EXHIBIT 10.101
EMPLOYMENT AGREEMENT
AGREEMENT dated as of August 3, 1997, between Xxxxx X. Xxxxx
(the "Executive") and XXXXX XXXXXX, INC., a Delaware corporation (the
"Company").
The Executive is presently the Vice-President, Product
Division of Xxxxxxxx Dental Products, Inc. ("Xxxxxxxx").
The Company and Xxxxxxxx are parties to an Agreement and Plan
of Merger dated August 3, 1997 (the "Merger Agreement"), pursuant to which it is
contemplated that HSI Acquisition Corp., a wholly-owned subsidiary of the
Company, will be merged with and into Xxxxxxxx.
The Company desires to employ the Executive, and the Executive
desires to be employed by the Company, at the Effective Time, as that term is
defined in the Merger Agreement. Accordingly, the parties hereto are entering
into this Agreement to set forth and confirm their respective rights and
obligations with respect to the Executive's employment by the Company commencing
as of the Effective Time.
The parties agree as follows:
1. Employment. The Company shall employ the Executive,
as of the Effective Time, as Vice-President, Product Division of the U.S. Dental
Division of the Company (the "Dental Division") and Vice-President, Product
Division of Xxxxxxxx, and the Executive shall accept such employment and serve
as such, subject to and upon the terms and conditions set forth in this
Agreement; provided, however, that this Agreement shall terminate and be of no
further force or effect if the Executive shall have died or, in the reasonable
judgment of the Company, become disabled (as defined in Section 7(a)(i)), or his
employment by Xxxxxxxx shall have been terminated for Cause (as hereinafter
defined), in any such case, prior to the Effective Time.
2. Duties.
(a) At all times during his employment with the Company,
the Executive shall, subject to the direction and control of the President and
the Executive Vice President of the Dental Division, perform such executive
duties and functions as he may be called upon by such persons to perform,
consistent with his employment hereunder as Vice-President, Product Division of
the Dental Division and Vice-President, Product Division of Xxxxxxxx.
(b) The Executive shall devote his full time and
reasonable best efforts to the performance of his duties hereunder; and, to the
extent requested by the President or the
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Executive Vice President of the Dental Division, render such executive services
for any other subsidiary or affiliated business of the Company. Notwithstanding
the foregoing, Executive may devote time and effort to charitable activities
(subject to the provision of Section 8), provided that such activities do not
interfere with the Executive fulfilling his obligations under this Agreement.
(c) The Company shall not require the Executive to
maintain his principal office anywhere other than within a 50 mile radius of
Xxxxxxxx'x principal executive offices in West Allis, Wisconsin provided that
the Executive shall travel on the Company's behalf within and outside such area
to the extent reasonably necessary to perform his duties hereunder.
3. Compensation.
(a) The Company shall pay to the Executive for all
services to be rendered by him pursuant to this Agreement a base salary at the
annual rate of One Hundred Seventy-Five Thousand Dollars ($175,000), payable in
accordance with the Company's practices with respect to its senior executives as
in effect from time to time) ("Company's Practices"). Such salary shall be
increased each year (beginning in 1999) by an amount determined by the Company
in accordance with the Company's Practices, but in any event such amount shall
be no less than the percentage increase in the cost of living over the preceding
year.
(b) The Executive shall be entitled to a bonus in
respect of each fiscal year of the Company during which he is employed
hereunder, payable no later than 90 days after the end of each year for which
such bonus is payable, the thresholds and amounts of which shall be determined
in accordance with the Company's Practices.
(c) At the Effective Time, the Executive shall be
granted options to purchase shares of common stock, par value $.01 per share
("Common Stock"), of the Company in accordance with the stock option agreement
attached hereto as Exhibit A (the "Option Agreement").
(d) At the Effective Time, the Executive shall be
granted shares of Common Stock of the Company in accordance with the restricted
stock agreement attached hereto as Exhibit B (the "Restricted Stock Agreement").
