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EXHIBIT 10.5
FORM OF
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is executed this ___ day of
______, 1999, by and between ALLEGHENY TELEDYNE INCORPORATED, a Delaware
corporation with its principal place of business at 0000 Xxx XXX Xxxxx,
Xxxxxxxxxx, Xxxxxxxxxxxx 00000 (with all of its direct and indirect
subsidiaries, "ATI" or, together with the Company and the Parent Company
referred to below, as the case may be,"Employer"), and ___________________, an
individual residing in the State of California (the "Executive").
RECITALS:
A. Laars and Water Pik are unincorporated operating companies of ATI involved in
the manufacture and sale of consumer products, the assets and liabilities of
which are currently owned by indirect subsidiaries of ATI.
B. ATI is contemplating a transaction involving the incorporation of the Laars
and Water Pik operating companies (the "Company") and the subsequent spin-off of
the outstanding common stock of the Company (or the corporate parent of the
Company whose primary assets will be the stock of the Company, hereinafter
referred to as the "Parent Company") as the case may be, to the stockholders of
ATI (the "Spin-off"), followed by a public offering of shares of common stock of
the Company or the Parent Company (the "IPO/Spin-off").
C. The Executive is experienced in ________________________________ and is
desirous of becoming the __________________________________________________ of
the Company in light of the contemplated IPO/Spin-off.
D. ATI believes the Executive will contribute to the growth and profitability of
the Company as a part of ATI pending the IPO/Spin-off and as an independent
company following the IPO/Spin-off, and desires to employ the Executive as the
__________________________________________________ of the Company.
E. Executive represents that he has a right to enter into this agreement, that
there are no restrictions imposed on him by any third party agreement which
would prevent him from honoring all terms of this agreement, and that he will
not enter into any arrangement in conflict with the terms of this agreement.
F. The Executive is willing to make his services available to ATI on the terms
and conditions hereinafter set forth.
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AGREEMENT
Therefore, in consideration of the premises, mutual covenants and
agreements of the parties contained herein, and other good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged,
Employer and the Executive hereby agree as follows:
1. Employment. Commencing on ____________ (the "Effective Date"),
Employer, in reliance on the representations of Executive set forth herein,
shall employ the Executive and the Executive shall accept employment by
Employer, upon the terms and conditions set forth in this Agreement.
2. Term. The term of employment (the "Term") of this Agreement shall
begin on the Effective Date and, except as otherwise provided in Sections 7, 8,
9, 10, 11 and 12 below, shall end on the first anniversary date of the Effective
Date. The Term shall be automatically extended for one additional month
commencing on the Effective Date and on the last day of each calendar month
thereafter (each, an "Extension Date") unless one party gives written notice to
the other on or before an Extension Date. As of the last day of the month in
which a notice not to renew is delivered, the Term of this Agreement shall be
twelve months and shall not be further extended. The last day of the calendar
month in which the Term hereof, as extended from time to time, is then due to
expire is hereinafter referred to as the "Expiration Date."
3. Duties. The Executive will serve as ________________________________
_________________ of the Company and shall report to the President and Chief
Executive Officer of the Company (the "CEO"). The Executive shall perform such
duties as are consistent with the role of _________________________________
___________________ of the Company and such other duties as may be reasonably
assigned to him by the CEO.
4. Compensation. During the Term, Executive shall be compensated as
follows:
(a) Salary. Executive shall be paid an annual salary of
________ (the "Annual Base Salary"), to be distributed in equal periodic
installments according to Employer's customary payroll practices. The Annual
Base Salary will be reviewed annually by the CEO and increased (but not
decreased) if the CEO, in his or her discretion, determines an increase to be
appropriate, based on the types of factors the CEO usually takes into account in
reviewing executive level salaries, including, but not limited to,
cost-of-living factors.
