section. Executive acknowledges and agrees
that the Confidential Information of the Company and its affiliates gained by
Executive during his association with the Company and its affiliates was, is and
will be developed by and/or for the Company and its affiliates through
substantial expenditure of time, effort and money and constitutes valuable and
unique property of the Company and its affiliates.
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(ii) The Executive will keep in strict confidence, and will not,
directly or indirectly, at any time, disclose, furnish, disseminate, make
available, use or suffer to be used in any manner any Confidential Information
of the Company or its affiliates without limitation as to when or how Executive
may have acquired such Confidential Information (subject to subsection (iv).
Executive specifically acknowledges that Confidential Information includes any
and all information, whether reduced to writing (or in a form from which
information can be obtained, translated, or derived into reasonably usable
form), or maintained in the mind or memory of Executive and whether compiled or
created by the Company or its affiliates, which derives independent economic
value from not being readily known to or ascertainable by proper means by others
who can obtain economic value from the disclosure or use of such information,
that reasonable efforts have been put forth by the Company and its affiliates to
maintain the secrecy of Confidential Information, that such Confidential
Information is and will remain the sole property of the Company and its
affiliates, and that any retention (in tangible form) or use by Executive of
Confidential Information not in the good faith performance of his duties in the
best interest of the Company or, in any case, after the termination of
Executive's employment with and services for the Company and its affiliates
shall constitute a misappropriation of the Company's Confidential Information.
(iii) The Executive further agrees that he shall return, within
ten (10) days of the effective date of his termination as an employee of the
Company and its affiliates, in good condition, all property of the Company and
its affiliates then in Executive's possession, including, without limitation,
whether in hard copy or in any other media (i) property, documents and/or all
other materials (including copies, reproductions, summaries and/or analyses)
which constitute, refer or relate to Confidential Information of the Company or
its affiliates, (ii) keys to property of the Company or its affiliates, (iii)
files and (iv) blueprints or other drawings.
(iv) Executive further acknowledges and agrees that his
obligation of confidentiality shall survive until and unless such Confidential
Information of the Company or its affiliates shall have become, through no fault
of Executive, generally known to the industry or Executive is required by law
(after providing the Company with notice and opportunity to contest such
requirement) to make disclosure. Executive's obligations under this Section are
in addition to, and not in limitation or preemption of, all other obligations of
confidentiality which Executive may have to the Company and its affiliates under
general legal or equitable principles or statutes.
b. Intellectual Property.
(i) If Executive has created, invented or contributed to any
works of authorship, inventions, software, databases, systems or other
intellectual property, materials, documents or other work product ("WORKS")
prior to Executive's employment, that are relevant to or implicated by such
employment ("PRIOR WORKS"), Executive hereby agrees not to seek royalties or
other compensation from the Company, and not to assert any infringement or
similar claim against the Company, for the Company's use of such Prior Works.
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(ii) If Executive creates, invents or contributes to any Works at
any time during Executive's employment and within the scope of such employment
and/or with the use of any Company resources ("COMPANY WORKS"), Executive hereby
assigns and shall assign all rights and intellectual property rights therein to
the Company to the extent ownership of any such rights does not vest originally
in the Company.
10. Specific Performance/Survival. Executive acknowledges and agrees
that the Company's remedies at law for a breach or threatened breach of any of
the provisions of Section 8 or 9 would be inadequate and the Company would
suffer irreparable damages as a result of such breach or threatened breach. In
recognition of this fact, Executive agrees that, in the event of such a breach
or threatened breach, in addition to any remedies at law, the Company, without
posting any bond, shall be entitled to cease making any payments or providing
any benefit otherwise required by this Agreement and obtain equitable relief in
the form of specific performance, temporary restraining order, temporary or
permanent injunction or any other equitable remedy which may then be available.
In the event the Company wrongfully ceases making payments and providing
benefits in accordance with the prior sentence, Executive shall be entitled to
recover reasonable attorney fees, incurred in recovering such payments or
benefits. The provisions of Section 8, 9 and 10 shall survive the termination of
this Agreement.