(e) At the Effective Time, the Executive shall be paid
the sum of One Hundred Nine-Five Thousand Dollars ($195,000) as an inducement to
enter into this Agreement.
4. Working Conditions and Benefits. While employed by
the Company hereunder:
(a) The Executive shall be entitled to four (4) weeks of
paid vacation per year, in accordance with the Company's Practices and shall be
entitled to sick leave and personal time in accordance with the Company's
policies for its senior executives.
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(b) The Executive shall be authorized to incur
reasonable and necessary expenses for promoting the business of the Company,
including expenses for entertainment, travel and similar items, all in
accordance with the Company's Practices. The Company shall reimburse the
Executive for all such expenses, upon presentation by the Executive of an
itemized account of such authorized expenditures in accordance with the
Company's Practices with respect to expense reimbursement.
(c) The Company in accordance with Xxxxxxxx'x prior
practices (x) shall provide to the Executive an automobile for business use and
(y) shall pay for certain expenses incurred in connection with such use.
(d) The Company shall provide to the Executive to the
full extent provided for under the laws of the Company's state of incorporation
and the Company's By-Laws, indemnification for any claim or lawsuit which may be
asserted against the Executive with respect to his capacity as an officer or
employee of the Company, provided that said indemnification is not in violation
of any Federal or state law, rule or regulation. The indemnification obligations
of the Company shall survive the termination of this Agreement.
5. Other Benefits. While employed by the Company
hereunder:
The Executive shall be entitled to participate in all benefit,
welfare and perquisite plans, policies and programs, in accordance with the
terms thereof and in accordance with the Company's Practices ("Benefit
Programs").
6. Term. The Executive's employment hereunder shall
commence at the Effective Time and shall continue until the earlier of (a) the
fifth anniversary of the Effective Time, (b) his death, or (c) termination of
employment pursuant to Section 7 hereof.
7. Termination.
(a) Notwithstanding anything herein contained, if on or
after the Effective Time and prior to the fifth anniversary of the Effective
Time, (i) Executive shall have been determined by the Board of Directors of the
Company to have become "Permanently Disabled," or (ii) the Executive shall have
furnished the Company with Cause for his discharge then, and in any such case,
the Company shall have the right, by notice given to the Executive, to terminate
the Executive's employment as of a date to be specified in such notice. Cause
shall be defined as: (A) the Executive shall be convicted of a felony involving
fraud, dishonesty or moral turpitude (other than ordinary traffic infractions),
(B) the Board of Directors of the Company shall have determined that the
Executive has committed any act, or omitted to take any action, in bad faith or
has materially neglected the Company's business, which, in any case, shall have
had, or reasonably would be expected to have, a material adverse effect on the
Company or Xxxxxxxx, or (C) the Board of Directors of the Company shall have
determined in good faith that the Executive has materially breached any term of
this Agreement and failed to correct such breach, if such breach is curable,
within 30 days after receipt of written notice thereof. For purposes hereof, the
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term "Permanently Disabled" shall mean a condition (certified by two licensed
physicians, one selected by the Company and one by the Executive and each
reasonably satisfactory to the other party) rendering the Executive unable to
perform his responsibilities under this Agreement for a period of 180 days
whether or not continuous, in any period of 12 months.
(b) Upon the Executive's death, or the termination of the
Executive's employment pursuant to Section 7(a)(i), the Executive (or his
estate, as the case may be) shall be entitled to receive only (i) his salary at
the rate provided in Section 3(a) to the date of termination and (ii) any unpaid
bonus pursuant to Section 3(b) in respect of the fiscal year of the Company
ended prior to the year in which such termination occurs and (iii) an amount
equal to such bonus in respect of such prior fiscal year multiplied by a
fraction the numerator of which shall be the number of days that shall have
elapsed from the first day of the fiscal year in which such termination occurs
to the date of such termination and the denominator of which shall be 365.
