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EXHIBIT 10.7
CHANGE IN CONTROL AGREEMENT
This Change in Control Agreement (the "Agreement") is made and entered into
as of April 10, 2001, by and between Xxxxxxxxxxx Industries, Inc., an Indiana
corporation (the "Company"), and __________________ (the "Executive").
WHEREAS, the Company considers it essential to the best interests of its
shareholders to xxxxxx continuous employment by the Company and its subsidiaries
of their key management personnel;
WHEREAS, the Compensation Committee (the "Committee") of the Board of
Directors (the "Board") of the Company has recommended, and the Board has
approved, that the Company enter into Change in Control Agreements with key
executives of the Company and its subsidiaries who are from time to time
designated by the Management of the Company and approved by the Committee;
WHEREAS, the Committee and the Board believe that Executive has made
valuable contributions to the productivity and profitability of the Company and
consider it essential to the best interests of the Company and its shareholders
that Executive be encouraged to remain with the Company; and
WHEREAS, the Board believes it is in the best interests of the Company and
its shareholders that Executive continue in employment with the Company in the
event of any proposed Change in Control (as defined below) and be in a position
to provide assessment and advice to the Board regarding any proposed Change in
Control without concern that Executive might be unduly distracted by the
personal uncertainties and risks created by any proposed Change in Control:
NOW, THEREFORE, the Company and Executive agree as follows:
1. TERMINATION FOLLOWING A CHANGE IN CONTROL. The Company will provide or
cause to be provided to Executive the rights and benefits described in Section 2
hereof in the event that Executive's employment with the Company and its
subsidiaries is terminated:
(a) by the Company for any reason other than on account of his death,
permanent disability, retirement or for Cause at any time prior to the third
anniversary of a Change in Control;
(b) by Executive for Good Reason at any time prior to the third
anniversary of a Change in Control; or
(c) by Executive for any reason during the 30-day period immediately
following the first anniversary of the Change in Control.
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Anything in this Agreement to the contrary notwithstanding, if a Change in
Control occurs and if the Executive's employment with the Company is terminated
by the Company, without Cause, prior to the date on which the Change in Control
occurs, and if it is reasonably demonstrated by Executive that such termination
of employment (i) was at the request of a third party who has taken steps
reasonably calculated to effect a Change in Control or (ii) otherwise arose in
connection with or anticipation of a Change in Control which subsequently occurs
within 3 months of such termination, then for purposes of this Agreement
(including Section 3 hereof) a Change in Control shall be deemed to have
occurred on the day immediately prior to such termination of employment and all
references in Section 2 to payments within a specified period following
"Termination" shall instead be references to the specified period following the
Change in Control.
The rights and benefits described in Section 2 and 3 hereof shall be in
lieu of any severance payments otherwise payable to Executive under any
employment agreement or severance plan or program of the Company or any of its
subsidiaries but shall not otherwise affect Executive's rights to compensation
or benefits under the Company's compensation and benefit programs except to the
extent expressly provided herein.
