EXHIBIT 10.14.1
XXXXXX CORPORATION
DEFERRED COMPENSATION AGREEMENT
THIS DEFERRED COMPENSATION AGREEMENT (the "Agreement"), dated as of
December 1, 2001 ("Effective Date"), is by and between Xxxxxx Corporation, a
Delaware corporation (the "Company"), and Xxxxxxx X. Xxxxxx (the "Executive").
WITNESSETH THAT:
In consideration of the agreements hereinafter contained the parties
hereto agree as follows:
I. Employment. Until Executive's employment with the Company terminates,
----------
the Company agrees to employ the Executive and the Executive agrees to
be employed by the Company.
II. Benefits. In addition to the base salary, equity based compensation and
other benefits provided to Executive by the Company in consideration of
his employment, Executive may earn up to $600,000 ("Maximum Benefit
Amount") during a forty-nine (49) month period commencing on the Effective
Date ("Measurement Period"). The "Benefit" to be paid Executive under this
Agreement is calculated as follows:
A. At the end of each calendar year during the Measurement Period (except
for any calendar year in which occurs or follows a Change in
Control as defined in Section 3), the Compensation Committee of the
Board of Directors of the Company ("Committee") shall evaluate the
Company's performance for such calendar year using criteria as it
may determine from time to time in its sole discretion. The
Committee shall give the Company a rating of either 1, 2, 3, 4, or
5 for such calendar year based on its evaluation, and such rating
shall be given by the Committee in its sole discretion. For each
rating made by the Committee, the Executive shall earn a percentage
("Percentage") of the Maximum Benefit Amount as set forth in the
following schedule:
Rating Percentage
------ ----------
1 33-1/3%
2 25%
3 20%
4 or 5 0%
B. In each calendar year, the Committee shall add the Percentages earned by
the Executive for the current calendar year and each of the prior
calendar years during the Measurement Period. If the sum of such
Percentages equals or exceeds 100%, the Company shall pay Executive
the Maximum Benefit Amount in one lump sum payment no later than
the business day coincident with or immediately preceding the March
15 following the end of such calendar year. If at the end of
Measurement Period, the Executive is not entitled to any Benefit
set forth in the preceding sentence, then the Company shall pay
Executive no later than the business day coincident with or
immediately preceding the March 15 following the end of the
Measurement Period an amount in one lump sum payment equal to the
sum of the Percentages earned during the Measurement Period
multiplied by the Maximum Benefit Amount. Upon any of the payments
set forth in this Section 2(b) being made, this Agreement shall
terminate, and the Company shall have no further obligations
hereunder. Notwithstanding anything in this Section to the
contrary, for any calendar year during the Measurement Period
except the last, if the sum of the Percentages earned does not
exceed 100%, the Company shall pay no Benefit hereunder.
C. Except as otherwise provided in this Section 2(c), if, prior to the
March 15 on which a payment is to be made to Executive as set forth
in Section 2(b) above, the Executive's employment terminates, the
Company shall be obligated to make such payment to the Executive or
his beneficiary as set forth in Section 6. If, prior to the March
15 on which a payment is to be made to Executive as set forth in
Section 2(b) above, the Executive's employment is terminated by the
Company "For Cause" (as defined below) or if the Executive
voluntarily terminates his employment with the Company, this
Agreement shall immediately terminate, and the Company shall have
no further obligations hereunder, including the payment of all or
any portion of the Maximum Benefit Amount.
As used in this Agreement, the term "For Cause" means (i) willful
misconduct by Executive of his duties as an employee, officer or
director of the Company, (ii) gross neglect by Executive of his
duties as an employee, officer or director of the Company, which
continues for more than thirty (30) days after Executive's receipt of
written notice from the Board to Executive specifically identifying
the gross negligence of Executive and directing Executive to
discontinue the same, (iii) the conviction of the Executive of a
crime constituting a felony, or (iv) the commission by Executive of
an act, other than an act taken in good faith within the course and
scope of Executive's employment, which is directly detrimental to the
Company and exposes the Company to material liability.
III. Change in Control.
-----------------
A. If the Executive is not otherwise due and owed the Maximum Benefit
Amount pursuant to Section 2(b), then upon the occurrence of a Change
in Control (as defined below in Section 3) during the Measurement
Period, the Company or its successor shall pay to the Executive the
Maximum Benefit Amount as follows:
1. Within fifteen (15) days of the occurrence of a Change in Control,
the Company or its successor shall pay Executive an amount in one
lump sum payment equal to the sum of the Percentages earned (as
provided in Section 2) prior to the Change in Control multiplied by
the Maximum Benefit Amount.
2. If the Company or its successor terminates the Executive's employment
for any reason other than For Cause or if the Executive
voluntarily terminates his employment with the Company for "Good
Reason" (as defined in Exhibit "A" attached hereto), the Company
or its successor shall pay the Executive an amount in one lump
sun payment equal to the Maximum Benefit Amount less the amount
(if any) paid under Section 3(a)(i) above, within fifteen (15)
days of the occurrence of such termination of employment.
3. If the Executive remains employed by the Company or its successor
until the last day of the Measurement Period, the Company or its
successor shall pay the Executive an amount in one lump sum payment
equal to the Maximum Benefit Amount less the amount (if any) paid
under Section 3(a)(i) above, no later than the business day
coincident with or immediately preceding the March 15 following the
end of such calendar year.