(b) Annual Incentive Compensation. Pending the IPO/Spin-off,
ATI will provide the Executive with a target bonus opportunity of __% of Annual
Base Salary under the ATI annual incentive bonus plan. After the IPO/Spin-off,
the Company will provide the Executive with a target bonus opportunity of __% of
Annual Base Salary (the "Performance Bonus") under the Company's annual
incentive bonus plan, subject to the
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approval of the Company's Board of Directors or applicable committee thereof.
The annual incentive compensation paid pursuant to this subparagraph (b) is
referred to as the "Performance Bonus."
(c) Certain Additional Payments. In addition to the above
payments, the Executive will be paid the aggregate sum of _______ in cash, in
two equal annual installments, beginning after the first month of Employment and
on the first anniversary of the Effective Date (so long as he is and has
remained employed by the Company on such payment date), by ATI to the extent
such date occurs prior to the IPO/Spin-off or by the Company to the extent such
date occurs on the date of or after the IPO/Spin-off.
(d) Stock Options. Upon the first to occur of a distribution
of shares of the common stock of the Company or the Parent Company in the
Spin-off or in a public offering during the Term in accordance with a
registration statement filed under the Securities Act of 1933, as amended (a
"Public Offering"), ATI will cause the company whose shares are being
distributed in the Spin-off or sold in the Public Offering, as the case may be,
to grant to the Executive options to purchase _______ shares of common stock of
such company outstanding after giving effect to the completion of the Spin-off
or Public Offering (including, to the extent exercised, shares of common stock
issued upon the exercise of any overallotment option by the underwriters of the
Public Offering), and assuming the shares underlying such option are
outstanding, on the terms and conditions described herein. It is agreed that the
number of shares covered by the option described in this Section is based on the
assumption that approximately 19 million shares of common stock of the Company
or Parent Company will be distributed in the Spin-off and that the number of
shares covered by such option shall be adjusted as appropriate to reflect the
actual number of shares of common stock of the Company or Parent Company
distributed in the Spin-off. The options shall be issued effective as of the
completion of the Spin-off or Public Offering (the "Closing Date") and shall
have a 10-year term. The purchase price for the shares issuable upon exercise of
the options shall equal the average of the high and low sales prices of a share
of common stock of the Company or the Parent Company on the Closing Date, as the
case may be. The options would be issued pursuant to a plan, the shares of which
will be registered on a registration statement on Form S-8 with the Securities
and Exchange Commission, which registration statement shall be declared
effective prior to the earliest exercise date. The options shall become
exercisable cumulatively in accordance with the following schedule: __% of the
shares covered herein at any time after the first anniversary of the Closing
Date, an additional __% of the shares covered herein at any time after the
second anniversary of the Closing Date, and the remaining __% of the shares
covered herein at any time after the third anniversary of the Closing Date. If,
however, the Spin-off is completed or a Public Offering is closed during the
Term but the Closing Date is at least one year after the first anniversary of
the Effective Date, the options shall become exercisable cumulatively in
accordance with the following schedule: __% of the shares covered herein at any
time after the Closing Date, an additional __% of the shares covered herein at
any time after the second anniversary of the Effective Date, and the remaining
__% of the shares
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covered herein at any time after the third anniversary of the Effective Date.
Vested options must be exercised within 30 days after the date the Executive's
employment with the Employer terminates.
5. Expense Reimbursement and Other Benefits.
(a) Reimbursement of Expenses. During the term of Executive's
employment hereunder, Employer, upon the Executive's submission of proper
substantiation in accordance with Employer's standard procedure, including
copies of all relevant invoices, receipts or other evidence reasonably requested
by Employer, shall reimburse the Executive for all reasonable expenses actually
paid or incurred by the Executive in the course of and pursuant to the business
of Employer.
