EXHIBIT 10.14
June 25, 1998
Xxxxxx X. Xxxxx
0000 Xxxxxxx Xxxxx Xxxx
Xxxx Xxxxx,, XX 00000
Re: Employee Retention Agreement
Dear Xxxxx:
Cadmus Communications Corporation (the "Corporation") considers it
essential to the best interests of its shareholders to xxxxxx the continuous
employment of its key management personnel and that of its direct and indirect
subsidiaries (collectively the "Cadmus Companies" or individually a "Cadmus
Company"). In this connection, the Board of Directors of the Corporation (the
"Board") recognizes that the possibility of a change in control of the
Corporation may exist and that such possibility, and the uncertainty and
questions which it may raise among management, may result in the departure or
distraction of management personnel to the detriment of the Corporation and its
shareholders.
The Board has determined that appropriate steps should be taken to
reinforce and encourage the continued attention and dedication of members of the
Cadmus Companies' management, including yourself, to their assigned duties
without distraction in the face of potentially disturbing circumstances arising
from the possibility of a change in control of the Corporation.
In order to induce you to remain in the employ of the Cadmus Companies,
the Corporation agrees that you shall receive the severance benefits set forth
in this letter agreement (the "Agreement") in the event your employment with the
Cadmus Companies is terminated under the circumstances described below
subsequent to a Change in Control (as defined in Section 2) of the Corporation.
1. Certain Definitions.
(a) "Change in Control Period" means the period commencing on the date hereof
and ending on the second anniversary of such date; provided, however, that
commencing on the date one year after the date hereof, and on each
anniversary of such date (such date and each annual anniversary thereof
shall be hereinafter referred to as the "Renewal Date"), the Change in
Control Period shall be automatically extended so as to terminate two
years from such Renewal Date, unless at least 60 days prior to the Renewal
Date the Corporation shall give notice to you that the Change in Control
Period shall not be so extended.
(b) "Effective Date" means the first date during the Change in Control Period
(as defined in Section 1(b)) on which a Change in Control occurs.
Anything in this Agreement to the contrary notwithstanding, if a Change in
Control occurs and if your employment with the Cadmus Companies is
terminated prior to the date on which the Change in Control occurs, and if
it is reasonably demonstrated by you that such termination of employment
(i) was at the request of a third party who has taken steps reasonably
calculated to effect the Change in Control, or (ii) otherwise arose in
connection with or anticipation of the Change in Control, then for all
purposes of this Agreement the "Effective Date" shall mean the date
immediately prior to the date of such termination of employment.
(c) "Employment Period" means the period commencing on the Effective
Date and ending on the second anniversary of such date.
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(d) "Date of Termination" means (i) if your employment with the Cadmus
Companies is terminated by the Corporation for Cause or is terminated by
you for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein, as the case may be, (ii) if your
employment with the Cadmus Companies is terminated by the Corporation
other than for Cause or Disability, the Date of Termination shall be the
date on which the Corporation notifies you of such termination, and (iii)
if your employment is terminated by reason of death or Disability, the
Date of Termination shall be the date of your death or the Disability
Effective Date, as the case may be.
(e) "Termination" means a notice which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) sets forth
in reasonable detail the facts and circumstances claimed to provide
a basis for termination of your employment under the provision so
indicated, and (iii) if the Date of Termination is other than the
date of receipt of such notice, specifies the termination date.
