Exhibit 10.2
Spitz, Inc.
U.S. Xxxxx Xxx
Xxxxxx Xxxx, XX 00000
PERSONAL & HIGHLY CONFIDENTIAL
December 20, 2004
Xxxx Xxxxxx
Xxxxx, Inc.
U.S. Xxxxx Xxx
Xxxxxx Xxxx, XX 00000
Dear Xxxx:
This letter constitutes the agreement (the "Agreement") between you and
Spitz, Inc. (the "Company") regarding stay benefits due to you under certain
circumstances as described below.
1. Stay Bonus. In the event of a Change of Control (as defined in Section 2
below), you shall be eligible for a stay bonus in an amount in cash equal to
$50,000 (minus applicable withholding and other deductions required by law),
provided you (i) remain employed by the Company (or its successor) for at least
ninety (90) days following the Change of Control; or (ii) terminate your
employment with Good Reason (as defined in Section 4 below) no later than ninety
(90) days following the Change in Control; or (iii) are terminated by the
Company without Cause (as defined in Section 3 below) no later than ninety (90)
days following the Change of Control. The stay bonus shall be paid in a lump sum
amount in cash within ten (10) days of the first occurrence of an event
described in (i), (ii) or (iii) of this paragraph.
2. Change of Control. For purposes of this Agreement, "Change of Control" shall
mean the occurrence of any of the following events: (i) the consummation of a
merger or consolidation of either the Company or the Company's parent,
Transnational Industries, Inc. ("Transnational"), with any other corporation,
other than (x) a merger or consolidation which would result in the voting
securities of Transnational outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) at least fifty percent (50%) of the total
voting power represented by the voting securities of Transnational or such
surviving entity outstanding immediately after such merger or consolidation and
(y) a merger in which such other corporation is your affiliate; (ii) the
consummation of the sale or disposition by the Company or Transnational of all
or substantially all of the Company's and/or Transnational's assets other than a
sale of such assets to you and/or any of your affiliates; or (iii) any person
(as such term is used in Section 13(d) of the Securities Exchange Act of 1934,
as amended), other than you and/or any of your affiliates, becomes the
beneficial owner (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of Transnational representing fifty percent (50%) or
more of the total voting power represented by Transnational's then outstanding
voting securities.
3. Cause. For purposes of this Agreement, "Cause" shall mean (i) your gross
misconduct in the performance of your duties for the Company; (ii) your engaging
in illegal conduct (other than any misdemeanor, traffic violation or similar
misconduct) in connection with your performance of duties for the Company; or
(iii) your commission of a felony. The determination as to whether "Cause"
exists shall be made by Transnational's Board of Directors, in its reasonable
discretion.
4. Good Reason. For purposes of this Agreement, "Good Reason" shall mean a
reduction in your compensation or/and employee benefits; material reduction in
your job responsibilities or position; or relocation of your work location by
more than fifty (50) miles from the current location of your office.
5. Other Agreements. Except as specifically stated herein, all other terms and
conditions of prior written agreements regarding the subject of your employment,
including that agreement dated September 1, 2002, shall remain in full force and
effect.
A few important final points: first, since only certain key employees
are being offered a stay bonus, we require that you treat as highly confidential
both the existence and terms of this letter, and that you refrain from
discussing this confidential information with any of your coworkers. You will
not be eligible for the stay bonus benefits described in Section 1 if you fail
to meet this critical requirement, except for disclosure required by law. You
are a key player at Spitz. We regard you as integral to our continued success,
and we want to reward you for staying on the team during this uncertain
transition period. I trust that the above-described stay bonus will allay some
of the concerns you may have for your future.
Very truly yours,
SPITZ, INC.
By:/s/ Xxxxxxxx X. Xxxx
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Xxxxxxxx X. Xxxx
President and Chief
Executive Officer
Accepted and Agreed:
/s/ Xxxx X. Xxxxxx
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Xxxx Xxxxxx
Date: December 20, 2004