(b) Employee Benefits. Pending the IPO/Spin-Off, the following
benefits shall be provided by ATI and on or after the IPO/Spin-off, the
following benefits shall be provided by the Company: (i) Executive shall
participate in the Group Health and Hospitalization Plan, Group Life Insurance
Plan, Group Disability Insurance Plan and all other insurances, or insurance
plans and all employee benefit plans provided to employees of the Company
(collectively, the "Welfare Benefits"), and executive benefits and bonuses
covering employees of the Company as are now or may in the future be in effect,
subject to applicable eligibility requirements; and (ii) the Executive shall
participate in accordance with their respective terms in any defined benefit and
defined contribution plans provided to employees of the Company.
(c) Automobile. During the Term, Employer shall provide the
Executive with a leased automobile or the cash equivalent of the lease payments
therefor.
(d) Vacation. During the Term, the Executive will be entitled
to four weeks' paid vacation for each year. The Executive will also be entitled
to the paid holidays and other paid leave set forth in Employer's policies.
Vacation days and holidays during any fiscal year that are not used by the
Executive during such fiscal year may not be carried over and used in any
subsequent fiscal year.
(e) Meaning of Certain Terms. For the purposes of this
Agreement, references to matters "pending" or "prior to" the IPO/Spin-off means
a date prior to the first to occur of the IPO or Spin-off and references to
matters "after" or "on or after" the IPO/Spin-off means a date on or after the
first to occur of such IPO or Spin-off.
6. Restrictions.
(a) Non-competition. During the Term and for a one year period
after the termination of the Term for any reason, the Executive shall not,
directly or indirectly, engage in or have any interest in any sole
proprietorship, partnership, corporation or business or any other person or
entity (whether as an executive, officer, director, partner, agent, security
holder, creditor, consultant or otherwise) that directly or indirectly (or
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through any affiliated entity) engages in competition with the Company (for this
purpose, any business that engages in the development, manufacture, distribution
or sale of products similar to those products developed, manufactured,
distributed, sold or in development by the Company at the time of termination of
the Agreement shall be deemed to be in competition with the Company); provided
that such provision shall not apply to the Executive's ownership of Common Stock
of ATI or the acquisition by the Executive, solely as an investment, of
securities of any issuer that are registered under Section 12(b) or 12(g) of the
Securities Exchange Act of 1934, as amended (the "Securities Exchange Act"), and
that are listed or admitted for trading on any United States national securities
exchange or that are quoted on the NASDAQ Stock Market, or any similar system or
automated dissemination of quotations of securities prices in common use, so
long as the Executive does not control, acquire a controlling interest in or
become a member of a group which exercises direct or indirect control of, more
than five percent of any class of capital stock of such corporation.
(b) Nondisclosure. During the Term and for a one year period
after the termination of the Term for any reason, the Executive shall not at any
time divulge, communicate, use to the detriment of ATI or the Company or for the
benefit of any other person or persons, or misuse in any way, any Confidential
Information (as hereinafter defined) pertaining to the business of ATI or the
Company. Any Confidential Information or data now or hereafter acquired by the
Executive with respect to the business of ATI or the Company (which shall
include, but not be limited to, information concerning ATI's or the Company's
financial condition, prospects, technology, customers, suppliers, sources of
leads and methods of doing business) shall be deemed a valuable, special and
unique asset of ATI or the Company that is received by the Executive in
confidence and as a fiduciary, and Executive shall remain a fiduciary to ATI and
the Company with respect to all of such information. For purposes of this
Agreement, "Confidential Information" means information disclosed to the
Executive or known by the Executive as a consequence of or through his
employment by ATI or the Company (including information conceived, originated,
discovered or developed by the Executive) prior to or after the date hereof, and
not generally known, about ATI or the Company or its or their respective
businesses. Notwithstanding the foregoing, nothing herein shall be deemed to
restrict the Executive from disclosing Confidential Information to the extent
required by law. None of the foregoing obligations and restrictions apply to any
Confidential Information that the Executive demonstrates was or became generally
available to the public other than as a result of disclosure by the Executive.