2. Change in Control. No benefits shall be payable hereunder unless there
shall have been a Change in Control of the Corporation, as set forth
below. For purposes of this Agreement, a "Change in Control" shall mean:
(a) The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) (a "Person") of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or
more of either (i) the then outstanding shares of common stock of the
Corporation (the "Outstanding Cadmus Common Stock") or (ii) the combined
voting power of the then outstanding voting securities of the Corporation
entitled to vote generally in the election of directors (the "Outstanding
Cadmus Voting Securities"). Notwithstanding the foregoing, the following
acquisitions shall not constitute a Change in Control: (i) any
acquisition directly from the Corporation, (ii) any acquisition by the
Corporation, (iii) any acquisition by, or benefit distribution from, any
employee benefit plan (or related trust) sponsored or maintained by the
Corporation or any corporation controlled by the Corporation, (iv) any
acquisition pursuant to any compensatory stock option, stock purchase or
other stock plan for employees, or (v) any acquisition pursuant to a
reorganization, merger or consolidation, if, following such
reorganization, merger or consolidation, the conditions described in
clauses (i), (ii), and (iii) of Subsection (c) of this Section 2 are
satisfied; or
(b) Individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority
of the Board; provided, however, that any individual becoming a director
subsequent to the date hereof whose election or nomination for election
was approved by a vote of at least a majority of the directors then
comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board (with his predecessor
thereafter ceasing to be a member); or
(c) Approval by the shareholders of the Corporation of the reorganization,
merger, or consolidation of the Corporation unless, following such
reorganization, merger, or consolidation, (i) more than 60% of the then
outstanding shares of common stock and the then outstanding voting
securities of the resulting corporation is then beneficially owned by all
or substantially all of the beneficial owners, respectively, of the
Outstanding Cadmus Common Stock and Outstanding Cadmus Voting Securities
immediately prior to such reorganization, merger, or consolidation, (ii)
no Person (excluding (A) the Corporation, (B) any employee benefit plan
(or related trust) of the Corporation or such corporation resulting from
such reorganization, merger, or consolidation, and (C) any Person
beneficially owning, immediately prior to such reorganization, merger, or
consolidation, 20% or more of the Outstanding Cadmus Common Stock or
Outstanding Cadmus Voting Securities, as the case may be) beneficially
owns 20% or more of the then outstanding shares of common stock or the
combined voting power of the then outstanding voting securities of the
resulting corporation, and (iii) at least a majority of the members of the
board of directors of the resulting corporation were members of the
Incumbent Board at the time of the execution of the initial agreement
providing for such reorganization, merger, or consolidation; or
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(d) Approval by the shareholders of the Corporation of (i) a complete
liquidation or dissolution of the Corporation, or (ii) the sale or other
disposition of all or substantially all of the assets of the Corporation
other than to a corporation with respect to which, following such sale or
other disposition, (A) more than 60% of the outstanding shares of common
stock and the then outstanding voting securities of such corporation is
beneficially owned by all or substantially all of the beneficial owners,
respectively, of the Outstanding Cadmus Common Stock and Outstanding
Cadmus Voting Securities immediately prior to such sale or disposition;
(B) no Person (excluding (I) the Corporation, (II) any employee benefit
plan (or related trust) of the Corporation or such corporation, and (III)
any Person beneficially owning, immediately prior to such sale or other
disposition, 20% or more of the Outstanding Cadmus Common Stock or
Outstanding Cadmus Voting Securities, as the case may be) beneficially
owns 20% or more of the then outstanding shares of common stock or the
combined voting power of the then outstanding voting securities of such
corporation, and (C) at least a majority of the members of the board of
directors of such corporation were members of the Incumbent Board at the
time of the execution of the initial agreement providing for such sale or
other disposition of the assets of the corporation.
3. Employment Period. The Corporation hereby agrees to continue, or cause to
be continued, your employment with the Cadmus Companies for the Employment
Period.
4. Termination of Employment.
(a) Your employment with the Cadmus Companies shall terminate
automatically upon your death during the Employment Period.
(b) If, as a result of your incapacity due to physical or mental illness (as
determined by the Corporation), you shall have been absent from the
full-time performance of your duties with the Cadmus Companies for six (6)
consecutive months (your "Disability"), the Cadmus Company by which you
are then employed may give you written notice of its intention to
terminate your employment. In such event, your employment with the Cadmus
Companies shall terminate effective on the 30th day after your receipt of
such notice (the "Disability Effective Date"), provided that within 30
days after your receipt of such notice you have not returned to full-time
performance of your duties.