11. Miscellaneous.
a. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Michigan, without regard
to conflicts of laws principles thereof.
b. Entire Agreement/Amendments. This Agreement contains the
entire understanding of the parties with respect to the employment of Executive
by the Company. There are no restrictions, agreements, promises, warranties,
covenants or undertakings between the parties with respect to the subject matter
herein other than those expressly set forth herein. This Agreement may not be
altered, modified, or amended except by written instrument signed by the parties
hereto.
c. No Waiver. The failure of a party to insist upon strict
adherence to any term of this Agreement on any occasion shall not be considered
a waiver of such party's rights or deprive such party of the right thereafter to
insist upon strict adherence to that term or any other term of this Agreement.
d. Severability. In the event that any one or more of the
provisions of this Agreement shall be or become invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions of this Agreement shall not be affected thereby.
e. Assignment. This Agreement, and all of Executive's rights
and duties hereunder, shall not be assignable or delegable by Executive. Any
purported assignment or delegation by Executive in violation of the foregoing
shall be null and void ab initio and of no force and effect. This Agreement may
be assigned by the Company to a person or entity which is an affiliate, and
shall be assigned by the Company to a person or entity which is a successor in
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interest to substantially all of the business operations of the Company. Upon
such assignment, the rights and obligations of the Company hereunder shall
become the rights and obligations of such affiliate or successor person or
entity.
f. Set Off; No Mitigation. The Company's obligation to pay
Executive the amounts provided and to make the arrangements provided hereunder
shall be subject to set-off, counterclaim or recoupment of amounts owed by
Executive to the Company or its affiliates. However, Executive shall not be
required to mitigate the amount of any payment provided for pursuant to this
Agreement by seeking other employment or otherwise.
g. Successors; Binding Agreement. This Agreement shall inure
to the benefit of and be binding upon personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees and
legatees.
h. Notice. For the purpose of this Agreement, notices and
all other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when delivered by hand or overnight
courier or three days after it has been mailed by United States registered mail,
return receipt requested, postage prepaid, addressed to the respective addresses
set forth below in this Agreement, or to such other address as either party may
have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon receipt.
If to the Company:
Xxxxxx-Standard Automotive Inc.
00000 Xxxxxxx Xxxx Xxxxx Xxxxx
Xxxx, XX 00000
Phone: 000-000-0000
Attention:
If to Executive:
To the most recent address of Executive set forth in the personnel
records of the Company.
i. Executive Representation. Executive hereby represents to
the Company that the execution and delivery of this Agreement by Executive and
the Company and the performance by Executive of Executive's duties hereunder
shall not constitute a breach of, or otherwise contravene, the terms of any
employment agreement or other agreement or policy to which Executive is a party
or otherwise bound.
j. Prior Agreements This Agreement supercedes all prior
agreements and understandings (including verbal agreements) between Executive
and the Company and/or its affiliates regarding the terms and conditions of
Executive's employment with the Company and/or its affiliates including, without
limitation, the term sheet attached to the letter agreement dated September 16,
2004 between among The Cypress Group L.L.C., GS Capital Partners 2000, L.P. and
Executive. For the avoidance of doubt, this Agreement shall not supercede the
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Company's Change of Control Severance Pay Plan and any equity-based awards
granted to the Executive pursuant to the 2004 CSA Acquisition Corp. Stock
Incentive Plan.
k. Cooperation. Executive shall provide Executive's
reasonable cooperation in connection with any action or proceeding (or any
appeal from any action or proceeding) which relates to events occurring during
Executive's employment hereunder. This provision shall survive any termination
of this Agreement.
l. Withholding Taxes. The Company may withhold from any
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.
m. Survival. The provisions of Sections 8, 9, 10 and 11 of
this Agreement shall survive any termination of this Agreement or Executive's
termination of employment hereunder
n. Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.
XXXXXX-STANDARD AUTOMOTIVE INC. EXECUTIVE
/s/ Xxxxx X. Xxxxxxxx /s/ Xxxxxx X. Xxxxxx
------------------------------------ -----------------------------------
By: Xxxxx X. Xxxxxxxx Name: Xxxxxx X. Xxxxxx
Title: Vice President
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EXHIBIT A
XXXXXX-STANDARD AUTOMOTIVE INC.
FORM OF RELEASE
WHEREAS, Xxxxxx X. Xxxxxx'x (the "EXECUTIVE") employment has been
terminated in accordance with Section 7(c) of the Employment Agreement dated as
of December 23, 2004 between Xxxxxx-Standard Automotive Inc. ("XXXXXX") and the
Executive (the "EMPLOYMENT AGREEMENT"); and
WHEREAS, the Executive is required to sign this Release in order to receive
the severance and termination benefits described in Section 7(c) of the
Employment Agreement.