2. RIGHTS AND BENEFITS UPON TERMINATION.
In the event of the termination of Executive's employment under any of the
circumstances set forth in Section 1 hereof ("Termination"), the Company shall
provide or cause to be provided to Executive the following rights and benefits
provided that Executive executes and delivers to the Company within 30 days of
the Termination a Release in the form attached hereto as Exhibit A:
(a) a lump sum payment in cash in the amount of three times
Executive's Annual Base Salary (as defined below), payable within 30 days of
Termination;
(b) for the 36 months following Termination, continued health and
medical insurance coverage for Executive and his dependents substantially
comparable (with regard to both benefits and employee contributions) to the
coverage provided by the Company immediately prior to the Change in Control for
active employees of equivalent rank. From the end of such 36-month period until
Executive attains Social Security Retirement Age, Executive shall have the right
to purchase (at COBRA rates applicable to such coverage) continued coverage for
himself and his dependents under one or more plans maintained by the Company for
its active employees, to the extent Executive would have been eligible to
purchase continued coverage under the plan in effect immediately prior to the
Change in Control had his employment terminated 36 months following Termination;
(c) a lump sum payment in cash, payable within 30 days of Termination,
equal to the unpaid portion of the Perquisite Compensation to which Executive is
entitled for the year of Termination plus the amount of Perquisite Compensation
to which Executive would be entitled for one additional year based on his Annual
Base Salary;
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(d) a lump sum payment in cash, payable within 30 days of Termination,
equal to the unpaid portion of the car allowance to which Executive is entitled
for the year of Termination plus the amount of car allowance for one additional
year;
(e) except as provided otherwise in this paragraph, continuation for
Executive, for a period of three years following Termination, of the Split
Dollar Life Insurance Program (if any) provided for Executive by the Company
immediately prior to the Change in Control and the group term life insurance
program provided for executive immediately prior to the Change in Control. The
Company shall be under no obligation to provide insurance benefits with
reference to a Split Dollar Life Insurance Program that has terminated between
the date of the Change in Control and Executive's Termination under
[sub-sections (a), (b), or (c) of Section 4.1] of such program's agreement
between the policy owner and the Company. The company shall be under no
obligation to provide insurance benefits with reference to a Split Dollar Life
Insurance Program that has terminated between the date of the Change in Control
and Executive's Termination by notice from the policy owner under [subsection
(d) of Section 4.1] of such agreement. If Executive is a participant in a Split
Dollar Life Insurance Program, the Company may nevertheless elect to exercise
its right to terminate the Split Dollar Life Insurance Program under Section
[4.1(d)] of the program agreement between the policy owner and the Company. If
the Company elects to exercise such right, the Company shall provide insurance
coverage with a face amount comparable to the then current face amount (net of
the Company's interest) in the split-dollar policy, at no greater cost to the
policy owner and the Executive, until the completion of the three-year period
following Termination. Nothing in the paragraph shall prevent Company and the
policy owner from agreeing to provide such comparable coverage through a
modification of their agreement under the Split Dollar Life Insurance Program;
(f) a lump sum payment in cash, payable within 30 days of Termination,
equal to all accrued and unpaid vacation, reimbursable business expenses, and
similar miscellaneous benefits as of the Termination; and
(g) a monthly pension annuity benefit starting at age 62 or the
current age, if later (in the form of a joint and 50% survivor annuity) equal to
the difference between (i) the monthly Pension Plan annuity benefit, the monthly
Supplemental Pension Plan annuity benefit if Executive is a participant in the
Supplemental Pension Plan, and any additional pension benefit provided in an
offer letter if Executive is subject to such an offer letter, which Executive
will receive starting at age 62 or the current age, if later (in the form of a
joint and 50% survivor annuity), and (ii) the monthly pension annuity benefit he
would have received starting at age 62 or the current age, if later under such
plan(s) and/or offer letter, as in effect on April 10, 2001, (in the form of a
joint and 50% survivor annuity) calculated as if Executive had earned two
additional years of service and pay at his Annual Base Salary or continued in
service with pay at his Annual Base Salary through December 31, 2004, whichever
is greater. The monthly pension annuity benefit described in the prior sentence
shall be paid at the same time(s) and in the same form as Executive's benefit
under the Pension Plan (with the same actuarial adjustments as used in
calculating benefits under the Pension Plan). The benefit provided for in this
paragraph shall be funded in a rabbi trust prior to the Change in Control. For
purposes of this subparagraph (g),
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the benefit under clause (ii) will be calculated as though the Pension Plan and
Supplemental Plan as in effect on April 10, 2001 remained the same.
3. ADDITIONAL BENEFITS UPON A CHANGE IN CONTROL.
Upon the occurrence of a Change in Control, so long as Executive is an
employee of the Company at that time, the Company will provide or cause to be
provided to Executive the following rights and benefits whether or not
Executive's employment with the Company or its subsidiaries is terminated:
(a) a lump sum payment in cash equal to the amount of Short-Term
Incentive Compensation which would be payable to Executive if the company
performance targets (at 100%) with respect to such incentive compensation in
effect for the entire year in which the Change in Control occurred had been
achieved, payable within 30 days of the Change in Control;
(b) the number of shares of common stock of the Company that would be
payable to Executive as Performance Share Compensation under all performance
share periods in progress at the date of the Change in Control as if the target
goal for each such performance share period was achieved 100%, without proration
for uncompleted performance share periods, provided, however, that if the Change
in Control involves a merger, acquisition or other corporate restructuring where
the Company is not the surviving entity (or survives as a wholly-owned
subsidiary of another entity), then, in lieu of such shares of common stock of
the Company, Executive shall be entitled to receive the consideration he would
have received in such transaction in exchange for such shares of common stock;
and provided, further, that the Company shall in any case have the right to
substitute cash for such shares of common stock of the Company or merger
consideration in an amount equal to the fair market value of such shares or
merger consideration as determined by the Company
(c) immediate vesting of all mandatory deferred shares attributable to
Performance Share Compensation,
(d) immediate vesting of all outstanding options held by Executive
under the Xxxxxxxxxxx Industries, Inc. 1996 Stock Options Plan; and
(e) immediate vesting of all awards of Restricted Stock held by
Executive under the Stock Award Agreements with Executive and Xxxxxxxxxxx
Industries, Inc.