(c) Your employment with the Cadmus Companies may be terminated by the
Corporation during the Employment Period with or without Cause. For
purposes hereof, "Cause" shall mean (i) the willful and continued failure
by you to substantially perform your duties with the Cadmus Companies
(other than any such failure resulting from your incapacity due to
physical or mental illness or any such actual or anticipated failure after
the issuance of a Notice of Termination by you for Good Reason (as defined
in Section 4(d)), after a written demand for substantial performance is
delivered to you by the Board, which demand specifically identifies the
manner in which the Board believes that you have not substantially
performed your duties, (ii) the willful engagement by you in conduct which
is demonstrably and materially injurious to the Cadmus Companies,
monetarily or otherwise, or (iii) your conviction of a felony involving
moral turpitude. For purposes of this subsection, no act, or failure to
act, on your part shall be deemed "willful" unless done, or omitted to be
done, by you not in good faith and without reasonable belief that your
action or omission was in the best interest of the Cadmus Companies.
(d) You may terminate your employment with the Cadmus Companies during
the Employment Period for any reason, including without limitation
Good Reason. For purposes of this Agreement, "Good Reason" shall
mean:
(i) the assignment to you of any duties inconsistent with the
position (including status, offices, titles, and reporting
requirements) or authority in the Cadmus Companies that you
held immediately prior to the Change in Control, or a
significant adverse alteration in the nature or status of your
responsibilities or the conditions of your employment from
those in effect immediately prior to such Change in Control;
(ii) a reduction by the Corporation in your annual base salary as
in effect on the date hereof or as the same may be increased
from time to time;
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(iii) if your principal office location is at the Corporation's
principal executive offices immediately prior to the Change
in Control, the relocation of the Corporation's principal
executive offices to a location outside the Richmond
Metropolitan Area, or if your principal office location is
not at the Corporation's principal executive offices
immediately prior to the Change in Control, the Corporation's
requiring you to be based anywhere other than your principal
office location immediately prior to the Change in Control
except for required travel on the Cadmus Companies' business
to an extent substantially consistent with your present
business travel obligations;
(iv) except in the event of reasonable administrative delay, the
failure by the Cadmus Companies to pay to you any portion of
your current compensation or to pay to you any portion of an
installment of deferred compensation under any deferred
compensation program of the Cadmus Companies within seven (7)
days of the date such compensation is due;
(v) the failure by the Cadmus Companies to continue in effect
for you any compensation plan in which you participate
immediately prior to the Change in Control that is material
to your total compensation or any substitute plan adopted
prior to the Change in Control, unless an equitable
arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to such
plan, or the failure by the Cadmus Companies to continue
your participation therein (or in such substitute or
alternative plan) on a basis not materially less favorable,
both in terms of the amount of benefits provided and the
level of your participation relative to other
participants, as it existed at the time of the Change
in Control;
(vi) the failure by the Cadmus Companies to continue to provide
you with benefits substantially similar to those enjoyed
by you under any of the Cadmus Companies' life insurance,
medical, health and accident, or disability plans in
which you were participating at the time of the Change in
Control, the taking of any action by any Cadmus Company
which would directly or indirectly materially reduce any
of such benefits or deprive you of any material fringe
benefit enjoyed by you at the time of the Change in
Control, or the failure by the Cadmus Companies to
provide you with the number of paid vacation days to which
you are entitled on the basis of years of service with
the Cadmus Companies in accordance with the normal
vacation policy of the Cadmus Company employing you in
effect at the time of the Change in Control;
(vii) the failure of the Corporation to obtain a satisfactory
agreement from any successor to assume and agree to perform
this Agreement, as contemplated in Section 6 hereof;
(viii) any purported termination of your employment that is not
effected pursuant to a Notice of Termination satisfying the
requirements of Subsection (e) hereof (and, if applicable,
the requirements of Subsections (b) and (c) hereof), which
purported termination shall not be effective for purposes of
this Agreement; or
(ix) so long as no Cause for your termination by the Corporation
exists (or would exist assuming the Board made a
determination of Cause), a voluntary cessation by you of your
employment for any reason during the 60-day period commencing
on the first anniversary of the occurrence of the Change in
Control.
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For purposes of this subsection, any good faith determination of
"Good Reason" made by you shall be conclusive. In addition,
your right to terminate your employment pursuant to this
subsection shall not be affected by your incapacity due to
physical or mental illness and your continued employment shall
not constitute consent to, or a waiver of rights with respect
to, any circumstance constituting Good Reason hereunder.