4. If, prior to the last day of the Measurement Period, the
Executive's employment is terminated by the Company or its
successor For Cause or the Executive voluntarily terminates his
employment with the Company or its successor other than for Good
Reason, this Agreement shall immediately terminate, and the Company
or its successor shall have no further obligation hereunder,
including the payment of all or any portion of the Maximum Benefit
Amount.
5. Upon any of the payments set forth in Sections 3(a)(ii) and (iii)
above being made, this Agreement shall terminate, and the Company
or its successor thereto shall have no further obligations
hereunder.
B. As used herein, the term "Change in Control" shall mean the occurrence
with respect to the Company of any of the following events:
1. a report on Schedule 13D is filed with the Securities and Exchange
Commission (the "SEC") pursuant to Section 13(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
disclosing that any person, entity or group (within the meaning
of Section 13(d) or 14(d) of the Exchange Act), other than the
Company (or one of its subsidiaries) or any employee benefit plan
sponsored by the Company (or one of its subsidiaries), is the
beneficial owner (as such term is defined in Rule 13d-3
promulgated under the Exchange Act), directly or indirectly, of
40% or more of the outstanding shares of common stock of the
Company or the combined voting power of the then outstanding
securities of the Company;
2. a report is filed by the Company disclosing a response to either
Item 6(e) of Schedule 14A of Regulation 14A promulgated under the
Exchange Act, Item 1 of Form 8-K promulgated under the Exchange
Act, or any successor or similar reporting requirement hereafter
promulgated by the SEC;
3. any person, entity or group (within the meaning of Section 13(d) or
14(d) of the Exchange Act), other than the Company (or one of its
subsidiaries) or any employee benefit plan sponsored by the
Company (or one of its subsidiaries), shall purchase securities
pursuant to a tender offer or exchange offer to acquire any
common stock of the Company (or securities convertible into
common stock) for cash, securities or any other consideration,
provided that after consummation of the offer, the person, entity
or group in question is the beneficial owner (as such term is
defined in Rule 13d-3 promulgated under the Exchange Act),
directly or indirectly, of 40% or more of the combined voting
power of the then outstanding securities of the Company (as
determined under paragraph (d) of Rule 13d-3 promulgated under
the Exchange Act, in the case of rights to acquire common stock);
4. the stockholders of the Company shall approve:
a. any merger, consolidation, or reorganization of the Company:
i. in which the Company is not the continuing or surviving corporation;
ii. pursuant to which shares of common stock of the Company would be
converted into cash, securities or other property;
iii. with a corporation which prior to such merger, consolidation, or
reorganization owned 20% or more of the combined voting
power of the then outstanding securities of the Company; or
iv. in which the Company will not survive as an independent, publicly owned
corporation;
b. any sale, lease, exchange or other transfer (in one transaction or a
series of related transactions) of all or substantially all
the assets of the Company; or
c. any liquidation or dissolution of the Company;
5. the stockholders of the Company shall approve a merger, consolidation,
reorganization, recapitalization, exchange offer, purchase of
assets or other transaction after the consummation of which any
person, entity or group (within the meaning of Section 13(d) or
14(d) of the Exchange Act) would own beneficially in excess of
40% of the outstanding shares of common stock of the Company or
in excess of 40% of the combined voting power of the then
outstanding securities of the Company; or
6. during any period of two consecutive years, the individuals who at
the beginning of such period constituted the Board cease for any
reason to constitute a majority of the Board, unless the election
or nomination for election by the Company's stockholders of each
new director during any such two-year period was approved by the
vote of two-thirds of the directors then still in office who were
directors at the beginning of such two-year period.
IV. No Funding Requirement. Nothing contained in this Agreement and no
------------------------
action taken pursuant to the provisions of this Agreement shall create
or be construed to create a trust of any kind, or a fiduciary
relationship between the Company and the Executive, his designated
beneficiary or any other person. Any funds which may be invested under
the provisions of this Agreement shall continue for all purposes to be a
part of the general funds of the Company and no person other than the
Company shall by virtue of the provisions of this Agreement have any
interest in such funds. To the extent that any person acquires a right
to receive payments from the Company under this Agreement, such right
shall be no greater than the right of any unsecured general creditor of
the Company.
V. Non-Alienation. The right of the Executive or any other person to the
payment of the Benefit or other benefits under this Agreement shall not be
assigned, transferred, pledged or encumbered except by will or by the laws
of descent and distribution.
VI. Beneficiaries. If the Board of Directors of the Company (the "Board")
-------------
shall find that any person to whom any payment is payable under this
Agreement is unable to care for his affairs because of illness or
accident, or is a minor, any payment due (unless a prior claim therefor
shall have been made by a duly appointed guardian, committee or other
legal representative) may be paid to the spouse, a child, a parent, or a
brother or sister, or to any person deemed by the Board to have incurred
expense for such person otherwise entitled to payment, in such manner
and proportions as the Board may determine. Any such payment shall be a
complete discharge of the liabilities of the Company under this
Agreement.
VII. Miscellaneous.
-------------
A. Nothing contained herein shall be construed as conferring upon the
Executive the right to continue in the employ of the Company as an
executive or in any other capacity.
B. The Benefit payable under this Agreement shall not be deemed salary
or other compensation to the Executive for the purpose of computing
benefits to which he may be entitled under any pension plan or other
arrangement of the Company for the benefit of its employees.