4. GROSS-UP ON EXCESS PARACHUTE PAYMENT.
(a) If any benefit or payment by the Company or its subsidiaries to
Executive (whether paid or payable or distributed or distributable pursuant to
the terms of this Agreement or otherwise, including any acceleration of vesting
or payment) (a "Payment") is determined to be subject to the excise tax imposed
by Section 4999 of the Code or any interest or penalties are incurred by
Executive with respect to such excise tax (such excise tax, together with any
such interest and penalties, being herein collectively referred to as the
"Excise Tax"), then Executive shall be entitled to receive an additional payment
(the "Gross-Up Payment") in an amount such
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that the net amount of such additional payment retained by Executive, after
payment of all federal, state and local income and employment taxes (including,
without limitation, any federal, state, and local income and employment taxes
and Excise Tax imposed on the Gross-Up Payment), shall be equal to the Excise
Tax imposed on the Payment.
(b) Subject to the provisions of Section 4(c) hereto, all
determinations required to be made under this Section 4, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be made
by an independent accounting firm of nationally recognized standing selected by
the Company and which is not serving as accountant or auditor for the Company or
the individual, entity or group effecting the Change in Control (the "Accounting
Firm"), which shall provide detailed supporting calculations both to the Company
and Executive within 15 business days of the receipt of the notice from
Executive that there has been a Payment or such earlier time as is requested by
the Company. All fees and expenses of the Accounting Firm shall be borne solely
by the Company. Any Gross-Up Payment shall be paid by the Company to Executive
within ten business days of the receipt of the Accounting Firm's determination.
Any determination by the Accounting Firm shall be binding upon the Company and
Executive. As a result of the uncertainty in the application of Section 4999 of
the Code at the time of the initial determination by the Accounting Firm
hereunder, it is possible that Gross-Up Payments will not have been made by the
Company which should have been made ("Underpayment"), consistent with the
calculations required to be made hereunder. In the event that the Company
exhausts its remedies pursuant to Section 4(c) hereof and Executive thereafter
is required to make a payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has occurred and the amount of the
Underpayment shall be promptly paid by the Company to or for the benefit of
Executive.
(c) Executive shall notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require the payment by the
Company of a Gross-Up Payment. Such notification shall be given as soon as
practicable but no later than ten business days after Executive is informed in
writing of such claim and shall apprise the Company of the nature of such claim
and the date on which such claim is requested to be paid. Executive shall not
pay such claim prior to the expiration of the 30-day period following the date
on which it gives such notice to the Company (or such shorter period ending on
the date that any payment of taxes with respect to such claim is due). If the
Company notifies Executive in writing prior to the expiration of such period
that it desires to contest such claim, Executive shall:
(i) give the Company any information reasonably requested by the
Company relating to such claim;
(ii) take such action in connection with contesting such claim as
the Company shall reasonably request in writing from time to time,
including without limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the Company;
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(iii) cooperate with the Company in good faith in order
effectively to contest such claim; and
(iv) permit the Company to participate in any proceedings
relating to such claim; provided, however, that the Company shall bear and
pay directly all costs and expenses (including additional interest and
penalties) incurred in connection with such contest and shall indemnify and
hold Executive harmless, on an after-tax basis, for any Excise Tax or
federal, state and local income and employment tax (including interest and
penalties with respect thereto) imposed as a result of such representation
and payment of costs and expenses. Without limitation on the foregoing
provisions of this Section 4(c), the Company shall control all proceedings
taken in connection with such contest and, at its sole option, may pursue
or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at
its sole option, either direct Executive to pay the tax claimed and xxx for
a refund or to contest the claim in any permissible manner, and Executive
agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one or
more appellate courts, as the Company shall determine; provided, however,
that if the Company directs Executive to pay such claim and xxx for a
refund, the Company shall advance the amount of such payment to Executive,
on an after-tax basis, and shall hold Executive harmless from any Excise
Tax or federal, state or local income or employment tax (including interest
or penalties with respect thereto) imposed with respect to such advance or
with respect to any imputed income with respect to such advance; and
further provided that any extension of the statute of limitations relating
to payment of taxes for the taxable year of Executive with respect to which
such contested amount is claimed to be due is limited solely to such
contested amount. The Company's control of the contest, however, shall be
limited to issues with respect to which a Gross-Up Payment would be payable
hereunder, and Executive shall be entitled to settle or contest, as the
case may by, any other issue raised by the Internal Revenue Service or any
other taxing authority.