(c) Upon termination of the Executive's employment
hereunder pursuant to Section 7(a)(ii) or the Executive's voluntary termination
of his employment hereunder, the Executive shall be entitled to receive only (i)
his salary at the rate provided in Section 3(a) to the date of termination and
(ii) any unpaid bonus pursuant to Section 3(b) in respect of the fiscal year of
the Company ended prior to the year in which such termination occurs. In either
of such events, the Executive shall not be entitled to receive any bonuses
pursuant to Section 3(b) in respect of the year in which such termination occurs
or any year thereafter.
(d) Upon termination of the Executive's employment
hereunder by the Company other than for cause the Executive shall be entitled to
receive (i) his salary at the rate provided in Section 3(a) to the date of
termination, (ii) continuation of the Executive's base salary for a period of
one year (subject to extension pursuant to Section 8(b)) after the date of such
termination at the rate in effect at such date of termination, (iii) any unpaid
bonus pursuant to Section 3(b) in respect of the fiscal year of the Company
ended prior to the year in which such termination occurs, and (iv) an amount
equal to the bonus paid to the Executive in respect of the prior fiscal year
multiplied by a fraction the numerator of which shall be the number of days that
shall have elapsed from the first day of the fiscal year in which such
termination occurs and the denominator of which shall be 365.
8. Confidentiality and Non-Competition.
(a) In view of the unique and valuable services it is
expected the Executive will render to the Company, the Executive's knowledge of
the customers, trade secrets, and other proprietary information relating to the
business of the Company and its customers and suppliers, and in consideration of
the compensation to be received hereunder, the Executive agrees that he will
not, during his employment with the Company and for a period of (i) three years
thereafter if the Executive is terminated for Cause pursuant to Section 7(a)
hereof or if Executive voluntarily terminates this Agreement or (ii) twelve (12)
months thereafter if the Executive is terminated other than for Cause or
for Permanent Disability (each of (i) and (ii), a "Noncompete Period") except on
behalf of the Company: (a) directly or indirectly engage or have an interest
(whether
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as owner, partner, lender, consultant, employee, agent, supplier, distributor or
otherwise) in any business, activity or enterprise which competes with any
material businesses or operations of the Company or any of the Company's
affiliates (including Xxxxxxxx) at any time during his employment with the
Company; (b) directly or indirectly employ or otherwise engage, or offer to
employ or otherwise engage, any person who is then (or was at any time within
three months prior to the time of such employment, engagement or offer thereof)
an employee, sales representative or agent of the Company or any of the
Company's affiliates (including Xxxxxxxx); or (c) solicit any business from any
person or entity that during his employment with the Company has been a customer
of the Company or any of the Company's affiliates (including Xxxxxxxx) or
directly or indirectly induce or influence any customer, supplier or other
person that has a business relationship with the Company or any of the Company's
affiliates (including Xxxxxxxx) to discontinue or reduce the extent of such
relationship with the Company or any of the Company's affiliates (including
Xxxxxxxx). Notwithstanding the foregoing, however, if the Executive's employment
hereunder continues until the fifth anniversary of the Effective Time, then
(subject to the immediately following sentence), the Executive shall not, upon
termination of the Executive's employment hereunder, be subject to the
restrictions and limitations set forth in clause (a) above, subject to the right
of the Company to enforce clause (a) above for a period beginning on the date of
termination of the Executive's employment hereunder and ending no more than
eighteen (18) months after such date (the "Optional Period") upon payment to the
Executive of an amount equal to the Executive's then current rate of salary for
the Optional Period. Notwithstanding the immediately preceding sentence, if
prior to the fifth anniversary of the Effective Time, the Company offers the
Executive continued employment at his then current rate of salary and otherwise
on terms (excluding the employment term) not substantially less favorable to the
Executive as those provided for in this Agreement (as modified or amended from
time to time) and the Executive rejects said offer, then the Noncompete Period
referred to in clause (ii) above shall remain in effect with respect to all of
clauses (a), (b) and (c) above for eighteen (18) months from the date the
Executive's employment is terminated. In addition, the Executive shall never use
or divulge (unless available in the public domain not due to
Executive's disclosure in violation of this Agreement) any trade secrets,
customer or supplier lists, pricing information, marketing arrangements or
strategies, business plans, internal performance statistics, training manuals or