(e) Any purported termination of your employment with the Cadmus
Companies by the Corporation or by you shall be communicated by
written Notice of Termination to the other party hereto in
accordance with Section 8.
5. Compensation upon Termination during the Employment Period. Following a
Change in Control, you shall be entitled to the following benefits upon
termination of your employment with the Cadmus Companies provided that
such termination occurs during the Employment Period:
(a) If your employment is terminated by reason of your death during the
Employment Period, this Agreement shall terminate without further
obligations to your legal representatives under this Agreement, other than
for (i) payment of your Base Salary (as defined in Section 5(g) hereof)
through the Date of Termination at the same rate in effect at such date,
and (ii) all other amounts to which you are entitled under any
compensation plan or any other plan, policy, or arrangement of the Cadmus
Companies, at the time such payments are due.
(b) During any period that you fail to perform your full-time duties with the
Cadmus Companies as a result of incapacity due to physical or mental
illness, you shall continue to receive, until this Agreement is terminated
pursuant to Section 4(b) hereof, your Base Salary (as defined in Section
5(g)) at the rate in effect at the commencement of any such period,
together with all compensation payable to you under any long-term
disability plan maintained by the Xxxxxx Companies in your name or for
your benefit or other similar plan during such period. Thereafter, your
benefits shall be determined under the retirement, insurance and other
compensation programs of the Cadmus Companies in which you participate in
accordance with the terms of such programs; however, your receipt of
benefits under any long-term disability plan maintained by the Cadmus
Companies in your name or for your benefit will not be affected by your
termination under this Agreement.
(c) If, during the Employment Period, your employment with the Cadmus
Companies shall be terminated by the Corporation for Cause or by you other
than for Good Reason, you shall be entitled to your full Base Salary (as
defined in Section 5(g)) through the Date of Termination at the rate in
effect at the time Notice of Termination is given, plus all other amounts
to which you are entitled under any compensation plan of the Cadmus
Companies at the time such payments are due, and the Cadmus Companies
shall have no further obligations to you under this Agreement.
(d) If, during the Employment Period, your employment with the Cadmus
Companies shall be terminated by you for Good Reason or by the
Corporation other than for Cause, death, or Disability, then you
shall be entitled to the benefits provided below:
(i) you the Corporation shall pay to you your full Base Salary (as
defined in Section 5(g) hereof) through the Date of
Termination at the rate in effect at the time Notice of
Termination is given, no later than the fifth day following
the Date of Termination, plus all other amounts to which you
are entitled under any compensation plan of the Cadmus
Companies, at the time such payments are due;
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(ii) in lieu of any further salary or bonus payments to you for
periods subsequent to the Date of Termination, you shall be
paid as severance pay to you, at the time and in the manner
specified in Subsection (e), a severance payment (the
"Severance Payment") equal to the product of (A) your Base
Salary (as defined in Section 5(g) hereof), and (B) a number
(the "Payment/Benefit Factor") determined by dividing by 52
the sum of (I) three times the number of full years that you
have been employed by the Cadmus Companies, and (II) three
times each $10,000 of your annual salary (that is, excluding
bonus) as in effect at the Date of Termination; provided,
however, that in no event shall such Payment/Benefit Factor be
less than .5 nor greater than 2, and provided, further, that
in no event shall such amount exceed the amount of your Base
Salary (as defined in Section 5(g)), on an undiscounted basis,
which you would have received had you remained in the employ
of the Cadmus Companies until your "Normal Retirement Date"
(as defined in the Corporation's Pension Plan (or any
successor thereto) (the "Pension Plan");
(iii) a separate lump-sum supplemental retirement benefit (the
amount of such benefit shall be hereinafter referred to as the
"Supplemental Retirement Amount") equal to the difference
between (A) the actuarial equivalent (utilizing for this
purpose the actuarial assumptions utilized in determining
benefit cash-outs with respect to the Corporation's Pension
Plan during the 90-day period immediately preceding the
Effective Date) of the benefit payable under the Pension Plan
and any supplemental and/or excess benefit plan of the
Corporation providing benefits for you (the "SERP") which you
would receive if your employment continued at the compensation
level in effect at the Date of Termination for the remainder
of the Employment Period, assuming for this purpose that all
accrued benefits are fully vested and that benefit accrual