C. The Committee shall have full power and authority to interpret,
construe, and administer this Agreement and the Committee's
interpretations and construction thereof, shall be binding and
conclusive on all persons for all purposes. No member of the
Committee shall be liable to any person for any action taken or
omitted in connection with the interpretation and administration of
this Agreement unless attributable to his own willful misconduct or
lack of good faith.
D. Any questions as to whether and when there has been a termination of
employment and the cause of such termination shall be determined by
the Committee, and its determination shall be final.
E. This Agreement shall be binding upon and inure to the benefit of the
Company, its successors and assigns, and the Executive and his
heirs, executors, administrators, and legal representatives.
F. This Agreement shall be construed in accordance with and governed by the
law of the State of Delaware.
In WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officers and has hereunto set his hand as of the date
first above written.
XXXXXX CORPORATION
/s/ XXXXXX X. XXXXXXX
-------------------------------
Xxxxxx X. Xxxxxxx
Chairman of the Board of Directors
EXECUTIVE
/s/ XXXXXXX X. XXXXXX
-------------------------------
Xxxxxxx X. Xxxxxx
EXHIBIT A
GOOD REASON TERMINATION
For all purposes of this Exhibit A, Company shall include any
successor thereto. As used in the Agreement, the term "Good Reason" means
a determination by Executive that any one or more of the following events
has occurred:
(i) a material diminution in the nature of Executive's office or
position, including, but not limited to, his authorities, duties,
responsibilities or status (including offices, titles or reporting
requirements), from those in effect prior to a Change in Control; or
(ii) the relocation of Executive's place of employment to a location in
excess of fifty (50) miles from the place of Executive's employment
prior to a Change in Control, except for required travel on Company
business to an extent substantially equivalent to Executive's
business travel obligations prior to a Change in Control; or
(iii) any reduction by the Company of Executive's Base Salary, or a
material reduction in his bonus, profit sharing or other incentive
benefits, from those in effect prior to a Change in Control; or
(iv) the failure by the Company to increase Executive's Base Salary in a
manner consistent (both as to frequency and percentage increase) with
(A) the Company's practices in effect prior to a Change in Control
with respect to similarly positioned employees or (B) the Company's
practices implemented subsequent to the Change in Control with
respect to similarly positioned employees, whichever is more
favorable to Executive; or
(v) the failure of the Company to continue in effect Executive's
participation in (A) the Company's employee benefit plans,
programs, arrangements and policies, at a level substantially
equivalent in value to and on a basis consistent with the relative
levels of participation of other similarly positioned employees, as
in effect prior to a Change in Control or (B) the Company's
employee benefit plans, programs, arrangements, and policies
implemented subsequent to the Change in Control with respect to
similarly positioned employees, whichever is more favorable to
Executive; or
(vi) the failure of the Company to obtain from a successor (including a
successor to a material portion of the business or assets of the
Company) a satisfactory assumption in writing of the Company's
obligations under the Agreement; or
A-1
(ii) failure of the Company (A) to advance expenses to or for the benefit
of Executive pursuant to a request made by Executive in conformity
with the provisions of any indemnity agreement between the Company
and Executive or (B) to indemnify Executive pursuant to the
provisions of any indemnity agreement between Company and Executive
or any charter or the bylaw provisions; or
(iii) the failure of the Company to continue to provide Executive with
office space, related facilities, and support personnel (including,
but not limited to, administrative and secretarial assistance) that
are both commensurate with the office or position and Executive's
responsibilities to and position with the Company prior to a Change
in Control and not materially dissimilar to the office space, related
facilities, and support personnel provided to other key executive
officers of the Company; or
(iv) the Company notifies Executive of the Company's intention not to
observe or perform one or more of the obligations of the Company
under this Agreement.
A-2
EXHIBIT 10.14.2
XXXXXX CORPORATION
DEFERRED COMPENSATION AGREEMENT
THIS DEFERRED COMPENSATION AGREEMENT (the "Agreement"), dated as of
December 1, 2001 ("Effective Date"), is by and between Xxxxxx Corporation, a
Delaware corporation (the "Company"), and Xxxxxx X. Xxxxxxx (the "Executive").
WITNESSETH THAT:
In consideration of the agreements hereinafter contained the parties
hereto agree as follows:
I. Employment. Until Executive's employment with the Company terminates,
----------
the Company agrees to employ the Executive and the Executive agrees to
be employed by the Company.
II. Benefits. In addition to the base salary, equity based compensation and
other benefits provided to Executive by the Company in consideration of
his employment, Executive may earn up to $450,000 ("Maximum Benefit
Amount") during a forty-nine (49) month period commencing on the Effective
Date ("Measurement Period"). The "Benefit" to be paid Executive under this
Agreement is calculated as follows:
A. At the end of each calendar year during the Measurement Period (except
for any calendar year in which occurs or follows a Change in
Control as defined in Section 3), the Compensation Committee of the
Board of Directors of the Company ("Committee") shall evaluate the
Company's performance for such calendar year using criteria as it
may determine from time to time in its sole discretion. The
Committee shall give the Company a rating of either 1, 2, 3, 4, or
5 for such calendar year based on its evaluation, and such rating
shall be given by the Committee in its sole discretion. For each
rating made by the Committee, the Executive shall earn a percentage
("Percentage") of the Maximum Benefit Amount as set forth in the
following schedule:
Rating Percentage
------ ----------
1 33-1/3%
2 25%
3 20%
4 or 5 0%
B. In each calendar year, the Committee shall add the Percentages earned by
the Executive for the current calendar year and each of the prior
calendar years during the Measurement Period. If the sum of such
Percentages equals or exceeds 100%, the Company shall pay Executive
the Maximum Benefit Amount in one lump sum payment no later than
the business day coincident with or immediately preceding the March
15 following the end of such calendar year. If at the end of
Measurement Period, the Executive is not entitled to any Benefit
set forth in the preceding sentence, then the Company shall pay
Executive no later than the business day coincident with or
immediately preceding the March 15 following the end of the
Measurement Period an amount in one lump sum payment equal to the
sum of the Percentages earned during the Measurement Period
multiplied by the Maximum Benefit Amount. Upon any of the payments
set forth in this Section 2(b) being made, this Agreement shall
terminate, and the Company shall have no further obligations
hereunder. Notwithstanding anything in this Section to the
contrary, for any calendar year during the Measurement Period
except the last, if the sum of the Percentages earned does not
exceed 100%, the Company shall pay no Benefit hereunder.