(c) Nonsolicitation of Employees and Clients. During the Term
and for a one year period after the termination of the Term for any reason, the
Executive shall not, directly or indirectly, for himself or for any other
person, firm, corporation, partnership, association or other entity, other than
in connection with the performance of Executive's duties under this Agreement,
(i) solicit for employment or attempt to employ or enter into any contractual
arrangement with any employee or former employee of Employer, unless such
employee or former employee has not been employed by
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Employer for a period in excess of six months, (ii) call on or solicit any of
the actual or targeted prospective clients of Employer on behalf of any person
or entity in connection with any business competitive with the business of
Employer, and/or (iii) make known the names and addresses of such clients or any
information relating in any manner to Employer's trade or business relationships
with such customers (unless the Executive can demonstrate that such information
was or became generally available to the public other than as a result of a
disclosure by the Executive).
(d) Ownership of Developments. All copyrights, patents, trade
secrets, or other intellectual property rights associated with any ideas,
concepts, techniques, inventions, processes, or works of authorship developed or
created by Executive during the course of performing work for Employer or its
customers (collectively, the "Work Product") shall belong exclusively to
Employer and shall, to the extent possible, be considered a work made by the
Executive for hire for Employer within the meaning of Title 17 of the United
States Code. To the extent the Work Product may not be considered work made by
the Executive for hire for Employer, the Executive agrees to assign, and
automatically assign at the time of creation of the Work Product, without any
requirement of further consideration, any right, title, or interest the
Executive may have in such Work Product. Upon the request of Employer, the
Executive shall take such further actions, including execution and delivery of
instruments of conveyance, as may be appropriate to give full and proper effect
to such assignment.
(e) Books and Records. All books, records, and accounts
relating in any manner to the customers of Employer, whether prepared by the
Executive or otherwise coming into the Executive's possession, shall be the
exclusive property of Employer and shall be returned immediately to Employer on
termination of the Executive's employment hereunder or on Employer's request at
any time.
(f) Definition of Company. Solely for purposes of this Section
6, the term "Company" also shall include, along with all current direct and
indirect subsidiaries, any existing or future subsidiaries of the Company or the
Parent Company that are operating during the time periods described herein and
any other entities that directly or indirectly, through one or more
intermediaries, control, are controlled by or are under common control with the
Company or the Parent Company during the periods described herein.
(g) Acknowledgment by Executive. The Executive acknowledges
and confirms that (i) the restrictive covenants contained in this Section 6 are
reasonably necessary to protect the legitimate business interest of Employer
including the legitimate interests of the Company, and (ii) the restrictions
contained in this Section 6 (including without limitation the length of the term
of the provisions of this Section 6) are not overbroad, over long, or unfair and
are not the result of overreaching, duress or coercion of any kind. The
Executive further acknowledges and confirms that his full, uninhibited and
faithful observance of each of the covenants contained in this Section 6 will
not cause
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him any undue hardship, financial, or otherwise, and that enforcement of each of
the covenants contained herein will not impair his ability to obtain employment
commensurate with his abilities and on terms fully acceptable to him or
otherwise to obtain income required for the comfortable support of him and his
family and the satisfaction of the needs of his creditors. The Executive
acknowledges and confirms that his special knowledge of the business of the
Company is such as would cause Employer serious injury or loss if he were to use
such ability and knowledge to the benefit of a competitor or were to compete
with the Company in violation of the terms of this Section 6. The Executive
further acknowledges that the restrictions contained in this Section 6 are
intended to be, and shall be, for the benefit of and shall be enforceable by,
Employer's successors and assigns.
(h) Reformation by Court. In the event that a court of
competent jurisdiction shall determine that any provision of this Section 6 is
invalid or more restrictive than permitted under the governing law of such
jurisdiction, then only as to enforcement of this Section 6 within the
jurisdiction of such court, such provision shall be interpreted and enforced as
if it provided for the maximum restriction permitted under such governing law.