formulas are no less advantageous to you than those in effect
during the 90-day period immediately proceeding the Effective
Date, and (B) the actuarial equivalent (utilizing for this
purpose the actuarial assumptions utilized in determining
benefit cash outs with respect to the Pension Plan during the
90-day period immediately preceding the Effective Date) of
your actual vested benefit (paid or payable), if any, under
the Pension Plan and the SERP;
(iv) Except as provided in (iii) above, your participation in, and
terminating distribution and vested rights under, the
Corporation's Pension Plan and other plans of deferred
compensation of the Cadmus Companies shall be governed by the
terms of those respective plans;
(v) the Corporation shall pay to you all legal fees and expenses
incurred by you as a result of such termination, including all
such fees and expenses, if any, incurred in seeking to obtain
or enforce any right or benefit provided by this Agreement or
in connection with any tax audit or proceeding to the extent
attributable to the application of Section 4999 of the
Internal Revenue Code of 1986, as amended (the "Code") to any
payment or benefit provided hereunder;
(vi) for a period of years (or portion thereof) (the "Payment
Period") equal to the Payment/Benefit Factor after such
termination or until your "Normal Retirement Date" (as defined
in the Corporation's Pension Plan, whichever first occurs, the
Corporation shall arrange to provide you with life,
disability, accident and group health insurance benefits
substantially similar to those which you were receiving under
the welfare programs of the Cadmus Companies immediately prior
to the Notice of Termination. Benefits otherwise receivable
by you pursuant to this clause (vi) shall be reduced to the
extent comparable benefits are actually received by you from
any source (including a subsequent employer) during such
period following your termination, and any such benefits
actually received by you shall be reported to the Corporation;
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(vii) in the event that the payments and benefits provided to you,
or for your benefit, under this Agreement (determined without
regard to the Gross-Up Payment described below) or under any
other plan or agreement which become payable or are taken into
account as "parachute payments" within the meaning of Section
280G of the Code as a result of a Change in Control or your
termination of employment relating thereto (the "Total
Parachute Payments") would result in your being entitled to
"excess parachute payments" as defined in Section 280G of the
Code, the following applicable reduction shall occur or
additional payment shall be made:
(A) in the event the Change in Control occurs before July 1,
1999, you shall be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that
after payment by you of all taxes (including any
interest or penalties incurred by you with respect to
such taxes), including, without limitation, any federal,
state and local income taxes, any employment taxes, and
the excise tax imposed by Section 4999 of the Code (such
excise tax, together with any interest or penalties
relating to such excise tax, are hereinafter
collectively referred to as the "Excise Tax"), you
retain an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Total Parachute Payments; or
(B) in the event the Change in Control occurs on or after
July 1, 1999, the payments and benefits provided to you,
or for your benefit, under this Agreement shall be
reduced (but not below zero) to the extent necessary so
that no payment to be made, or benefit to be provided,
to you or for your benefit under this Agreement or any
other plan or agreement would result in "excess
parachute payments" as defined in Section 280G of the
Code, provided, however that the reduction provided in
this clause shall not apply unless your net after-tax
benefit if such reduction were made shall exceed your
net after-tax benefit if such reduction were not made.
"Net after-tax benefit" shall mean the sum of (I) the
Total Parachute Payments which you receive or are then
entitled to receive, less (II) the amount of federal,
state and local income and employment taxes payable by
you with respect to the Total Parachute Payments, less
(III) the amount of excise taxes imposed with respect to
the Total Parachute Payments by Section 4999 of the Code.
All determinations regarding the reductions or additional
payment called for in this clause (vii) shall be made by tax
counsel selected by the Corporation and shall be based on the
maximum applicable marginal tax rates for each year in which
such payments and benefits shall be paid or provided to you or
for your benefit (based upon the rate in effect for such year
at the time of the first payment of the foregoing and, as
appropriate as determined by such tax counsel, the taxable
wage base for employment tax purposes); and
(viii) for a period of twelve (12) months following such
termination, the Corporation shall pay the expenses of such
outplacement services as you may require, with such services
to be performed by such agency as the Corporation shall
designate.