C. Except as otherwise provided in this Section 2(c), if, prior to the
March 15 on which a payment is to be made to Executive as set forth
in Section 2(b) above, the Executive's employment terminates, the
Company shall be obligated to make such payment to the Executive or
his beneficiary as set forth in Section 6. If, prior to the March
15 on which a payment is to be made to Executive as set forth in
Section 2(b) above, the Executive's employment is terminated by the
Company "For Cause" (as defined below) or if the Executive
voluntarily terminates his employment with the Company, this
Agreement shall immediately terminate, and the Company shall have
no further obligations hereunder, including the payment of all or
any portion of the Maximum Benefit Amount.
As used in this Agreement, the term "For Cause" means (i) willful
misconduct by Executive of his duties as an employee, officer or
director of the Company, (ii) gross neglect by Executive of his
duties as an employee, officer or director of the Company, which
continues for more than thirty (30) days after Executive's receipt of
written notice from the Board to Executive specifically identifying
the gross negligence of Executive and directing Executive to
discontinue the same, (iii) the conviction of the Executive of a
crime constituting a felony, or (iv) the commission by Executive of
an act, other than an act taken in good faith within the course and
scope of Executive's employment, which is directly detrimental to the
Company and exposes the Company to material liability.
III. Change in Control.
-----------------
A. If the Executive is not otherwise due and owed the Maximum Benefit
Amount pursuant to Section 2(b), then upon the occurrence of a Change
in Control (as defined below in Section 3) during the Measurement
Period, the Company or its successor shall pay to the Executive the
Maximum Benefit Amount as follows:
1. Within fifteen (15) days of the occurrence of a Change in Control,
the Company or its successor shall pay Executive an amount in one
lump sum payment equal to the sum of the Percentages earned (as
provided in Section 2) prior to the Change in Control multiplied by
the Maximum Benefit Amount.
2. If the Company or its successor terminates the Executive's employment
for any reason other than For Cause or if the Executive
voluntarily terminates his employment with the Company for "Good
Reason" (as defined in Exhibit "A" attached hereto), the Company
or its successor shall pay the Executive an amount in one lump
sun payment equal to the Maximum Benefit Amount less the amount
(if any) paid under Section 3(a)(i) above, within fifteen (15)
days of the occurrence of such termination of employment.
3. If the Executive remains employed by the Company or its successor
until the last day of the Measurement Period, the Company or its
successor shall pay the Executive an amount in one lump sum payment
equal to the Maximum Benefit Amount less the amount (if any) paid
under Section 3(a)(i) above, no later than the business day
coincident with or immediately preceding the March 15 following the
end of such calendar year.
4. If, prior to the last day of the Measurement Period, the
Executive's employment is terminated by the Company or its
successor For Cause or the Executive voluntarily terminates his
employment with the Company or its successor other than for Good
Reason, this Agreement shall immediately terminate, and the Company
or its successor shall have no further obligation hereunder,
including the payment of all or any portion of the Maximum Benefit
Amount.
5. Upon any of the payments set forth in Sections 3(a)(ii) and (iii)
above being made, this Agreement shall terminate, and the Company
or its successor thereto shall have no further obligations
hereunder.