other information concerning the Company or its affiliates that is confidential,
except on behalf of the Company, and shall not knowingly make false or
misleading or negative statements, either orally or in writing, about the
Company or its affiliates (including Xxxxxxxx), or their respective directors,
officers or employees. Because the breach or attempted breach of this Section 8
will result in immediate and irreparable injury to the Company for which the
Company will not have an adequate remedy at law, the Company shall be entitled,
in addition to all other remedies, to a decree of specific performance of this
covenant and to a temporary and permanent injunction enjoining such breach,
without posting bond or furnishing similar security. The provisions of this
Section 8 are in addition to and independent of any agreements or covenants
contained in any other agreement between the Company and the Executive. If any
restriction contained in this Section 8 shall be deemed to be invalid, illegal,
or unenforceable by reason of the extent, duration, or geographical scope
thereof, or otherwise, then the court making such determination shall have the
right to reduce such extent, duration, geographical scope, or other
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provisions hereof, and in its reduced form such restriction shall then be
enforceable in the manner contemplated hereby. Notwithstanding any of the
foregoing, the Executive (i) may have an interest (whether as owner, partner,
lender, consultant, employee or agent but not as distributor or supplier) in any
manufacturer that sells products exclusively and directly to health care
practitioners rather than through distributors or (ii) hold up to 2% of the
outstanding shares of any class of stock of a publicly traded entity.
(b) Notwithstanding anything to the contrary in the
foregoing paragraph, the Company shall have the option, at any time prior to its
expiration, to extend the Noncompete Period provided for in clause (ii) of the
preceding paragraph for additional periods by written notice to the Executive,
provided, however, that under no circumstance shall the Noncompete Period
pursuant to such clause (ii) (including all extensions thereof) exceed two years
in the aggregate. Any such extension shall be conditioned upon the payment by
the Company to the Executive of salary in accordance with Sections 3(a) and 3(b)
for such extended period.
9. Amendment and Modification; Waiver. This Agreement
may be amended, modified or supplemented only by written agreement (referring
specifically to this Agreement) of the parties. The waiver by
either party of any breach or violation of any provision of this agreement shall
not operate or be construed as a waiver of any subsequent breach.
10. Notice. All notices required to be given under the
terms of this Agreement shall be in writing and shall be deemed to have been
duly given if delivered to the addressee in person or mailed by certified mail,
return receipt requested, as follows:
If to the Company, addressed to:
Xxxxx Xxxxxx, Inc.
000 Xxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxx, Esq.
With a copy to:
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
If to the Executive, addressed to:
Xxxxx X. Xxxxx, Vice President, Products Division
Xxxxxxxx Dental Products, Inc.
00000 Xxxx Xxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxxxx 00000
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With a copy to:
Xxxxx, Xxxxx & Ryd
00 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxx, Esq.
or to any such other address as the party to receive the notice shall advise by
due notice given in accordance with this paragraph.
11. Further Agreement. In the event that any amounts
paid or payable to the Executive pursuant to this Agreement shall adversely
affect the qualification of the Merger (as defined in the Merger Agreement) as a
pooling of interests, then the Company and the Executive shall endeavor in good
faith to modify such payments so that they will not adversely affect the Merger
as a pooling of interests for financial reporting purposes; provided, however,
that the parties shall, in any event, carry out the intent of this Agreement.
12. Headings. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
13. Entire Agreement; Benefit. This Agreement
constitutes the entire agreement and supersede all other prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof and all prior employment or other compensation or
compensation continuation agreements and arrangements between the Executive and
Xxxxxxxx. This agreement shall inure to and shall be binding upon the parties
hereto, the successors and assigns of the Company and the heirs and personal
representatives of the Executive.
14. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York without
giving effect to the provisions thereof relating to conflicts of law.
15. Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed to be an original but all of
which shall constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this
agreement as of the day and year first above written.
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Xxxxx X. Xxxxx
XXXXX XXXXXX, INC.
By:
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Authorized Officer
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