(d) If, after the receipt by Executive of an amount advanced by the
Company pursuant to Section 4(c), Executive becomes entitled to receive any
refund with respect to such claim, Executive shall (subject to the Company's
complying with the requirements of Section 4(c)) promptly pay to the Company the
amount of such refund (together with any interest paid or credited thereon after
taxes applicable thereto). If, after the receipt by Executive of an amount
advanced by the Company pursuant to Section 4(c), a determination is made that
Executive shall not be entitled to any refund with respect to such claim and the
Company does not notify Executive in writing of its intent to contest such
denial of refund prior to the expiration of 30 days after such determination,
then such advance shall be forgiven and shall not be required to be repaid and
the amount of such advance shall offset, to the extent thereof, the amount of
Gross-Up Payment required to be paid.
(e) In the event that the Excise Tax is subsequently determined to be
less than initially determined by the Accounting Firm, Executive shall repay to
the Company at the time that the amount of such reduction in Excise Tax is
determined (but, if previously paid to the
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taxing authorities, not prior to the time the amount of such reduction is
refunded to Executive or otherwise realized as a benefit by Executive) the
portion of the Gross-Up Payment that would not have been paid if the Excise Tax
as subsequently determined had been applied in initially calculating the
Gross-Up Payment, with the amount of such repayment determined by the Accounting
Firm.
5. CONFIDENTIALITY; NON-COMPETITION.
(a) Executive shall not at any time without the prior approval of the
Company disclose to any person, firm, corporation or other entity any trade
secret, confidential customer information, or other proprietary information not
known within the industry or by the public generally regarding the business then
being conducted by the Company, including, without limitation, financial
information, marketing and sales information and business and strategic plans.
(b) Executive shall not at any time during the term of this Agreement
and within three years following the termination of his employment with the
Company, (i) solicit any persons who are employed by the Company to terminate
their employment with the Company, and (ii) directly or indirectly (either
individually or as an agent, employee, director, officer, stockholder, partner
or individual proprietor, consultant or as an investor who has made advances of
loan capital or contributions to equity capital), engage in any activity which
he knows (or reasonably should have known) to be competitive with the business
of the Company as then being carried on. Nothing in this Agreement, however,
shall prevent Executive from owning, as an investment, up to two percent (2%) of
the outstanding equity capital of any competitor of the Company, shares of which
are regularly traded on a national securities exchange or in over-the-counter
markets. The restrictions set forth in this Section 5 shall not apply in the
event of a termination of Executive's employment pursuant to Section 1.
6. DEFINITIONS. As used in this Agreement, the following terms shall have
the following meanings:
(a) "Annual Base Salary" means the annualized amount of Executive's
rate of base salary in effect immediately before the Change in Control or
immediately before the date of Termination, whichever is greater.
(b) "Cause" means
(i) embezzlement or material misappropriation of funds or
property of the Company,
(ii) the continued failure of Executive to perform substantially
the Executive's current duties (as of the date hereof) with the Company or
one of its affiliates (other than any such failure resulting from
incapacity due to physical or mental illness), after a written demand for
substantial performance is delivered to the Executive by the Company which
specifically identifies the manner in which the Company believes that
Executive has not substantially performed the Executive's duties; or
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(iii) the willful engaging by Executive in illegal conduct or
gross misconduct which is materially and demonstrably injurious to the
Company.