B. As used herein, the term "Change in Control" shall mean the occurrence
with respect to the Company of any of the following events:
1. a report on Schedule 13D is filed with the Securities and Exchange
Commission (the "SEC") pursuant to Section 13(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
disclosing that any person, entity or group (within the meaning
of Section 13(d) or 14(d) of the Exchange Act), other than the
Company (or one of its subsidiaries) or any employee benefit plan
sponsored by the Company (or one of its subsidiaries), is the
beneficial owner (as such term is defined in Rule 13d-3
promulgated under the Exchange Act), directly or indirectly, of
40% or more of the outstanding shares of common stock of the
Company or the combined voting power of the then outstanding
securities of the Company;
2. a report is filed by the Company disclosing a response to either
Item 6(e) of Schedule 14A of Regulation 14A promulgated under the
Exchange Act, Item 1 of Form 8-K promulgated under the Exchange
Act, or any successor or similar reporting requirement hereafter
promulgated by the SEC;
3. any person, entity or group (within the meaning of Section 13(d) or
14(d) of the Exchange Act), other than the Company (or one of its
subsidiaries) or any employee benefit plan sponsored by the
Company (or one of its subsidiaries), shall purchase securities
pursuant to a tender offer or exchange offer to acquire any
common stock of the Company (or securities convertible into
common stock) for cash, securities or any other consideration,
provided that after consummation of the offer, the person, entity
or group in question is the beneficial owner (as such term is
defined in Rule 13d-3 promulgated under the Exchange Act),
directly or indirectly, of 40% or more of the combined voting
power of the then outstanding securities of the Company (as
determined under paragraph (d) of Rule 13d-3 promulgated under
the Exchange Act, in the case of rights to acquire common stock);
4. the stockholders of the Company shall approve:
a. any merger, consolidation, or reorganization of the Company:
i. in which the Company is not the continuing or surviving corporation;
ii. pursuant to which shares of common stock of the Company would be
converted into cash, securities or other property;
iii. with a corporation which prior to such merger, consolidation, or
reorganization owned 20% or more of the combined voting
power of the then outstanding securities of the Company; or
iv. in which the Company will not survive as an independent, publicly owned
corporation;
b. any sale, lease, exchange or other transfer (in one transaction or a
series of related transactions) of all or substantially all
the assets of the Company; or
c. any liquidation or dissolution of the Company;
5. the stockholders of the Company shall approve a merger, consolidation,
reorganization, recapitalization, exchange offer, purchase of
assets or other transaction after the consummation of which any
person, entity or group (within the meaning of Section 13(d) or
14(d) of the Exchange Act) would own beneficially in excess of
40% of the outstanding shares of common stock of the Company or
in excess of 40% of the combined voting power of the then
outstanding securities of the Company; or
6. during any period of two consecutive years, the individuals who at
the beginning of such period constituted the Board cease for any
reason to constitute a majority of the Board, unless the election
or nomination for election by the Company's stockholders of each
new director during any such two-year period was approved by the
vote of two-thirds of the directors then still in office who were
directors at the beginning of such two-year period.
IV. No Funding Requirement. Nothing contained in this Agreement and no
------------------------
action taken pursuant to the provisions of this Agreement shall create
or be construed to create a trust of any kind, or a fiduciary
relationship between the Company and the Executive, his designated
beneficiary or any other person. Any funds which may be invested under
the provisions of this Agreement shall continue for all purposes to be a
part of the general funds of the Company and no person other than the
Company shall by virtue of the provisions of this Agreement have any
interest in such funds. To the extent that any person acquires a right
to receive payments from the Company under this Agreement, such right
shall be no greater than the right of any unsecured general creditor of
the Company.
V. Non-Alienation. The right of the Executive or any other person to the
payment of the Benefit or other benefits under this Agreement shall not be
assigned, transferred, pledged or encumbered except by will or by the laws
of descent and distribution.
VI. Beneficiaries. If the Board of Directors of the Company (the "Board")
-------------
shall find that any person to whom any payment is payable under this
Agreement is unable to care for his affairs because of illness or
accident, or is a minor, any payment due (unless a prior claim therefor
shall have been made by a duly appointed guardian, committee or other
legal representative) may be paid to the spouse, a child, a parent, or a
brother or sister, or to any person deemed by the Board to have incurred
expense for such person otherwise entitled to payment, in such manner
and proportions as the Board may determine. Any such payment shall be a
complete discharge of the liabilities of the Company under this
Agreement.
VII. Miscellaneous.
-------------
A. Nothing contained herein shall be construed as conferring upon the
Executive the right to continue in the employ of the Company as an
executive or in any other capacity.
B. The Benefit payable under this Agreement shall not be deemed salary
or other compensation to the Executive for the purpose of computing
benefits to which he may be entitled under any pension plan or other
arrangement of the Company for the benefit of its employees.
C. The Committee shall have full power and authority to interpret,
construe, and administer this Agreement and the Committee's
interpretations and construction thereof, shall be binding and
conclusive on all persons for all purposes. No member of the
Committee shall be liable to any person for any action taken or
omitted in connection with the interpretation and administration of
this Agreement unless attributable to his own willful misconduct or
lack of good faith.
D. Any questions as to whether and when there has been a termination of
employment and the cause of such termination shall be determined by
the Committee, and its determination shall be final.
E. This Agreement shall be binding upon and inure to the benefit of the
Company, its successors and assigns, and the Executive and his
heirs, executors, administrators, and legal representatives.
F. This Agreement shall be construed in accordance with and governed by the
law of the State of Delaware.
In WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officers and has hereunto set his hand as of the date
first above written.