(e) The payment provided for in Subsection (d)(ii), shall be made in a
lump-sum not later than the 30th day following the Date of Termination.
Notwithstanding anything contained in this Subsection (e) or in Subsection
(d)(ii), you may elect to receive, in lieu of a lump-sum Severance
Payment, the benefits described in Subsection (d)(ii) in equal monthly
installments commencing on the first day of the month following the Date
of Termination and ending on the first to occur of (A) the first day of
the last month within the Payment Period, or (B) the first day of the
month in which occurs your "Normal Retirement Date" (as defined in the
Corporation's Pension Plan.
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(f) Except as provided in Subsection (d)(vi) hereof you shall not be
required to mitigate the amount of any payment provided for in this
Section 5 by seeking other employment or otherwise, nor shall the
amount of any payment or benefit provided for in this Section 5 be
reduced by any compensation earned by you as the result of
employment by another employer, by retirement benefits, by offset
against any amount claimed to be owed by you to any Cadmus Company,
or otherwise.
(g) For purposes of this Agreement, your "Base Salary" shall mean the
greater of (i) the annual salary and bonus paid to you by the Cadmus
Companies at the date of this Agreement, or (ii) the annual salary
and bonus payable to you by the Cadmus Companies during the fiscal
year in which a Change in Control occurs.
6. Successors: Binding Agreement.
(a) This Agreement is personal to you and without the prior written
consent of the Corporation shall not be assignable by you otherwise
than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of, and be enforceable by, your legal
representatives.
(b) This Agreement shall inure to the benefit of, and be binding upon,
the Corporation and its successors and assigns.
(c) The Corporation will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all
of the business and/or assets of the Corporation to assume expressly and
agree to perform this Agreement in the same manner and to the same extent
that the Corporation would be required to perform it if no such succession
had taken place. As used in this Agreement, "Corporation" shall mean the
Corporation as hereinbefore defined and any successor to its business
and/or assets as aforesaid which assumes and agrees to perform this
Agreement by operation of law, or otherwise.
7. Resolution of Disputes. If there shall be any dispute between the Corporation
and you (i) in the event of any termination of your employment with the Cadmus
Companies by the Corporation, whether such termination was for Cause, or (ii) in
the event of any termination of employment with the Cadmus Companies by you,
whether Good Reason existed, then, unless and until there is a final,
nonappealable judgment by a court of competent jurisdiction declaring that such
termination was for Cause or that the determination by you of the existence of
Good Reason was not made in good faith, the Corporation shall pay all amounts,
and provide all benefits, to you and/or your family or other beneficiaries, as
the case may be, that the Corporation would be required to pay or provide
pursuant to Section 5(d) as though such termination were by the Corporation
without Cause or by you with Good Reason; provided, however, that the
Corporation shall not be required to pay any disputed amounts pursuant to this
Section 7 except upon receipt of an undertaking by or on behalf of you to repay
all such amounts to which you are ultimately adjudged by such court not to be
entitled.
8. Notice. For the purpose of this Agreement, notices and all other communications
provided for in this Agreement shall be in writing and shall be deemed to have
been duly given when delivered or mailed by United States certified or
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses set forth on the first page of this Agreement, provided
that all notice to the Corporation shall be directed to the attention of the
Board with a copy to the Secretary of the Corporation, 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.
9. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance with
the laws of the Commonwealth of Virginia, without reference to
principles of conflict of laws. The captions of this Agreement are
not part of the provisions hereof and shall have no force or effect.
(b) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any
other provision of this Agreement.
139
(c) The Corporation may withhold from any amounts payable under this
Agreement such Federal, state or local taxes as shall be required to
be withheld pursuant to any applicable law or regulation.
(d) Your or the Corporation's failure to insist upon strict compliance with
any provision hereof or any other provision of this Agreement or the
failure to assert any right you or the Corporation may have hereunder,
including, without limitation, your right to terminate your employment for
Good Reason pursuant to Section 4(d) or the Corporation's right to
terminate your employment for Cause pursuant to Section 4(c), shall not be
deemed to be a waiver of such provision or right or any other provision or
right of this Agreement.