(I) Extension of Time. If the Executive shall be in violation
of any provision of this Section 6 then each time limitation set forth in this
Section 6 shall be extended for a period of time equal to the period of time
during which such violation or violations occur. If Employer seeks injunctive
relief from such violation in any court, then the covenants set forth in this
Section 6 shall be extended for a period of time equal to the pendency of such
proceeding including all appeals by the Executive.
(j) Survival. The provisions of this Section 6 shall survive
the termination of this Agreement, as applicable.
7. Death. The Term shall terminate upon the death of Executive and be
of no further force or effect. Upon such termination, Employer will pay the
Executive's estate a lump sum equal to the sum of (A) the product of one-twelfth
of the Annual Base Salary at the date of termination multiplied by the number of
months including fractions thereof remaining in the Term, and (B) the product of
one-twelfth of the Performance Bonus multiplied by the number of months
remaining in the Term. Employer reserves the right to provide this amount
through a policy of insurance on the life of the Executive.
8. Disability. If during the Term Executive is unable to perform his
services, by reason of illness or incapacity, for a period of 180 consecutive
days or more, Employer may, at its option, upon written notice to Executive,
terminate the Term and his employment hereunder. If the Term is terminated as a
result of the Executive's disability, Employer will pay the Executive the
product of one-twelfth of his Annual Base Salary at the date of termination for
the period remaining in the Term, to be distributed in periodic installments
according to Employer's customary payroll practices, and a lump sum equal
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to the product of one-twelfth of the Performance Bonus multiplied by the number
of months remaining in the Term, to be paid at the time of such termination.
Employer shall also continue to pay the premiums for the same or substantially
similar Welfare Benefits for the remainder of the Term. Notwithstanding the
foregoing, if the Executive shall find other employment during the period he is
receiving payments pursuant to this Section 8, then the Executive shall promptly
notify Employer in writing of the date and terms of such employment and Employer
shall be entitled to reduce the amount payable to the Executive pursuant to this
Section 8 during the period from the commencement of such other employment by
the cash compensation received and to be received by the Executive for services
rendered in connection with such other employment. Employer reserves the right
to provide this benefit through a policy of insurance.
9. Termination for Cause.
(a) Employer shall have the right to terminate the Term and
the Executive's employment hereunder for Cause (as defined below). Upon any
termination pursuant to this Section 9, Employer shall pay to the Executive any
unpaid Annual Base Salary through the effective date of termination specified in
such notice. Employer shall have no further liability hereunder (other than for
reimbursement for reasonable business expenses incurred prior to the date of
termination, subject, however, to the provisions of Section 5(a)).
(b) For purposes hereof, the term "Cause" shall mean the
Executive's conviction of a felony, the Executive's personal dishonesty directly
affecting ATI or the Company; willful misconduct or gross negligence (which
shall require prior written notice to the Executive from the CEO unless not
curable or such misconduct or gross negligence is injurious to Employer); breach
of a fiduciary duty involving personal profit to the Executive; or intentional
failure to substantially perform his duties after written notice to the
Executive from the CEO that, in the reasonable judgment of the CEO, the
Executive has failed to perform specific duties.
10. Termination Without Cause. At any time Employer shall have the
right to terminate the Term and the Executive's employment hereunder by written
notice to the Executive. Upon any termination pursuant to this Section 10 (that
is not a termination under any of Sections 7, 8, 11 or 12), Employer shall pay
to the Executive a lump sum equal to the sum of (A) the product of one-twelfth
of the Annual Base Salary at the date of termination multiplied by the number of
months remaining in the Term, and (B) the product of one-twelfth of the
Performance Bonus multiplied by the number of months remaining in the Term.
Employer shall also continue to pay the premiums for the same or substantially
similar Welfare Benefits and the Executive shall be entitled to the other
benefits set forth in Section 5(b), (c) and (d) for the remainder of the Term.