NOW THEREFORE, in consideration of the promises and agreements contained
herein and other good and valuable consideration, the sufficiency and receipt of
which are hereby acknowledged, and intending to be legally bound, the Executive
agrees as follows:
1. This Release is effective on the date hereof and will continue in effect
as provided herein.
2. In consideration of the payments to be made and the benefits to be
received by the Executive pursuant to the Employment Agreement, which the
Executive acknowledges are in addition to payments and benefits which the
Executive would be entitled to receive absent the Employment Agreement, the
Executive, for himself and his dependents, successors, assigns, heirs, executors
and administrators (and his and their legal representatives of every kind),
hereby releases, dismisses, remises and forever discharges Xxxxxx, its
predecessors, parents, subsidiaries, divisions, related or affiliated companies,
officers, directors, stockholders, members, employees, heirs, successors,
assigns, representatives, agents and counsel (the "COMPANY") from any and all
arbitrations, claims, including claims for attorney's fees, demands, damages,
suits, proceedings, actions and/or causes of action of any kind and every
description, whether known or unknown, which Executive now has or may have had
for, upon, or by reason of any cause whatsoever ("CLAIMS"), against the Company,
including but not limited to:
(a) any and all claims arising out of or relating to Executive's
employment by or service with the Company and his termination from the
Company;
(b) any and all claims of discrimination, including but not limited to
claims of discrimination on the basis of sex, race, age, national origin,
marital status, religion or handicap, including, specifically, but without
limiting the generality of the foregoing, any claims under the Age
Discrimination in Employment Act, as amended, Title VII of the Civil Rights
Act of 1964, as amended, the Americans with Disabilities Act, The
Xxxxxxx-Xxxxxx Civil Rights Act, the Michigan Handicappers' Civil Rights
Act, the Michigan Wage Payment Act (MCLA Section 408.471), the Polygraph
Protection Act of 1981, the Michigan Whistleblower's Protection Act (MCLA
Section 15.361), the common law of
17
the State of Michigan, and any other applicable state statutes and
regulations; and provided, however, that the foregoing shall not apply to
claims to enforce rights that Executive may have as of the date hereof or
in the future under any of Xxxxxx'x health, welfare, retirement, pension or
incentive plans, under any indemnification agreement between the Executive
and Xxxxxx, under Xxxxxx'x indemnification by-laws, under the directors'
and officers' liability coverage maintained by Xxxxxx, under the applicable
provisions of the Delaware General Corporation Law, or that Executive may
have in the future under the Employment Agreement or under this Release.
(c) any and all claims of wrongful or unjust discharge or breach of
any contract or promise, express or implied.
3. Executive understands and acknowledges that the Company does not admit
any violation of law, liability or invasion of any of his rights and that any
such violation, liability or invasion is expressly denied. The consideration
provided for this Release is made for the purpose of settling and extinguishing
all claims and rights (and every other similar or dissimilar matter) that
Executive ever had or now may have against the Company to the extent provided in
this Release. Executive further agrees and acknowledges that no representations,
promises or inducements have been made by the Company other than as appear in
the Employment Agreement.
4. Executive further agrees and acknowledges that:
(a) The release provided for herein releases claims to and including
the date of this Release;
(b) Executive has been advised by the Company to consult with legal
counsel prior to executing this Release, has had an opportunity to consult
with and to be advised by legal counsel of his choice, fully understands
the terms of this Release, and enters into this Release freely, voluntarily
and intending to be bound;
(c) Executive has been given a period of 21 days to review and
consider the terms of this Release, prior to its execution and that he may
use as much of the 21 day period as he desires; and
(d) Executive may, within 7 days after execution, revoke this Release.
Revocation shall be made by delivering a written notice of revocation to
the General Counsel at Xxxxxx. For such revocation to be effective, written
notice must be actually received by the General Counsel at Xxxxxx no later
than the close of business on the 7th day after Executive executes this
Release. If Executive does exercise his right to revoke this Release, all
of the terms and conditions of the Release shall be of no force and effect
and Xxxxxx shall not have any obligation to make payments or provide
benefits to Executive as set forth in the Employment Agreement.
5. Executive agrees that he will never file a lawsuit or other complaint
asserting any claim that is released in this Release.
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6. Executive waives and releases any claim that he has or may have to
reemployment after the date of this Release.
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IN WITNESS WHEREOF, the Executive has executed and delivered this Release on the
date set forth below.
Dated:
--------------------------- -----------------------------------
Xxxxxx X. Xxxxxx
Executive