(e) You and the Corporation acknowledge that, except as may otherwise be
provided under any other written agreement between you and the
Corporation, your employment by the Cadmus Companies is "at will"
and if, prior to the Effective Date, your employment with the Cadmus
Companies terminates, then you shall have no rights under this
Agreement.
(f) Prior to the Effective Date, this Agreement may be amended,
modified, or terminated by the Corporation, which amendment,
modification, or termination shall be binding and effective without
any requirement for notification of, or consent by, you.
Notwithstanding the foregoing, on or after the Effective Date, this
Agreement may not be amended, modified, or terminated otherwise than
by a written agreement executed by the parties hereto or their
respective successors and legal representatives.
10. Entire Agreement. This Agreement, together with a letter agreement between you
and the Corporation dated as of the date hereof, sets forth the entire agreement
of the parties hereto in respect of the subject matter contained herein and
supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto; and any prior agreement
of the parties hereto in respect of the subject matter contained herein is
hereby terminated and canceled.
If this letter sets forth our agreement on the subject matter hereof,
kindly sign and return to the Corporation the enclosed copy of this letter,
which will then constitute our agreement on this subject.
Sincerely,
CADMUS COMMUNICATIONS CORPORATION
By ______________________________
Name:
Title:
Accepted and agreed to:
_____________________________
Xxxxxx X. Xxxxx
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June 24, 1998
Xxxxxx X. Xxxxx
0000 Xxxxxxx Xxxxx Xxxx
Xxxx Xxxxx,, XX 00000
Re: Employee Retention Agreement
Dear Xxxxx:
On June 24, 1998 you and Cadmus Communications Corporation (the
"Corporation") entered into an Employee Retention Agreement agreement (a copy of
which is attached hereto) designed to reinforce and to encourage your continued
attention and dedication to your assigned duties without distraction by certain
potentially disturbing circumstances arising from the possibility of a change in
control of the Corporation (the "Retention Agreement"). All capitalized terms
herein not otherwise defined, shall have the meanings ascribed to them in the
Retention Agreement.
Pursuant to the Retention Agreement, you are entitled to receive certain
severance and other benefits in the event that, during the Employment Period and
following a Change in Control of the Corporation, your employment with the
Cadmus Companies shall be terminated by you for Good Reason or by the
Corporation other than for Cause, death, or Disability. Those severance and
other benefits are set forth in, and conclusively fixed by, the express terms of
the Retention Agreement.
The Corporation has determined, however, that it desires to augment the
Severance Payment otherwise payable to you under Section 5(d)(ii) of the
Retention Agreement. Specifically, the Corporation shall pay to you a separate
lump-sum severance payment equal to the difference between (A) an amount equal
to two times your Base Salary, and (B) the amount payable to you pursuant to
Section 5(d)(ii) of the Retention Agreement. The Corporation's intent is to
provide you, by means of a combination of Section 5(d)(ii) of the Retention
Agreement and this agreement, a severance payment equal to twice your Base
Salary.
The payment, if any, to be made hereunder shall be made in a lump-sum not
later than the 30th day following the Date of Termination; provided, however,
that you may elect to receive said payment in equal monthly installments
commencing on the first day of the month following the Date of Termination and
ending on the first occur of (A) the first day of the last month within the
Payment Period or (B) the first day of the month in which occurs your Normal
Retirement Date.
Please note that the payment, if any, to be made hereunder is subject to
any applicable "cut-back" provisions of Section 5(d)(vii) of the Retention
Agreement, which provisions are expressly incorporated herein by reference. In
addition, please note that this agreement will expire or terminate upon the
earlier of (i) Xxxxxx X.or (ii) the expiration or termination of your Retention
Agreement according or pursuant to its terms.
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This letter replaces and supersedes any prior letter between you and the
Corporation dated regarding this matter.
If this letter sets forth our agreement on the subject matter hereof,
kindly sign and return to the Corporation the enclosed copy of this letter,
which will then constitute our agreement on this subject.
Sincerely,
CADMUS COMMUNICATIONS CORPORATION
By _______________________________
Name:
Title:
Accepted and agreed to:
_____________________________
Xxxxxx X. Xxxxx
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