XXXXXX CORPORATION
/s/ XXXXXX X. XXXXXXX
-------------------------------
Xxxxxx X. Xxxxxxx
Chairman of the Board of Directors
EXECUTIVE
/s/ XXXXXX X. XXXXXXX
-------------------------------
Xxxxxx X. Xxxxxxx
EXHIBIT A
GOOD REASON TERMINATION
For all purposes of this Exhibit A, Company shall include any
successor thereto. As used in the Agreement, the term "Good Reason" means
a determination by Executive that any one or more of the following events
has occurred:
(i) a material diminution in the nature of Executive's office or
position, including, but not limited to, his authorities, duties,
responsibilities or status (including offices, titles or reporting
requirements), from those in effect prior to a Change in Control; or
(ii) the relocation of Executive's place of employment to a location in
excess of fifty (50) miles from the place of Executive's employment
prior to a Change in Control, except for required travel on Company
business to an extent substantially equivalent to Executive's
business travel obligations prior to a Change in Control; or
(iii) any reduction by the Company of Executive's Base Salary, or a
material reduction in his bonus, profit sharing or other incentive
benefits, from those in effect prior to a Change in Control; or
(iv) the failure by the Company to increase Executive's Base Salary in a
manner consistent (both as to frequency and percentage increase) with
(A) the Company's practices in effect prior to a Change in Control
with respect to similarly positioned employees or (B) the Company's
practices implemented subsequent to the Change in Control with
respect to similarly positioned employees, whichever is more
favorable to Executive; or
(v) the failure of the Company to continue in effect Executive's
participation in (A) the Company's employee benefit plans,
programs, arrangements and policies, at a level substantially
equivalent in value to and on a basis consistent with the relative
levels of participation of other similarly positioned employees, as
in effect prior to a Change in Control or (B) the Company's
employee benefit plans, programs, arrangements, and policies
implemented subsequent to the Change in Control with respect to
similarly positioned employees, whichever is more favorable to
Executive; or
(vi) the failure of the Company to obtain from a successor (including a
successor to a material portion of the business or assets of the
Company) a satisfactory assumption in writing of the Company's
obligations under the Agreement; or
A-1
(v) failure of the Company (A) to advance expenses to or for the benefit
of Executive pursuant to a request made by Executive in conformity
with the provisions of any indemnity agreement between the Company
and Executive or (B) to indemnify Executive pursuant to the
provisions of any indemnity agreement between Company and Executive
or any charter or the bylaw provisions; or
(vi) the failure of the Company to continue to provide Executive with
office space, related facilities, and support personnel (including,
but not limited to, administrative and secretarial assistance) that
are both commensurate with the office or position and Executive's
responsibilities to and position with the Company prior to a Change
in Control and not materially dissimilar to the office space, related
facilities, and support personnel provided to other key executive
officers of the Company; or
(vii) the Company notifies Executive of the Company's intention not to
observe or perform one or more of the obligations of the Company
under this Agreement.
A-2
EXHIBIT 10.14.3
XXXXXX CORPORATION
DEFERRED COMPENSATION AGREEMENT
THIS DEFERRED COMPENSATION AGREEMENT (the "Agreement"), dated as of
December 1, 2001 ("Effective Date"), is by and between Xxxxxx Corporation, a
Delaware corporation (the "Company"), and Xxxxx X. Xxxxxxx, XX (the
"Executive").
WITNESSETH THAT:
In consideration of the agreements hereinafter contained the parties
hereto agree as follows:
I. Employment. Until Executive's employment with the Company terminates,
----------
the Company agrees to employ the Executive and the Executive agrees to
be employed by the Company.
II. Benefits. In addition to the base salary, equity based compensation and
other benefits provided to Executive by the Company in consideration of
his employment, Executive may earn up to $450,000 ("Maximum Benefit
Amount") during a forty-nine (49) month period commencing on the Effective
Date ("Measurement Period"). The "Benefit" to be paid Executive under this
Agreement is calculated as follows:
A. At the end of each calendar year during the Measurement Period (except
for any calendar year in which occurs or follows a Change in
Control as defined in Section 3), the Compensation Committee of the
Board of Directors of the Company ("Committee") shall evaluate the
Company's performance for such calendar year using criteria as it
may determine from time to time in its sole discretion. The
Committee shall give the Company a rating of either 1, 2, 3, 4, or
5 for such calendar year based on its evaluation, and such rating
shall be given by the Committee in its sole discretion. For each
rating made by the Committee, the Executive shall earn a percentage
("Percentage") of the Maximum Benefit Amount as set forth in the
following schedule:
Rating Percentage
------ ----------
1 33-1/3%
2 25%
3 20%
4 or 5 0%
B. In each calendar year, the Committee shall add the Percentages earned by
the Executive for the current calendar year and each of the prior
calendar years during the Measurement Period. If the sum of such
Percentages equals or exceeds 100%, the Company shall pay Executive
the Maximum Benefit Amount in one lump sum payment no later than
the business day coincident with or immediately preceding the March
15 following the end of such calendar year. If at the end of
Measurement Period, the Executive is not entitled to any Benefit
set forth in the preceding sentence, then the Company shall pay
Executive no later than the business day coincident with or
immediately preceding the March 15 following the end of the
Measurement Period an amount in one lump sum payment equal to the
sum of the Percentages earned during the Measurement Period
multiplied by the Maximum Benefit Amount. Upon any of the payments
set forth in this Section 2(b) being made, this Agreement shall
terminate, and the Company shall have no further obligations
hereunder. Notwithstanding anything in this Section to the
contrary, for any calendar year during the Measurement Period
except the last, if the sum of the Percentages earned does not
exceed 100%, the Company shall pay no Benefit hereunder.
C. Except as otherwise provided in this Section 2(c), if, prior to the
March 15 on which a payment is to be made to Executive as set forth
in Section 2(b) above, the Executive's employment terminates, the
Company shall be obligated to make such payment to the Executive or
his beneficiary as set forth in Section 6. If, prior to the March
15 on which a payment is to be made to Executive as set forth in
Section 2(b) above, the Executive's employment is terminated by the
Company "For Cause" (as defined below) or if the Executive
voluntarily terminates his employment with the Company, this
Agreement shall immediately terminate, and the Company shall have
no further obligations hereunder, including the payment of all or
any portion of the Maximum Benefit Amount.