In the event such entitlement is not allowed by law, the Executive shall be
entitled to the cash equivalent of that benefit. The Company shall have no
further liability hereunder (other than for reimbursement for reasonable
business expenses incurred prior to the date of
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termination, subject, however, to the provisions of Section 5(a)). The Executive
shall be entitled to receive all severance payments and benefits hereunder
regardless of any future employment undertaken by the Executive as long as he is
in full compliance with the terms of this Agreement.
11. Termination by Executive.
(a) The Executive shall at all times have the right, upon 30
days' written notice to Employer, to terminate the Term and his employment
hereunder.
(b) Upon any termination pursuant to this Section 11 by the
Executive without Good Reason (as defined below), Employer shall pay to the
Executive any unpaid Annual Base Salary through the effective date of
termination specified in such notice. Employer shall have no further liability
hereunder (other than for reimbursement for reasonable business expenses
incurred prior to the date of termination, subject, however, to the provisions
of Section 5(a)). The Executive shall be entitled to receive all severance
payments and benefits hereunder regardless of any future employment undertaken
by the Executive as long as he is in full compliance with the terms of this
Agreement.
(c) Upon any termination pursuant to this Section 11 by the
Executive for Good Reason, Employer shall pay to the Executive the same amounts
that would have been payable by Employer to the Executive under Section 10 of
this Agreement if the Executive's employment had been terminated by Employer
without Cause. Employer shall have no further liability hereunder (other than
for reimbursement for reasonable business expenses incurred prior to the date of
termination, subject, however, to the provisions of Section 5(a)).
(d) For purposes of this Agreement, "Good Reason" shall mean
(A) the occurrence of a Change in Control (as defined in Section 12 hereof) in
Employer during the Term and (B) prior to the earlier of the expiration of the
Term and one year after the date of the Change in Control, the Term and
Executive's employment with Employer is terminated by Employer without Cause, as
defined in Section 9(b) (and other than pursuant to Section 7 by reason of the
Executive's death or Section 8 by reason of the Executive's disability) or the
Executive terminates the Term and his employment as a result of (i) the
assignment to the Executive of duties which are materially inconsistent with or
substantially lesser in responsibility and scope than those usually performed by
a Vice President-Finance and Chief Financial Officer of the Company, excluding
for this purpose an isolated, insubstantial and inadvertent action not taken in
bad faith and which is remedied by Employer promptly after receipt of notice
thereof given by the Executive; or (ii) the failure by Employer to comply with
any of the material provisions of Section 4 of this Agreement, other than an
isolated, insubstantial and inadvertent failure not occurring in bad faith and
which is remedied by Employer promptly after receipt of notice thereof given by
the Executive.
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12. Change in Control.
(a) For purposes of this Agreement, the term "Change in
Control" shall mean:
(i) Subsequent to the IPO/Spin-off, approval by the
stockholders of Employer of (x) a reorganization, merger, consolidation
or other form of corporate transaction or series of transactions, in
each case, with respect to which persons who were the stockholders of
Employer immediately prior to such reorganization, merger or
consolidation or other transaction do not, immediately thereafter, own
more than 50% of the combined voting power entitled to vote generally
in the election of directors of the reorganized, merged or consolidated
company's then outstanding voting securities, or (y) a liquidation or
dissolution of Employer or (z) the sale of all or substantially all of
the assets of Employer (unless such reorganization, merger,
consolidation or other corporate transaction, liquidation, dissolution
or sale is subsequently abandoned); or
(ii) Individuals who, as of the date hereof,
constitute the Board of Directors of ATI or who, immediately after the
IPO/Spin-off, constitute the Board of Directors of the Company or
Parent Company, as the case may be, (each, the "Incumbent Board") cease
for any reason to constitute at least a majority of the Incumbent
Board, provided that any person becoming a director subsequent to the
date hereof or, if applicable, the date of the IPO/Spin-off, whose
election, or nomination for election by stockholders, was approved by a
vote of at least a majority of the directors then comprising the
Incumbent Board (other than an election or nomination of an individual
whose initial assumption of office is in connection with an actual or
threatened election contest relating to the election of the directors,
as such terms are used in Rule 14a-11 of Regulation 14A promulgated
under the Securities Exchange Act) shall be, for purposes of this
Agreement, considered as though such person were a member of the
Incumbent Board; or
(iii) The acquisition (other than from Employer) by
any person, entity or "group," within the meaning of Section 13(d)(3)
or 14(d)(2) of the Securities Exchange Act (excluding, for this
purpose, Employer or its subsidiaries, or any executive benefit plan of
Employer or its subsidiaries) which acquires beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Securities
Exchange Act), of 20% or more of either the then outstanding shares of
ATI Common Stock (prior to the IPO/Spin-off) or common stock of the
Company or the Parent Company, as the case may be, (after the
IPO/Spin-off) or the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of
directors of the applicable entity.