For purposes of this provision, no act, on the part of Executive,
shall be considered "willful" unless it is done, or omitted to be done, by
Executive in bad faith or without reasonable belief that Executive's action or
omission was in the best interests of the Company.
(c) A "Change in Control" shall be deemed to occur on:
(i) the date that both
(A) any person, corporation, partnership, syndicate, trust,
estate or other group acting with a view to the acquisition, holding or
disposition of securities of the Company, becomes, directly or indirectly,
the beneficial owner, as defined in Rule 13d-3 under the Securities
Exchange Act of 1934 ("Beneficial Owner"), of securities of the Company
representing 35% or more of the voting power of all Company securities
having the right under ordinary circumstances to vote at an election of the
Board ("Voting Securities"), other than by reason of (x) the acquisition of
Company securities by the Company or any of its subsidiaries or any
employee benefit plan of the Company or any of its subsidiaries, (y) the
acquisition of Company securities directly from the Company, or (z) the
acquisition of Company securities by one or more members of the Xxxxxxxxxxx
Family (which term shall mean [descendants of Xxxx X. Xxxxxxxxxxx and their
spouses, trusts primarily for their benefit or entities controlled by
them]), and
(B) members of the Xxxxxxxxxxx Family cease to be, directly
or indirectly, the Beneficial Owners of Voting Securities having a voting
power equal to or greater than that of such person, corporation,
partnership, syndicate, trust, estate or group;
(ii) the consummation of a merger or consolidation of the Company
with another corporation unless
(A) the shareholders of the Company, immediately prior to
the merger or consolidation, beneficially own, immediately after the merger
or consolidation, shares entitling such shareholders to 50% or more of the
voting power of all securities of the corporation surviving the merger or
consolidation having the right under ordinary circumstances to vote at an
election of directors in substantially the same proportions as their
ownership, immediately prior to such merger or consolidation, of Voting
Securities of the Company;
(B) no person, corporation, partnership, syndicate, trust,
estate or other group beneficially owns, directly or indirectly, 35% or
more of the voting power of the outstanding voting securities of the
corporation resulting from such merger or consolidation except to the
extent that such ownership existed prior to such merger or consolidation;
and
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(C) the members of the Company's Board, immediately prior to
the merger or consolidation, constitute, immediately after the merger or
consolidation, a majority of the board of directors of the corporation
issuing cash or securities in the merger;
(iii) the date on which a majority of the members of the Board
consist of persons other than Current Directors (which term shall mean any
member of the Board on the date hereof and any member whose nomination or
election has been approved by a majority of Current Directors then on the
Board);
(iv) the consummation of a sale or other disposition of all or
substantially all of the assets of the Company; or
(v) the date of approval by the shareholders of the Company of a
plan of complete liquidation of the Company.
(d) "Good Reason" means any of the following events occurring without
the Executive's consent:
(i) the assignment to Executive of duties substantially
inconsistent with his current position, duties, responsibilities or status
with the Company (as of the date hereof) or a substantial reduction of the
Executive's duties or responsibilities, which persists for at least 30 days
following written notice thereof by Executive; provided that it is
specifically understood that within six months of a Change in Control the
Company shall have the flexibility to appoint the Executive to a reporting
relationship different from that which existed prior to the Change in
Control, to make an immaterial change in Executive's duties, or to change
the Executive's title provided that Executive shall not have a stature less
than that of ______________________________. It is understood that
equivalent positions may have different titles;
(ii) a failure by the Company to continue to provide to Executive
compensation and benefits (including bonus opportunities) which in the
aggregate are at least as great as the compensation and benefits provided
prior to the Change in Control;
(iii) the Company's requiring Executive to be based at any office
or location more than 100 miles from the location at which he performs his
service for the Company, except for travel reasonably required in the
performance of Executive's responsibilities, or
(iv) any failure by the Company to perform its obligations under
Section 9 (b) hereof.
(e) "Normal Retirement Benefit" shall have the meaning set forth in
the Pension Plan.
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(f) "Pension Plan" means the Xxxxxxxxxxx Industries Pension Plan of
January 1, 1994 as amended from time to time.
(g) "Performance Share Compensation" means the Performance Share
Compensation payable under Article VI of the Senior Executive Program, or any
successor long-term incentive plan or program.