As used in this Agreement, the term "For Cause" means (i) willful
misconduct by Executive of his duties as an employee, officer or
director of the Company, (ii) gross neglect by Executive of his
duties as an employee, officer or director of the Company, which
continues for more than thirty (30) days after Executive's receipt of
written notice from the Board to Executive specifically identifying
the gross negligence of Executive and directing Executive to
discontinue the same, (iii) the conviction of the Executive of a
crime constituting a felony, or (iv) the commission by Executive of
an act, other than an act taken in good faith within the course and
scope of Executive's employment, which is directly detrimental to the
Company and exposes the Company to material liability.
III. Change in Control.
-----------------
A. If the Executive is not otherwise due and owed the Maximum Benefit
Amount pursuant to Section 2(b), then upon the occurrence of a Change
in Control (as defined below in Section 3) during the Measurement
Period, the Company or its successor shall pay to the Executive the
Maximum Benefit Amount as follows:
1. Within fifteen (15) days of the occurrence of a Change in Control,
the Company or its successor shall pay Executive an amount in one
lump sum payment equal to the sum of the Percentages earned (as
provided in Section 2) prior to the Change in Control multiplied by
the Maximum Benefit Amount.
2. If the Company or its successor terminates the Executive's employment
for any reason other than For Cause or if the Executive
voluntarily terminates his employment with the Company for "Good
Reason" (as defined in Exhibit "A" attached hereto), the Company
or its successor shall pay the Executive an amount in one lump
sun payment equal to the Maximum Benefit Amount less the amount
(if any) paid under Section 3(a)(i) above, within fifteen (15)
days of the occurrence of such termination of employment.
3. If the Executive remains employed by the Company or its successor
until the last day of the Measurement Period, the Company or its
successor shall pay the Executive an amount in one lump sum payment
equal to the Maximum Benefit Amount less the amount (if any) paid
under Section 3(a)(i) above, no later than the business day
coincident with or immediately preceding the March 15 following the
end of such calendar year.
4. If, prior to the last day of the Measurement Period, the
Executive's employment is terminated by the Company or its
successor For Cause or the Executive voluntarily terminates his
employment with the Company or its successor other than for Good
Reason, this Agreement shall immediately terminate, and the Company
or its successor shall have no further obligation hereunder,
including the payment of all or any portion of the Maximum Benefit
Amount.
5. Upon any of the payments set forth in Sections 3(a)(ii) and (iii)
above being made, this Agreement shall terminate, and the Company
or its successor thereto shall have no further obligations
hereunder.
B. As used herein, the term "Change in Control" shall mean the occurrence
with respect to the Company of any of the following events:
1. a report on Schedule 13D is filed with the Securities and Exchange
Commission (the "SEC") pursuant to Section 13(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
disclosing that any person, entity or group (within the meaning
of Section 13(d) or 14(d) of the Exchange Act), other than the
Company (or one of its subsidiaries) or any employee benefit plan
sponsored by the Company (or one of its subsidiaries), is the
beneficial owner (as such term is defined in Rule 13d-3
promulgated under the Exchange Act), directly or indirectly, of
40% or more of the outstanding shares of common stock of the
Company or the combined voting power of the then outstanding
securities of the Company;
2. a report is filed by the Company disclosing a response to either
Item 6(e) of Schedule 14A of Regulation 14A promulgated under the
Exchange Act, Item 1 of Form 8-K promulgated under the Exchange
Act, or any successor or similar reporting requirement hereafter
promulgated by the SEC;
3. any person, entity or group (within the meaning of Section 13(d) or
14(d) of the Exchange Act), other than the Company (or one of its
subsidiaries) or any employee benefit plan sponsored by the
Company (or one of its subsidiaries), shall purchase securities
pursuant to a tender offer or exchange offer to acquire any
common stock of the Company (or securities convertible into
common stock) for cash, securities or any other consideration,
provided that after consummation of the offer, the person, entity
or group in question is the beneficial owner (as such term is
defined in Rule 13d-3 promulgated under the Exchange Act),
directly or indirectly, of 40% or more of the combined voting
power of the then outstanding securities of the Company (as
determined under paragraph (d) of Rule 13d-3 promulgated under
the Exchange Act, in the case of rights to acquire common stock);
4. the stockholders of the Company shall approve:
a. any merger, consolidation, or reorganization of the Company:
i. in which the Company is not the continuing or surviving corporation;
ii. pursuant to which shares of common stock of the Company would be
converted into cash, securities or other property;
iii. with a corporation which prior to such merger, consolidation, or
reorganization owned 20% or more of the combined voting
power of the then outstanding securities of the Company; or
iv. in which the Company will not survive as an independent, publicly owned
corporation;
b. any sale, lease, exchange or other transfer (in one transaction or a
series of related transactions) of all or substantially all
the assets of the Company; or
c. any liquidation or dissolution of the Company;
5. the stockholders of the Company shall approve a merger, consolidation,
reorganization, recapitalization, exchange offer, purchase of
assets or other transaction after the consummation of which any
person, entity or group (within the meaning of Section 13(d) or
14(d) of the Exchange Act) would own beneficially in excess of
40% of the outstanding shares of common stock of the Company or
in excess of 40% of the combined voting power of the then
outstanding securities of the Company; or
6. during any period of two consecutive years, the individuals who at
the beginning of such period constituted the Board cease for any
reason to constitute a majority of the Board, unless the election
or nomination for election by the Company's stockholders of each
new director during any such two-year period was approved by the
vote of two-thirds of the directors then still in office who were
directors at the beginning of such two-year period.