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(b) The payments made pursuant to the provisions of Section 11
as a result of a termination by the Executive for the Good Reason described in
Section 11(d) above shall be in lieu of any and all compensation due to
Executive for the years that would otherwise be remaining in the Term. Upon
receipt of said lump sum payment, this Agreement and all rights and duties of
the parties shall be terminated, except as follows. In consideration for such
lump sum payment and for the right to terminate under the conditions set forth
above, Executive agrees to consult with Employer (or its successors), and its
officers if requested to do so for a period of at least one year from the date
of such termination. However, Executive shall be required to devote only such
part of his time to such services as Executive believes reasonable in
Executive's sole discretion, including not interfering with Executive's
employment, and the time and date such services are offered shall be determined
by Executive so long as that time and date is within a reasonable period of time
after the request. It is expressly agreed that ATI's rights to avail itself of
the advice and consultation services of Executive shall at all times be
exercised in a reasonable manner, that adequate notice shall be given to
Executive in such events, and that non-compliance with any such request by
Executive for good reason, including, but not limited to, ill health or prior
commitments, shall not constitute a breach or violation of this Agreement.
Executive agrees that, except for reimbursement of all reasonable expenses
incurred by him with respect to such consultation and advisory services, payable
as such consultation and advisory services are rendered, he shall not be
entitled to any further compensation. It is understood that in furnishing any
advisory and consulting services provided herein, Executive shall not be an
executive of Employer but shall act in the capacity of independent contractor.
13. Waivers. It is understood that either party may waive the strict
performance of any covenant or agreement made herein; however, any waiver made
by a party hereto must be duly made in writing in order to be considered a
waiver, and the waiver of one covenant or agreement shall not be considered a
waiver of any other covenant or agreement unless specifically in writing as
aforementioned.
14. Savings Provisions. The invalidity, in whole or in part, of any
covenant or restriction, or any section, subsection, sentence, clause, phrase or
word, or other provisions of this Agreement, as the same may be amended from
time to time shall not affect the validity of the remaining portions thereof.
15. Governing Law. Until such time as this Agreement is assigned to the
Company, this Agreement shall be construed in accordance with and governed by
the laws of the Commonwealth of Pennsylvania without giving effect to its choice
of law provision. After the assignment of the Agreement to the Company, the
Agreement shall be construed in accordance with and governed by the laws of the
State of California without giving effect to its choice of law provisions.