(h) "Perquisite Compensation" means the Perquisite Compensation set
forth in Article VII of the Senior Executive Program, or any successor plan or
program.
(i) "Senior Executive Program" means the Xxxxxxxxxxx Industries Inc.
Senior Executive Compensation Program, as it may be amended from time to time.
(j) "Short-Term Incentive Compensation" means the Incentive
Compensation payable under Article V of the Senior Executive Program, or any
successor or other short-term incentive plan or program.
(k) "Early Retirement Benefits" early retirement benefits shall have
the meaning set forth in the pension plan which defines the age
at which full, unreduced benefits are available without any early
retirement reduction being applied
(l) (l) "Split Dollar Life Insurance Program" shall mean a program
under which the Company assists the owner of an insurance policy
- on the life of Executive - in the payment of premiums for the
policy, as evidenced by a split dollar life insurance agreement
between the owner and the Company.
(m) "Supplemental Pension Plan" means the Supplemental Pension Plan
provided under Article IX of the Senior Executive Program, or any successor
long-term supplemental pension plan or program or any other commitment made by
the company to provide retirement benefits in addition to those provided by the
pension plan trust.
7. NOTICE.
(a) Any discharge or termination of Executive's employment pursuant to
Section 1 shall be communicated in a written notice to the other party hereto
setting forth the effective date of such discharge or termination (which date
shall not be more than 30 days after the date such notice is delivered) and, in
the case of a discharge for Cause or a termination for Good Reason the basis for
such discharge or termination.
(b) For purposes 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 000 Xxxxxxx 00 Xxxx, Xxxxxxxxxx, Xxxxxxx 00000 provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to Vice
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President and General Counsel, 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.
8. NO DUTY TO MITIGATE. Executive is not required to seek other employment
or otherwise mitigate the amount of any payments to be made by the Company
pursuant to this Agreement.
9. ASSIGNMENT.
(a) This Agreement is personal to Executive and shall not be
assignable by Executive other than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by
Executive's legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors. The Company shall require any successor to all
or substantially all of the business and/or assets of the Company, whether
direct or indirect, by purchase, merger, consolidation, acquisition of stock, or
otherwise, to expressly assume and agree to perform this Agreement in the same
manner and to the same extent as the Company would be required to perform it if
no such succession had taken place.
10. ARBITRATION. Any dispute or controversy arising under, related to or in
connection with this Agreement shall be settled exclusively by arbitration
before a single arbitrator in Cincinnati, Ohio, in accordance with the
Commercial Arbitration Rules of the American Arbitration Association. The
arbitrator's award shall be final and binding on all parties to this Agreement.
Judgment may be entered on an arbitrator's award in any court having competent
jurisdiction.
11. INTEGRATION. This Agreement supersedes and replaces any prior oral or
written agreements or understandings in respect of the matters addressed hereby.
12. AMENDMENT. This Agreement may not be amended or modified otherwise than
by a written agreement executed by the parties hereto or their respective
successors and legal representatives.
13. SEVERABILITY. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
14. WITHHOLDING. The Company may withhold from any amounts payable under
this Agreement such federal, state, local or foreign taxes as shall be required
to be withheld pursuant to any applicable law or regulation.
15. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the law of the State of Indiana without reference to principles
of conflict of laws.
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16. ATTORNEY'S FEES. If any legal proceeding (whether in arbitration, at
trial or on appeal) is brought under or in connection with this Agreement, each
party shall pay its own expenses, including attorneys' fees.
17. TERM OF AGREEMENT. The term of this Agreement shall be one (1) year
commencing on the date hereof; provided however, that this Agreement shall be
automatically renewed for successive one-year terms commencing on each
anniversary of the date of this Agreement unless the Company shall have given
notice of non-renewal to Executive at least 30 days prior to the scheduled
termination date; and further provided that notwithstanding the foregoing, this
Agreement shall not terminate (i) within three years after a Change in Control
or (ii) during any period of time when a transaction which would result in a
Change in Control is pending or under consideration by the Board. The
termination of this Agreement shall not adversely affect any rights to which
Executive has become entitled prior to such termination. In addition, Section
5(a) shall survive the termination of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered as of the day and year first above set forth.
XXXXXXXXXXX INDUSTRIES, INC.
By
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Title: Chairman of the Board of Directors
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Executive