IV. No Funding Requirement. Nothing contained in this Agreement and no
------------------------
action taken pursuant to the provisions of this Agreement shall create
or be construed to create a trust of any kind, or a fiduciary
relationship between the Company and the Executive, his designated
beneficiary or any other person. Any funds which may be invested under
the provisions of this Agreement shall continue for all purposes to be a
part of the general funds of the Company and no person other than the
Company shall by virtue of the provisions of this Agreement have any
interest in such funds. To the extent that any person acquires a right
to receive payments from the Company under this Agreement, such right
shall be no greater than the right of any unsecured general creditor of
the Company.
V. Non-Alienation. The right of the Executive or any other person to the
payment of the Benefit or other benefits under this Agreement shall not be
assigned, transferred, pledged or encumbered except by will or by the laws
of descent and distribution.
VI. Beneficiaries. If the Board of Directors of the Company (the "Board")
-------------
shall find that any person to whom any payment is payable under this
Agreement is unable to care for his affairs because of illness or
accident, or is a minor, any payment due (unless a prior claim therefor
shall have been made by a duly appointed guardian, committee or other
legal representative) may be paid to the spouse, a child, a parent, or a
brother or sister, or to any person deemed by the Board to have incurred
expense for such person otherwise entitled to payment, in such manner
and proportions as the Board may determine. Any such payment shall be a
complete discharge of the liabilities of the Company under this
Agreement.
VII. Miscellaneous.
-------------
A. Nothing contained herein shall be construed as conferring upon the
Executive the right to continue in the employ of the Company as an
executive or in any other capacity.
B. The Benefit payable under this Agreement shall not be deemed salary
or other compensation to the Executive for the purpose of computing
benefits to which he may be entitled under any pension plan or other
arrangement of the Company for the benefit of its employees.
C. The Committee shall have full power and authority to interpret,
construe, and administer this Agreement and the Committee's
interpretations and construction thereof, shall be binding and
conclusive on all persons for all purposes. No member of the
Committee shall be liable to any person for any action taken or
omitted in connection with the interpretation and administration of
this Agreement unless attributable to his own willful misconduct or
lack of good faith.
D. Any questions as to whether and when there has been a termination of
employment and the cause of such termination shall be determined by
the Committee, and its determination shall be final.
E. This Agreement shall be binding upon and inure to the benefit of the
Company, its successors and assigns, and the Executive and his
heirs, executors, administrators, and legal representatives.
F. This Agreement shall be construed in accordance with and governed by the
law of the State of Delaware.
In WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officers and has hereunto set his hand as of the date
first above written.
XXXXXX CORPORATION
/s/ XXXXXX X. XXXXXXX
-------------------------------
Xxxxxx X. Xxxxxxx
Chairman of the Board of Directors
EXECUTIVE
/s/ XXXXX X. XXXXXXX, XX
--------------------------
Xxxxx X. Xxxxxxx, XX
EXHIBIT A
GOOD REASON TERMINATION
For all purposes of this Exhibit A, Company shall include any
successor thereto. As used in the Agreement, the term "Good Reason" means
a determination by Executive that any one or more of the following events
has occurred:
(i) a material diminution in the nature of Executive's office or
position, including, but not limited to, his authorities, duties,
responsibilities or status (including offices, titles or reporting
requirements), from those in effect prior to a Change in Control; or
(ii) the relocation of Executive's place of employment to a location in
excess of fifty (50) miles from the place of Executive's employment
prior to a Change in Control, except for required travel on Company
business to an extent substantially equivalent to Executive's
business travel obligations prior to a Change in Control; or
(iii) any reduction by the Company of Executive's Base Salary, or a
material reduction in his bonus, profit sharing or other incentive
benefits, from those in effect prior to a Change in Control; or
(iv) the failure by the Company to increase Executive's Base Salary in a
manner consistent (both as to frequency and percentage increase) with
(A) the Company's practices in effect prior to a Change in Control
with respect to similarly positioned employees or (B) the Company's
practices implemented subsequent to the Change in Control with
respect to similarly positioned employees, whichever is more
favorable to Executive; or
(v) the failure of the Company to continue in effect Executive's
participation in (A) the Company's employee benefit plans,
programs, arrangements and policies, at a level substantially
equivalent in value to and on a basis consistent with the relative
levels of participation of other similarly positioned employees, as
in effect prior to a Change in Control or (B) the Company's
employee benefit plans, programs, arrangements, and policies
implemented subsequent to the Change in Control with respect to
similarly positioned employees, whichever is more favorable to
Executive; or
(vi) the failure of the Company to obtain from a successor (including a
successor to a material portion of the business or assets of the
Company) a satisfactory assumption in writing of the Company's
obligations under the Agreement; or
A-1
(viii) failure of the Company (A) to advance expenses to or for the benefit
of Executive pursuant to a request made by Executive in conformity
with the provisions of any indemnity agreement between the Company
and Executive or (B) to indemnify Executive pursuant to the
provisions of any indemnity agreement between Company and Executive
or any charter or the bylaw provisions; or
(ix) the failure of the Company to continue to provide Executive with
office space, related facilities, and support personnel (including,
but not limited to, administrative and secretarial assistance) that
are both commensurate with the office or position and Executive's
responsibilities to and position with the Company prior to a Change
in Control and not materially dissimilar to the office space, related
facilities, and support personnel provided to other key executive
officers of the Company; or
(x) the Company notifies Executive of the Company's intention not to
observe or perform one or more of the obligations of the Company
under this Agreement.
A-2