16. Notices. If either party desires to give notice to the other in
connection with any of the terms and provisions of this Agreement, said notice
must be in writing
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and shall be deemed given when (a) delivered by hand (with written confirmation
of receipt), (b) sent by facsimile (with written confirmation of receipt),
provided that a copy is mailed by registered mail, return receipt requested, or
(c) when received by the addressee, if sent by a nationally recognized overnight
delivery service (receipt requested), in each case addressed to the party for
whom it is intended as follows (or such other addresses as either party may
designate by notice to the other party and, after the IPO/Spin-off, at the
Parent Company's or Company's then principal executive offices):
If to Employer Xxxxxxx X. Xxxxxx
Allegheny Teledyne Incorporated
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxx, XX 00000
with a copy to: Xxx X. Xxxxxx
Senior Vice President, General Counsel
and Secretary
Allegheny Teledyne Incorporated
0000 Xxx XXX Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
If to Executive: At the most recent home address of Executive
on the official records of Employer
17. Default. In the event either party defaults in the performance of
its obligations under this Agreement, the non-defaulting party may, after giving
30 days' notice to the defaulting party to provide a reasonable opportunity to
cure such default, proceed to protect its rights by suit in equity, action at
law, or, where specifically provided for herein, by arbitration, to enforce
performance under this Agreement or to recover damages for breach thereof,
including all costs and attorneys' fees, whether settled out of court,
arbitrated, or tried (at both trial and appellate levels).
18. Section 162(m) Limits. Notwithstanding any other provision of this
Agreement, if and to the extent that any remuneration payable by Employer to the
Executive for any year would exceed the maximum amount of such remuneration that
Employer may deduct for that year by reason of Section 162(m) of the Code,
payment of the portion of the remuneration for that year that would not be so
deductible under Section 162(m) shall, in the sole discretion of the Board, be
deferred so that it shall become payable at such time or times as the Board
reasonably determines that it would be deductible by Employer under Section
162(m), with interest at the "short-term applicable federal rate" as such term
is defined in Section 1274(d) of the Code.
19. No Third Party Beneficiary. Nothing expressed or implied in this
Agreement is intended, or shall be construed, to confer upon or give any person
other
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than Employer, the parties hereto and their respective heirs, personal
representatives, legal representatives, successors and assigns, any rights or
remedies under or by reason of this Agreement.
20. Waiver of Jury Trial. ALL PARTIES KNOWINGLY WAIVE THEIR RIGHTS TO
REQUEST A TRIAL BY JURY IN ANY LITIGATION IN ANY COURT OF LAW, TRIBUNAL OR LEGAL
PROCEEDING INVOLVING THE PARTIES HERETO OR ANY DISPUTES ARISING OUT OF OR
RELATED TO THIS AGREEMENT.
21. Successors.
(a) This Agreement shall inure to the benefit of and be
binding upon the Executive and the Executive's assigns, heirs, representatives
or estate.
(b) This Agreement shall be binding upon and inure to the
benefit of ATI (including therein each direct and indirect subsidiary) and its
successors and assigns. In the event of a Spin-off or Public Offering, ATI shall
cause the corporation whose stock is distributed in the Spin-off or sold in the
Public Offering (the "Offered Company") to accept this Agreement as its
obligation and this Agreement shall be binding upon and inure to the benefit of
the Offered Company and its direct and indirect subsidiaries and their
respective successors and assigns. In the event that this Agreement is adopted
by the Offered Company, ATI will have no obligation thereafter to perform or to
make payments to the Executive, except for payments earned, due and owning as of
the date of such Public Offering under this Agreement or under any one or more
plans, programs and arrangements in which the Executive then participates.
[THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, ATI, by its appropriate officer, signed this
Agreement and Executive has signed this Agreement, as of the day and year first
above written.
ALLEGHENY TELEDYNE INCORPORATED
By: __________________________________________
Xxxx X. Cool
Senior Vice President-Human Resources
EXECUTIVE
______________________________________________
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Schedule to Form of Employment Agreement
Name Title Base Salary Additional Payments Number of Options
---- ----- ----------- ------------------- -----------------
Xxxxxxx Xxxxxx Vice President - Operations $190,000 $ 20,000 over 2 years 37,500
Xxxxxx X. Xxxxxx Executive Vice President - Sales, $245,000 $180,000 over 3 years 62,500
Marketing & Business Development
Xxxxxx X. Xxxxxxxxx Vice President - Finance $225,000 $ 50,000 over 2 years 50,000
Chief Financial Officer
